[Editor’s note: An earlier version of this article incorrectly identified the mobile home park at the center of a dispute between residents, the development owner and the city of Goleta. The story has been corrected below.]

Three months after the Goleta City Council voted its approval of a development agreement with the owner of Rancho Mobile Home Park, the residents have launched a lawsuit against the developer and the city.

“Basically what has happened is, for the first time in February … the city took action that the homeowners disagreed with,” said James Ballantine, attorney for the Monarch Country Mobile Home Owners Association. Before it filed the lawsuit, the homeowners association and the city of Goleta were allies against the park owner, Daniel Guggenheim, in an attempt to maintain rent control of the 150-unit park, 7465 Hollister Ave., and later, to prevent conversion of the park into tenant-owned units.

According to Ballantine, Guggenheim is the primary target of the lawsuit, but the city, because of what the homeowners association deems as illegal actions on its part, is also a party to the litigation. The developer is expected to indemnify the city in this case.

At the heart of the argument is a survey of the residents required by state law as part of the mobile home park conversion process. According to California Government Code 66427.5, “The subdivider shall obtain a survey of support of residents of the mobile home park for the proposed conversion.” The Monarch Country Mobile Home Owners Association says the survey was not done correctly; the city and the developer say they followed the rules.

“The city complied with state law in processing Guggenheim’s request. The tenants are suing the City Council for not imposing conditions that are prohibited by the legislature,” Goleta City Attorney Tim Giles said.

According to both sides, the law is not specific on any required outcome of the survey, so the survey conducted in 2005, albeit boycotted by most of the residents, from the defendants’ standpoint, is adequate.

Meanwhile, the homeowners association argues that the survey didn’t comply with the policy that states that, “The survey of support shall be conducted in accordance with an agreement between the subdivider and a resident homeowners’ association, if any, that is independent of the subdivider or mobilehome park owner.”

Since they were not party to how the survey was created, the tenants boycotted the survey, Ballantine said.

“Standard law throughout all this country and all democracy is that majority rules,” said Monarch Country Mobile Home Owners Association President Ken Tatro, commenting on what his side assumes to be the required outcome of the survey.

“Because we haven’t had a valid survey, we don’t know what kind of support we have in this park,” Tatro said. “Quite likely it’s not going to be very much because over two-thirds of the people in this park are low-income, and they will not have enough to buy in anyway.”

The Rancho Mobile Home Park in western Goleta has been at the center of a tug-of-war between the city, park residents and the Guggenheim family, owner of the park, since Goleta’s beginnings. Calling Goleta’s adoption of the county’s rent control ordinance a new ordinance, the park owners sued the city for property rights violations.

The legal battle intensified with the addition of other lawsuits, as the developer’s plans changed from fighting to abolish rent control to pursuing a conversion from a renter’s mobile home park to tenant-owned units: for environmental documents the city required for the Guggenheims’ mobile home park conversion project, for the city’s adoption of an emergency moratorium pending legislative action and for damages related to both cases.

With decisions on the state level pre-empting the actions of local government, and a development agreement that could address the Coastal Act requirement to deal with tenant displacement and possibly provide better protections to the tenants than state rules, the City Council decided last February to approve the development agreement, much to the consternation of several of the park’s residents.

“You just robbed me of $175,000 of my investment,” Rancho resident John Douglas said at the February meeting. “Of course, we want to own our own homes, but not when it’s being rammed down our throat like this.”

The filing of this suit by the homeowners could delay the review of the development agreement by the Coastal Commission, one of the regulatory agencies in this conversion application, because a good portion of the park is in the Coastal Zone.

“It’s unfortunate because it could postpone the ability of the residents to purchase their spaces,” said Richard Close, attorney for the Daniel Guggenheim family. The down housing market would be the best time to purchase, he added. “In the future, the price may be much greater.”

— Noozhawk staff writer Sonia Fernandez can be reached at sfernandez@noozhawk.com.