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2015-05-26 City Council Agenda Packet
CITY OF PALO ALTO CITY COUNCIL May 26, 2015 Special Meeting Council Chambers 5:00 PM Agenda posted according to PAMC Section 2.04.070. Supporting materials are available in the Council Chambers on the Thursday preceding the meeting. PUBLIC COMMENT Members of the public may speak to agendized items; up to three minutes per speaker, to be determined by the presiding officer. If you wish to address the Council on any issue that is on this agenda, please complete a speaker request card located on the table at the entrance to the Council Chambers, and deliver it to the City Clerk prior to discussion of the item. You are not required to give your name on the speaker card in order to speak to the Council, but it is very helpful. HEARINGS REQUIRED BY LAW Applicants and/or appellants may have up to ten minutes at the outset of the public discussion to make their remarks and up to three minutes for concluding remarks after other members of the public have spoken. Call to Order Oral Communications Members of the public may speak to any item NOT on the agenda. Council reserves the right to limit the duration of Oral Communications period to 30 minutes. Action Items Include: Reports of Committees/Commissions, Ordinances and Resolutions, Public Hearings, Reports of Officials, Unfinished Business and Council Matters. 1.Adoption of Findings and Final Decision in the Matter of the Appeal by the Buena Vista Mobilehome Park Residents Association of the Hearing Officer’s Decision Approving the Application for Closure of the Buena Vista Mobilehome Park and Establishing Mitigation Measures and Additional Conditions of Approval Adjournment AMERICANS WITH DISABILITY ACT (ADA) Persons with disabilities who require auxiliary aids or services in using City facilities, services or programs or who would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact (650) 329-2550 (Voice) 24 hours in advance. 1 May 26, 2015 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. City Attorney Letter Buena Vista Meeting - April 13, 2015 - Vol. 1 Buena Vista Meeting - April 14, 2015 - Vol. 2 Residents Association's Response Draft Findings April 22, 2015 Letter from M. Stump October 26, 2012 Letter from N. Tuttle May 22, 2015 Letter from James Brabant Additional Information Standing Committee Meetings Sp. Finance Committee Meeting May 26, 2015 Sp. City Council Meeting May 27, 2015 Comprehensive Plan Summit May 30, 2015 Schedule of Meetings Schedule of Meetings Tentative Agenda Tentative Agenda Public Letters to Council Set 1 Set 2 Set 3 Set 4 Set 5 2 May 26, 2015 MATERIALS RELATED TO AN ITEM ON THIS AGENDA SUBMITTED TO THE CITY COUNCIL AFTER DISTRIBUTION OF THE AGENDA PACKET ARE AVAILABLE FOR PUBLIC INSPECTION IN THE CITY CLERK’S OFFICE AT PALO ALTO CITY HALL, 250 HAMILTON AVE. DURING NORMAL BUSINESS HOURS. CITY OF PALO ALTO OFFICE OF THE CITY ATTORNEY May 26, 2015 The Honorable City Council Palo Alto, California Adoption of Findings and Final Decision in the Matter of the Appeal by the Buena Vista Mobilehome Park Residents Association of the Hearing Officer’s Decision Approving the Application for Closure of the Buena Vista Mobilehome Park and Establishing Mitigation Measures and Additional Conditions of Approval Recommendation Adopt written Findings and a statement of Final Decision, as attached and as may be revised by the Council. Discussion On April 13 and 14, 2015, the Council heard testimony and argument and received written argument and evidence in the matter of the appeal by the Buena Vista Mobilehome Park Residents Association of the Hearing Officer’s Decision regarding the park owner’s application to close the park [Attachment A]. The Council had before it the three-volume record of proceedings before the Hearing Officer, which the parties jointly agreed included all relevant documents constituting the administrative record through the date of preparation, February 25, 2015. (The record is voluminous and is not attached here. The record is available for public review at the City Clerk’s Office and the City’s public libraries.). On April 14, 2015, the Council voted unanimously to deny the appeal and approve the closure application with certain modifications to the Hearing Officer’s Decision, subject to adoption of written Findings and a statement of Final Decision in the matter [Attachment B]. The Council endorsed the Hearing Officer’s order that the owner update two key items within the mitigation package – (a) the appraisals of the on-site fair market value of each mobile home or residential unit; and (b) a market survey of average apartment rents in the cities surrounding Palo Alto and average space rents in the Buena Vista Mobilehome Park – and directed that three changes be made to the procedures and mitigations ordered by the Hearing Officer: First, the Council rejected the Hearing Officer’s determination that the one-year rent subsidy and start-up costs be calculated based on the difference between the Buena Vista site rent and the average cost of an apartment in the surrounding communities that contains the same number of bedrooms as the legally allowed number of bedrooms in the resident’s unit at Buena Vista, typically one. Instead, the Council directed that where the Buena Vista unit contained one legally allowed bedroom, but in fact currently contained more than one bedroom as a result of permitted or unpermitted additions, and where three or more people reside in the unit at the time the closure order Page 2 becomes effective, the owner must calculate the rent subsidy and start-up costs based on a comparison with the average cost of a two-bedroom apartment in the surrounding communities. Second, the Council inquired of the appraiser whether an appraisal methodology exists to identify and calculate valuation related to the quality of local public schools and the public safety characteristics of the community. At the hearing, appraiser Beccaria stated that subject to consultations with professional colleagues on this question, he believed that such a methodology could be developed. The Council sought Mr. Beccaria’s recommendation on the wording of this part of the motion. Adopting the specific wording recommended by Mr. Beccaria, the Council directed that “the appraiser will revise the scope of work to include safety and schools.” Third, the Council established a procedure for disputes regarding the updates to the appraisals and market survey to be reviewed by the Hearing Officer. The Council defined the Hearing Officer’s discretion and delegated final decision making authority within defined parameters to the Hearing Officer. On May 5, 2015, the Council received correspondence from appraiser David Beccaria of Beccaria & Weber, Inc. [Attachment C]. Mr. Beccaria opined that on further study and review, he has concluded that the existing appraisal methodology incorporates all elements of neighborhood location, including public schools and safety, and that no change should be made to the scope of work. On May 12, 2015, the Residents Association submitted correspondence responding to Mr. Beccaria’s correspondence [Attachment D]. The Association asks the City to order the owner to retain a new appraiser to perform appraisals consistent with the Council’s May 14th direction, and submit a revised Relocation Information Report. The matter returns to Council for adoption of written Findings and a statement of Final Decision. A draft Findings and statement of Final Decision is attached for Council’s consideration [Attachment E]. The Findings and statement of Final Decision reflect Council’s determination with one exception: because Mr. Beccaria concluded that revising the scope of work to include public schools and safety is unnecessary and inappropriate, the draft does not include Council’s preliminary direction that Mr. Beccaria complete the appraisal updates using that revised scope. The Council could adopt the findings as drafted, meaning that the updated appraisals would be performed by Mr. Beccaria’s firm using the methodology and scope of work described in the RIR. Staff is researching and will advise Council at the meeting on May 26th whether there are other alternatives that would address Council’s concern to ensure that the updated appraisals are complete and accurate, and in particular that the in-place value of the Buena Vista units reflect all the attributes of the community location, including public schools and safety. Page 3 Environmental Review The discretionary determination before the City – whether the mitigation measures proposed by the park owner, together with additional conditions ordered by the independent Hearing Officer and the City Council, are adequate to mitigate the adverse impacts of park closure on the displaced residents, provided that those conditions do not exceed the reasonable costs of relocation – will not in and of itself have physical environmental impacts and does not constitute a “project” under CEQA (State CEQA Guidelines 15378) when there is no related decision that would result in reuse or redevelopment of the property. Under state and local law, the City is obligated to approve the closure of the mobilehome park contingent on adequate mitigation measures to be provided to the individual park residents. The City also must analyze the impacts of any proposal for reuse or redevelopment of the property unless that proposal is statutorily