Loading...
HomeMy WebLinkAboutRDA Min 2000-01-10 12-13-99 I 1-10-00 ~I responded that the fund is approaching about $1.7 million, those monies may only be used for the preservation of low to moderate income housing or the creation of such new housing, and these monies must be used within a specific time period to avoid forfeiture. Mr. Shanks said given that amount of money, the involvement of the Agency in the Park since the late 1970's, and more recently the implied threats to the residents under the new ownership, he would suggest that the Agency use that money to either purchase the Park or help the residents in some way, his preference would be purchase. Councilman Boyd arrived at 6:56 p.m. Ms. Sue Corbin, Seal Beach, suggested that the details of this item should be known before a vote is taken, is the identity of the resident of this trailer known, what is the criteria for doing this. Expressing appreciation for the comments, Agencymember Snow moved to authorize the purchase of a used trailer home at a cost of $15,000, and authorize the additional expenditure to prepare the trailer for habitation under the terms mentioned. Agencymember Doane seconded the motion. Agencymember Boyd stated he would abstain on this item as he was not present for the entire discussion. I AYES: NOES: ABSTAIN: ABSENT: Campbell, Doane, Snow None Boyd Yost Motion carried AGENCY COMMENTS There were no Agency comments. ADJOURNMENT By unanimous consent, the meeting was adjourned at 7:00 p.m. y'~Jf~ _I Seal Beach, California January 10, 2000 The Redevelopment Agency of the City of Seal Beach met in special session at 6:30 p.m. with Chairman Campbell calling the meeting to order and read the notice of special meeting as follows: 1-10-00 NOTICE OF SPECIAL MEETING "Patricia Campbell, 4433 Ironwood Avenue, Seal Beach Shawn Boyd, 229 - 7th Street, Seal Beach William Doane, 1401 Skokie Road, 83-A, Seal Beach Paul Snow, 1621 Interlachen Road, 265-K, Seal Beach Paul Yost, 485 Schooner Way, Seal Beach I NOTICE IS HEREBY GIVEN that pursuant to Government Code Section ,54956 a special meeting of the Seal Beach Redevelopment Agency is hereby called for Monday, January 10th, 2000 at 6:30 p.m., in the City Council Chambers, 211 - 8th Street, Seal Beach, California, for the purpose of: * Meeting in Closed Session pursuant to Government Code Section 54956.9(b) with regard to anticipated litigation; * Consideration of a proposed rental schedule increase in the Seal Beach Trailer Park, and the taking of any and all actions relating thereto; and * Consideration of agreements between the Seal Beach Redevelopment Agency and Mr. Bob Latta and between the Seal Beach Redevelopment Agency and Richard A. Hall & Associates relating to a replacement trailer at 94 Welcome Lane in the Seal Beach Trailer Park, and the taking of any and all actions relating thereto. I DATED THIS 3rd day of January, 2000. siqned Patricia Campbell, Chairman Seal Beach Redevelopment Agency by siqned Joanne Yeo, City Clerk City of Seal Beach" ROLL CALL Present: Chairman Campbell Agencymembers Boyd, Doane, Snow, Yost 1- Absent: None Also present: Mr. Till, Executive Director Mr. Barrow, City Attorney Mr. Whittenberg, Director of Development Services . Ms. Yeo, City Clerk \ \ 1-10-00 APPROVAL OF AGENDA Doane moved, second by Boyd, to approve the order of the agenda as presented. I AYES: NOES: Boyd, Campbell, Doane, Snow, Yost None Motion carried I PUBLIC COMMENTS Chairman Campbell declared the public comment period open. Mr. Frank Boychuck introduced himself as a member of the Seal Beach Trailer Park Residents Committee, said the issue that he wished to speak is the assistance given by the Agency to Mr. Latta and his family for new accommodations in the Park, the preparation for the replacement trailer was to have commenced late in December however a representative of the Park owner appeared and stopped the operation, the reason is not understood, mention has been that the issue is the ownership of the trailer. He noted that this trailer has been donated to Mr. Latta, he would like to take possession, it is not felt that the Park owner should own something that has been donated to Mr. Latta, the desire is that a resolution relating to this issue be worked out, in fact Mr. Latta is prepared to purchase the unit and make payments on it. With regard to the proposed rent increase, Mr. Boychuck stated that one of the legal representatives for the residents, Mr. Bruce Stanton from San Jose, was present to address that issue. Mr. Bob Latta, Welcome Lane, recalled the recent action of the Agency to secure a replacement trailer to be moved onto his property in the Park as well as payment of the cost to demolish the existing trailer, the intent was to put his possessions in storage during the replacement however this effort was stopped and