HomeMy WebLinkAboutCorrespondence- #21LOFTIN I BEDELL
LN
ATTORNEYS AT L A W
Via Overnight Delivery to the Clerkfor Council and Electronic Transmission
October 13, 2022
Honorable Mayor Vincente Sarmiento and
Council Persons: Thai Viet Phan; David Penaloza; Jessie Lopez; Phil Bacerra; Johnathan Ryan
Hernandez; Nelida Mendoza
City Clerk, Daisy Gomez
City Attorney, Sonia R. Carvalho
City of Santa Ana
22 Civil Center Plaza
Santa Ana, California 92701
RE: Hearing Date: October 18, 2022
Agenda Item: ITEM 21— OPPOSITION
For Further Correction
Description of Item: Second Reading of Ordinances amending the Rent
Stabilization and Just Cause Eviction Ordinances (`IRS/JCE
Ordinance")
As Applicable to Mobilehome Parks
Request Action 1. Remove from Consent Calendar
2. Remand to Staff with Direction for Further Amendment
of Proposed RSIJCE Ordinances
Dear Honorable Mayor Sarmiento and Council Persons:
This Firm represents Kingsley Management Corporation, and its affiliated companies which
manage, own, and operate with care and concern for the residents within multiple mobilehome parks,
representing 478 resident occupied spaces, in the City of Santa Ana.
The efforts of the City Council, City Attorney and Staff have made to bring the RSIJCE
Ordinance better in line with the specific and preemptive laws relating to Mobilehome Parks as well as
the uniqueness of operating such communities are acknowledged. The proposed RSIJCE Ordinance,
combining the existing Just Cause Eviction Ordinance and Rent Stabilization Ordinance, on the consent
agenda as a second reading on October 18, 2022, continues to require additional modifications to
accommodate such statutes, regulations and case law. Additionally, we point out in this letter an internal
inconsistency specifically affecting mobilehome parks. As there is no rush to adopt the amendment to
the ordinances, which has been in place already for a year, the proposed amended RSIJCE Ordinance
should be sent back for final edits and corrections to fix the continued errors and issues within the statute;
2540 Gateway Road • Carlsbad • California • 92009
T: 760.431.2111 • Direct: 760.444-4040 • www.loftinbedell.com • Sue@loftinbedell.com
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 2 of 5
as well as the legal issues raised by the JS/JCE Ordinance. This is an important Ordinance that will
significantly impact the affordable opportunity mobilehome parks currently provide to the residents of
the City of Santa Ana.
This letter focuses solely on issues relating to conflicts within the ordinance, non -substantive
corrections needing to be put in place and laws specifically relating to mobilehome parks. Separate,
substantive, and legal issues are raised in the adjoining letter regarding violations of the Brown Act,
substantive due process claims and equal protection issues, which letter is provided concurrently with
this correspondence. Additionally, reference is made to the correspondence from this Firm dated
September 30, 2022, regarding the JS/JCE Ordinance. All legal issues, comments and concerns raised
in such correspondences are reiterated herein as though set forth In full.
As has been noted on the dais, mobilehome parks present a unique and distinct landlord tenant
relationship wherein the applicable laws are only those that apply to mobilehome parks. The structure of
the landlord tenant relationship is so unique that special care needs to be made to ensure the City's
RS/JCE Ordinance incorporates, reflects and gives necessary deference to that uniqueness.
The proposed amended RS/JCE Ordinance reflects the validity of the arguments presented in the
litigation and the proposed amendments take necessary steps to bring the laws into compliance with state
and federal laws and regulations, as specifically detailed in that litigation; however, further modifications
are necessary.'
MODIFICATION OF NEW SECTION 8-3104
The addition of Section 8-3104 in the JC/RSO Ordinance takes important steps to ensure that the
laws specifically affecting and wholly controlling the landlord tenant relationship in mobilehome parks
is clearly and expressly preemptive of anything within the JC/RSO. However, additional laws regulating
mobilehome parks should be expressly included within this provision. As such we recommend the
section be revised to read as follows:
"Section 8-3104 — Mobilehome Park Applicable Laws
The provisions of this Article shall not supersede the regulation so the state
Mobilehome Residency Law, Civil Code sections 798 et seq, Mobilehome Parks Act,
Health and Safety Code Sec. 18200 et seq., the Manufactured Housing Act, Health and
Safety Code Sec. 18000 et seq., and the implementing regulations at Title 25, 25 Cal. Code
of Regs. Sec. 1000 et seq, as is applicable. If there is any conflict between the tenns of this
Article and such laws, such laws shall prevail.
JUST CAUSE EVICTION
A. Section 8-3120(i) should be deleted in its entirety. This provision was amended to remove the
provision that the sale of a mobilchome park is included in the term of a change of use under
'Kingsley et al v. City of Santa Ana, U.S. District Court for the Central District of California, Case No, 8:22-CV-0076-CJC-
JDEx (the "litigation" or "pending litigation").
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 3 of 5
Government Code section 65863.7, ostensibly in response to the conflict of law and preemption
detailed in the pending litigation. However, the failure to remove the provision in its entirety merely
works an abandonment of one improper basis (the expansion of state legislation in contrary to its
express terns), to another improper basisa local police power adoption that causes a conflict with
the Mobilehome Residency Law, and a regulatory taking (on multiple grounds), among other
violations of the constitutional rights of mobilehome park owners.
The Mobilehome Residency Law contains provisions governing notice to residents of the intent to
sell and protections upon a change of use.'- The requirement that a Park Owner, the Seller, prepare
a "Tenant Impact Report" on the sale of the Park to a third party at least 60 days prior to a sale
requires the Park to determine either prior to offering the Park for sale or prior to the close of an
escrow the plans a third party has for the Park, which may change over time, among other practical
application issues. In summary, the selling Park owner must now guarantee the "intent" of the
purchasing Park owner and financially, or otherwise, mitigate that "intent" prior to selling.
The adoption of the "tenant impact report" requirement, for any sale, also works as a regulatory
taking. The City has granted mobilehome parks the vested right to operate, as part of their land use
regulations and application process, and conditions set out at the time of approval and construction.
Now, however, the City proposes to abridge or revoke those rights —effectively injecting a new
condition of approval —that the mobilehome park owner may be required to return to the City in the
event of sale, and without any allegation of a traditional land use basis like a change in use. This
proposal amounts to a regulatory taking, insofar as it effectively causes the forfeiture of the vested
right to continue operating a lawfully permitted property —from a mere transfer and without a
proposed change in use.
However, this forfeiture of vested right also constitutes a regulatory taking in that it forces a
mobilehome park owner to endure the burden and cost of preparation of a tenant impact report, the
cost and delay of a noticed, discretionary public hearing, and the related impacts effectively clouding
the ability to sell their property without public approval —premised solely on a regulatory nexus of
preventing displacement of tenants, which displacement cam -lot occur solely as the result of a
transaction. Moreover, any condition imposed at such a hearing would also constitute a regulatory
taking, as it would lack rough proportionality with the nexus of a mere transfer of property.'
As a threshold matter, it seems doubtful that this proposed readoption would even support the finding
of a rational basis, in potentially requiring a public hearing and impact report, from the sale of a
property, for any legitimate government interest surrounding tenant displacement. A sale, in and of
itself, cannot cause tenant displacement such that the City could reasonably condition the sale.
B. Section 8-3121 Notice of Termination of Tenancy. as applied to mobilehome park tenancies, this
section creates an internal conflict leading to mobilehome park owners' inability to comply with
these provisions, but simultaneously creating the obligation to so comply. Section should be amended
a CA Civ. Code § § 798.80, 798.56(g),
3 In fact, this provision —once adopted —would work a veritable resolution of necessity against all mobilehome park owners
and cause them to suffer damages in the nature of Klopping v. City of Whittier, 8 Cal. 3d 39, 54 (1972).