exempt from review. At this time, the property owner has expressed a general desire to “replace the 117 unit Buena Vista Mobilehome Park (approximately 5 acres) with a new, well designed infill apartment home community” setting aside approximately 0.5 acre “for future development” (RIR p. 26), but has not made a specific proposal for development that can be analyzed under CEQA. The City is aware through media reports and public documents produced by Santa Clara County that the County Board of Supervisors has partnered with a non-profit organization which is seeking to purchase the site and perpetuate its current use. Whatever is ultimately proposed for the site by the current property owner or a subsequent property owner will require environmental review under to CEQA, however, at present it would be speculative to identify specific uses or impacts. It would also be speculative to identify off-site impacts of the displacement that may occur without knowing where and when current tenants will relocate. Finally, the focus of the determination that is currently before the City is on financial matters, which are not generally considered under CEQA, and the general rule in CEQA Guidelines Section 15061(b)(3) is applicable, since it can be seen with certainty that there is no possibility that the City’s decision on the adequacy of mitigation may have a significant effect on the environment. ATTACHMENTS: Attachment1.a: Attachment A: Staff Report and Attachments 4/13/15 (PDF) Attachment1.b: Attachment B: Action Minutes 4/14/15 (PDF) Attachment1.c: Attachment C: David Beccaria correspondence dated 5/5/15 (PDF) Attachment1.d: Attachment D: Residents Association Correspondence dated 5/12/15 (PDF) Attachment1.e: Attachment E - Buena Vista Draft Findings and Statement of Final Decision (PDF) Attachment1.f: Attachment F - Letters to Council (PDF) Department Head: Molly Stump, City Attorney Page 4 ^P City of PaloAlto Office of The City Attorney CITY OF PALO ALTO April 13,2015 The Honorable City Council Palo Alto,California Hearing on Buena Vista Mobilehome Park Residents Association's Appeal of Hearing Officer's Decision Relating to Mitigation Measures Proposed by Buena Vista Mobilehome Park Owner in Connection with Mobilehome Park Closure Application Attached is a letter dated March 30, 2015 from City Attorney,Molly Stump,outlining the information regarding this agenda item.On February 25, 2015 the City Attorney's Office distributed Volumes 1, 2 and 3 of materials that constitute the administrative record on appeal to the Council regarding this matter. The document pertaining to the appeal procedures to be followed by the Council at the hearing is also attached. This hearing is scheduled to be considered by the Council on Monday,April 13,2015,and if the matter is not concluded on that day,the hearing will be continued to Tuesday,April 14,2015, as needed. ATTACHMENTS: • A:Buena Vista Letter (PDF) • B: BVMHP Appeal Procedures v2 (PDF) Department Head:Molly Stump,City Attorney ATTACHMENT A 0 OFFICE OF THE CITY ATTORNEY CITY OF 250 Hamilton Avenue,8th Floor PALO Palo Alto,CA 94301 ALTO 650.329.2171 March 30,2015 THE HONORABLE CITYCOUNCIL Palo Alto, California Re:Buena Vista Mobilehome Park Dear Members ofthe Council: On April 13and 14,the City Council isscheduled to hear the appeal of the HearingOfficer's decision regarding the adequacy of mitigation measures related to the closure ofthe Buena VistaMobile Home Park.This letter addresses certain pre-hearing matters. Please find attached the pre-hearingstatements submitted bythe Park Owner and the Residents'Association(ExhibitA),as wellas additional correspondence regarding the appeal procedures (Exhibit B). The Residents'Association seeks to add twotypes ofnew evidence to the record in this matter: recent real estate listingsand an "Appraisal ReviewReport"commenting on the Beccaria & Weber appraisals that are part of the RelocationImpact Report. (Seecover letter and proposed new material,ExhibitC.) The Park owner objects that the proffered new material does not meet the standard set forth in the Council's appeal procedures,and is more prejudicial than probative. (See letter,Exhibit D.) This proceedingisconvenedto implement the City's responsibilities under Chapter9.76ofthe Municipal Codewith appropriate notice,opportunityto be heard and fairness to all parties.The Council'sappeal procedures provide that newlydiscovered and relevant evidence may be allowed where a party demonstrates that the evidence could not have been discovered using reasonable diligence duringthe proceedingbefore the Hearing Officer.Theprocedures also state they are general guidelines that may be modifiedas appropriate. We note that the Residents Associations'new material relates to mattersthat the Hearing Officerrecommended be updated within 6 months of residents'relocation from Buena Vista: (a)the appraisalsof the mobilehomesand other living unitsat BuenaVista;and (b)the costof comparable housingfor purposes of calculating rent differentialsand start-up costs. Ifthe Council approvesthe Hearing Officer's recommendation that updates be made,these topics will be subject to further analysisand maybe be revisedas appropriate.Inlightof the potential for this additional review,the Park owner's objections appearto go to the weight thatshould 150336lh 0140132 THE HONORABLE CITY COUNCIL March 30,2015 Page2 of2 Re:Buena Vista Mobilehome Park be given tothe material provided by the Residents Association,ratherthan to the appropriatenessofincluding itinthe record of these proceedings.We recommend that the Residents'Associations'material be made apartofthe record.Council mayconsider the Information or direct the experts performing the updates to doso,giving itthe weight-Ifany- that it isdue. The Park owner, however, must be givenanopportunityto respondto this material.Accordingly,the Park owner may providerebuttal evidence or comments,if desired, no laterthan April 6.The Park owner's responsive letter of March 25 Isalreadya part ofthe record and need not be repeated. In addition,the ResidentsAssociation hasindicatedanintention to exercisethe option Council provided to bringonewitness to make a statement or no more than 10 minutes.The Park Owner has stated it does not intend atthis time to bringawitness, but hasasked that the Residents'Association disclose the identityoftheirwitness. We agreethat this is fair and appropriate.No later than April6,the Residents'Association shall inform the Council and the Park Ownerof the identityof itswitness,provide a general description ofthe natureofthe witnesses intended statement,and provideacopy ofanywritten assessment or commentsthat the witness intends to offer. Finally,during theweekof April 6,thisoffice will provide additional guidance to the parties and the public regarding the orderof presentations atthe April 13hearing.PowerPoint presentations andother visual aids should be provided to the Clerk's Office the morning ofthe 13th,so that they can be loaded and tested in advance ofthe meeting. Very truly yours, MOLLYS.STUMP City Attorney MSS:sh Attachments cc: Margaret EckerNanda,Esq. NadiaAziz, Esq. James Zahradka, Esq. James Keene,City Manager Hillary Gitelman,Director of Planning andCommunity Environment Grant (tolling,Senior Assistant City Attorney Beth Minor,InterimCityClerk 150336 sh 0140132 EXHIBIT A APPLICANTSPRE-HEARING STATEMENT The Toufic Jisser Family,the Ownerofthe BuenaVista Mobilehome Park locatedat 3980 El CaminoReaI in Palo Alto submits this Pre-Hearing Statement in opposition to the Buena Vista MHP Residents Association appeal of the decision of Craig Labadie,Hearing Officer, dated September 30, 2014 in the matter ofthe closureofthe BuenaVista Mobilehome Park (Volume 2, Attachment 151).TheTouficJisser family has owned BuenaVista Mobilehome Park(hereinafter BuenaVista or the Park)since 1986. Buena Vista hasa mobilehome parkoperating permitwith the State of California,Departmentof Housing and Community Development for104 mobilehomespaces. Ofthose 104spaces there are98occupiedspaces. In additiontothe mobilehomespacesthere aretwelve (12)studioapartments,whichwere originally part of a motel which existed on the property when it was operated In combination with a transient trailer park.Finally there Is asinglefamilyhome onthe park,a portionofwhichhouses the Park Office.The Park is89 years old havingbegun as a "tourist camp" in 1926 (Volume 1, Attachment 3, Section l.C).The propertyowned bythe Jisser family includes the Park andthe propertywhichisimmediately In front of the Park along El Camino Real whichcontains retail storesanda gas station,approximately 6.1acres. Palo Alto Municipal Cede.Chanter 9.76.Mobilehome ParkConversion MunicipalCode Chapter 9.76,Mobilehome Park Conversion (hereinafter "the ConversionOrdinance" or "Ordinance"was enacted in 2001 after the City Council enacted an Urgency Ordinance in 2000 to temporarily freeze the amount of a noticed rent increase by the Park Owner to the tenants. The Ordinancecontains two parts,firsta processand procedure forclosureof the Park contained In Sections 9.76.010through 9.76.110and the second portioncontainsa limiton allowable rent Increases (Section 9.76.120 through 9.76.110). There Is a detailed discussion regarding the enactment of the Ordinance contained In Volume1,Attachment8,Part A,Section 1,pages 7to 13ofthe record on appeal.In addition the record on appealcontainsthe minutes of the various city council meetingsinwhichthe Ordinance was discussed and then enacted. (SeeVolume 2, Attachment 11,Tabs 5 through 10).Several facts howeverareconfirmedbyanexamination ofthe historyofthe enactment ofthe Ordinance. 