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HomeMy WebLinkAbout2000-12-19 City Council Summary Minutes 12/19/00 91-264 Adjourned Meeting of December 18, 2000, To December 19, 2000 1. Vice Mayor Eakins and Council Members Burch, Kleinberg, and Ojakian re Emergency Mobile Home Rent Stabilization for Buena Vista Mobile Home Park ..........................................................26 5 ADJOURNMENT: The meeting adjourned at 7:15 p.m. in honor of Mayor Kniss who served on the Palo Alto City Council for the past ten years. ..........................................................27 1 12/19/00 91-265 The City Council of the City of Palo Alto met on this date in the Council Chambers at 6:10 p.m. PRESENT: Beecham, Burch, Eakins, Fazzino, Kleinberg, Kniss, Lytle, Mossar, Ojakian UNFINISHED BUSINESS 1. Vice Mayor Eakins and Council Members Burch, Kleinberg, and Ojakian re Emergency Mobile Home Rent Stabilization for Buena Vista Mobile Home Park City Attorney Ariel Calonne referred to his City Attorney Report dated December 19, 2000, which included two ordinances. The first ordinance was based on direction from the Council the previous evening and would establish a rent freeze effective up to and including May 1, 2001. Council Member Beecham said the second ordinance implemented an agreement, Exhibit A of the ordinance worked out earlier that day, between the City of Palo Alto and the owners of Buena Vista Mobile Home Park (the Park). On page 1, Paragraph A of the agreement under Background Information, reviewed the background of the Park. The current owners had owned the Park since 1986. They experienced dissolution of a partnership and a forced sale causing a reassessment of taxes which appeared to be the main catalyst for a rent increase proposal. Paragraph B discussed the Comprehensive Plan and how it recognized the importance of affordable housing. Paragraph C stated that the owners did notify the residents of the proposed rent increase. Paragraph D indicated the proposed rent increases had the potential to severely impact some of the residents in the Park. Paragraph E stated that the City did not prefer to regulate the economic relations between owners of parcels and owners of the individual mobile homes. The City did recognize that the preservation of affordable housing was an urgent requirement in the City. Paragraph F explained that the City and the owners reached an agreement to cooperate in the identification and development of several strategies for the long-term preservation of the Park as affordable housing. In addition, the owners voluntarily agreed to suspend and limit the previously noticed rent increases in order that the status quo could be maintained while the owners and the City studied other long-term preservation strategies. The owners agreed to a 5 percent limit on the rent increase beginning January 1, 2001, lasting no later than May 1, 2001. The owners agreed with the City that other strategies would be pursued for preserving the affordable housing. The strategies included considering the annual rent increases, taking into account adjustments for extraordinary expenses, and included the City’s developing housing subsidy programs, insuring that the City’s utilities rate payer assistance program was implemented, and looking for any state or federal voucher or subsidy program. Item 12/19/00 91-266 C of the Agreement under Long Term Strategies, addressed reviewing the City’s planning and zoning policies to develop cooperative strategies that would permit the owners a fair return on their investment while protecting the tenants of the Park. The form and contents of a park closure ordinance would also be considered, and the use of mediation between the owners and residents would be facilitated. Page 2, Item 3, an additional Assured Community Participation indicated the owners and the City would work through a special committee appointed by the Mayor and including individual mobile home owners and other community representatives. The committee would work to address community needs and concerns related to mediation and long term affordable housing preservation strategies. During discussions with the City Attorney, it was decided that the appropriate implementation of the agreement was by ordinance. Mayor Kniss suggested the Council might wish to move approval of the agreement subsequent to comments from Council Members. Mr. Jisser said he met with Council Member Beecham and the City Attorney and came up with what he believed the Council asked for the previous evening. Expenses had occurred since June. He felt a standard increase was appropriate to keep the status quo and give the owners a few months to discuss the issue with other Council Members and create ways to help the tenants. The Council Members made it clear that the burden should not fall on one private owner. He was an investor and was driven by profit but, at the same time, he had moral interest in taking care of tenants and the property. Nancy Powell, Attorney for Mr. Jisser, emphasized the need and the desire for the Park owners to receive communication. The way the entire procedure was handled from the beginning was bad. Notice of the rent increase was distributed approximately October 1, 2000 and the owners of the Park learned about a complaint regarding the rent when they read in the Palo Alto Daily News that a hearing would be held on December 18, 2000. That was not the proper way for the Council to communicate with property owners who were trying their best to be honorable citizens and take care of their tenants and property. Council Member Mossar said the agreement presented to the Council was a big step beyond what was discussed the previous night. She asked what would happen on May 1, 2001, if the City and interested parties were unable to agree upon acceptable strategies for preserving the Park as affordable housing. Mr. Calonne said the Council had the range of options directed the previous evening. Those options