San Rafael can take steps to keep residents in place

The first rule in affordable housing is don't lose what already exists. That backward step may soon happen in San Rafael, displacing low-income residents at 40 residences, unless the city acts decisively.

In a column last year, I suggested that an overlooked source of affordable rentals are mobile homes. There is no need for expensive construction. Traditionally, most park residents own their not-so-mobile structures, which are inexpensively customized for long-term living. All that's needed is a concrete pad with drainage, water availability and electricity.

A recent incident at one Marin mobile home park is suddenly a hot topic. The location is the R.V. Park of San Rafael at 742 Francisco Blvd. West. I was told that approximately 80 people live there, ranging in age from 2 months to 96 years and occupying more than 40 “pads” or “spaces.” Most of these long-term tenants aren't draining public resources or overburdening public services. They are the “working poor” and retired folks living on Social Security.

Until Feb. 1, the 1.26-acre site was owned by the K&M Family 1997 Trust. Its trustee, Donna Chessen, an 85-year-old Orange County resident, retained a Stockton-based investment company, Harmony Communities, as the manager. Harmony controls 33 “manufactured housing” parks.

Last week I visited the site. Most tenants received an eviction notice from Harmony dated Feb. 10. It indicated they are to be out by Oct. 31 due to “a change of use.” Harmony contends the park isn't profitable. The new use remains unknown.

Not so coincidentally, on Feb. 10, the Ninth Circuit Court of Appeals rejected litigation filed by the park's owners who claimed

San Rafael's mobile home rent stabilization ordinance (MRSO) was an unconstitutional “taking.”

For those concerned about landlord rights, the court's reasoning is instructive.

“When a rent control ordinance is in place and a matter of public record before a property is purchased, the sale price incorporates the burden of the rent control,” the decision reads. “Here, not only had the MRSO been applied to the RV Park for over fifteen years when Chessen purchased the property, there was a final judgment from a state court concluding that the property was subject to the ordinance. It would be unreasonable to conclude that the sale price of the property under such circumstances did not reflect the burden of the MRSO.”

In a post on Twitter, Harmony praised its top executive, Matthew Davies, by writing that this process is “helping to make housing more affordable.” However, history tells another story. In a news story about another of Davies'

operations, Shady Lakes LLC, near Fresno, the Business Journal reported, “It only took four years under ownership of Shady Lakes and Harmony — both of which are owned by the same person — to undergo triple digit increases in rent.”

Harmony bet they'd defeat San Rafael's renter-protection law in court. It lost the gamble.

Curiously, the K&M Family 1997 Trust sold the property for $2.7 million on Feb. 1 to San Rafael Housing Opportunities, a Delaware LLC. That's 10 days before the court's decision. Another coincidence: The buyer has the same Stockton address as Harmony.

Several things need to happen to defeat this greedy attempted end run around the law.

First, San Rafael must make it clear to Harmony and Davies that it will fight tooth and nail to keep the tenants in place indefinitely.

Second, San Rafael should offer to buy the site. Davies would be smart to accept. The city had an unintended benefit due to Chassen's sale. The $2.7 million sale price determined the property's fair market value.

Given that figure, the pro rata value per mobile home pad is $60,750. Compared to the high six-figure cost of building a single unit of affordable housing, the city's purchase of this property makes economic sense. The new owner loses nothing, the tenants' monthly rents will ultimately reimburse San Rafael for the purchase price and the land will be devoted to affordable rentals in perpetuity.

A recent incident at one Marin mobile home park is suddenly a hot topic.