Bill Text: CA AB225 | 2013-2014 | Regular Session | Chaptered
Bill Title: Mobilehomes: loans.
Spectrum: Slight Partisan Bill (Democrat 2-1)
Status: (Passed) 2014-09-20 - Chaptered by Secretary of State - Chapter 493, Statutes of 2014. [AB225 Detail]
Download: California-2013-AB225-Chaptered.html
BILL NUMBER: AB 225 CHAPTERED
BILL TEXT
CHAPTER 493
FILED WITH SECRETARY OF STATE SEPTEMBER 20, 2014
APPROVED BY GOVERNOR SEPTEMBER 20, 2014
PASSED THE SENATE AUGUST 25, 2014
PASSED THE ASSEMBLY AUGUST 28, 2014
AMENDED IN SENATE AUGUST 20, 2014
AMENDED IN SENATE AUGUST 6, 2014
AMENDED IN SENATE JULY 2, 2014
AMENDED IN SENATE JUNE 18, 2014
AMENDED IN ASSEMBLY MAY 9, 2013
AMENDED IN ASSEMBLY APRIL 18, 2013
AMENDED IN ASSEMBLY APRIL 9, 2013
AMENDED IN ASSEMBLY APRIL 1, 2013
INTRODUCED BY Assembly Members Chau and Nestande
(Principal coauthor: Assembly Member V. Manuel Pérez)
FEBRUARY 4, 2013
An act to amend Sections 18114.1, 50781, 50782, 50784, 50785, and
50786 of, and to add Sections 50784.5 and 50784.7 to, the Health and
Safety Code, relating to mobilehomes, making an appropriation
therefor, and declaring the urgency thereof, to take effect
immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 225, Chau. Mobilehomes: loans.
Existing law authorizes the Department of Housing and Community
Development to make loans from the Mobilehome Park Purchase Fund, a
continuously appropriated fund, to qualified mobilehome park
residents, resident organizations, and nonprofit housing sponsors or
local public entities to finance conversion of the parks to resident
ownership to make monthly housing costs more affordable. Existing law
also requires the provision of specified information to the
department before making loans for mobilehome park conversions.
This bill would change the name of the fund to the Mobilehome Park
Rehabilitation and Purchase Fund. The bill would require the
department to consider specified criteria in determining eligibility
for, and the amount of, loans made from the fund to nonprofit housing
sponsors or local public entities to acquire a mobilehome park. The
bill would authorize loans to a resident organization or nonprofit
housing sponsor to assist park residents with needed repairs or
accessibility upgrades to the mobilehomes if specified criteria are
met. The bill would also make conforming changes.
By expanding the authorization to use continuously appropriated
funds, this bill would make an appropriation.
This bill would declare that it is to take effect immediately as
an urgency statute.
Appropriation: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 18114.1 of the Health and Safety Code is
amended to read:
18114.1. (a) In addition to the annual registration fee required
by Section 18114, an annual fee of five dollars ($5) shall be paid to
the department at the time of registration or renewal for each
transportable section of a manufactured home or mobilehome registered
pursuant to this part. All revenues derived from this fee shall be
deposited in the Mobilehome Park Rehabilitation and Purchase Fund
provided for in Chapter 11 (commencing with Section 50780) of Part 2
of Division 31.
(b) Any transportable section of a manufactured home or mobilehome
registered pursuant to this part and located on a private parcel
owned by the registered owner of the manufactured home or mobilehome
shall be exempt from the fee imposed by subdivision (a), if the owner
provides documentation or a written statement, signed under penalty
of perjury, which establishes to the satisfaction of the department
that the manufactured home or mobilehome is located on a private
parcel owned by the registered owner of the manufactured home or
mobilehome.
(c) Pursuant to subdivision (b), upon renewal of registration in
1989, or thereafter, once the registered owner provides documentation
or a written statement to the department to establish the exemption,
the department shall not require the owner to establish the
exemption in each subsequent year upon renewal, unless the department
receives evidence that the manufactured home or mobilehome is no
longer located on a private parcel owned by the registered owner of
the home. Renewal forms for registered owners of manufactured homes
or mobilehomes who have established the exemption shall not reflect
or include the fee required pursuant to subdivision (a).
SEC. 2. Section 50781 of the Health and Safety Code is amended to
read:
50781. Unless the context otherwise requires, the following
definitions given in this section shall control construction of this
chapter:
(a) "Affordable" means that, where feasible, low-income residents
should not pay more than 30 percent of their monthly income for
housing costs.