1.Council Member Bern Beecham statedthatthe useful life ofthe Park wasreasonably short, thereafter mentioning ten years.TheAssistant City Attorney,Ariel Calonne acknowledged intheApril 30, 2001meetingandthe May14,2001council hearings that extending the usefullifeof the park forten years reflected the Council's goal and could be achieved bya Long Term Preservation Strategy between the City andthe ownersofthe Park,also referred to asa "Development Agreement." 2. After enactment of theOrdinanceon a 5 to 4 vote,no further efforts were ever undertaken by any memberof the City Staffandthe Park Owner to reach a Development or other Agreement regarding the preservation of Buena Vista asa mobilehome Park.Despite a suggestion tothe contrary bytheattorneys for theResidents Association2,the Park Owner has never received any property taxoranyotherbenefitfromthe City of Palo Altofollowing enactmentofthe Ordinance. ParkC(psure Proc^i Thirty-one months ago,In September 2012 the Park Owner sentalettertothe tenants advising themthat itwas considering closing the Park and converting It to another use (Volume 1,Attachment 3,Appendix 7).On November 9,2012 the Jisser family filed a Development Review Application withthe City of Palo AltoforaMobilehome Park Conversion pursuant to Municipal Code Chapter 9.76 (Volume 1,Attachment 1References toVolumes and Attachments are those identified and listed in theAttachments oftheAppeal ofFinal Decision ofthe Hearing Officer In rethe Matter of Application ofToufic Jisser,Trustee oftheJisser Family Trust,for Closure ofthe Buena Vista Mobilehome Park,Palo Alto,California compiled bySenior Assistant City Attorney,Grant Rolling,andasamendedinhis February 62015email to counsel forthe parties. 2SeeVolume 1,Attachment 8,Part A,Section 1,pages 13and14. 3,Appendix 3).Initial Informational meetings withthe tenantswereheldon December 11and12,2012. (Volume 1,Attachment 3,Appendix 10).City staff approved the Housing Relocation Specialist,David Richman of Autotemp pursuant to Section 976.030 (m)of the Ordinance.The Park Owner was also required to chose anappraiser from a list supplied bythe City (Section 9.76.030 (d) (5)(tv))to appraise the homes In the Park at Its cost. The Park Ownerselectedthe firm of Beccaria &Weber,Inc.,which conductedon site interior andexterior inspections of eachhome in early2013,followed by a written appraisal report of each homeinthe Park.Copies ofthe residents'appraisals were personally servedon each resident In April 2013.In May 2013 the first draftof the Relocation Impact Report (RIR)was submitted to the City,which included electronic copies of the appraisals for all of the Park homes. Subsequently,overa period often monthsthe Park Owner,atthe City'swrittenrequest amended the RIR four more times, and the Cityfound that the Fifth Amended RIR met the requirements ofthe Ordinance andthe Park Owner's application wasdeemedcomplete.(Municipal Code Section 9.76.040 (a)).Volume 1,Attachment 6, Tabs8through 13 containthe Law Foundation's written opposition to eachversion of the RIR,thuseachofthe Residents Association's perceived deficiencies inthe RIR were considered bythe CityAttorney prior to Its ultimate approval of the RIR In February 2014.Pursuant to Municipal Code Section9.76.040,subsection (f)the Citymust select a qualified hearingofficer. TheCity Attorney,withoutconsultation with,orinputfrom the Park OwneroritsattorneyselectedCraig Labadie,aformercityattorneyforthe CityofWalnutCreekasthe Hearing Officer.Pursuant to subsection (g)ofMunicipal CodeSection9.76.040,the hearingofficershallapprovethe application on the condition thatthe mitigation measures proposed bythe park ownerareadequateto mitigate the adverse impacts onthe displaced residents,andmaycondition the approval on additional conditions.Craig Labadie held three publichearings regarding the application for closureon May 12,13 and 14, 2014 at the Avenldas Senior Center In Palo Alto. As Council can observe through watching the city's videotape of the proceedings,orread In the transcript ofthe proceedings,(Volume 3,Attachment19)testimonywasgiven by the Residents'Association experts andany ofthe residentswho wished to speak, aswellas members ofthe public.In addition the Residents Association submitted written statements by residents unwilling or unable totestify publicly,seeVolume 1,Attachment 6,Tab14. Atthe 3rd hearing on May 14,2014the Park Owner presented awritten amendment to the RIR.(Volume 1,Attachment8,Tab2).Specifically the Park Ownerpresented a letterto the Hearing Officer amending the mitigation assistance offered in the RIR to include an updated appraisalof the resident's homes to reflectwhatwasrepeatedinthe tenant'stestimonyatthe hearings,specifically thatthe appraised values of their homes were too low. Secondly the mitigation assistance was amended to offer a 10096 rent subsidy, or a payment of 10096 ofthe difference between the resident's rent at BuenaVista and the rent at the resident's new housing. The ResidentsAssociationopposed the amendment and requested that the Hearing Officerfindamongother thingsthat the hearing process wasvoidand that anentirely new hearing process on the amended RIR was required. (Volume 1,Attachment 8, Tab 3). The ParkOwner responded atlength (Volume 1,Attachment8,Tab4)andinaletterto all counsel on May 23,2014,Craig Labadie found that the,"hearing process remains legally valid and can continue forward,subject to reasonable adjustmentsto the post-hearing scheduleif necessary to allowa full and fairopportunityfor the presentation ofadditionalevidence and arguments by both parties."(Volume 1,Attachment 8, Tab 4). The Residents Association did not request any adjustments to the post hearingschedule, norsubmit any additional evidence but did argue again in its Post Hearing Brief and Attachments (Volume 2, Attachment 9)thatthe Hearing Officershould not have allowedthe Park Owner to amend the RIR.The Park Owner submitted a ReplyBriefto the Hearing Officeron July 23,2014 (Volume 2,Attachment 10) and on August 27,2014the HearingOfficerissued hisTentative Decisionfinding that the ParkOwner had met its burden of proof that the mitigation measures offered did meet the criteria of the City's MobilehomeParkConversion Ordinance.(Volume2,Attachment12).TheResidentsAssociation opposed the Hearing Officer'sTentative Decision.(Volume2,Attachment 14). The Hearing Officerissuedhis Final Decision,25 pages in length, on September30,2014 findingthat *After carefulconsideration of allthe Information presented,my ultimate conclusion isthat the park owner has met its burden of proofby proposing a package of mitigation measures which,taken as a whole and with certain supplemental conditions, do meet the criteria set forth in the Ot/s Mobilehome ParkConversion Ordinance for mandatory approval of the application to close the Buena Vista Mobilehome Park."(Volume 2, Attachment 15, page2; emphasis supplied).The Park Owner filed a certificate of acceptance of the conditions of approval pursuant to Municipal Code Section 9.76.050 by letter to Hilary Gitelman on October 3,2014.(Volume2,Attachment 11,Tab1).OnOctober 14,2014,the Residents Association filed anappealofthe Hearing Officer'sdecision.(Volume2, Attachment 15). PartiestotheAppeal. Despite requests to the cityattorney bythe Park Owner thatthe appeal be heard earlier,the City took approximately 90days from the filing oftheappeal bythe Residents Association to conduct ahearing on January 12,2015 to determine the procedures forthe appeal.The City Attorney proposed the hearing be conducted in February butcounsel forthe Residents Association argued the hearing be held sometimein early April inorder for both the City Council and all parties to amply prepare.3 The hearings onthe Appeal were subsequently scheduled bythe City Attorney's office,after discussion with counsel for both parties for April 13,2015 and April 14,2015,which also scheduled May4,2015 asthe date forthe Council to adopt itsdecision perSection 3.a.ofthe Appeal Procedures.Per Section 2d.ofthe Appeal Procedures, "The parties to the proceeding arethe Park ownerandthe residents,tenants andlegal owners of the mobilehomes In the Park."(Emphasis supplied).Byany reading of this language it is clear that the residents ofthe studioapartments arenot parties tothis appeal sincetheyarenot residents,tenantsor legal owners of mobilehomes in the Park.The sentence does notstate that residents ortenants living In the Park are included as parties inthe appeal,butrather thatthe residents,tenants orlegal owners of mobilehomes In the Park are parties. The City also did not state that all members of the Residents Association areparties tothe appeal,anissuewhich wasextensively discussed bycounsel forboth parties, and addressed prior to the January 12,2015 hearing by counsel for both parties.