it is understood that the Park owner wanted the trailer to be in his name exclusively, not the City, said he does not believe the owner has the right to take advantage of his poverty to increase his own value. Mr. Latta said he does not understand why he can not personally own the trailer, he is willing to make the payments once the unit is moved in, also, mentioned his income as being very low, he has a family, they need accommodations, he has been a Park resident for eighteen years, has never had a problem with the rent or with his neighbors, therefore does not understand why the replacement of his trailer can not go forward. Mr. Bruce Stanton, stated he is legal counsel for the Park residents, his specialization for nearly seventeen years has been in the representation of residents of mobile home parks, most often dealing with administrative rent hearings, rent control ordinances bearing a similarity to the Park covenants. Mr. Stanton said his comments at this point would be made on behalf of the Board of the Association not the residents as a whole, mentioned some surprise on his part that this matter is being heard at this time given the understanding that negotiations are on-going relating to the Park purchase, the timing not necessarily in the best interest of those persons or are the approximate eighteen pages of new Park rules. He stated he was encouraged upon seeing the analysis of this issue and the Park Board has given concurrence to the recommendation of the Director, a 7.8 percent rent increase I 1-10-00 is more than fair and is supported by evidence, said he would reiterate the finding that debt service should not be allowed, to that he totally concurs, in fact the vast majority or virtually every mobile home rent ordinance throughout the State does not allow debt service, for that there are good public policy reasons as it is something that can be manipulated to the detriment of the residents of a Park too easily, there is also a past history from 1989 where this issue was looked at and rejected, the owner of the Park did not challenge that determination, there has now been a ten year span in between, it is understood too that the City Attorney has rendered an analysis in support of that determination with which he too concurs, since the debt service is the greatest line item that is the most important issue that needs to be dealt with. with respect to the legal fees, Mr. Stanton said from the staff report it was not clear whether the line items for legal and accounting expenses were included in the 7.8 percent increase, suggested that the Agency be careful when looking at the legal expenses to determine whether or not they are derived from ordinary daily types of legal expenses that a Park owner would incur such as evictions, new law information, rental agreement forms, etc., a contrast to that would be legal fees paid in specific reference to the covenant incurred this year with regard to the rent increase, stating that most rental ordinances do not allow legal fees that are incurred in connection with such ordinance or covenant, to do so would skew the legal fee category to show a very large fee for the period, and once allowed they most likely would not go away or be shown at that level again, also, he was uncertain whether the legal fee category has been previously allowed because as stated it appears that legal fees could be revisited in the future with more documentation. Mr. Stanton concluded that the recommendation is felt to be proper, even though not having seen the initial expense numbers, presently there are only small discrepancies, therefore the Board appears to be willing to stand by the recommendation. Mr. Boychuck acknowledged and expressed appreciation to the many Park residents present at this meeting. Mr. Paul Jeffers, Cottonwood Lane, spoke in support of Mr. Latta whom he has known for many years, a carpenter by trade, he and friends built his addition, then he was injured and developed other health problems. Mr. Jeffers said the condition of Mr. Latta is an example of what the low and moderate income housing should be for, and questioned the reason why the replacement trailer is not being put in Mr. Latta's name rather than the City or the Park owner. There being no further comments, Chairman Campbell declared public comments to be closed. I I WAIVER OF FULL READING Boyd moved, second by Doane, to waive the reading in full of all resolutions and that consent to the waiver of reading shall be deemed to be given by all Agencymembers after reading of the title unless specific request is made at that time for the reading of such resolution. I AYES: NOES: Boyd, Campbell, Doane, Snow, Yost None Motion carried 1-10-00 I CLOSED SESSION The City Attorney announced that the Agency would meet in Closed Session pursuant to Government