(b) "Conversion costs" includes the cost of acquiring the
mobilehome park, the costs of planning and processing the conversion,
the costs of any needed repairs or rehabilitation, and any
expenditures required by a governmental agency or lender for the
project.
(c) "Department" means the Department of Housing and Community
Development.
(d) "Fund" means the Mobilehome Park Rehabilitation and Purchase
Fund created pursuant to Section 50782.
(e) "Housing costs" means the total cost of owning, occupying, and
maintaining a mobilehome and a lot or space in a mobilehome park.
The department's regulations shall specify the factors included in
these costs and may, for the purposes of calculating affordability,
establish reasonable allowances.
(f) "Individual interest in a mobilehome park" means any interest
that is fee ownership or a lesser interest that entitles the holder
to occupy a lot or space in a mobilehome park for a period of not
less than either 15 years or the life of the holder. Individual
interests in a mobilehome park include, but are not limited to, the
following:
(1) Ownership of a lot or space in a mobilehome park or
subdivision.
(2) A membership or shares in a stock cooperative, as defined in
Section 11003.2 of the Business and Professions Code, or a limited
equity housing cooperative, as defined in Section 817 of the Civil
Code.
(3) Membership in a nonprofit mutual benefit corporation that
owns, operates, or owns and operates the mobilehome park.
(g) "Low-income resident" means an individual or household that is
a lower income household, as defined in Section 50079.5. However,
personal assets shall not be considered in the calculation of income,
except to the extent that they actually generate income.
(h) "Low-income spaces" means those spaces in a mobilehome park
operated by a resident organization, a qualified nonprofit housing
sponsor, or a local public entity that are occupied by low-income
residents.
(i) "Mobilehome park" means a mobilehome park, as defined in
Section 18214, or a manufactured home subdivision created by the
conversion of a mobilehome park, as defined in Section 18214,
including a senior park, to resident ownership or ownership by a
qualified nonprofit housing sponsor or local public entity.
(j) "Program" means the Mobilehome Park Rehabilitation and
Resident Ownership Program.
(k) "Qualified nonprofit housing sponsor" means a nonprofit public
benefit corporation, as defined in Part 2 (commencing with Section
5110) of Division 2 of the Corporations Code, that (1) has received
its tax-exempt status under Section 501(c)(3) of the Internal Revenue
Code, (2) is not affiliated with or controlled by a for-profit
organization or individual, (3) has extensive experience with the
development and operation of publicly subsidized affordable housing,
(4) the department determines is qualified by experience and
capability to own and operate a mobilehome park that provides housing
affordable to low-income households, and (5) has formal arrangements
for ensuring resident participation or input in the management of
the park that may include, but not be limited to, membership on the
board of directors. "Qualified nonprofit housing sponsor" also means
a limited partnership where all of the general partners are nonprofit
mutual or public benefit corporations that meet the requirements of
paragraphs (1) to (5), inclusive.
( l ) "Resident organization" means a group of
mobilehome park residents who have formed a nonprofit corporation,
cooperative corporation, or other entity or organization for the
purpose of acquiring the mobilehome park in which they reside and
converting the mobilehome park to resident ownership. The membership
of a resident organization shall include at least two-thirds of the
households residing in the mobilehome park, or in each park of a
combination of parks where the residents of two or more parks combine
to form a single resident organization. The two-thirds of households
in the resident organization at the time of funding the park need
not be the same households that were residing in the park when the
application for assistance was submitted to the department. A
household's membership in the resident organization when the
application was submitted to the department shall not be a
requirement for that household to receive a loan or assistance under
this chapter.
(m) "Resident ownership" means, depending on the context, either
the ownership by a resident organization of an interest in a
mobilehome park that entitles the resident organization to control
the operations of the mobilehome park for a term of no less than 15
years, or the ownership of individual interests in a mobilehome park,
or both.