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 4 of 5
to clarify that termination notices sent subject to the Mobilehome Residency Law shall comply with
such requirements and not the provisions of this Section.
(1) Recommend adding a new subparagraph (a)6) as follows:
"6) The Owner terminating a Tenancy of a Mobilchome Space shall comply with the
Mobilehome Residency Law and is exempt from compliance with subparagraphs 1 and 3)
above."
The owner of a mobilehome park should be exempt from being required to include contents
within a termination notice relating to the at -fault or no-fault just cause evictions as such
tenancies are exempt from Section 8-3120. This internal inconsistency can be easily resolved
and without such resolution places a mobilehome park owner in a technical default under the
RS/JCE Ordinance if its notices comply with the Mobilehome Residency Law but do not
include the at -fault or no-fault grounds for the termination, thereby potentially subjecting the
mobilehome park owner to potential administrative citation, civil action or inability to
complete, an otherwise lawful and valid eviction action.
(2) Submittal of the termination notice within five days of service upon the resident to the City
(i) makes the notice now subject to disclosure through the public records act process, and (ii)
does not take into consideration that tenants may comply with a notice to pay or cure prior to
a termination being triggered. Such provisions create a disclosure risk of confidential
information about tenancies which are otherwise protected under California law. Although
we recommend the deletion of this Section, as an alternative, we recommend updating
subsection 4) to read as follows:
"4) The Owner has submitted to the City, within (5) days after service of the notice of
termination on the Tenants and Tenant's failure to cure the notice of termination or otherwise
vacate the Residential Rental Unit or Mobilehome Space, a true and correct copy..."
C. Section 8-3122 Retaliatory Eviction and Anti -Harassment. Section (b)(9)(A)(iii), and (b)(12).
This proposed language appears to conflict with California law that provides state regulation of the
formation of contracts and notices in foreign languages. In particular, Cal. Civ. Code § 1632 was
intended to only regulate "[a]ny person engaged in a trade or business who negotiates primarily [in
one of the named foreign languages]." Cal. Civ. Code § 1632(h)(1). It also specifically exempted
contracts negotiated "through the party's own interpreter." Id. The proposed subparagraph have the
effect of making requiring a landlord to prepare leases in a tenant's primary language or else having
such failure be deemed harassment of the tenant — this conflicts with state law and imposes
substantial additional costs and burdens on landlords beyond the state intended laws.
As noted above, although the amendment proposes and attempts to satisfy the issues, claims and causes
of actions raised in the pending litigation, and demonstrates the City's acknowledgement of the accuracy
of claims raised, the proposed amended ordinance continues to require corrective work to avoid
preemption by the various laws specifically impacting mobilehome parks; being vague and ambiguous
and constituting an unlawful taking in violation of the constitution.
LOFTIN I BEDELL P.C.
Honorable Mayor and CouncHmembers
City of Santa Ana
October 13, 2022
Page 5 of 5
RENT STABILIZATION ORDINANCE
The numerous changes made in response to the pending litigation are hereby acknowledged. We
snake reference to the adjoining letter addressing the issues with the RSO portion of the Ordinance as
though such continents were fully incorporated herein.
CONCLUSION
Incorporated hereby reference, as though fully set forth for the record in this matter, are all prior
comments, objections and legal issues raised in the correspondence provided to the City from this Firm,
including without limitation, correspondence dated October 1, 2021 and September 30, 2022, the
correspondence sent concurrently with this letter and the staff report, draft ordinances, City records,
communications with and among or in any way related to the City "study group" organized among City
Council representation, City staff and tenant representatives and presented prior to, at or after all
hearings related to the Just Cause Ordinance or Rent Stabilization Ordinance and the Amended
Ordinance combing the two prior Ordinances commencing with the hearings on September 21, 2021,
October 5, 2021, October 19, 2021, and October 4, 2022 to the present date. For purposes of specifically
setting forth the remaining factual and legal objections to the provisions of the proposed Amended
Ordinance, please refer to the October 1, 2021, and September 30, 2022 correspondence from this Firm
and the Amended Complaint in the matter Kingsley et al. vs. City of Santa Ana, et. al., case number
S : 22-ev-00076-CJC-JDE.
Again, we appreciate the City's work and apparent partial corrections and refinements in response to the
pending litigation. We reserve the right to further supplement this letter and administrative record
concerning this Item 21, and its future readings, as our review of the proposed adoption and public
proceedings continues. For avoidance of doubt, this correspondence and the correspondence and
pleadings incorporated by reference are not intended to list all of the deficiencies, and errors or omissions
of facts and law contained in both the Rent Stabilization Ordinance, the Just Cause Eviction Ordinance,
in the amended RS/JCE Ordinance, and all related findings and resolutions. All legal rights and remedies
based upon the impacts of these Ordinances are reserved on behalf of our clients.
Sincerely,
LOFTIN I BEDELL P.C.
r /
13
Arie/1 R. Bedell, Esq.
cc: Clients
B
LOFTIN I BEDELL
ATTORNEYS AT LAW
Via Overnight Delivery and Hand Delivery to the Clerk for Council; Electronic Transmission
October 13, 2022
Honorable Mayor Vincente Sarrniento and
Council Persons: Thai Viet Phan; David Penaloza; Jessie Lopez; Phil Bacerra; Johnathan Ryan.
Hernandez; Nelida Mendoza
City Clerk, Daisy Gomez
City Attorney, Sonia Carvalho
City of Santa Ana
22 Civil Center Plaza
Santa Ana, California 92701
RE: Hearing Date: October 18, 2022
Agenda Item: ITEM 21— OPPOSITION
For Further Correction
Description of Item: Second Reading of Ordinances amending the Rent
Stabilization and Just Cause Eviction Ordinances ("RS/JCE
Ordinance")
As Applicable to Mobilehome Parks
Request Action 1. Remove from Consent Calendar
2. Remand to Staff with Direction for Further Amendment
of Proposed RS/JCE Ordinances
Dear Honorable Mayor Sarmiento and Council Persons:
This Firm represents Kingsley Management Corporation, and its affiliated companies which manages,
owns, and operates multiple mobilehome parks, representing 478 resident occupied spaces, in the City
of Santa Ana.
RENT STABLIZATION ORDINANCE
A Rent Review Board Must Be Balanced
The legal basis regarding the importance of balanced rent review boards was previously provided to the
City. See Letter to City of Santa Ana from Sue Loftin, regarding October 4, 2022 Agenda Item Number
25, Pg. 10, Footnote 8. As noted therein, the board composition selected will raise due process issues
and concerns for the City.
2540 Gateway Road • Carlsbad a California - 92009
T: 760.431.2111 * F: 760.842.0432 • www.loftinbedell.corn • sue@loftinbedell.com
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 2 of 7
On October 4, 2022, the City acted in continuation of its "long term implementation" resolution from
September 21, 2021, Resolution 2021-054 to consider and select the rent control board size and
composition. The City Council specifically asked staff to provide examples of imbalanced
representation of tenants and landlords —and a detailed discussion ensued.
Judson Brown, City Housing Division Manager, explained that there was a lack of evidence in support
of an imbalanced Board, in response to Councilmember Pham's questions. The evidence actually
supported "balanced" boards due to "due process" concerns:
"Based on our research of other jurisdictions, there aren't other
jurisdictions with an imbalanced board... where there's either more tenants
or more landlords. There is a reason for that. We found in our research that
most boards are equitably balanced between tenants and landlords and that
serves the best interest of tenants and landlords as they are following the
due process rights under the law."'