(See Volume 2, Attachment 11,Tab 2,Tab 3,Tab 4andTab 5,andVolume 2,Attachment 18.)The Park Owner confirms itscontinuing position thatthe issueof standing to appeal the Hearing officer isajurisdictional issuewhich has In noway been waived bythe Park Owner.The Cit/s decision of January 12,2015 to allow the Residents Association to appeal on behalf of non-members ofthe Association,as well asto appeal on behalf ofitsIndividual members whenthe relief sought,specifically the amount of mitigation assistance isspecific asto eachmember,andthereforenot permitted underapplicable law is reversible error. Burden ofproof. Although it Is the Residents Association who filed the appeal,pursuant to Municipal Code Section 9.76.040(g),thePark Owner,as theApplicant,bears theburden of proof.The standard of proof Is "by a preponderance oftheevidence."As noted bytheHearing Officer in his decision,both parties extensively discussed in their respective post-hearing briefs how the burden of proof should be applied,butthe Hearing Officer noted thatboth parties appeared to besaying the same thing,which was,To approve theconversion application,thehearing officer mustweigh alltheevidence and concludethat theapproval criteria In Section 9.76.040(g)have been met,i.e.,thatthemitigation measures proposed bythe applicant, as supplemented bythe hearing officer are adequate to mitigate theadverse Impacts of park closure on 'Nadia Aziz,Law Foundation ofSilicon Valley,page 22,lines 11 through 14,from the transcript ofCity ofPalo Alto City Council Meeting,January 12,2015,prepared by Robin Pendergraft,CSR-895L the displaced residents." (Volume 2,Attachment 15, page8, fn. 6). The traditional rules of evidence do not apply inadministrativehearings. The Mitigation Assistance fallows the Ordinance; The Park Ownerhasagreed to payto each park resident4: 1. An amount equal to 10096 ofthe on-site fair market value ofeach mobilehome,as determined by Becccarla &Weber,Inc.accordingto the methodology used initsApril 2013 appraisal reports. The appraisalsshall be updated to reflect current market conditions within six months ofthe owner's relocation from the Park. 2. A lump sum amount equalto 10096 of the differential between averagerents for apartments in the cities surrounding Palo Alto5 andthe average spacerentsInthe Buena Vista Mobilehome Park for a periodof12 months,which shallbe updated to reflect current market conditions within six months of the resident's relocation from BuenaVista.In additionthe Park Ownerwillpay for "start-upcosts", meaningfirstand lastmonth's rent plussecuritydeposit in an amount equal to three times theaverage apartment rent. 3. Actual,reasonablemovingcosts forrelocating allpersonalpropertyforeach mobilehomeowner; AND Actual,reasonable expensesfora minimum overnight stayoftwo nightsinahotel/motel during the movingprocess. The appropriatelevelof these expenses willbe determined by the Housing RelocationSpecialist. 4.Additional AssistanceforHandicapped/Disabled Residents including but not limitedto: (a)help with packingor other physicaltasks that the resident cannot do without assistance;and (b)the cost of replacing anyspecialequipmentthat Isnecessitated y the resident's disability but cannot be moved. The appropriate amount of these payments will be determined by the Housing RelocationSpecialistif not agreed by the affected parties.(See Volume 2,Attachment 15, Exhibit A, pp 24-25). DetailsofMitigation Assistance Asstatedinthe 5th Amended RIR,theaverage appraised value ofahomeat Buena Vista was,In April 2013, $18,816.00(Volume1,Attachment 3,Section 19,page55). Perthe express language oftheOrdinancein Section 9.76.030(d)(5(iv)the Park Owner will paythe value the mobilehome would have ifthe parkwere not beingclosed,whichanotherwayof saying the home's onsite marketvalue.Further the Park Owner hasagreedto haveeach home re-appraised to reflectcurrent market conditionswithin six months ofthe mobilehome owner's relocation from the Park.The Residents Association argued at thetime the RIR was being prepared,aswell asat the publichearingsinMay2014thatthe appraisalswere toolowand didnot adequatelytake into accountthe factthat the homesarelocatedIn Palo Alto.Please review,Exhibit A, page 10ofthisdocument foranapproximation of relocation benefitsto be received on average. The Resident's Associations negative criticisms about the Appraisals are without merit because the appraisalsare accurate andwere completedbv an unbiased qualified party. The Resident's Association made repeated claims each time aversion ofthe RIR was submitted to the City5,and at the May2014 hearingsthatthe appraisals ofthe residents' homes aretoo low. However, 4 "Resident is defined under Municipal Code Section 9.76.020 subsection (h) as the registered owner of a mobilehome who resides in the mobilehome. sAsdiscussed and presented throughout the variousversionsofthe RIR,the marketrate apartment rent datawas presentedforthe following cities:Palo Alto;Redwood City;Sunnyvale;Mountain View;andEast Palo Alto. 6See Volume 1,Attachment6, Tabs 8,9,10,11,12 and 13. theseclaimsarewithout merit.First,the Association purportsto obfuscate standardsbetween the CRAA (California Relocation Assistance Act)standards and the Conversion Ordinance standards and highlights thatthe CRAA usesthe "In-piace valueofa resident's coach."In the Buena Vista case,the in-place value is the value used in theappraisals(albeitit isreferredto asthe "on-site"value)and not thevalue ofthe coaches should theybe removed from the Park.The Residents Association's argument isthusconfusing and misleading.The homesat BuenaVista were infactvaluedattheir on-site,fair marketvalue,there Is nodifference In thiscontext between the words,"In-place"and "on-site."Further,asdiscussed supra in the discussion ofthe Park Closure Process,the Park Owner,indirect response tothe tenant's testimony atthe hearings thattheir appraisaIs weretoo low,agreed to haveall ofthe homes reappraised withinsix months ofthe resident'ssaleof the home to the parkowner. Secondly,the Resident'smake the argumentthat their due process rights have been violatedbecause they areunableto challenge the appraisals.The Resident's claims arehinged upontheir assertion that the appraisals aretoo low.However,the appraiser,Mr.David Beccaria of Beccaria &Weber Inc.,Is an experienced qualified appraiser whowasselectedfrom alist ofappraisers,supplied bythe City,to provide opinions for mobilehomes7.Mr.Labadie,inhis opinion,noted thatMr.Beccaria "has extensive experience appraising various kinds of residential properties,including mobilehomes located inmobilehome parks."8 TheResidents Association did putforth achallenge toone the appraisals byusing anadditional appraisal from another appraiser,Mr.McCuilough for the homeatspace 27.The Hearing Officer discussed this appraisal and found that itwas based upon "the incorrect assumption thatthe subject mobilehome Is permanently attachedto the landand qualifies as real property."9 Mr.Labadie also found the Residents Association's expert Kenneth Baar to have no probative value since Kenneth Baar wasnot a qualified appraiser.Hearing Officer Labadie carefullyconsidered butfound thatResidents Association's evidentiary support for the contention that Mr.Beccaria undervalued the 98 homes he appraised to be unpersuasive10. Lastly,the Residents Association overlooks the benefitthatthe homes wereappraised byMr.Beccaria as if all oftheir additions wereobtainedwith proper permits.The Hearing Officer notedthatthe residents will receive a financial benefitsincemany oftheirhomeswere modified with unpermitted substandard additions11. The Combination LumpSum Payment ofthe Rental Subsidy andAppraisal Is morethan Adequate The ResidentsAssociation hasopinedthat the rentsubsidyIs essentiallytoo low. Thiscriticism isflawed because the rent subsidy Is based upon the current average apartment rental rates in the surrounding cities,whenthe Park currently offers below-market rents,which Is controlled byanOrdinance that limits the amount of rentincreases the Park Owner can charge.Atruly comparable subsidy would be based upon affordable housing rents from surrounding cities.Instead,theresidents will benefit from receiving a significantly higher subsidy amountas part oftheirlump sum payment that imputes the benefit from the Park's particularlocationinPaloAlto byutilizingcurrent market rental rates inthe area. The Residents Association further complaint that the rent subsidy should not be baseduponsizeofthe unitbut householdsize isnot reasonable becausethe rental subsidywill be basedupon fair marketrent rates while the appraisals additionally assumed the additions werecompleted with permits.Thus,the residentswillhave already receivedthe added benefit of their higherappraisals and willalsoreceivea 7SeeVolume 2,AttachmentIS,p12 8SeeVolume2,Attachment15,p12 9SeeVolume2,Attachment15,pl3 10 SeeVolume 2,Attachment15,p13 u SeeVolume2,Attachment 15,p15 subsidy based upon market rate subsidies for the truesizeoftheir units.The market rate subsidy Is disproportionately beneficial tothe Residents and not the ParkOwner becausethe ParkOwner has not been charging rentsat marketrate,but will be required to paya subsidy calculated at marketrate. The Residents Association's criticismsofthe Relocation Specialist Dave Rlchman are misguided Following the Conversion Ordinance,the Park Owner identified a relocation specialist to assist residents, Mr.Dave Rlchman andhiscompany,Autotemp,Inc.andthe City subsequentlyapproved the employment of Autotemp as a proper relocation specialist.Throughout their correspondence withthe City regarding various versions of the RIR and inthe Resident Association's Post-Hearing Brief and Attachments they haveinferred that Mr.Rlchman worksforthe Park Ownerbecause the Park Owneris required under the terms of the Ordinance to pay the Housing Relocation Spedallst.Further In their Closing Brief the Residents Association refersto Mr.Rlchman asthe Park Owner's expert.12 He