included the possibility that if a mediated process with Project Sentinel and others such as the Mayor’s committee did not work out, staff might return with a rent control ordinance. Section 2A, Long Term Strategies, considered appropriate rent increases. Conceivably, there could be an 12/19/00 91-267 agreement between the City and property owner such as a Section 8 agreement in which the issues could be worked out. He hoped that an agreement similar to Section 8 that called for preservation of all or part of the Park at certain income levels could be worked out. Council Member Mossar shared the City Attorney’s hope. She asked what would happen if there were no agreed strategies on May 1, 2001. Mr. Calonne said part of the prior meeting’s direction was to develop a park closure ordinance. The agreement recognized that the ordinance would be better if the City worked cooperatively with the Park owners and owners of mobile homes. The Council would see a closure ordinance by the ending of the agreement and would see a form of land use analysis that suggested regulatory land use strategies for keeping the Park a park. Council Member Mossar said staff needed to return to the Council on April 1,2001, for example, and state whether events were going well or were not. At that point, the Council should take the opportunity to discuss the options. The Council should be prepared to act when the ordinance lapsed on May 1, 2001. Otherwise, the Council would find itself in an emergency situation, of its own making. Council Member Beecham said there was a provision for community participation which included a committee appointed by the Mayor. He expected the Mayor would appoint one or two members of the Council to that committee. Council Member Mossar said the entire Council set the policy, and if the entire Council did not have the opportunity to establish policy in April for what might happen in May, the Council would find itself in an emergency situation. She requested that, as part of motion, staff be directed to agendize that on or about April 1, 2001 a status report of the negotiations. At that time, the Council could discuss alternative measures that might be needed. Council Member Lytle said she did not recall the Council’s consideration of an ordinance where the Council did not conduct a public hearing. Mayor Kniss said under usual circumstances, ordinances were not brought to the Council without public input. Mr. Calonne said the Council could hear public testimony if it wanted to, but there was no legal requirement. Mayor Kniss said she was not aware that the public had the opportunity to review the ordinance and make comments. 12/19/00 91-268 Council Member Fazzino said the reason the Council decided to move forward on the issue was that it was a logical extension of the prior evening’s actions. The Council established direction, and the City Attorney returned to the Council in response to that direction. A public hearing was not necessary because what the Council was being asked to consider at the present meeting was consistent with the direction established at the previous evening’s meeting. RECESS: 6:30 p.m. – 6:35 p.m. Council Member Kleinberg asked who the parties were to the negotiated agreement. Mr. Calonne said there was no agreement but rather a draft of a proposal as an alternative to the direction to him to prepare a rent freeze ordinance. The Council’s direction at the previous evening’s meeting was to prepare an ordinance freezing rents until May 1, 2001. In addition, he understood the Council directed staff to meet with the Park representatives. That was done earlier in the day, and the result of that discussion was an alternative ordinance that was presently before the Council. Council Member Kleinberg clarified the agreement still had to be brought forth to the mobile home owners for acceptance. Mr. Calonne said no. Council Member Kleinberg clarified what was before the Council was the mobile home Park owner’s agreement to do a 5 percent rent increase. Mr. Calonne said that was correct, and it established a framework for implementing the direction of the previous evening. Council Member Kleinberg asked whether the Council, when adopting the proposed alternate ordinance, became party to all of the terms of the agreement. Many terms in the ordinance appeared vague. She asked why the Council needed an ordinance adopting the agreement if, in fact, the existing motion from the previous evening asked for the Park owner and the residents to enter into an agreement, and the offer by the owner was the basis for a proposed agreement between the owner and the tenants. Mr. Calonne said the ordinance was a means of assuring enforcement of the owner’s promises. He felt that was a concern. The agreement consisted of two basic components: 1) an agreement backed up by the ordinance to limit rent increases to 5 percent of the rent existing at the current time, which amounted to an 80 percent reduction against the proposed rent increase; and 2) the establishment of a process for the City to communicate with the Park owner and the mobile home owners during the ensuing four months. He appreciated 12/19/00 91-269 the Council’s sensitivity concerning the short notice. Vice Mayor Eakins supported the 5 percent solution. Council Member Lytle appreciated the members of the community who spoke about the issue and commended the courage and decisiveness with which her colleagues initiated the emergency regulation. She appreciated the extra effort made to reach the negotiated settlement. She was sad about the manner in which the Council explained what it was likely to adopt at the present meeting. She was unsure how much revenue Mr. Jisser would lose by the Council’s action and whether the action was temporary. Mr. Jisser and his representatives were not allowed to make their case at the previous evening’s meeting. The balance and respect that was usually shown for all parties in such a situation was not shown for the Jissers. She