Code Section 54956.9(b) to discuss the item identified on the agenda, a conference with legal counsel with regard to one potential case of anticipated litigation. It was the consensus of the Agency to adjourn to Closed Session at 6:47 p.m. The Agency reconvened at 7:20 p.m. with Chairman Campbell calling the meeting to order and then recessed the Agency meeting to convene the City Council regular meeting. The Agency recessed at 7:21 p.m. and reconvened at 7:23 p.m. I TRAILER PARK - RENT INCREASE The City Manager stated this item pertains to a proposed rent increase by the Trailer Park owner, a rent review conducted by the Redevelopment Agency under the terms of the Covenant, under the terms of the Covenant the Park owner is entitled to a rent increase however the largest component of the increase is defined as the loan payment and is apparently based upon the financing used by the new owner to purchase the Park, yet legal counsel to the Agency has consistently provided the opinion that additional costs incurred by the owner for new financing or refinancing can not be passed through to the tenants, the Park owner has disputed this interpretation and has submitted a proposal to raise the rents by more than thirty-six percent. At issue, in part, is whether the owner is entitled to raise rent to recoup increased debt service, this issue was also raised in 1989 when the prior owner requested an increase based upon increased debt service costs associated with refinancing, the legal counsel for the Agency at that time interpreted the Covenant as allowing a rate increase based upon specified costs, mostly tied to the Consumer Price Index or the actual documented increase of costs, the opinion was that rent increases could not be based upon refinancing, therefore upon that opinion the Agency disputed the portion of the request based upon the increase of costs associated with refinancing, at that time the issue was resolved and the costs contained as they had been. He mentioned that the loan payment category has always been the largest component of the rent formula however based upon the original financing, the loan payment of the new owner is about $7,000 per month higher than that of the previous owner because the amount of debt has increased, part of that is buying out the ground lease. Without the ability to charge the additional $7,000 per month the owner can only justify more modest rent increases based on operating expense adjustments and an increase in the ground lease which is generally aligned with the CPl. The Director recommended that the Agency approve a rent increase of 7.8 percent, or $2,623 per month, concluding the dispute, this in comparison to the $12,709 increase, 37.63 percent, proposed by the Park owner, therefore of the $9,486 in dispute, $6,340 is attributable to the difference between the original and new loan payment. He noted that other line items such as the legal expenses and repairs and maintenance are also in dispute however are minor in comparison and it is the opinion of staff that there is insufficient basis for granting increases for those until possibly next year when I 1-10-00 documentation of a full year of expenses can be provided, and given that there has not been a rent increase in the Park since 1993 the 7.8 percent increase would average to about 1.59 percent per year, with no compounding. The Director referred to the Covenant as a complex, old document, changes have occurred since that document was drawn, however in order to try to facilitate discussion between the two parties, the Park owner and the resident Association, one of the more viable compromises discussed included a plan to keep intact the Covenant rent control formula for residents who currently reside in the Park for as long as they remain in the Park and then apply the standard County rent control rate to any new Park tenants, this was not something that the Agency promoted or encouraged the owners or residents to pursue, however it has been said that there may be some further discussion of that concept in the future. He reported that the Park owner has indicated they remain in dispute with the findings of the City, at least at the staff level, and urged consideration of this matter at this meeting. The Director said as a matter of practicality the Agency must address the rent increase proposal first before the tenants could consider purchase of the Park themselves, which is something in which they have expressed interest, the City assisting in that evaluation, the outcome of which should be known by possibly the end of this month, if the purchase proves to be infeasible then there could be consideration of the compromise alternatives. He again recommended approval of the implementation of the proposed rent schedule of 7.8 percent effective November 16, 