SEC. 3. Section 50782 of the Health and Safety Code is amended to
read:
50782. (a) The Mobilehome Park Rehabilitation and Purchase Fund
is hereby created in the State Treasury and, notwithstanding Section
13340 of the Government Code or any other law, is continuously
appropriated to the department for the purpose of providing loans
pursuant to this chapter and for related administrative costs of the
department. Notwithstanding Section 16305.7 of the Government Code,
any moneys received by the department pursuant to this chapter, and
any other sources, repayments, interest, or new appropriations, shall
be deposited in the fund. Except as described in subdivision (b),
moneys in the fund shall not be subject to transfer to any other fund
pursuant to any provision of Part 2 (commencing with Section 16300)
of Division 4 of Title 2 of the Government Code, except the Surplus
Money Investment Fund. The department may require the transfer of
moneys in the fund to the Surplus Money Investment Fund for
investment pursuant to Article 4 (commencing with Section 16470) of
Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code.
Notwithstanding Section 16305.7 of the Government Code, all interest,
dividends, and pecuniary gains from the investments shall accrue to
the fund.
(b) Notwithstanding any other law, the Controller may use the
moneys in the Mobilehome Park Rehabilitation and Purchase Fund for
loans to the General Fund as provided in Sections 16310 and 16381 of
the Government Code. However, interest shall be paid on all moneys
loaned to the General Fund from the Mobilehome Park Rehabilitation
and Purchase Fund. Interest payable shall be computed at a rate
determined by the Pooled Money Investment Board to be the current
earning rate of the fund from which loaned. This subdivision does not
authorize any transfer that will interfere with the carrying out of
the object for which the fund was created.
SEC. 4. Section 50784 of the Health and Safety Code is amended to
read:
50784. (a) The department may make loans from the fund to
individual low-income residents of mobilehome parks that have
converted to resident ownership or resident organizations that have
converted or plan to convert a mobilehome park to resident ownership.
The purpose of providing loans pursuant to this section is to reduce
the monthly housing costs for low-income residents to an affordable
level.
(b) Loans provided pursuant to this section shall be for a term of
no more than 40 years and shall bear interest at a rate of 3 percent
per annum, unless the department finds that a lower interest rate is
necessary and will not jeopardize the financial stability of the
fund.
(c) The department may establish flexible repayment terms for
loans provided pursuant to this section if the terms are necessary to
reduce the monthly housing costs for low-income residents to an
affordable level, and do not represent an unacceptable risk to the
security of the fund.
(d) Loans provided to low-income residents pursuant to this
section shall be for the minimum amount necessary to reduce the
borrower's monthly housing costs to an affordable level. All of the
following shall apply to loans to finance individual interests
pursuant to this section:
(1) To the extent possible, loan amounts shall not exceed 50
percent of the acquisition costs of the individual interests in the
mobilehome parks. However, the loan amounts may be for up to 100
percent of the acquisition costs of the individual interests in the
mobilehome parks when approved by the department.
(2) The department may grant approval to exceed 50 percent of the
acquisition costs of the individual interests only if both of the
following are demonstrated:
(A) That the low-income resident has made an effort to secure
additional funding from other sources and these funds are not
available.
(B) That the low-income resident would be unable to purchase an
individual interest without a waiver of the 50-percent financing
limitation.
(3) The total indebtedness of the loan provided pursuant to this
section plus any senior debt upon individual interests may not exceed
100 percent of the value of the collateral securing the loan, plus
the amount of costs incidentally, but directly, related to the
acquisition.
(e) Loans provided to resident organizations pursuant to this
section shall be for the minimum amount necessary to reduce the
monthly housing costs of low-income residents to an affordable level.
All of the following shall apply to loans made to resident
organizations pursuant to this section:
(1) To the extent possible, loan amounts shall not exceed 50
percent of the conversion costs attributable to the low-income
spaces. However, the loan amounts may be for up to 95 percent of the
conversion costs attributable to the low-income spaces when approved
by the department.
(2) The department may grant approval to exceed 50 percent of the
conversion costs attributable to low-income spaces only if both of
the following are demonstrated:
(A) That the applicant has made an effort to secure additional
funds from other sources and these funds are not available.
(B) That the project would not be feasible as determined by the
department without a waiver of the 50-percent financing limitation.
(3) The total secured debt in a superior position to the
department's loan plus the department's loan shall not exceed 115
percent of the value of the collateral securing the loan plus the
amount of costs incidentally, but directly, related to the
acquisition and, if applicable, rehabilitation of the park.
(f) Funds provided pursuant to this section shall not be used to
assist residents who are not of low income or to reduce monthly
housing costs for low-income residents to less than 30 percent of
their monthly income.