Councilmember Pham asked a follow up question: "There aren't any other jurisdictions .... how many
did you look at?�2
Judson Brown, City Housing Division Manager, responded: "We looked at all the jurisdictions that have
ordinances, but the sample jurisdictions in particular do not have any... "I
Councilmember Pham then asked for the City Attorney's opinion. The City Attorney explained the
necessity of a "fair hearing before a neutral and fair board." "You would be best served by having a
balanced board from the get -go" and that an imbalanced board would encourage legal challenges.
Councilmember Pham reiterated that her suggestion was to follow the Staff s recommendation with the
City Attorney's guidance.4
Despite this, the Mayor disagreed as to the composition of the Board. "I respect that due process and a
challenge could be made based on [tilting] of the Board." The Mayor attempted to distinguish that the
City had a "very high concentration of tenants and renters" and justified the Board based on consistency
with the "proportionality of tenants to landlord". The Mayor speculated that such an imbalanced board
"would withstand challenge" and that no other city in the study has the same proportion of renters to
owners/landlords—all asserted by the Mayor without evidence in the record. With that, the Mayor made
an amendment to approve an imbalanced Board, in line with Option 3 contained in the staff report.
Comments by Councilmember Pham and Judson Brown, City Housing Division Manager, City of Santa Ana City Council
Meeting, October 4, 2022, 5:48:35 to 5:51.https://youtu.be/Cg6b2JtGLxl?t=20922
Z Comments by Councilmember Pham and Judson Brown, City Housing Division Manager, City of Santa Ana City Council
Meeting, October 4, 2022, 5:48:35 to 5:5I .htt s:// Gutu.be/C(16b2JtGLx1?t-2G922
Comments by Councilmember Pham and Judson Brown, City Housing Division Manager, City of Santa Ana City Council
Meeting, October 4, 2022, 5:48:35 to 5:5I.hUps://Youtu.be/cq6b2JtGLxl?t==20922
a Comments by Councilmember Pham and Judson Brown, City Housing Division Manager, City of Santa Ana City Council
Meeting, October 4, 2022, 5:48:35 to 5:51.https://youtu.be/Cg6b2JtGLxI?t=20922
(Volumes/Shared/Kingsley Management Company/700 Litigalion/Kingsley V City Of Santa Ana/010 Correspondence/2022.10.13 Correspondence To
City Regarding. Implementation Of Rent Board V4.Docx
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 3 of 7
These comments mirror comments by Councihember Hernandez, who commented without any factual
verification that over 50 percent of the City residents were renters.s These statements are contrary to
U.S. Census Data.
Los Angeles, San Francisco, Oakland, Berkeley and Santa Monica all have renters in excess of 50%,and
have rent controI.' Hayward, San Jose, and Chula Vista are also 40% or greater, and also have rent
control. 7 Accordingly, Councilmember Hernandez' and the Mayor's continents could not serve as
factual support for findings nor as a rational basis for adopting such an imbalanced board ---in
contradiction to the testimony of staff and the advice of the City Attorney. But regardless, our previous
citation shows that "representative" boards (as advanced by the Mayor and Councilmember Hernandez)
are different from "mandated" boards, where the composition is required, and not appointed on an ad
hoc basis or by an electorate. In such a case, like Santa Ana's, the mandate for an unbalanced board
creates a due process violation itself, in addition to other constitutional claims. For example, the
imbalanced Board also causes the City's entire rent control regime to appear confiscatory, in that the
City has "tilted" the sole means for which its landlords would be assured a constitutional, fair return.
Also, the fact that an imbalanced board is adopted not only speaks to the procedural due process
unfairness, but to the character of the government action —and the related substantive due process
concern.
We reiterate our citation to previous California case law where mandating a board with imbalanced
constituency (based on pecuniary interests) has been overturned:
"It is sufficiently clear from our cases that those with substantial pecuniary
interest in legal proceedings should not adjudicate these disputes.
[Citation] And [Ward v. Village of Monroeville] indicates that the financial
stake need not be as direct or positive as it appeared to be in Tunzey. It has
also come to be the prevailing view that '[most] of the law concerning
disqualification because of interest applies with equal force to . . .
administrative adjudicators.' K. Davis, Administrative Law Text § 12.04,
p. 250 (1972), and cases cited." (Italics added.)[Citations] In Withrow v.
Larkin, the United States Supreme Court additionally notes: " Not only is
a biased decisionmaker constitutionally unacceptable but bur system of
law has always endeavored to prevent even the probability of unfairness."'
Ain. Motors Sales Corp. v. New Motor Vehicle Bd., 69 Cal. App. 3d 983,
990 (1977) (citing Tumey v. Ohio, 273 U.S. 510 (1927), Ward v. Village
of Monroeville, 409 U.S. 57 (1972), and Withrow v. Larkin, 421 U.S. 35,
47 (1975), in overturning an imbalanced board of administrative hearing
officers with pecuniary interests). See also, Applebaum v. Board of
s Comments by Mayor Sarmiento, City of Santa Ana City Council Meeting October 4, 2022, 6:04:
https://youtu.be/Cg6b2JtGLxl?t=21836.
'U.S. Census, 2017 5 Year American Community Survey.
U.S. Census, 2017 5 Year American Community Survey.
Nolumes/Shared/Kingsley Management Companyno0 Litigation/Kingsley V City Of Santa Ana/010 Correspondence/2022.10-13 Correspondence To
City Regarding Implementation Of Rent Board V4.Docx
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 4 of 7
Directors, 104 Cal. App. 3d 648 (1980), Hackethal v. California Medical
Assn., 138 Cal. App. 3d 435, 443 (1982), and Natarajan v. Dignity Health,
11 Cal. 5" 1095, 1106-07 (2021).
Clearly, tenants have a pecuniary interest in the considerations related to reviewing, analyzing and
determining applications for capital improvement or NOI rental increases, and on the amount of rent to
be charged generally — as do the landlords. The decision to create a mandatory imbalanced board of this
administrative process in favor of the tenants violates the landlords' right to due process, based on settled
California jurisprudence. A mandatory imbalanced board suggests the City does not consider the rent
board as a bona fide "relief valve" to assure that property owners receive a constitutional fair return
despite the City's harsh restrictions on rent increases and passthroughs.
Fiscal Impact
In the discussion, the Mayor Pro Tern asked staff the implication of the fiscal impact section of the staff
report, and how it could show no impact, Mr. Brown and other staff responded that it was the intention
that there would be no net increase in cost to the general fund through the imposition of the fee, through
the specific action contemplated in the staff report. It was noted in the staff report that the City had
entered into a $500,000.00 contract with RSG to assist with the implementation plan, which apparently
was not considered a "fiscal impact" despite that there is no "fee" to cover these expenses.
It is important to note that jurisdictions like Santa Ana typically report fiscal impact of proposed
ordinances in the staff reports. There are constitutional constraints on the ability of a City to approve
measures that cause the City to incur debt. Otherwise, the constitutional debt limit which "prohibit a
city from incurring indebtedness beyond the city's ability to pay the debt back from revenues received
in the same fiscal year in which the debt is incurred would be meaningless. Cal. Cost. Art, XVl Sec. 18.
California Municipal Law Handbook, 2016 ed., Sec. 5.13. This fiscal impact did not receive adequate
discussion from staff, despite acknowledgement that neither the rent board, nor the study, would be
funded at the outset from fees. Further, the discussion failed to consider the legal costs given the
proposals contrary to staff and the City Attorney's own acknowledgement that the mandated imbalance
in the rent review board would invite due process litigation.
