Council decides on fair-market rate for owners of mobile homes
Hutchins switches position from his stand on March 6
Vote disappoints McNelly
By Nathan R. Huff
After months of debating the definition of "fair compensation" for Los Gatos Mobile Home park homeowners, the Town Council decided, on March 20, to let the market be the boss. The homeowners will be displaced by the park's proposed conversion,
The nine owners of mobile homes in the Woodland Avenue park will receive the adjusted in-place value for their mobile homes, if and when park owner Douglas McNelly's plans to convert the park are approved.
Councilman Jan Hutchins changed his position from the March 6 meeting, leading to the 3-2 vote in favor of using the adjusted in-place value. Hutchins said his change of heart was motivated by the need to move the process forward, and his perception of who had more at stake in the council's decision.
"It's a much more significant part of [mobile-home owner's] lives," Hutchins said after the meeting. "No one on the other end of the equation is worried about where they're going to sleep tomorrow."
Councilman Randy Attaway and Mayor Steve Blanton voted against the motion. Blanton said he believed a more equitable decision could have been made.
"I was looking for a compromise," Blanton later said. "You have the people, who actually own the homes, but the land they sit on belongs to someone else. And, I was looking for a solution that recognized both of those intrinsic [property] rights."
McNelly was disappointed with the decision, but, later said the council followed its precedent of favoring the park's tenants, citing rent and vacancy control, as examples.
"I'm surprised we went to such lengths to develop a range just to top it out at what the most was," McNelly said. "It gives me the sense that there was a little bit of bias."
For months, council members have listened to residents argue that they should be compensated according to what their homes would fetch on the open market. McNelly has stressed repeatedly that mobile-home owners do not own the land itself, and should receive only the value of the home.
On March 6, the council asked town staff to return with compensation figures, based on 50 to 85 percent of the adjusted in-place value. Using appraisals made in December 1998, the town calculated a range of values for 17 mobile homes.
The total adjusted in-place value for all the homes was more than $900,000, with the midpoint between the unadjusted and adjusted value falling at $622,000. However, since the 1998 appraisal, the number of homeowners in the park has dropped to nine, so McNelly's total compensation costs may be much less. Six other owners are covered by a different agreement.
The jubilation expressed, following the meeting, was a sharp contrast to the strained, occasionally angry, mood homeowners were in during the hearing.
"Every dime under fair-market value is denying us a dime of rights," park resident Jim Gurney told the council. He added he believed the compensation debate was a violation of the mobile-home owner's property rights.
McNelly had a much different perspective. "The suggestion is made that as land value goes up, the right to occupy the land goes up as well," McNelly said at the meeting. "The right to occupy issue is, in my mind, governed by the lease, which is very clear in its terms."
McNelly added that park residents had known about the conversion plans for years. "If they bought four years ago, they darn well knew what was ahead of them," McNelly said. "They were banking on the fact that they could petition the council, and gain a greater value than the person who sold it to them could find."
Councilwoman Linda Lubeck, who repeatedly reminded the council audience and participants that the conversion may or may not be approved, asked her fellow council members to remember why the town passed the 1986 conversion ordinance.
"When this ordinance was passed," Lubeck said, "the intent was that the owners, in essence, would receive fair-market value if and when the park closed."
McNelly can now begin his trek through the planning process, where he must win project approval, as well as a zone change. In the end, the project, like any which requires a zone change, will return to council for approval.
McNelly has not submitted a formal plan, but a condominium, or townhouse, complex is likely. McNelly also will be required to provide some affordable housing, but no definitive number of affordable units has been determined.
"The hard decisions now are going to be how to fulfill the community's interest in affordable housing, while at the same time getting a project you can move forward on," Hutchins said.
McNelly agreed the project's fate would be tied largely to what the town required in terms of affordable housing. He added that, even if the project dies, the park will still be redone.
"If we have to rebuild it as a mobile-home park that'll involve bringing in all new homes and rebuilding the infrastructure," he said, "and we'll miss the town's objective of affordable housing."
But, for park residents, now is the time to breathe a sigh of relief. "After all these many years I, finally, got a good night's sleep," mobile-home owner, Dorie Ousley, later said. The retiree bought her home in 1985, and said she has made substantial improvements--improvements, she now knows, she'll be compensated for. She added that park residents were very apprehensive about the cloudy future of the park and their homes.
"It's been a nightmare for all the poor people who live here," Ousley said.
Los Gatos, California Since 1881
