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Goleta Council Green Lights Mobile Home Development Deal
Caught between a rock and a hard place, the Goleta City Council on Tuesday unanimously voted to move forward with a development agreement with the owner of Rancho Mobile Home Park, 7465 Hollister Ave.
“I have no love for Mr. Guggenheim,” Councilman Michael Bennett said of park owner Daniel Guggenheim. Nevertheless, Bennett and his colleagues reluctantly voted to push ahead with a proposed development agreement that would convert the park to tenant-owned spaces from rentals.
The vote came after hours of report, discussion and testimony from staff, Guggenheim’s representatives and attorney, and mobile home residents who crowded the chambers to standing-room-only capacity.
The meeting signaled what could be the culmination of years of litigation between Goleta and Guggenheim, who first sued the city when it adopted Santa Barbara County’s rent-control policies upon incorporation in 2002. Guggenheim called the act an unlawful taking: coach owners could pay low rents and then sell their units for more than they were worth because of them.
Four more suits followed, one for a moratorium the city imposed on mobile home park conversions as the state wrestled with legislation that could have changed the rules, one for an environmental impact report the city required for the conversion, and two for damages related to those cases.
The first case, lost and then won by the city, is currently before the 9th U.S. Circuit Court of Appeals. The damages lawsuits have been stayed pending the development agreement, while the cases on the EIR and the moratorium were judged against the city, which is currently appealing those decisions.
Outside of the lawsuits, the state, according to city counsel Tim Giles, prefers conversion, having already made legal decisions that outweigh the rulings of local government.
Both city and park representatives asserted that the development agreement was a better deal than what the state would offer in terms of rent control.
“Any family that makes less than $80,500 a year will get better rent control than they would from the state,” said Guggenheim attorney Richard Close.
According to the proposed agreement, residents who wish to purchase their lots can do so at a 15 percent discount of the purchase price. The landowners also would be willing to finance 15 percent of the purchase price at 5 percent interest over 20 years. The city would engage in helping residents find funding sources, like the state-sponsored Mobilehome Park Resident Ownership Program loan at 3 percent interest over 30 years based on the buyer’s income.
Furthermore, tenants who qualify as low- and moderate-income who do not wish to purchase will experience rent increases “limited to the difference between pre-conversion rental rate and the market rate, over a period of four years ... but in no case could rental rate increases exceed the Consumer Price Index.”
Meanwhile, nonpurchasing residents who are classified as “above moderate” in their income would be subject to increases over a seven-year period up to $800 per month. At the end of the eighth year, the rents would rise to market rate. In contrast, state law provides for increases in a four-year period, with rents going to market rate in the fifth year.
Despite the better rent-control terms offered by the agreement, park residents were still worried about their loss of equity, something the development agreement did not address.
“You just robbed me of $175,000 of my investment,” said Rancho resident John Douglas. “Of course, we want to own our own homes, but not when it’s being rammed down our throat like this.”
Others inquired about a resident survey, a requirement for conversion. According to Giles, a survey was conducted in 2005 at the time of the conversion application, but most of the park residents boycotted it.
Residents of other mobile home parks also aired their concerns, worried that the precedent set by this decision would ripple out to their complexes.
“If you let this bully come in here and take all these people’s equity, it’s going to happen all over town,” said one commenter.
Yet other community members were incensed at the owners’ seeming reluctance to improve the park’s facilities: pipes, drains and hydrants that had not been upgraded since 1962.
“What is the owner doing with that money?” asked Rich Foster.
Still, as the City Council prepared to vote to move ahead with the agreement, members did wrap into their motion a requirement that Guggenheim pay for the fire-suppression upgrades recommended by the Fire Department instead of passing the costs on to the tenants. It’s not clear whether he will agree to such a requirement; but the answer will be clear at the council’s March 3 hearing.
Write to sfernandez@noozhawk.com
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» on 02.18.09 @ 07:03 PM
At the end of this meeting, Mr. Bennet stated, rich people get their way, he doesn’t like it but that is the systme we have.
Unfortunately, the truth of this statement must lead to sad conclusions, Goleta is too small to stand against the rapacious instincts of billionaire developers and predators. They will either fund canidates closer to their liking, and dumping any who cross them. Or they will litigate the city into submission.
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» on 02.18.09 @ 07:24 PM
At the end of this meeting, Mr. Bennet stated, rich people get their way, he doesn’t like it but that is the systme we have.