Accordingly, we urge the City Council to reconsider the concerns identified in this letter, with additional
consideration of the costs that will arise at initiation, and in defending the apparent due process violation
on the face of the ordinance.
Brown Act Violation
The Brown Act ensures that Iocal governing bodies deliberate in public. Cal. Gov. Code Sec. 54950.
Documents distributed to a majority of the legislative body in connection with any matter subject to
discussion at a public meeting item are public records that must be made available to the public "without
delay." Cal. Gov. Code Sec. 54957.5(a), California Municipal Law Handbook, 2016 ed., Sec. 2.72.
At the October 4, 2022 City Council meeting, the Council discussed and considered apparent "redline"
changes to the proposed legislation sent by Tenants United to the City Council. Some of those changes
were adopted. Notwithstanding that the Brown Act requires prompt disclosure of revisions without
/Volumes/Shared/Kingsley Management Company/700 Litigation/Kingsley V City Of Santa Anaf010 Correspondencel2022.10-13 Correspondence To
City Regarding Implementation Of Rent Board V4.Doea
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 5 of 7
delay, (a) the City apparently failed to include the Tenants United "redline" changes correspondence in
the public correspondence posted along with the staff report, (which included other correspondence
from other stakeholders sent at the same time), (b) the City considered, discussed, and adopted in part
some of those revisions, and (c) the City adopted those revisions upon a first reading without the
opportunity of the public to know or respond to the substance and rationale contained in the Tenants
United correspondence.
Mayor Sarmiento advanced a conflicted theory, effectively disregarding the Brown Act:
As many lawyers will do, we will disagree... I do disagree with you
Madam City Attorney, on the revisions that were just suggested by
councilmember Pham, because I do think that they are an extension of
what was just asked of us, especially on the composition of the Board, and
some clarity on some of the other provisions on the registry fee, and so I
do think they are worthy of qualifying still, or at least being considered a
first reading because these are just a revision of the provisions and terns
that were provided to us, especially because there was a redline version of
changes submitted to us in advance of the meeting.
Comments by Mayor Sarmiento, City of Santa Ana City Council Meeting
October 4, 2022,
5:56.30, available at:
https://www.youtube.com/watch?v—Cq.6b2JtGLxl&t=21389s
The City Attorney asked the Clerk whether and when the redline [prepared by Tenants United] was
circulated with the agenda for "transparency and public notice."' The City Clerk confirmed the redline
was not circulated at all to the public.
The Mayor failed to acknowledge that the public had not had the benefit of reviewing the revised
legislative draft provided to the City by an outside commenter —effectively depriving the public of the
opportunity to continent on those changes and the related rationale at the hearing and "first reading."'
This oversight both undermines any appearance of an impartial and transparent jurisdiction —where a
tenant's rights group apparently has a direct, privileged line of communication to the City Council that
is also shielded in part from public review. These grounds are in addition to those grounds previously
s Comments by City Attorney Sonia Carvalho, City of Santa Ana City Council Meeting October 4, 2022:
5:56:30, available at: litt s://tvww. outube.conv'watch?v=C 6b2JtGLxl&t=21400s
9 The Mayor attempted to narrow the redlined changes to "citation" and suggested the redline changes were merely
clarifications within the vein of the previous guidance. In response, the City Attorney appeared to re -cast her comments that
her sole concern was whether the City Staff could "accurately capture" the comments —but again failing to reconcile that the
documents were not made available to the public without delay pursuant to Cal. Gov. Code Sec. 54957.5(a). The Mayor
concluded that there was nothing new, despite that changes were being implemented pursuant to a revision sent to the City
Council, without the opportunity for the public to review.
/VolumeslShared/Kingsley Management Company/700 Litigation/Kingsley V City Of Santa Anal010 Correspondence12022.10-13 Correspondence To
City Regarding Implementation OFRent Board V&,Doex
LOF"TIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 6 of 7
enumerated in our communications dated September 29, 2022, which have been attached hereto and
incorporated into this letter.
Prior Commiunications Incorporated
For avoidance of doubt, this correspondence incorporates by reference the following records into the
administrative record for the October 4, 2021 and October 18, 2022 hearing, as they appear in the public
records of the City of Santa Ana: the Staff Reports and all public records in the City records are hereby
incorporated as though fully set forth: (i) for the City Council Hearings on September 21, 2021, October
5, 2021, October 19, 2021, adopting Rent Stabilization Ordinance, NS-3009 (RSO) and Just Cause
Eviction Ordinance, NS 3010; (ii) September 6, 2022, Resolution No. 2021-054, Adoption of the Long -
Term Implementation Plan and direction of direction from City Council; (iii) the City Council Hearing
on October 4, 2022, for "Item 25" October, including all proceedings, testimony, and documents,
correspondence, and source records and reports referenced or provided, and specifically including
without limitation the communication sent by this firm dated September 29, 2022, a copy of which is
attached hereto for convenience.
Conclusion
1. We respectfully object and disagree with the proposed findings in the resolution, and allege they
are unsupported by substantial evidence, particularly as to Section 1(c), and particularly as they relate to
mobilehome parks. There is no evidence of significant rent increases and housing instability at
mobilehome parks in the City. If there were actual issues, then a referral to code enforcement and/or
nonprofit legal assistance are available to residents, Council and staff. (Section 1. C)
2. We respectfully object and disagree with the legal citations previously relied upon by the City as
to Ordinance NS-3009, NS-3010, and Resolution 2021-054, and they do not reasonably relate to the
extension of the Ordinances and proposed amendments in this Item 25 to mobilehome parks.
3. The alleged regulatory nexus of ameliorating housing instability at mobilehome parks does not
bear a reasonable relationship and rough proportionality to the purposed legislative adoptions —which
include, without limitation the forfeiture, without hearing, of the vested right to continue operation of a
mobilehome park upon sale, and without a proposed change in use.
4. The City's proposed legislation lacks substantial evidence in support of findings for the
imposition of an imbalanced board in favor of the pecuniary interests of tenants (and without
representation of mobilehome park landlords). This will amount to a due process violation of
mobilehome park landlords at adoption, and should be corrected now to avoid unnecessary cost and
delay to the City and its constituents.
We acknowledge the City's work and partial corrections and refinements in response to the pending
litigation.
/Volumes/Shared/Kingsley Management Company/700 Litigation/Kingsley V City Of Santa Ana/010 Correspondence/2022.10-13 Correspondence To
City Regarding Implementation Of Reni Board V4.Docx
LOFTIN I BEDELL P.C.
Honorable Mayor and Councilmembers
City of Santa Ana
October 13, 2022
Page 7 of 7
We must reserve the right to further supplement this letter and administrative record concerning this Item
21, and its future readings, as our review of the proposed adoption and public proceedings continues.
For avoidance of doubt, this correspondence and the correspondence and pleadings incorporated by
reference are not intended to list all of the deficiencies, and errors or omissions of facts and law contained
in both the Rent Stabilization Ordinance, the Just Cause Eviction Ordinance, and the related findings
and provisions. All legal rights and remedies based upon the impacts of these Ordinances are reserved
on behalf of our clients.