(g) Subject to the restrictions of this subdivision, funds
provided pursuant to this section may be used to finance the costs of
relocating a mobilehome park to a more suitable site within the same
jurisdiction if the department determines that the cost of the
relocation, including any and all relocation costs to the affected
households, is a more prudent expenditure of funds than the costs of
needed or repetitive repairs to the existing park. Funds provided
pursuant to this section shall not be used to relieve a park owner of
any responsibility for covering the costs of mitigating the impacts
of a park closure as may be provided for by local ordinance or
pursuant to Section 65863.7 or 66427.4 of the Government Code.
SEC. 5. Section 50784.5 is added to the Health and Safety Code, to
read:
50784.5. (a) The department may make loans from the Mobilehome
Park Rehabilitation and Purchase Fund to a qualified nonprofit
housing sponsor or a local public entity to acquire a mobilehome
park, provided that no less than 30 percent of residents at the time
of acquisition are low income.
(b) Loans may be provided pursuant to this section where either of
the following applies:
(1) The park to be acquired has significant outstanding violations
of the Mobilehome Parks Act (Part 2.1 (commencing with Section
18200)) that threaten the long-term viability of the park and that
will be remedied by the purchaser.
(2) The department determines that the acquisition of the park
will have a substantial benefit to low- and moderate-income
homeowners and that the purchaser will maintain rents at levels
affordable to lower income households.
(c) (1) Any mobilehome park purchased by a local public entity
with a loan pursuant to this section shall be transferred to a
qualified nonprofit housing sponsor or to a resident organization
that plans to convert the park to resident ownership no later than
three years from the date of loan closing, with all obligations under
the loan assumed by the nonprofit organization or resident
organization.
(2) If a local public entity has made a good faith effort, but has
not been able, to transfer the park by the end of the three-year
period, the entity may apply to the department for an additional
three-year extension. Upon a determination by the department that the
local public entity has made a good faith effort to transfer the
park in accordance with paragraph (1), it shall have an additional
three years from the expiration date of the first three-year period
to consummate the transfer. The three-year extension shall only be
granted once by the department for each loan to a local public
entity.
(3) If a local public entity fails to make a good faith effort to
transfer the park within the first three-year period, as determined
by the department, or fails to transfer the park by the expiration
date of the extended three-year period, it shall repay the loan in
full to the department.
(d) All of the following shall apply to loans provided pursuant to
this section:
(1) Loans shall be for a term of no more than 40 years and shall
bear interest at a rate of 3 percent per annum unless the department
finds that a lower interest rate is necessary and will not jeopardize
the financial stability of the fund.
(2) The department may establish flexible repayment terms for
loans provided pursuant to this section if the terms do not represent
an unacceptable risk to the security of the fund.
(3) Loans shall be for the minimum amount necessary to bring the
park into compliance with all applicable health and safety standards
and to maintain the monthly housing costs of lower income residents
at an affordable level.
(4) The total secured debt in a superior position to the
department's loan plus the department's loan shall not exceed 115
percent of the value of the collateral securing the loan plus the
amount of costs incidentally, but directly, related to the
acquisition and rehabilitation of the park.
(e) In determining the eligibility for and amount of loans
pursuant to this section, the department shall take into
consideration, among other factors, all of the following:
(1) The current health and safety conditions in the park and the
likelihood that conditions would be remedied without the loan.
(2) The degree to which the loan will benefit lower income
homeowners.
(3) The age of the park and the age of the infrastructure that
will be rehabilitated with the loan proceeds.
(f) Before providing financing pursuant to this section, the
department shall require provision of, and approve, at least all of
the following:
(1) Verification that either no park residents shall be
involuntarily displaced as a result of the purchase or that the
impacts of the displacement shall be mitigated as required under
state and local law. For purposes of this requirement, compliance
with Section 66427.5 of the Government Code shall be conclusively
presumed to have mitigated economic displacement.
(2) Projected costs and sources of funds for all purchase and
rehabilitation activities.
(3) Projected operating budget for the park after the purchase.
(4) A management plan for the operation of the park.
SEC. 6. Section 50784.7 is added to the Health and Safety Code, to
read:
50784.7. (a) The department may make loans to resident
organizations or qualified nonprofit sponsors from the Mobilehome
Park Rehabilitation and Purchase Fund for the purpose of assisting
lower income homeowners to make needed repairs or
accessibility-related upgrades to their mobilehomes. Loans made
pursuant to these provisions shall meet both of the following
requirements:
(1) The applicant entity has received a loan or loans pursuant to
Section 50783, 50784, or 50784.5 for the purpose of assisting
homeowners within a park proposed for acquisition or conversion.