is not the Park Owner's expert, and he did not testify atthe public hearings as the Park Owner's expert;he Is the Cityapproved Housing RelocationSpecialist. The Resident'sAssociationcriticisms appearto beentrenched inmany assumptionsabout Mr.Richman's testimony regarding the additional assistance that Resident'swill receive.13 Mr.Rlchman stated that the increased rentsubsidywill provide the residents with "a great manymoretoolsto securereplacement housing.""Yet, the Resident's Association opinesthat Mr.Richman's testimony is given too much credence because he had previouslystated that residents would likelyneed financing to purchase new mobilehomesanddid not specifically state exactmobilehomesthat couldbe purchased,but reliedupon his pastexperienceandgeneralknowledgethat he hasseen unitsforsale before.15 Despite these criticisms,the Hearing Officer,Craig Labadie recognizedthe role the Housing Relocation Specialist playsin a park closure and in his decision gives several discretionary roles to Mr. Rlchman, including decisions regarding the appropriate level of moving costs and additional assistance for handicapped/disabledresidents.16 The Hearing Officer'sdecisionto relyupon Mr.Richman's knowledge isnot misguidedas the Resident's attemptto show because Mr.Richman's credentials areextensiveinthat he isadesignated Right ofWay Relocation Assistance Certified professional, has provided real estate related services to hundreds of clients, has personally handled several hundred projects, and has experience not only as a Project Manager but alsoasacaseworker,workingwith peoplerepresenting all socio-economic levels.17 Mr. Richman's belief that the increased rent subsidy provides many more tools for residents was not overvaluedbytheHearing Officerasthe ResidentsAssociation dalms but givenproperweight considering Mr. Richman's extensive experience in resident relocation. Comparable Housing as defined In the Ordinancedoes not Includeaccess to comparable schools. In this case,this appeal evaluates whether the Hearing Officer's decision fallowed the City's Conversion Ordinance properly,not whether the Ordinance should also include schools In an evaluation of Comparable Housing.The Conversion Ordinance isthe only relevant and applicable legal standardthat Council must ensure is followed. Although a discussion about schools and the impacts on residents with 12 Volume2,Attachment9, p.19 "Volume2,Attachment 14,Resident'sAssociation Opposition toTentative Decision,pg8 MVolume 2,Attachment14., Exhibit14. u Volume 2,Attachment 14,pg.8 16SeeVolume3,Attachment15,pp24-25. 17 Relocation ImpactReport,Appendix5. children has taken place and isgreatly appreciated by the ParkOwner and allstakeholders, schools are conspicuously absent from theCit/sown ConversionOrdinance. A.The Legislative History of the Palo Alto Ordinance shows that many other Mobilehome ConversionOrdinanceswere reviewed that contained mention of"schools"butany mentionof "schools"is conspicuously absentin the PaloAltoOrdinance. The PaloAlto City Council considered and voted upon the Mobilehome Park Conversion Ordinance In 2001. Assistant CityAttorney, ArielCalonne,drafted the Conversion Ordinance. He considered other Conversion Ordinances and providedcopiesofthose to packetsto the City Coundl.Bruce Stanton,who was the attorney forthe residents,testified that he has reviewed 107 mobilehome rent ordinacnes and over 40 conversion ordinances n effect in cities and counties,and "he found Mr.Calonne's work to be excellent."Theonlydiscussion of Comparable Housing that occurred at the hearing on May 14, 2001, the meeting at which the Ordinance wasadopted,reflect astatementbyMr.Calonne thatthe lump sum payment based onthecostofmoving to and purchasingor renting comparable housing was "intended by theStateto discourage conversion."Therewasnota single resident whotestified atanyhearing that the Issue ofcontinuing their child's orchild's education in Palo Alto schooolwas a reason for support ofthe Conversion Ordinanceor anyofIts provisions. Ultimately the PaloAltoCity Council approveda mobilehome parkconversion ordinancewhichcontained the followingdefinitionof "comparable housing." "Comparable housing"meanshousing inanapartmentcomplex orcondominium that issimilar Insize,numbers ofbedrooms and amenities to the mobilehome that isbeing displaced andIslocated inacommunity thathassimilar access to shopping, medical services,recreationalrealitiesandtransportationora comparableMobilehome park. The City of Monrovia's Conversion Ordinance which closely parallels the Palo Alto Ordinance,andalso contains a rent increase cap on allowable rent Increases to prevent rent increases which would act to drive tenants outso that mandatory relocation assistance payments could be avoided.The City of Monrovia'sdefinitionofcomparable housingprovidesas follows: Comparable Housing.Housing whichiscomparableinfloorarea, numberof bedrooms and amenities,proximity to public transportation,shopping,schools,employment opportunities and medicalservicesand otherrelevantfactors to the Mobilehometo which comparison Is being made.(Emphasisadded). The City ofCapltola also has a mobilehome park conversion ordinance which is similar in many ways to theCity ofPalo Alto.Similar provisions include therequirements ofthecontents oftherelocation impact report (RIR)and resident questionnaires.The definition of"Comparable Housing"is asfollows: "Comparable Housing"means housing which,on balance,iscomparable infloor area, number ofbedrooms,and amenities,proximity to publictransportation,shopping schools,employment opportunities and medical servicesand other relevantfactors tothe mobile home to which thecomparison is being made.(Emphasis added) The Coundl meeting minutes ofboth April 30,2001 and May 14,2001 confirm that Assistant City Attorney Ariel Calonne had, in the process of preparing the draft conversion ordinance reviewed numerous conversion ordinances inotherjurisdictions.He had even included copies ofthe CityofMonrovia's Closure Ordinance In a council packet.ItisdearthattheCity Attorney had before him examples ofthedefinition ofcomparable housing which Included references to"schools"asan element ofcomparability. Nonetheless,the definitionof comparablehousinginthe Palo Altoconversion ordinancedidnot contain anyreferenceto schools.Furthermore thereisno category of comparability specifically called out inthe definition whichcouldreasonably beextendedto include schools.Theordinance specifically enumerates shopping,medical services,access to transportation andrecreational fadlltles.Education,and specifically schools,do not fit withinany of the enumerated categories of comparability.The school system was excellent in 2001,the year the ordinancewas adopted.If the city intended for the schoolsto be an element of measuring comparable replacementhousing it could haveindudediteither specifically orin some generalized category of "other facilities"that could be construed to Include schools. As was discussed supra therewasno resident or publictestimonyateitherthe April 30,2001orthe May 14,2001 dty council hearings which mentionedthe Importance of schools,orthe needto preserve access bythe residents totheschool system. B.For this Appeal,the Coundl's roleis to evaluate whether the Conversion Ordinance has been adequately followed. All stakeholders appreciate that relocating to newhomes Is a difficult process andthat changing schools presentsan additional consideration.However,the Park Owner also appreciates the legislative process where concerned parties have already come together to manufacture ordinances that provide governance during thesetransitions.ThePalo AltoMobilehome Conversion Ordinance legislative history demonstrates that its adoptionwas wellconsideredby all concerned partiesat that time andthe Council hadknowledge of Palo Alto'sabove-average schools.Ultimately,we mustrespectthat anymention of schools withinthe Ordinance is intentionally absent,particularly In light of the legislative historythat shows the governing body was well aware otherOrdinancesdid mention schools and that PaloAlto had excellent schools at time of adoption. As parties governed under this adopted Ordinance now in full effect and dictatingthis proceeding,we must accept and respectthe fact that schools is not mentioned within the Ordinance. C. Options for Residents who want their childrento remain in Palo Alto Unified School District: Apartmentsand Inter-district transfers available regardless oflocation. The Park owner recognizes the wellsettled factthat Palo AltoUnified School District (PAUSD)isexcellent and believesthat the rentsubsidyprovides agood alternative option for residentswishingto keep their children within the school district aswell as possible inter-district transfers. The rent subsidy is based upon fair market value rents,despite that Buena Vista offers rents far below market rates.Furthermore,because Buena Vistaistheonlymobilehome park within the City,residents who wish to keep their childrenwithin PAUSD will have the option of rentingan apartment usingthis subsidy.The Park's ownexpert,Dr.Padilla even admittedthatthereisnothing special aboutBuena Vista that providesanadvantageforthe childrenthat reside In BuenaVista;rather,ItIs living inanareaserved bythe PAUSD that isof academicbenefitto the children.Therefore,ifresidentsusetheir rentsubsidyto rent an apartment within PAUSD served areas,this problem can be mitigated. Additionally,the option ofinter-dlstrict transfers