did not recall Palo Alto regulation being threatened or imposed on a property owner that reduced that owner’s income permanently without notice and full public airing. Council Member Burch said there was reason for urgency. He recalled the homeowners came to the Council about an urgent situation facing a 25 percent increase that could threaten the homeowners’ ability to stay in their homes. The Council responded to that. He would be surprised if the homeowners of the units in the Park were not happy with the concept of a 5 percent increase beginning January 1, 2001, which gave the Council four or five months to take a more reasonable look at the issue. He supported the ordinance and appreciated the owners’ reasonable goodwill offer in order to give the Council time to explore other possibilities. Council Member Mossar acknowledged concerns about the process. What was before the Council at the present meeting was exactly what the Council requested. The ordinance was an alternative to which the property owner agreed rather than an alternative that the Council chose to impose. The purpose of the ordinance was to buy time in order to make sure the Council could protect an affordable housing resource in the community. In the process of doing that, the Council needed to work out with all parties an effective strategy for preserving that affordable housing. The Council was not adopting the ordinance in order to enforce rent control, begin a practice of rent control or regulating property owners. She encouraged her colleagues to speak out if they disagreed with the ordinance. Council Member Kleinberg clarified the action taken was not a settlement agreement but was a voluntarily offered rent freeze. She thanked the Jissers for their willingness to help the residents. MOTION: Council Member Beecham moved, seconded by Ojakian, to adopt the ordinance, approve Exhibit “A” of the City Attorney’s Report dated December 19, 2000, and have staff return no later than April 12/19/00 91-270 1, 2001, with the status report of the negotiations. Ordinance 4672 entitled “Ordinance of the Council of the City of Palo Alto Approving the Buena Vista Mobilehome Park Affordable Housing Preservation Strategy and a Voluntary 5% Cap on Rent Increases for Mobilehome Park Spaces at the Buena Vista Mobilehome Park and Declaring the Urgency Thereof, to Take Effect Immediately” Council Member Beecham said he was impressed with the Jisser’s clarity of involvement and willingness to exhibit the goodwill that the Council sought. Council Member Fazzino supported the motion and echoed what was said by some of his colleagues about the willingness of the Jissers and their attorney to address the issue. The issue emerged due to the tenants’ concerns about the possibility of losing their homes. Constituents contacted the Council and the issue was placed before the Council. In the future, it was important that all stakeholders involved in an issue were brought into the process prior to the issue’s being placed on the agenda. Two goals for the City were: 1) to preserve affordable housing; and 2) to protect those who were unable to deal with rapidly rising rents and costs of living in Palo Alto. He hoped a solution would be in place by April so additional action would not have to be taken. He had not supported rent control and did not think that was a legitimate course of action. Other actions could be taken to address those who were truly needy. Mayor Kniss said the rent issue in the Bay Area was critical, and she heard murmurs of rent control throughout the County. A warning should be given to anyone who raised rents at too rapid a rate. She had great trust in the rest of the Council who would continue to protect affordable housing in such a way as to allow it to go forward. Council Member Kleinberg said a statement was made at the previous evening’s meeting by a representative of Mr. Jisser that there would be no increases for hardship cases at the Park. She was concerned that the Council had not heard from the tenants as to whether or not any had a hardship and were unable to meet the 5 percent. She asked whether there was any discussion earlier in the day to verify that everyone could meet the 5 percent increase. Council Member Beecham said general discussion was held, and the owner expressed concern. No position was taken. Council Member Kleinberg was concerned that those on fixed incomes might not be able to pay the increase. Mr. Calonne said the newspaper accounts reported that tenant representatives indicated a 7 percent increase was acceptable. 12/19/00 91-271 Council Member Ojakian said the agreement set a framework for a result that benefited all parties involved. The situation was unique as it involved the only mobile home park in the City. Vice Mayor Eakins thanked everyone who participated in the issue. She respected all the comments made by Council Members. MOTION PASSED 9-0. City Manager Frank Benest said in respect to those people who might have difficulty meeting the 5 percent, he would work with staff to expedite the utility rebate portion of the program which would provide some relief to minimize the rent increase. He commended the City Attorney who worked under very tight timelines. Mayor Kniss said there were County resources to use in such emergencies. ADJOURNMENT: The meeting adjourned at 7:15 p.m. in honor of Mayor Kniss who served on the Palo Alto City Council for the past ten years. ATTEST: APPROVED: ______________________________ ______________________________ City Clerk Mayor NOTE: Sense minutes (synopsis) are prepared in accordance with Palo Alto Municipal Code Sections 2.04.180(a) and (b). The City Council and Standing Committee meeting tapes are made solely for the purpose of facilitating the preparation of the minutes of the meetings. City Council and Standing Committee meeting tapes are recycled 90 days from the date of the meeting. The tapes are available for members of the public to listen to during regular office hours.