(2) The applicant entity demonstrates sufficient organizational
stability and capacity to manage a portfolio of individual loans over
an extended time period. This capacity may be demonstrated by
substantial successful experience performing similar activities or
through other means acceptable to the department.
(b) The department may adopt guidelines to implement this section.
SEC. 7. Section 50785 of the Health and Safety Code is amended to
read:
50785. (a) In determining the eligibility for and amount of loans
pursuant to this chapter, the department shall take into
consideration, among other factors, all of the following:
(1) The reasonableness of the conversion costs relating to
repairs, rehabilitation, construction, or other costs.
(2) Any administrative and security factors affecting the
department's program operation and administration.
(3) Whether or not the projects complement the implementation of a
local housing program to preserve or increase the supply of housing
for persons and families of low or moderate income.
(4) Whether or not state funds are utilized in the most efficient
and effective manner.
(5) In the case of a loan to a qualified nonprofit housing sponsor
or to a local public entity, evidence of resident participation in
the conversion and management of the park, in the form of either
resident participation on the board of directors of the entity that
acquires ownership of the park, or the establishment of, and
consultation with, a permanent resident advisory board.
(b) To the extent consistent with requests for assistance, the
department shall allocate funds available for the purposes of this
chapter throughout the state in accordance with identified housing
needs, including seeking to allocate not less than 20 percent to
rural areas.
SEC. 8. Section 50786 of the Health and Safety Code is amended to
read:
50786. (a) The department shall adopt regulations for the
administration and implementation of this chapter.
(b) The department shall obtain the best available security for
loans made pursuant to this chapter. The security may include a note,
deed of trust, assignment of lease, or other form of security on
real or personal property that the department determines is adequate
to protect the interests of the state. To the extent applicable,
these documents and any regulatory provisions shall be recorded or
referenced in a recorded document in the office of the county
recorder of the county in which the mobilehome park is located.
(c) The degree of continuing regulatory control with respect to
park operations and resident loans exercised by the department in
making loans pursuant to this chapter shall be commensurate with the
level of financial assistance provided and in all cases shall be
adequate to protect the state's security interest and ensure the
accomplishment of the purposes of the program authorized by this
chapter. The regulatory requirements shall be set forth in a
regulatory agreement, deed of trust, or other lien, and any violation
of these requirements shall be considered a violation of a security
document. If loans are made to a qualifying nonprofit housing sponsor
or local public entity, a regulatory agreement shall be recorded
against the mobilehome park. This regulatory agreement shall contain
provisions limiting occupancy, rents, and park operation for the
entire loan term. The department may release individual spaces from
the regulatory agreement only if they are purchased by residents who
occupy them.
(d) Before providing financing pursuant to Sections 50783 and
50784, the department shall require provision of, and approve, at
least all of the following:
(1) Verification at the time of application and prior to funding
that at least two-thirds of the households residing in the mobilehome
park support the plans for acquisition and conversion of the park.
(2) Verification that either no park residents shall be
involuntarily displaced as a result of the park conversion or the
impacts of the displacement shall be mitigated as required under
state and local law. For purposes of this requirement, compliance
with Section 66427.5 of the Government Code shall be conclusively
presumed to have mitigated economic displacement.
(3) Verification that the conversion is consistent with local
zoning and land use requirements, other applicable state and local
laws, and regulations and ordinances.
(4) Projected costs and sources of funds for all conversion
activities.
(5) Projected operating budget for the park during and after the
conversion.
(6) A management plan for the conversion and operation of the
park.
(7) If necessary, a relocation plan for residents not
participating that is in compliance with Chapter 16 (commencing with
Section 7260) of Division 7 of Title 1 of the Government Code.
(e) The department shall, to the greatest extent feasible, do all
of the following:
(1) Require participation by cities and counties in loan
applications submitted pursuant to this chapter.
(2) Contract with private lenders or local public entities to
provide program administration and to service loans made pursuant to
this chapter.
(3) Give priority to applications for resident-owned parks.
(f) The department may provide technical assistance to loan
applicants, or may contract with a qualified nonprofit entity to
provide that technical assistance, and may include the reasonable
costs of the technical assistance as a part of the loan principal.
SEC. 9. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to immediately increase the accessibility of funds to
mobilehome residents who suffer from unaffordable housing costs, it
is necessary that this bill go into immediate effect.