Sincerely,
LOFTINIBEDELL P.C.
exander S. Maniscalco, Esq.
cc: Client
Enclosures: Correspondence for L, Sue Loftin to City of Santa Ana dated September 29, 2022
/Volmncs/Shared/Kingsley Management Company1700 Litigation/Kingsley V City Of Santa Ana/010 Correspondence/2022.10-13 Correspondence To
City Regarding Implementation Of Rent Board V4.Docx
BI LOFTIN I BEDELL
LATTORNEYS AT L A W
Via OWrnight Delivery and Hand Delivery to the Clerk for Council; Electronic Transmission
September 30, 2022
Honorable Mayor Vincente Sarmiento and
Council Persons: Thai Viet Phan; David Penaloza; Jessie Lopez; Phil Bacerra; Johnathan Ryan
Hernandez; NeIida Mendoza
City Clerk, Daisy Gomez
City of Santa Ana
22 Civil Center Plaza
Santa Ana, California 92701
RE: Hearing Date: October 4, 2022
Agenda Item: ITEM 25 — OPPOSITION
Description of Item: Rent Stabilization and Just Cause Eviction Ordinances,
"Rent Stabilization and Just Cause Eviction Ordinance"
("RS/JCE Ordinance")
As Applicable to Mobilehome Parks
Request Action 1. Vote NO on the Revised Ordinances, and
2. Remand to Staff with Direction for Further Amendment
of Proposed Ordinances.
Dear Honorable Mayor Sarmiento and Council Persons:
This Finn represents Kingsley Management Corporation, and its affiliated companies which
manage, own, and operate with care and concern for the residents within multiple mobilehome parks,
representing 478 resident occupied spaces, in the City of Santa Ana. The care and concern for residents
is exemplified by the careful protection of their housing through strict adherence to the numerous
governmental orders issued and statutes as amended frequently by various levels of governmental
entities prior to and during the challenges presented due to the pandemic.
This correspondence ("Opposition") is offered in opposition to the proposed amendments to both
Rent Stabilization Ordinance, NS-3009 (RSO) and Just Cause Eviction Ordinance, NS 3010
("Ordinances") and to preserve and reserve all rights of my clients and the mobilehome parks so
represented. For the record and to facilitate time and consideration of the issues, the following matters
of public record, including without limitation, Staff Reports and all documents, exhibits, correspondence
(electronically transmitted and hard copies), testimony (in -person or electronic), whether by City elected
officials or City personnel, consultants, including RSG, experts; members of the public submitted to the
City; the Staff Reports and all public records in the City records are hereby incorporated as though fully
2540 Gateway Roach - Carlsbad • California • 92009
T: 760.431.2111 * Direct: 760.444-4040 www.loftinbedell.com • Sue@loftinbedeIl.com
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 2 of 11
set forth: (i) for the City Council Hearings on September 21, 2021, October 5, 2021, October 19, 2021,
adopting Rent Stabilization Ordinance, NS-3009 (RSO) and Just Cause Eviction Ordinance, NS 3010;
(ii) September 6, 2022, Resolution No. 2021-054, Adoption of the Long -Term Implementation Plan and
direction of direction from City Council; (iii) for preparation and completion of the Staff Report and all
documents, exhibits, correspondence (electronically transmitted and hard copies), in the City records
related to in connection with this matter in consideration of the matter before you, "Item 25" comments,
documents, communications submitted for consideration or preparation of the Staff Report whether by
City elected officials or City personnel, consultants, including RSG, experts; members of the public
submitted to the City; the Staff Reports and all public records.
This Opposition is an objection and challenge to the inaccurate findings that are the basis behind
the proposed amendments and facts that lead to the proposed amendments leading to the RS/JCE
Ordinance. Additionally, this Opposition objects to the legal basis for the proposed RS/JCE Ordinance,
and the provisions therein, to the extent they violate, directly conflict with, or are preempted by as they
violate and/or directly conflict with numerous state and federal statutes, and the case law related thereto,
including without limitation, a local jurisdiction's authority to enact ordinances attempting to supersede
and/or amend such laws.'
The following "bullet points" relate to the application of the RS/JCE Ordinance to Mobilehome
Parks. They are intended to be illustrative, but not inclusive, of all objections to the respective RS/JCE
Ordinance. Our clients reserve all objections and rights under state and federal law, and the case law
interpreting the same. For charity, the discussion below is divided into three sections: the Implementation
Plan, common comments to the Definitions, the Just Cause Eviction components, and the Rent
Stabilization components.
As background, mobilehome parks within the state of California are governed by an extensive
and exclusive body of law and regulations, including, without limitation, the Mobilehome Residency
Law, Civil Code Section 798 et seq., the Mobilehome Parks Act, Health and Safety Code Sec. 18200 et
seq., the Manufactured Housing Act, Health and Safety Code Sec. 18000 et seq., and the implementing
regulations at Title 25, 25 Cal. Code of Regs. Sec. 1000 et seq. Except where local law is allowed to
regulate, the laws relating to the tobilehome park landlord -tenant relationship, including notices, lease
terns, and termination provisions; the condition and maintenance of the mobilehomes; and the amount,
manner and method of utility charges against tenants, are set forth in an extensive body of law. This
body of law is preemptive of local regulation with limited exceptions. The gravamen of the litigation by
and between our clients and the City relate to the original adoption of the RS/JCE Ordinance, the mamier
in which they conflicted with and were preempted by the state and federal body of law, and the impact
thereon.
The proposed amended RS/JCE Ordinance reflects the validity of the arguments presented in the
litigation and the proposed amendments take necessary steps to bring the laws into compliance with state
and federal laws and regulations, as specifically detailed in that litigation.2
I See, Correspondence dated October 1, 2021 from LoftinlBedell P.C. to the Honorable Mayor and Council Persons
incorporated hereat as though fully set forth;
z Kingsle}, et at v. City of Santa Ana, U.S. District Court for the Central District of California, Case No. 8:22-CV-0076-
CJC-.[I)Ex (the "litigation" or "pending litigation").
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 3 of 1:1
IMPLEMENTATION PLAN
Equal Protection
In the most recent City presentation, the City refers owners and landlords to their own legal counsel,
saying "we are not attorneys, we cannot give legal advise." This effectively deprives owners and
landlords with the City's interpretation of the Rent Stabilization Ordinance and Just Cause Eviction
Ordinance —effectively refusing to respond to owners and landlords, while responding to residents'
questions.' However, they include and provide counsel to residents —including both with City staff and
guest speaker attorneys, and even solicit resident complaints about enforcement.
Procedural Due Process
Further, the owners of mobilehome parks are not being provided equal protection under the law in the
composition of the Rental Housing Board. The Staff Report outlines the RSG's Long -Term
Implementation Plan and includes four options for the composition of the Board. Of note, of the proposed
compositions, only Options 1 and 4 allow for parity between the composition of tenant representation
and owner representation. Each option expressly calls out that one of the tenant representatives to be
from a mobilehomes parks; but none of the options call out that one of the owner representatives should
be from the ownership/management of a mobilehome park. The end result is that of the 30 mobilehome
parks within the City, the residents will have a representative on the RSG board, but the park owners
who represent over 3900 mobilehome spaces will have no representation. Given the uniqueness of
mobilehome park laws, operations and issues, both sides, tenants and park owners/operators should have
equal representation on the Board, and other jurisdictions typically provide a separate rent board
specifically for mobilehome rent review.4
DEFMTIONS
In review of the Definition section leading into the newly proposed and combined RSIJCE
Ordinance, the following comments and recommendations are made to eliminate the conflicts with
California existing law as they relate to mobilehome parks, reduce the potential for taking of private
property, and eliminate vagueness and confusion:
A. Section 8-3102 — Definitions: "Rent" — the definition of rent is vague and ambiguous and
conflicts with and is preempted by the Mobilchome Residency Law, Civil Code § 798 et seq in
that (i) utilities are expressly governed and billed by mobilchome park owners under the
Mobilehome Residency Law, (ii) incidental service charges, including charges for items such as
rental of extra parking space, or for the park owner to perform services to the tenant, are governed
by the Mobilehome Residency Law and are not and should not be considered "rent", (iii) many
utilities in mobilehome parks are separately billed (either through metering services or through
proportionate share of the cost) by the mobilehome park owner to the tenant and such should not
be considered rent that is capped in its increases; and (iv) laws applicable to mobilehome parks
expressly provide for the pass through of certain charges and expenditures such as
'See Screenshot Attached as Attachment A:
4 See. e.g. Chula Vista Municipal Code Chapter 2.31: "Mobilehome Rent Review Commission."
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 4 of 11
governmentally imposed fees, fees for guests or additional services, which charges should not be
included in the definition of rent.