is also preferredby the Park Owner. The ParkOwner hopes that the PAUSD canrecognizethevalue thatthechildrenofBuenaVista bringtotheir educational system and allowthe children to continueattending PAUSD schools untilthey graduate.First,school districtsare funded by propertytaxes.Possible redevelopment of the park to residentialhomes after Park dosure willprovidePAUSD with a significant boon inpropertytaxes. Thus,any burden PAUSD may face by allowing the children to continue their education inthe districtwillbe offset by the anticipated significantincrease in revenue from their property tax base. 8 Insummary, the Park Owner recognizesthe unique considerationthat families with schoolagechildren face upon relocation but hopes that the PAUSD has the compassionto allow Buena Vista children to continue attending their educationalinstitutions by allowing inter-districttransfers,regardless ofwhere the residents ultimately relocate. Conduslon BuenaVista Mobilehome Park isthe only mobilehome parkin Palo Altoand represents 03596ofthe housing stockinthe City of Palo Alto.18 Theadequacy ofthe mitigation assistance offeredto the Residentsthroughthe Relocation Impact Reportandthe amendment to the Reportatthe final public hearingon May14,2014was carefullyconsideredbythe Hearing Officer,Craig Labadie.Mr.Labadle's twenty five page opinion reflects hiscareful and studied consideration ofallofthe evidence submitted to himby both the Park Ownerandthe ResidentsAssodation.Every argument raisedbythe Residents Association inboththeirPost Hearing Brief19 andtheirOpposition tothe Hearing Officer's Tentative Dedslon20 has beenaddressed byMr.Labadie.TheCit/s Mobilehome Conversion Ordinance clearly contemplates that it isthe Hearing Officerto whom the decisionasto the adequacy ofthe mitigation assistanceisgiven. The ParkOwner metthe burden of proofby a preponderance of the evidencethat the mitigation measuresit proposed wereadequateto mitigate the adverse impactsonthe displaced residents.Further the Hearing Officer wasmindful ofthe limitation contained In Statelaw,specifically In Government Code §65863.7subsection(e)which provides thatthe stepsto mitigatethe adverse Impact ofa parkclosure shall not exceed the reasonable costs of relocation. The Owner ofBuena Vista Mobilehome Park hastheunqualifiedrightto closethe Park andcease itsoperation asa mobilehome park,provideditcompileswith state lawandthe Municipal Code9.76. The Park Ownerunderstands and appreciates asthe Landlord who offersthe leastexpensive,non-subsidized rentalhousingIn the Cityof Palo Altothatsome of the tenants do not want to leavethe Park.Asoccurredat the public hearings before Mr.Labadie,heartfelttestimony will begivenatthe time of the appealbythe residents aswellasmembersofthe community.The City Coundl however,mustasMr.Labadie wrote,accept that theirtask inthis appealisto "dispassionately consider andanalyze the factual evidence andlegal arguments presented by the partiesand reach a conclusion onthe essentialquestionwhether the mitigation measures... meetthe standardof adequacywithout beingunreasonable.AlthoughIam mindfulofthe Impact this decision willhaveonthe lives of park residents,my factual and legal condusions must be basedon evidenceandreasonedanalysis,notemotion orsympathy."21 RespectfullySubmitted, Margaret EckerNanda,esq. Date: March 23,2015 18 Palo AltoHousing Element,AdoptedNovember 10,2014,p47 19Volume 2,Attachment9 20 Volume 2,Attachment14 a Volume 2,Attachment15,p1 EXHIBIT A For Instance,below follows acalculation ofthe lump sumpayment tenantswill receive based upon 1-bedroom and2-bedroom units.This lump sumispayablewithout identification ofa specific relocation property isnot tied to anyrequirementotherthanthe residency requirementsset forthInthe Conversion Ordinance. Thesefiguresare anaverageapproximation usingHearing Officer Craig labadie's TentativeDedsion. Figure L |1Bedroom" rentbltj.com* rentjungle.com" {Hlow.com***• all units Average AvengeRent MonthlySubsidy 12 monthsubsidy StmtupCosts MovingCosts |P«toArto iSunnyvala iRedwoedClty [Mountain Maw |Eart Palo Alto lAverage Total I $2,864.00 $2,515.00 $3,495.00 $2,958.00 $2,208 $26/496 $8,874 $2,236.00 $2380.00 $2,8S0XX) $2,488.67 $1,739 $20,858 $7,466 $3,026.00 $1410.00 $3,475.00 SZ970.33 $2,220 $26,640 $8,911 $2/483.00 $2,430.00 $234S.OO $1619.33 $1369 $22,432 $7,858 $2,064 $2,759.08 $2,759 $1314 $1,870 $15,768 $22,441 $6,192 $7,860 $1,100 ISampleMrUijetJeflBanefrts for rarwtomparktenartrw^I 100*of AppraisedValue $22,203 ($18316, parkaverageappraisal+18ftIncrease****) 12 monthsubsidy $22^41 (based on data above) Startupcosts $7,860 (3xthe monthly cost of anapartment) MovingCosts $1,100 (fromLFSVpost-hearingbrief.Increased from $930) Disabled Assistance TBD Returnof Deposit variable $53,604 MWgatkwAssWaneetoMobUetoineOwnenwIw1-bedroomunit PayableIntump sumregardless ofwheretenantrelocates. AvengeRent MonthlySubsldy 12 monthsubsidy Stmtop Costs Moving Costs rentbtts.com* rentjungle.com** zlllowxom****all units Avenge lOOKof AppraisedValue 12monthsubsidy Startupcosts Moving Costs DisabledAssistance Returnof Deposit $3,936 $3,400 $3,495 $3,610 $2,860 $34320 $10,830 $22303 $27383 $9,071 $1,100 TOO variable $2,823 $3,035 $2,850 $2,903 $2,153 $25336 $8,709 $3,843 $3,125 $3,475 $3,481 $2,731 $32,772 $10,443 $2,989 no data $3,245 no data $2,945 $3,060 $2310 $27,720 $9,180 ($18316,parkaverageappraisal+18Kincrease) (basedondataabove) (3xthe monthlycostof anapartment) (fromLFSV post-hearingbrief,Increased from $990) $2,064 $2,064 $3/124 $3,024 $1314 $2,274 $15,768 $27383 $6,192 $9,071 $1,100 $59357 Mitigation Assistance forMobllehc^Comerswith2-bedroomurdt Paya^mlampsum regarileuofwheretenantrelocetes. Note:Current apartmentrentdatawasobtainedusingthesewebsites: •httpy/rentblts.com/rbA/rental-rates/apartments/palo_alto-caltfornla ••https://www.rentJungte.com/comparerent/ •••http://www.illlow.eom/researeh/data/ ••••The 18ftIncreasewasbased uponaveragereal property values Increase In Palo Alto betweenQ42013 and012015 usingdatafromwwwjUlow.comandwww.truila.com 10 Appeal of HearingOfficer's Decision Concerning BuenaVista MitigationMeasures L Introduction FourhundredPalo Alto residents live at BuenaVista Mobile Home Parkandits closure wouldmeantheloss oftheircurrenthomesandtheir displacement fromPaloAlto. Itwould also meantheobliterationof a vibrant,diverse,andclose-knitcommunity,andthelossofa shrinking numberof affordablehousingopportunities for low-income familiesin PaloAlto. The Buena Vista MHP Residents Association is appealing theHearing Officer's approval oftheowner's relocationassistanceplanbecauseit doesnotcomplywithPaloAlto's MobilehomeConversionOrdinance("Ordinance").Hie proposedassistancedoesnot adequatelycompensateBuenaVista's familiesfor thelossof their mobilehomes,andit is far belowwhatisneededtoallowthe families tofinda new,comparable,permanent placetolive within35 milesof BuenaVista.On behalfofthemoreman 100families livingin PaloAlto's onlymobilehome park,theResidents Association requests thattheCity Council overturn the decisionoftheHearingOfficer,anddenythe owner's requesttocloseBuenaVista. II.Background:Buena Vista Mobile Home Park TheBuena Vista community is comprised oflow-income,working class families.Nearly halfofits families make under $30,000 a year,another thirty percent make between $30,000 and $40,000 ayear.1 Approximately ninety percent of Buena Vista families are Latino and nearly eighty percent speak Spanish as their primary language.2 Buena Vistahas existed inits current location fornearly a century,andhashoused permanent residents since the 1950s.3 For more than 60 years,Buena Vista has provided a crucial source ofaffordable housing and home ownership opportunity toworking families who whose labor has supported the unprecedented growth ofbusiness inthe region.4 As an affordability crisis rages inSilicon Valley,Buena Vista is the oneofthe only options for homeownershipavailableto lower incomeresidents ofPalo Alto. The City ofPalo Alto has long recognized the central role ofBuena Vista increating affordable housing opportunities forPalo Alto's working class families.For decades,Palo Alto has recognized Buena Vista as "an important affordable housing resource"inthe Housing Element ofits Comprehensive Plan.5 As recently as November 2014,in the midst ofthis closure process,the City Council approved its 2015-2022 state-mandated Housing Element6 Yet again, the City Council recognized and relied on Buena Vista's affordable housing stock asanessential tool to meet theCity's current and future housing needs.TheCity Council also stated thatits 'Kenneth K.Baar,PhD.,Analysis ofRelocation Impact Report (RIR)and Mitigation for Proposed Closure ofBuena Vista Park(May 5,2015)at3. 2Donald Barx,MD,PhD and Amado Padilla,PhD,The Families and Children Who Live in the Buena Vista Mobile Home Park (March 17,2014)(report ofstudy conducted for the Stanford Graduate School ofEducation)at 7. JBarr andPadilla all. Joseph W.Doherty,PhD,Report ofDr.Joseph W.Doheity,Buena VistaMobile Home,Park Palo Alto Mobile Home Park Conversion Ordinance (May S,2014),para.22. 