1999. I I Chairman Campbell inquired if the increase needs to be retroactive to November and Agencymember Yost suggested an effective date of this day, January 10th. The Director offered that that could be a possibility, however there were some scheduling problems, there was delay in scheduling the matter for at least two meetings, there was insufficient data provided by the owners that resulted in at least one delay, they had requested and submitted something timely for a November 16th implementation however the dispute was not resolved, therefore since there were delays that were attributable to both the Agency and the owner it is recommended to go forward with the November 16th effective date. To a suggestion to split the time period, the Director responded that there is no clear cut answer as it is debatable as to the time frame for Agency consideration, if that were done then it is possible the representative of the owner may dispute it. Mr. Bill Talley, representing the Park owner, stated that the rent increase was submitted in June, 1999, it was amended in September, it is not known that any information was not submitted on a timely basis, they have not had the courtesy of a staff report therefore not known what is being considered, therefore the Agency can vote on whatever they want whenever they want because if there was a good faith dealing they should at least know what is under consideration. The Chair noted that when the request was submitted there was insufficient data therefore nothing could be done until the numbers were known, which is understood to have been recently. I 1-10-00 I Agencymember Yost moved to approve a 7.8 percent rent increase effective this date. Agencymember Snow seconded the motion. Agencymember Boyd said his point of discussion relates to how this increase came about, he has spent time discussing the issue with the City Attorney and legal counsel, it appears that there is some difficulty in justifying everything but not all, it is felt that as much protection as possible needs to be afforded the residents of the Trailer Park. He noted that the Park was built to provide low and moderate income housing to people in Seal Beach, the Housing Element of the General Plan requires that low and moderate income be provided, therefore if the City is not fulfilling its diligence in what it does people of low to moderate means are then being denied the ability to live in this City, his contention, on that basis, is that the City has not performed its full diligence in this matter and it is likely that more needs to be done than has been with respect to saying yes or no to this rent increase request. His intent is to offer the full protection of the Covenant to the residents of the Park if they qualify, that is fair, if one lives in low or moderate income housing then one should be a low to moderate income person and not just for the purpose of qualifying, it is not believed that that has been the case. Agencymember Boyd offered an amendment to the motion to not vote on the 7.8 percent increase at this time, rather, that a sliding scale be used similar to what the County uses for Section 8, and if a rent increase is going to be established then it should be based on those who qualify, if one wants to live somewhere that is subsidized by taxpayer dollars and is protected by rent control, then they should qualify, if not then the protection of rent control should not be afforded because that then denies others of the low to moderate income opportunity. Agencymember Yost denied acceptance of the amendment to the motion, also responded that most low to moderate income parks do not require people to vacate their residence if their income happens to go up after a period of time, that is consistent with most rent control ordinances. Agencymember Boyd noted that the Covenant does not spell out in detail many of the things that are being voted on, it is silent, action on the rent increase is being based on a 1989 opinion that involved refinancing of the Park, not acquisition, by the Covenant the City is required to abide by its constraints, in his opinion that has not been done, and said that personally he does not support rent control. There was no second to the amendment to the motion. I Vote on motion to approve the 7.8 percent rent increase: I AYES: NOES: Campbell, Doane, Snow, Yost Boyd Motion carried MEMORANDUM OF UNDERSTANDING - 94 WELCOME LANE - TRAILER PARK The Director of Development Services presented the staff report, noted that the Agency, at the December 13th meeting, authorized the purchase of a used trailer to be moved onto property at 94 Welcome Lane to correct a situation of substandard living conditions, there were discussions with the representative of the Trailer Park with an understanding 1-10-00 that certain conditions