The costs of utilities are already governed by the California Public Utilities Commission,
pursuant to its tariffs and ratemaking under the Public Utilities Act, Cal. Pub. Util. Code § 201
et seq. In particular, Cal. Pub. Util. Code § 739.5 already requires that landlords submeter tenants
at the same rate that the regulated public utilities would charge for residential service if it were
providing the services directly. By mixing these rates into the calculation of acceptable rates, the
City will either (a) deprive landlords of the regulated rates they are entitled under the authority
of the California Public Utilities Commission per Cal. Pub. Util. Code § 739.5, or (b) violate the
rights of tenants concerning ratentaking of utilities, by approving rent increases that pertain
to regulated utility rates. Accordingly sub -billed utilities should be excluded fi•oni the definition
based on the exclusive jurisdiction of the California Public Utilities Commission to set utility
rates for master-nieter sub -meter tenants.
Accordingly:
a. Sub -billed (sub -metered) utilities should be excluded from the definition of rent based on
the exclusive jurisdiction of the California Public Utilities Convnission to set utility rates
for master -meter sub -meter tenants; and
b. Mobilehome Residency Law is preemptive of the City's ordinance and as such the
sentence should be rephrased to remove the concept of the Mobilehome Residency Law
being incorporated into the definition of rent, but rather the Mobilehome Residency Law
shall govern the charges of incidental service charges in a mobilehome park.
Propose modify the final sentence to read as follows (in pertinent part): "... any regulations of
rent, fees, and costs included within the Mobilehome Residency Law, Civil Code section 798 et
seq., shall be control such charges as relating to Mobilehomes and Mobilehome Spaces, as
applicable, including without limitation the exclusion off the costs of utility services, including
utility service fees, originally charged to the owner from a third party utility provider that is
passed through to the tenants; any voter approved bonds charged and billed through the real
properoJ tax bills including those for Elementary School, High School, and Community College;
health care district, metro water- district; fixed charge assessments for emergency ambulance,
fire district, paramedic fees, fire and EMS specific taxes, mosquito and vector disease control
and water standby and availability charges; any fees or charge imposed by the State in
connection with the operation of the a niobilehoine park such as, without limitations, fees charged
by the State in connection with the annual permits to operate the Community or for the
Mobilehome Residency Late Protection Program; all governmentally -mandated fees and
charges required or permitted to be passed through to a tenant; fees and expenses relating to
goveriinientally-niaiidated projects; and incidental service charges that may be placed upon a
mobilehome space pursuant to Civil Code section 798 et seq.; andfees for additional storage,
guest fees, late fees. "
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 5 of 11
B. Section 8-3102 — Definitions: "Capital Improvement". Remove "... andlor deterioration
resulting from an unreasonable delay in the undertaking of completion or after a Notice of
Violation by a government agency ordering repairs. "
While it could be reasonable to exclude civil fines from a Notice of Violation, which itself has
an appeal process related to those fines, the exclusion of capital improvements based on
deterioration or agency notice essentially causes a forfeiture without regard for fault and such
a forfeiture has no quarter in fair return jurisprudence concerning rent adjustment boards. The
City has powerful authority already as a local police power to levy fines, and would be best apt
to present evidence to preserve the legitimacy of its fines as part of the code enforcement process.
It need not inject confusion, cost, and burden into the Board's consideration of fair return, with
risk of litigation.
Add "... or major repair relating to a Rental Unit or mobilehome bark... "
There is ambiguity within the Rental Unit definition which could give rise to the allegation that
common area is not included —which then would cause the rental adjustment procedure to fail to
meet the requirements of rent adjustment jurisprudence. Accordingly, we suggest inserting the
clarification that the mobilehome park improvement costs generally are included. They will
already be subject to the pro rata Iimitations elsewhere in the ordinance.
C. Section 8-3102 — Definitions: "Mobilehome Space" Add the following as a new definition to
clarify the meaning of Mobilehome Space used throughout the Ordinance:
"Mobilehome Space " shall mean the rental of a mobilehome space within a mobilehome park
by a "homeowner " or a "resident " as ,such terms are defined in California Civil Code Section
798.9 and 798.11.
JUST CAUSE EVICTION
In review of the proposed amendments to the Just Cause Eviction Ordinance, as those
amendments relate specifically to mobilehome parks, the proposed corrections through the amendment,
are based on objections and legal issues raised in the pending litigation between our clients and the City.
The City, through the proposed amendments, acknowledge and admit that the October 19, 2021 Just
Cause Eviction Ordinance, NS 3010 violated numerous laws and regulations related to Mobilehome
Parks.' Despite the attempts to correct such violations, the following bullet points are provided for ease
of further amendments to bring the Just Cause Eviction sections of the proposed amended ordinance in
line with the applicable laws for mobilehome parks:
A. Section 8-3120(i) should be deleted in its entirety. This provision was amended to remove the
provision that the sale of a mobilehome park is included in the term of a change of use under
Government Code section 65863.7, ostensibly in response to the conflict of law and preemption
detailed in the pending litigation. However, the failure to remove the provision in its entirety
s Rather than reiterate in this correspondence the facial challenges to the newly combined RSIJCE Ordinance, the specific
issues, including the constitutional challenges are set forth in the case Kingsley et al v. City of Santa Ana, U.S. District Court
for the Central District of California. Case No. 8:22-cv-00076-C JC-TDEx, all allegations, assertions, and pleadings are hereby
incorporated as though fully set forth
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 6 of 11
merely works an abandonment of one improper basis (the expansion of state legislation in
contrary to its express terms), to another improper basis —a local police power adoption that
causes a conflict with the Mobilehome Residency Law, and a regulatory taking (on multiple
grounds), among other violations of the constitutional rights of mobilehome park owners.
The Mobilehome Residency Law contains provisions governing notice to residents of the intent
to sell and protections upon a change of use.6 The requirement that a Park Owner, the Seller, to
prepare a "Tenant Impact Report" on the sale of the Park to a third party at least 60 days prior to
a sale requires the Park to determine either prior to offering the Park for sale or prior to the close
of an escrow to determine the plans a third party has for the Park, which may change over time,
among other practical application issues. In summary, the selling Park owner must now
guarantee the "intent" of the purchasing Park owner and financially, or otherwise, mitigate that
"intent" prior to selling.
The adoption of the "tenant impact report" requirement, for any sale, also works as a regulatory
taking. The City has granted mobilehome parks the vested right to operate, as part of their land
use regulations and application process, and conditions set out at the time of approval and
construction. Now, however, the City proposes to abridge or revoke those rights--Cffectively
injecting a new condition of approval that the mobilehome park owner may be required to
return to the City in the event of sale, and without any allegation of a traditional land use basis
like a change in use. This proposal amounts to a regulatory taking, insofar as it effectively causes
the forfeiture of the vested right to continue operating a lawfully permitted property —from a
mere transfer and without a proposed change in use.