5Palo Alto Ordinance No.4672 (Dec.19,2000). *City ofPalo Alto 2015-2023 Housing Element ("Housing Element"),available at: http://www.rityofoa]<>altD.org/gov/dep^ 1 PRE-HEARING STATEMENTOFTHE BUENA VISTA MHPRESIDENTS ASSOCIATION Appeal of HearingOfficer's Decision ConcerningBuenaVista Mitigation Measures "Five-YearObjective"is to "Preservethe 120mobilehome unitsin the Buena VistaMobile Home Park as alow and moderate income housing resource."7 In addition toBuenaVista's importance froman affordable housingstandpoint,thechart belowshowshowitcontributesethnic,culturaland socioeconomic diversityto PaloAlto. Buena Vista's Demoeraohics Compared to Palo Alto Generally8 BuenaVista Mobile Home Park Palo Alto Median Income $35,000 $120,025 Latino Population 73%-9096 6% Occupation 18%- Service Industry 23%-Sales/Office 9%-Construction/Maintenance 75%-Management Likewise,the 129childrenlivingat BuenaVistacontributegreatlytothe diversityofthePalo Altoschools.9 m.Background;Efforts to Close Buena Vista In2000,BuenaVista's ownerattemptedto significantly increasetherent at Buena Vista.10 Recognizing the importance ofBuena Vista as asource ofaffordable housing,the City Council enacted a Mobilehome Park Conversion Ordinance ("Ordinance")which limited rent increases andpermittedtheclosureofBuenaVistaonlyifandwhenthe owneradequately compensated residents for the loss oftheir mobilehomes.'' In 2012, the ownerinitiated theclosureprocess and, in 2013, submitted a Relocation ImpactReport ("RIR")for approvalby theCity. Afterfiverejectedsubmissionsof theRIRand 18months,the Citydeemed the RIRto be technicallycompleteand scheduled a hearingto determine its adequacy.12 During the three-day hearing,testimony was taken from residents, severalexpert witnesses,and members ofthe public. The parkownerdid not testify. At the conclusionofthe three-day hearing,the ownersubmitteda last-minutechange to the RIR, promisingupdatedappraisalssix monthspriortotheparkclosure(andan updatetotherent differential).TheHearingOfficerdeniedtheResidentAssociation'srequestforfurtherhearing on this last-minute addendum to the RIR.13 Following the hearing,the parties submitted briefing to HearingOfficerCraig Labadie. OnSeptember 30,2014,Mr.Labadie approvedthe owners' proposedassistancewithminor changes.TheResidentsAssociation filedthisappealtothe 7Housing Element at 140. *See Doherty Report;Barr and Padilla at7. 9Barr andPadillaat4-5. '"Palo AltoOrdinance No.4672 (Dec.19.2000). "Palo Alto Mun.Code §9.76.010 et.seq. "Letter from Grant Rolling,Office of the City Attorney,Palo Alto deeming RIRcomplete dated Feb.20,2014. "Letter from Craig Labadie,Hearing Officer to M.Morris and M.Nanda dated May 23,2014. MCraig Labadie,"Final Decision inthe Matter ofthe Application ofToufic Jisser,AsTrustee ofthe Jisser Family Trust,forClosure ofBuenaVista Mobilehome Parkin PaloAlto, California,"(FinalHearingDecision)dated September30,2014. PRB-HBARINGSTATEMENTOFTHEBUENA VISTA MHP RESIDENTS ASSOCIATION AppealofHearingOfficer's Decision Concerning BuenaVistaMitigationMeasures CityCouncil on October 14,2014.TheCity Council held a preliminary hearing on January 20, 2015,tosettheprocedures forthe appeal. IV.The Cltv Council's Authority TheCity Council's roleinthemobilehome park closure process ispartofits broader planningandzoningauthority toprotectthepublic's health,safetyand welfare;locallawsthat govern the use ofland fit squarely within that power.15 The Ordinance explicitly recognizes the unique andvulnerable situation ofmobilehome owners—they own their homes butrentthespace on which thehomes sit—and provides them withspecial protections.One oftheexplicit purposes of enacting the ordinance was to support preservation and indirectly discourage conversion because ofthe financial burden conversion imposed onthe owner.16 Thus,the Ordinance's provisions must beconsidered incontext ofitsenactment—an effort bytheCity Councilto preserve thiscrucialsourceof affordable housing. TheOrdinancespecifically requirestheCity Council tomakethefinaldecisionabout whetherornottherelocationassistance provided bytheowneris adequate,and,thus,whether Buena Vista can be closed.17 The City Council must make the decision onade novo review, meaning thattheCityCouncil hastheopportunity toreview allevidence,askquestions ofthe owner andresidents,andmust useitsindependent judgment toreject,accept,or modify the decision ofthe Hearing Officer.18 V.The Relocation Plan Does Not Comply withthe Conversion Ordinance Under theterms oftheOrdinance,theCitymust notapprove amobilehome park closure unless themitigation measures proposed bytheowner "areadequate to mitigate the adverse impacts on the displaced residents."19 For residents whose mobilehomes can be moved,which is asmallnumber of residents,theowner mustpayforthecostofmoving themobilehome,anda lump sum payment that is intended tocover a rent differential,moving expenses,and start-up costs.20 For all other residents,along with the lump-sum payment ofmoving costs,the owner must offer arelocation payment that includes the cost ofpurchasing comparable housing,any remaining loan payments on the mobilehome, and the loss ofinvestment in the mobilehome. A.TheHearing Decision's Interpretation ofthe"Reasonable Cost ofRelocation"IsWrong "See Palo Alto Mun.Code §9.76.010;see Euclid v.Amber Realty Co.(1926)272 U.S.365,387;Miller v.Board of Public Works ofCityofLosAngeles(1925) 195Cal.477,490. "Testimony of Ariel Calonne,City Attorney,City ofPalo Alto Council Meeting Minutes,4/30/01,p.92-69. "Palo Alto Mun.Code §9.76.060.Although itwas decided under adifferent Government Code section,Goldstone v.County ofSanta Cruz,207 Cal.App.4th 1038 (2012)upheld a localjurisdiction's discretion toreject a mobilehome park conversion.Id.at 1042. "Appeal Procedures:Application for Closure ofBuena Vista Mobilehome Park Pursuant to Palo Alto Municipal CodeChapter9.76(adoptedJan.12,2015). "Palo Alto Mun.Code §9.76.040(g). "Palo Alto Mun.Code §9.76.040(g)(1). "Palo Alto Mun.Code §9.76.040(g)(2). 3 PRE-HEARING STATEMENT OFTHEBUENA VISTA MHP RESIDBNTS ASSOCIATION Appeal of Hearing Officer's Decision Concerning Buena Vista Mitigation Measures The hearing decision notes that the Ordinance does not require any mitigation assistance thai wouldexceedthe "reasonable costsof relocation"andassertsthattheterm"reasonable costsof relocation"isnot defined anywhere in the law.22 However,the California Relocation Assistance Act, which pertains todisplacement bygovernment action,establishes uniform standards forrelocation benefits and,indoing so,provides aframework for understanding what is"reasonable"inthis context.23 The CRAA sets forth the types ofcompensation that are "reasonable and necessary"when aperson orentity isdisplaced,and its regulations require "fair and reasonable"relocation payments.24 UnderdieCRAA,reasonable costs ofrelocation contemplate:a "comparable"home that is affordable tothedisplaced resident,isofa similar size and function,and isina similar location.23 The location ofthereplacement housing must beina neighborhood thatis"notlessdesirable than the location ofthedisplaced person's dwelling with respect topublic utilities,facilities,services,andthe displaced person's place ofemployment,anddisplaced individuals are entitled to"payment for actual moving and related expenses...including actual and reasonable expenses inmoving and actual direct losses oftangible personal property as aresult ofmoving."27 Theserequirements setthestatewide benchmark forrelocation benefits,andthe Hearing Officershouldhaveturnedtothemwhenconsidering the"reasonable costsof relocation"underthe Ordinance.Viewed inthecontextof established California law,thehearing decision'sstatementthat theownerisnotresponsible for paving thecostofa replacement mobilehome foreachresident is incorrect28 Payments that make relocation to replacement housing possible are not only required by the Ordinance asacondition forclosure ofthepark;theyarereasonable bydefinition. B.TheImposedMitigation Measures Will Not AllowAnyResident to Relocateto ComparableHousing 1. The Appraised ValueoftheMobilehomes isnotan Adequate MethodtoMeasure Paymentfor ComparableHousing Asstatedabove,theowneris required toprovideBuenaVistaresidents witha relocation package that includes the "cost ofcomparable housing."29 The Ordinance lists mobilehomes, condominiums,andapartments as types of potential replacment housing.Whilenot explicitly statedin the Ordinance,a common-sensereading of theseoptions leadsto the conclusionthat comparable housing includes comparable tenure.Thatis,payments to mobilehome owners shouldallowthemto "mov[e]to andpurchasfe]"comparable ownership housing (mobilehome or condominium)andrentersshouldbe providedwithsufficientcompensationto allowthemto rent a comparable apartment.30 For mobilehome owners,the owner has refused tocomply with 22 Final Hearing Decision at4. °&e Gov'tCode §7262;CityofMountain View v.Superior Court,54 Cal.App.3d72,78-80(1975). "Gov't Code §7262;CCR§6010 (a)(1). "Gov't Code §7260(i)(l)(3);25CCR§6008. "Gov't Code §7260 (i)(6);25CCR§6008 (c)(2). "Gov'tCode §7262. "Final Hearing Decision at 16. ^alo AltoMun.Code§9.76.020G). "PaloAltoMun.Code §9.76.020(i);Moreover,theCityCouncil should reverse decision to deny relocation assistance to the studiotenants,who facethe lossoftheiraffordableunits.Final Hearing Decision,17-18. The City 4 PRE-HEARING STATEMENT OF THE BUENAVISTA MHP RESIDENTS ASSOCIATION Appealof Hearing Officer's Decision Concerning BuenaVista MitigationMeasures thispartoftheOrdinance andisonlyoffering payment equalto (artificially low)appraised valuesofresidents'mobilehomes.Theseappraisalamounts,whilerelevantto thelossofequity thatresidentswillsufferifBuenaVistais closed,havenorelevancetothecostof comparable housing.AndwhiletheOrdinance requires theRIRto include appraisals of mobilehomes,the appraisals are not acap on mitigation assistance provided to those displaced.31 Thecostofpurchasingmobilehomes withina 35-mileradiusoftheBuenaVistais far greaterthantheappraisedvalues. Theowner's relocation specialisthimselftestifiedthat residents willneed $20,000to$50,000more thanthe average $18,816beingofferedatthetime ofthe hearing to purchase amobilehome within 35 miles ofthe park.32 At the time ofthe hearing,theflooronmobilehomepricesin the neighboring citieswasover$40,000,withfew offerings for less than $70,000.33 At that time,residents would have needed atleast $100,000 to purchase replacement mobilehome housing.34 Today,mobilehomes for sale inSunnyvale and MountainViewrangefrom $119,000to $379,000. Moreover,theResident Association's expertDr.Joseph Doherty examined the quality of the mobilehome parksthattheownerlistsas "comparable,"andfound themwanting.These mobilehome parksarenotinfactcomparable,particularly astothequalityofschools(as described further below).Inanyevent,eventheseinferior parks would stillnotbe accessible to thevastmajority of Buena Vista families because thecostof mobilehomes at those parks is significantly morethantherelocation payment beingoffered. 