Unfortunately, the truth of this statement leads one to a sad conclusions, Goleta is too small to stand against the rapacious instincts of billionaire developers and predators. They will either fund canidates closer to their liking, while dumping any who cross them. Or they will litigate the city into submission.
The first city council bet the house fighting the Sandpiper project and its many variences, but the writing is on the wall. All any developer need do is litigate, litigate litigate and they will win. With a population of 28,000 residents Goleta simply cannot stand them off.
We have seen every ag conversion proposal moved forward. We have seen sigle family homes being forced to take high density planned residential. We have allowed Bacarra to propose fifty percent of the changes to the general plan, all designed to benifit their corporation and limit your access to Goleta’s only beach.
In the final analysis it is time to pack it in as a city and rejoin the County. How has Cityhood benefited our community thus far? And what does the future hold?More bowing of the knee before the god of litigation?
What we currently have is the Vichey Government. We are allowed to rule ourselves as long as the iron boot of moneyed developers is respected. So we are forced to swallow our self respect while we watch people’s lifesavings gobbled up by legal robbery. Existence as apuppet regime holds little hope, honor,or value.
What consolation it it, that this is a “better deal” than the state would give the residents? What good is a rent cap tied to the CPI, guaranteeing maximum rate increases, especially in that we will probably enter a period of high inflation and rent increases would easily spiral up.
It would have been better to litigate until the cows came home, the law was changed, or the city went bankrupt. Then we could rejoin the county with some dignity, and gain greater numerical and fiscal clout.
Apologizing to a rape victim is little consolation to the victim. Dying to defend their honor is noble. End the Vichey government.
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» on 02.19.09 @ 05:18 AM
Three words: Private Property Rights.
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» on 02.19.09 @ 01:11 PM
The owner of Rancho Mobile Homes Park here in Goleta, is Daniel Guggenheim. He and his team have a long history of “my way or the highway.” We saw that, again, Tuesday night at the very end of the City Council meeting, as G’s attorney, Mr Close, said very emphatically, that “the Client” wants this, a late finding of wording in the Development Agreement, distasteful the “the Client,” resolved now, ... but then you will notice, ... he was not willing to budge on his position. Classic D. Guggenheim.
We have had identical issues, year after year, at rent rise time. This year we were forced to circulate petitions, a minimum of 50% +1 signatures of the mobile home owners is required, of the MHs under the MHRC Ordinance, to go to arbitration to resolve the harsh rent increase issues. We had to do this, also, in 2005.
The 2005 “survey,” mentioned above, was not a lawful survey. The State law on this requires the Park owner to work with the Park’s Mobile Home Owners Association to develop the survey in which both sides have major input as to its make up and wording. You want the survey to have questions, the wording of which, do not slant or guide the respondent toward any particular kind of answer, favored by either side. Hence, the reasoning behind the requirement in the law that both parties produce the survey, together.
This 2005 survey, true to their very usual tactics, was done only by the park owner. They just went ahead and sent out there own unilaterally created survey. Our participation, the Mobile Home Owners Association, was not included as a part of its make up. Therefore, it was an illegal “survey,” in violation of the law , and cannot be counted as qualifying as the survey the law requires. We rightfully and lawfully “boycotted” it to drive Management to work with us on developing one we both could support. This was not done, hence our our rightful and legitimate charge that no survey was taken.
Ken Tatro, President
Monarch Country Mobile Home Owners Association
(in Rancho Mobile Homes Park, Mr Guggenheim’s park in dispute)
Spokesperson, Goleta Mobile Home Owners Coalition.
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» on 02.19.09 @ 03:28 PM
Mr Locke says “property rights” Implying the city should not limit the owners right to do whatever he wishes with his property. But those same laws and zoning is what has benifited the owners Appreciation in the property. If ant land owner in goleta could put up a mobile home park then what would be the value of these lots in a glutted market? You can’t complain of the riules and then expect to benifit from them too. “Property rights” is a catchy phrase, but in any community everyones property rights get limited for the benifit of the community. Would Mr Locke want a pig farm at his neighbors house? After all that is property rights.
Perhaps the best solution is for the city to grant numerous mobile home park zones on open parcels, thereby Mr Gugenheim can find out the true value of his property when there is a more open free market.
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» on 02.20.09 @ 07:52 AM
The State mandates that infrastructure must be maintainrd & that if a water line for instance has a 20 year life & 18 0f those are gone then the owner must put into escrow enough money to rebuild 90% of that system. There is a State board that will evaluate the entire park before the sale is complete. Check it out. The residents are more prtected than the owner.
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