However, this forfeiture of vested right also constitutes a regulatory taking in that it forces a
mobilehome park owner to endure the burden and cost of preparation of a tenant impact report,
the cost and delay of a noticed, discretionary public hearing, and the related impacts effectively
clouding the ability to sell their property without public approval —premised solely on a
regulatory nexus of preventing displacement of tenants, which displacement cannot occur solely
as the result of a transaction. Moreover, any condition imposed at such a hearing would also
constitute a regulatory taking, as it would lack rough proportionality with the nexus of a mere
transfer of property.'
As a threshold matter, it seems doubtful that this proposed readoption would even support the
finding of a rational basis, in requiring a public hearing and impact report, from the sale of a
property, for any legitimate government interest surrounding tenant displacement. A sale, in and
of itself, cannot cause tenant displacement such that the City could reasonably condition the sale.
B. Section 8-3121 Notice of Termination of Tenancy: as applied to mobilehome park tenancies,
this section creates an internal conflict and a conflict with the Mobilehome Residency Law.
Section should be amended to clarify that termination notices sent subject to the Mobilehome
Residency Law, shall comply with such requirements and not the provisions of this Section.
CA Civ.Code §§ 798.798.80798.56(g).
In fact, this provision —once adopted —would work a veritable resolution of necessity against all mobilehome park owners,
and cause them to suffer damages in the nature of Klopping t), City of 117I7ittier, 8 Cal. 3d 39, 54 (1972).
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 7 of 11
(1) Subparagraph (a) l) requires a notice of termination to be served in accordance with Civil
Code §§ 1946 — 1946.5; however, the Mobilehome Residency Law is preemptive of such
ordinances and expressly sets out the content, manner and service of all termination notices
within a mobilehome park.
(2) Subparagraph (a)2) prohibits the Owner from accepting rent after the notice of a termination
has expired "in compliance with Civil Code section 1945 through 1946.5" however,
mobilehome park tenancies are exclusively governed by the Mobilehome Residency Law.
(3) There is internal conflicting language in that subparagraphs (a)1) and (a)3) require notice that
a tenant's occupancy is being terminated in accordance with 8-3120(b); however,
mobilchome park tenancies are expressly excluded from the termination requirements in 8-
3120(b). Since a mobilehome park tenants' occupancy is not governed by 8-3120, the park
owner cannot and should not be required to give notice relating to such compliance.
(4) Submittal of the termination notice within five days of service upon the resident to the City
(i) makes the notice now subject to disclosure through the public records act process, and (ii)
does not take into consideration that tenants may comply with a notice to pay or cure prior to
a termination being triggered. Such provisions create a disclosure risk of confidential
information about tenancies which are otherwise protected under California law.
C. Section 8-3122 Retaliatory Eviction and Anti -Harassment. Section (b)(9)(A)(iii), and (b)(12).
This proposed language appears to conflict with California law that provides state regulation of
the formation of contracts and notices in foreign languages. In particular, Cal. Civ. Code § 1632
was intended to only regulate "[a]ny person engaged in a trade or business who negotiates
primarily [in one of the named foreign languages]." Cal. Civ. Code § 1632(h)(1). It also
specifically exempted contracts negotiated "through the party's own interpreter." Id. The
proposed subparagraph have the effect of making requiring a landlord to prepare leases in a
tenant's primary language or else having such failure be deemed harassment of the tenant -- this
conflicts with state law and imposes substantial additional costs and burdens on landlords beyond
the state intended laws.
As noted above, although the amendment proposes and attempts to satisfy the issues, claims and
causes of actions raised in the pending litigation, and demonstrates the City's acknowledgement of the
accuracy of claims raised, the proposed amended ordinance continues to require corrective work to avoid
preemption by the various laws specifically impacting mobilehome parks; being vague and ambiguous
and constituting an unlawful taking in violation of the constitution.
RENT STABILIZATION ORDINANCE
First, we appreciate the numerous changes ostensibly made in response to the pending litigation.
We respectfully submit the following comments for consideration to the new proposed language. The
prior rent adjustment procedure clearly "[withheld] powers by which the [City Manager] could adjust
maximum rents without unreasonable delays and instead [required] the [City Manager] to follow an
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 8 of 11
adjustment procedure which would make such delays
Cal.3d 129, 170 (1976). What follows, are comme
stabilization ordinance.
inevitable." Birkenafeld v. City of Berkeley, 17
its to the new proposals reworking the rent
For clarity purposes, our Clients are not contesting the City's ability to enact rent control
generally. Rather, they contest those portions of the ordinance which are contrary to settled law
particularly as it relates to mobilehome parks, or which are so burdensome as to constitute a taking, or
which comprise a violation of substantive due process.
The proposed amendments appear to still require some form of completeness, and are unclear as
to whether they relate to an individual property, or pen -nit adjustment to a class of rental units as
discussed in BirkenfHd. Section 8-3145 delegates a gatekeeper, the "Program Administrator" with the
authority to reject applications "that [do] not include required information or documentation or comply
with the requirements of this Division.." Proposed City of Santa Ana Ordinance Section 8-3145 (a). A
complete application for an individual property effectively prevents adjustments that a) deal with factors
that are common to all properties like property taxes, or b) that are initiated based on information
received by the rent adjustment official or board without a complete application or on their own motion,
or c) allowing/encouraging applications between multiple properties or classes of properties.
Accordingly, we suggest adding clarity that the Board can act on its own motion, and has flexibility to
consider adjustments based on generally applicable factors, across properties and classes of Rental Units.
Additionally, the new proposals regarding the rent review board pose some due process traps for
the legislators. We discuss below that it would be most prudent to assure that there are balanced boards
between pecuniary interests, and that mobilehome park rental review boards have precedent in other
jurisdictions given that their rent adjustment considerations differ from other types of properties.
A. Section 8-3142 — Fair Return Petition for Rent Increase: The provisions within the Standard
of Review do not take into consideration the realities of owning and operating a mobilehome
park. The following are changes to bring the proposed section into better parity with the
ownership and operation of a mobilehome park, and applicable law:
a. Subparagraph (a): Add additional sentence for Petition on rrrotion of Board, to
subparagraph (a): "Tire Board rimy also initiate a Fair Return Petition, upon a majority vote
of the Board, where such motion identifies generally applicable factors, and instructs the
Program Administrator to prepare such Petition, relating to a single property, or all or any
class of Rental Units. Such Petition will proceed to be considered as provided in this
Division.
b. Subparagraph (b)(7): Delete in its entireiy. Increases in utility charges are wholly beyond
the landlord's control and are often passed through to tenants directly. As further discussed
above, the costs of utilities are already governed by the California Public Utilities
Commission, pursuant to its tariffs and ratemaking under the Public Utilities Act, Cal. Pub.
Util. Code § 201 et seq. In particular, Cal. Pub. Util. Code § 739.5 already requires that
landlords submeter tenants at the same rate that the regulated public utilities would charge
for residential service if it were providing the services directly. By mixing these rates into
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 9 of 11
the calculation of acceptable rates, the City will either (a) deprive landlords of the regulated
rates they are entitled under the authority of the California Public Utilities Commission per
Cal. Pub. Util. Code § 739.5, or (b) violate the rights of tenants concerning ratenraking of
utilities, by approving rent increases that pertain to regulated utility rates. Accordingly sub -
billed utilities should be excluded from the definition based on the exclusive jurisdiction of
the California Public Utilities Commission to set utility rates for master -meter sub -meter
tenants.