would apply to the project, subsequently the City was advised that the Park owner was not willing to proceed with allowing the trailer to be placed on the property. He noted however that the Memorandum of Understanding has been prepared setting forth the understandings during discussions between the City Manager, the representative of the Park's owner, and himself, the MOU has been submitted to the owner however reported by his representative that the owner has as yet not consented to the terms of the agreement. The Director explained that the intent was to provide the MOU to the Agency for approval of the terms, then submit same to the Trailer Park to resolve the issue from that standpoint. Agencymember Yost asked if the proposal of Mr. Latta to assume title and payments of the trailer had been given consideration. The Director offered that that would be a discretionary choice of the Agency, that had not been looked at in that manner so as not to increase the costs of housing for the Latta family at this point, it could be an option to develop some means to have the cost of the trailer repaid, and with that it would be assumed the unit would be in their name. The Executive Director said from the staff standpoint it was not relevant as to who held title rather to deal with the health and safety hazard and appropriate housing for this family in the Trailer Park, if the Park owner is willing to have a trailer moved in and allow Mr. Latta to own it that would not seem to be a disadvantage to the Agency, or, if the Park owner wants to hold title and make the unit available to Mr. Latta so long as the Agency can recover fair market residual value at the time the unit is sold, the issue is getting appropriate accommodations in place for this family. Agencymember Yost asked of the Park representative if it would be acceptable to the Park owner to place the title in the name of Mr. Latta. Mr. Tally said he was uncertain, he would need to present that to the owner in that it has not been proposed until just now. In an attempt to avoid delay, the Executive Director sought concurrence of the Agency that any of the options mentioned would be acceptable in order to accomplish this goal. I I Agencymember Yost moved to provide the trailer to Mr. Latta pursuant to any option mentioned except having the title in the name of Mr. Hall, the Park owner. Agencymember Snow seconded the motion. Chairman Campbell requested that this be done as soon as possible. Agencymember Boyd requested confirmation of the accuracy of the statement that the Agency is setting precedent by making the loan for the trailer and additional expenditure of funds, the total expenditure being $29,999, the Executive Director confirmed the amount, however stated he did not believe it sets precedent. Agencymember Boyd noted that there is a low and moderate housing program whereby persons can make application and receive loans for rehabilitation purposes, and questioned if making this loan does not open the opportunity for others, in the same situation as Mr. Latta, to also seek financing from the Redevelopment Agency. The Executive Director responded that in this case the City I 1-10-00 / 1-24-00 I became aware of substandard housing, initiated Code enforcement for abatement, determined that this would likely be a long, expensive process and in turn the displacement of a family, the thought was then an alternative to merely purchase and replace the housing unit, in his view this does not set a precedent or a change in the housing assistance program, rather, a unique situation to correct a problem. The City Attorney concurred that this is not a precedent, rather it is a settlement of a civil dispute where legal action was brought forth, mediation followed with the direction of the judge being to come up with some way that Mr. Latta could remain in the Park, to him this is viewed as a settlement and unique, and should another similar situation present itself every alternative would be explored, but again, no precedent is seen. Councilman Boyd said he mentioned this in view of a resident of the First District coming before the Council several meetings ago as a result of a code enforcement action whereby the family ended up selling the home, his intent is that this be done in the correct way. Vote on the motion to approve with condition: AYES: NOES: ABSTAIN: Campbell, Doane, Snow, Yost None Boyd Motion carried I AGENCY COMMENTS There were no comments made. ADJOURNMENT By unanimous consent, the meeting was adjourned at 7:50 p.m. 't~Jf~ Seal Beach, California January 24, 2000 ,I The Redevelopment Agency of the City of Seal Beach met in regular session at 6:45 p.m. with Chairman Campbell calling the meeting to order. ROLL CALL Present: Chairman Campbell Agencymembers Boyd, Doane, Snow Absent: Agencymember Yost