B. Section 8-3145 — Petition Process, subparagraph (a): Amend to read in relevant part: "Upon
the filing of a Petition, the Program Administrator shall for"'ard the Petition to the Board
together n,ith all relevant ir7forination submitted by the petitioner, to avoid unreasonable delay;
the Board may encourage additional information if it finds the submittal, on its face, lacks
adequate evidence, but shall not refuse to consider an application based on completeness, or
whether it relates to nrrrltiple properties or classes of properties, or relates to generally available
information such as property taxes or the consumer price index. " Our client appreciates that the
City has removed the inflexible "Fair Return Petition" submittal requirements and up -front fee
deposit that ostensibly violated the principle in cases like Birkenfeld v. Cily of Berkeley, 17 Cal.
3d 129, 171 (1976) as detailed in the pending litigation.
However, we suggest that providing an agent of the Board with the ability to refuse "incomplete"
application may work unreasonable delay, if a basic application shows generally applicable
factors that apply to multiple properties or classes of units. The application should proceed, with
the Board corresponding back to a prospective petitioner and encouraging additional information
where necessary.
C. Section 8-3145 — Introductory Paragraph. Add additional sentence after first sentence.
"NoN,ithstanding anything to the contrary in this section, the Board may adjust rent upward, in
a Petition on the motion of the Board, or with an incomplete Petition, or with a Petition that
relates to multiple properties, so long as it is based on substantial evidence; and further, may
approve general rental adjustments for all or any class of rental units based on generally
applicable factors such as property taxes. Such an adjustment ivould proceed as a Petition on
the motion of the Board, proved by a majority vote of the Board, and proceed through the notice
and hearing provisions set forth herein. "
D. Section 8-3145 — Petition Process, subparagraph (d)2): Amend to read: "Has failed to bring
the Rental Unit, excludinga Mobilehome or Mobilehome Space, into compliance with the implied
warranty of habitability. " Under the Mobilehome Residency Law and applicable laws relating
to mobilchome parks, the maintenance, repair, and upkeep of a mobilehome is the exclusive
responsibility of the mobilehome owner (and in fact, a Park owner cannot modify or access the
mobilehome). The mobilehome space, with limited exceptions, is also the responsibility of the
mobilehome owner.
E. Section 8-3145 — Petition Process, subparagraph (1): Amend to read in relevant part: "The
hearing officer may request the City to conduct a current building inspection, or as to
mobilehome parks, to contact the California Department of Housing and Community
Kingslev — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 10 of 11
Development for the results of the most recent inspection of the space, if the hearing officerfinds
good cause to believe the current information does not reflect the current condition of the Rental
Unit. " Under the Mobilehome Parks Act, and its implementing regulations, the enforcement
agency for building codes and health and safety regulations within mobilehome parks is the
California. Department of Housing and Community Development.
F. Section 8-3147 — Exemptions. Add the following new subparagraph (d):
"(d) The provisions of this Ordinance regulating the amount of rent that a residential real
property or rnobilehome space Owner may charge only applies while the original occupant is/are
residing in the residential dwelling unit or on the mobilehome space, and shall not regulate the
rental rate for a residential dwelling unit or nobilehome space whenever a lawful vacancy
occurs, including through the voluntary termination by the tenant, the sale ofthe mobilehome by
a Homeowner, the abandonment of the tenancy, or through a lcm ful eviction process. "
This revision is consistent with current City guidance provided to residents seeking information
and inquiry and assists with providing equal protection under the laws by providing landlords
such similar clarity.
G. Section 8-3148 — Rent Increase Ineffective, subparagraph (b): to eliminate the inconsistency
of the language, the first portion of the sentence should be modified to read: "Fails to maintain
the residential real property (excluding a Mobilehome or Mobilehone Space) in compliance
with.... "
H. Section 8-3180 — Rental Housing Board: As discussed in the "Implementation Plan" section
above, while all of the options assure mobilehome park tenants of representation, none of the
options assure representation for mobilehome park landlords. Moreover, two of the options (so
called "Option 2" and "Option 3") propose an imbalanced board with pecuniary bias in favor of
tenants —which is a clear violation of the procedural due process rights of mobilehome park
owners.$ See City Council Staff Report, Item 25 "Rent Stabilization and Just Cause Eviction
Ordinances", dated October 4, 2022, Pg. 3. Given the uniqueness of rnobilehome park laws,
operations and issues, both sides, tenants and park owners/operators should have equal
representation on the Board, and other jurisdictions typically provide a separate rent board
specifically for mobilchome rent review.9
8 "It is sufficiently clear from our cases that those with substantial pecuniary interest in legal proceedings should not adjudicate
these disputes. [Citation] And [Ward v. Village of Monroeville] indicates that the financial stake need not be as direct or
positive as it appeared to be in Tumey. It has also come to be the prevailing view that '[most] of the law concerning
disqualification because of interest applies with equal force to ... administrative adjudicators.' K. Davis. Administrative Law
Text § 12.04, p. 250 (1972), and cases cited." (Italics added.)[Citations] In Withrow v. Larkin , the United States Supreme
Court additionally notes: " Not only is a biased decisionmaker constitutionally unacceptable but'our system of law has always
endeavored to prevent even the probability of unfairness."' Ant. Holors Sales Corp. v. New A9otor Vehicle Bd., 69 Cal. App.
3d 983, 990 (1977) (citing Tianrev v. Ohio, 273 U.S. 510 (1927), ITard v. Village of Monroeville, 409 U.S. 57 (1972), and
lf'ithrow v. Larkin, 421 U.S. 35, 47 (1975), in overturning an imbalanced board of administrative hearing officers with
pecuniary interests).
s See, e.g. Chula Vista Municipal Code Chapter 2.31: "Mobilehome Rent Review Commission."
Kingsley — 426 Santa Ana Ordinances
Honorable Mayor and City Council Persons
City of Santa Ana
Hearing: October 4, 2022; Item: 25
September 30, 2022
Page 11 of 11
CONCLUSION
1. We respectfully object and disagree with the proposed findings in the resolution, and allege they
are unsupported by substantial evidence, particularly as to Section 1(c), and particularly as they
relate to mobilehome parks. There is no evidence of significant rent increases and housing
instability at mobilehome parks in the City. If there were actual issues, then a referral to code
enforcement and/or nonprofit legal assistance are available to residents, Council and staff. This
issue is stated only to emphasize the practice of gross generalization of some Findings and
Statements. (Section 1. Q
2. We respectfully object and disagree with the proposed findings in the resolution, as alleged above
specifically, and extended here generally, the alleged regulatory nexus of ameliorating housing
instability at mobilehome parks does not bear a reasonable relationship and rough proportionality
to the proposed RSIJCE Ordinance, which amounts not to an iterative amendment, but rather a
wholesale repeal and readoption of new regulation.
3. We respectfully object and disagree with the legal citations previously relied upon by the City as
to Ordinance NS-3009, NS-3010, and Resolution 2021-054, and they do not reasonably relate to
the extension of the Ordinances and proposed amendments in this Item 25 to mobilehome parks.
Again, we appreciate the City's work and apparent corrections and refinements in response to the
pending litigation. We must reserve the right to further supplement this letter and administrative record
concerning this Item 25, and its future readings, as our review of the proposed adoption and public
proceedings continues. For avoidance of doubt, this correspondence and the correspondence and
pleadings incorporated by reference are not intended to list all of the deficiencies, and errors or omissions
of facts and law contained in both the Rent Stabilization Ordinance, the Just Cause Eviction Ordinance,
in the amended RSIJCE Ordinance, and all related findings and resolutions. All legal rights and remedies
based upon the impacts of these Ordinances are reserved on behalf of our clients.
Sincerely,
LOFTIN I BEDELL P.C.
By: Sue oftin Es
Y � . q
cc: Clients
Kingsley - 426 Santa Ana Ordinances
Attachment A
Assistance
Fair Housing Council of Orange
County
Santa Ana, CA 42701
(714) 541-1010 ext, 303