2. TheAppraisal Amounts Initially Proposed bvthe Owners AreTooLow As alluded toabove,the mobilehome appraisals performed by the owner's appraiser are low and rely onflawed methodology.Atthe time ofthe RIR,the appraised values ranged from $5,500 to $45,000,with an average of $18,816.36 As explained in the report ofexpert James Brabant,the methods used bythe owner's appraiser skewed towards misleadingly low comparables to appraise the mobilehomes and the owner's appraiser completely ignored the high value ofowning ahome in Palo Alto.37 The Ordinance requires the appraisals to look at the in- place value ofthe mobilehome.38 In-place value is not limited the physical value ofthe mobilehome itself,but the value ofoccupying aparticular space inaparticular neighborhoodwithparticularamenities.39 It is clear from the testimony of residents at the park that the driving factor for residents choosing to live in the park isits location in Palo Alto,including its location Council has broad authority to require the owner to mitigate any negative impacts ofthe closure,including requiring that the studio tenants begiven relocation assistance.Palo Alto Mun.Code §9.76.040(g)(1). "See Palo Alto Mun.Code §9.76.030(d)(5)(iv). "Transcript,23:11-13; "Baar at Hi. "Hearing Transcript at68. "See searches:htto://www.trulia.com/for sale/Mountain Vfew.CA/MOBn.ElMANIJFACnTRRn tvp.and http7/www.trulia.corn/for sale/Simnvvdt^A/MOBJlJBIMAr^ACTURBD tvne.run on 3/23/2015. Although Palo Alto housing prices have increased by49.8%since 1992,the owner dismisses any increase in value for theBuena Vista's mobilehomes.Many ofthe appraised values for the mobilehomes are even less than what residents paidforthem. Baarat8. "See James Brabant,MAI,Review ofAppraisals by Beccaria &Webster,Inc.,re Buena Vista Mobile Home Park."Palo Alto Mun.Code §9.76.030(dX5)(iv). *See Adamson v.City ofMaUbu,854 F.Supp.1476 (CD.Cal 1994). 5 PRE-HEARING STATEMENT OFTHEBUENAVISTA MHPRESIDENTS ASSOCIATION Appeal ofHearingOfficer's DecisionConcerning BuenaVista Mitigation Measures near high-quality schools,public transportation,several medical facilities,and theoverall safety of.the neighborhood.40 And yet the owner's appraiser did not even attempt to determine what any of the BuenaVistamobilehomeswouldsell for in-placeand in the current market. 3.The Mitigation Assistance Fails toConsiderEssential Amenities in its Determination of Comparable Housing As mentioned above,the comparable mobilehome parksidentified in the RIR werenot actually comparable.A "comparable mobilehome park,"is"a mobilehome parkthatis similarin condition,age,sizeand amenities totheparkthatis beingclosedandis locatedwithina community similartothatinwhichtheparkthatis beingclosedis located andhassimilaraccess tocommunityamenitiessuchas shopping,medical services,recreationalfacilitiesand transportation."41 In plain English,die Ordinance requires enough mitigation assistance so that displacedresidentsare ableto affordnewhomesinacommunitysimilarto PaloAlto. Theownerarguesthat becausetheOrdinancedoesnotcontainthe words"schools"or "education"thatno consideration canbe giventothepublicschoolswhendeterminingwhethera community iscomparable toPalo Alto.42 However,while the words "schools"and "education" donot appearin theOrdinance,the term"comparable"requires thatalternativehousingbe 'located within a community thatissimilartothatin which theparkthatisbeingclosedis located."43 That is,the Ordinance not only defines "comparable"to include certain enumerated "amenities"butalsoincludeswithinthedefinitionthelarger"community"in whichthe mobilehomeparkexists. Thus,to assesswhethertheproposedmitigationassistanceis adequate it mustbedetermined(1)whetherthePaloAltopublicschoolsare partofthePaloAlto "community,"(2)whetherPaloAltoschoolsare exceptional comparedto othercommunitiesto which residents mightbe relocated,and(3)whether theresidents willbe adversely impacted by losing accessto the Palo Alto public schools. The citizentestimonyreceivedduringtheMayhearingleavesno doubtasto therolePalo Alto's publicschoolsplayin thelarger community.Citizenaftercitizentestifiedregardingthe importance ofeducation and the public school system to what itmeans to live inPalo Alto.44 BoththePaloAltoschoolboardandthecity's PTA groups havefeltcompelled to takepositions on the closure ofBuena Vista.43 The Residents'expert,Professor Amado Padilla,noted that PaloAltoresidentspay a premiumonrealestateandhaveassessedthemselveshighertaxesto support the schools, allowing the school district to expend significant resources on education, which other communities are unable to match.46 Further,expert Dr.Joseph Doherty's report showsthattheeducationalresultsforchildrenattendingPaloAlto schoolsaresignificantly "Hearing Transcript at85-126. 41Palo AltoMun.Code§9.76.020(b). Owner's Closing Brief,at48-52.While the definition of"comparable housing"discussed by the owneratpages 48-52 of theirbriefdoesnot includethissame phrase,the ownerprovidenorationalefor whythe Ordinanceshould differentiate betweenwhatcharacteristics thatconstitutea comparable community in whicha mobilehome parkis located versus a comparable communityin which an apartment complex or condominiumis located. Aila\ "See,e.g..Hearing Transcript at143,150-156,168-195. "id.at 157,170-172,181-185. "id.at 136-138. PRE-HEARING STATEMENT OFTHEBUENA VISTA MHPRESIDENTS ASSOCIATION Appeal of HearingOfficer's Decision Concerning BuenaVista MitigationMeasures higher than those for children who live inother areas ofthe region.47 Dr.Doherty reached this conclusion by comparing dataforPaloAlto's schools tosimilardatafor schools attended by children living inmobilehome parks within a35-mile radius ofBuena Vista.48 BuenaVista's residentshavetakenfull advantage of PaloAlto's educational opportunities,withoverone hundred children from theparkenrolled,no drop-outs,and significant parent participation.49 C.The Lump-sum RelocationAssistancePackage Will Not Adequately Compensate Residents for Start-up Housing Costs Along with thecostofpurchasing a comparable home,theowner is required toa "lump sum" relocation assistance package to all residents, regardless ofwhethertheir mobilehomes can be moved.Theseamounts include costs tomovepersonal property,arent differential,and "start-upcosts" (firstmonths'rent,lastmonths'rent,anda securitydeposit),aswellas additional assistance for families with disabled and elderly household members.50 During thelastfew minutes ofthehearing,theowner stated thatthey would paya 100% rentdifferential foroneyearforallresidents,rather than the40%rentdifferential proposed in the RIR.31 However,instead ofcompensating residents for the difference between what the resident paysnowandtheactualrentofan appropriately-sized unit,theowneronlyagreed to payresidentsthe rentdifferential basedon the originalsize of their mobilehomes,without considering any additions to the unit32 Therefore,for all but four families,the owner will only provide arentdifferential attheone-bedroom unitrate,which isinadequate given theactual sizes ofmany residents'families.33 Families,especially ones with children,will need a unit larger than one bedroom and would notbe able to find affordable units with the assistance that the Owner proposes toprovide.34 Again,given the meager relocation amount offered,these residents willbe required tomovefarfromPaloAlto—and theirjobsandschools—in orderto afforda new,appropriately-sized unit Thelump sum forrelocation ofpersonal property is likewise inadequate.The $990.00 lump sum for relocation ofpersonal property is based onan average amount for moving costs for a 1-to 4-room unit under the Uniform Relocation Act35 However,by averaging the moving cost amounts for 1-,2-,3-,and4-room homes,theRIR skews thecostofmoving artificially low. Even very small1-bedroom mobilehomes have 3or more rooms.According totheschedule,the 47Doherty atparas.25-29. nld atparas.5-14. 49Barr andPadilla atnote3 at4-5. "Palo Alto Mun.Code §9.76.040(g)(l);Palo Alto Mun.Code,§9.76.040(g)(2)(c). "Hearing Transcript at 200-203. nRIRat72. ald. "Baar at3. "RIR at68. PRE-HEARING STATEMENT OFTHE BUENAVISTA MHP RESE5ENTS ASSOCIATION Appealof Hearing Officer's Decision Concerning Buena VistaMitigation Measures cost tomove a3-room home inCalifornia is$1100,and the costs ofmoving personal property from larger homes are predictably higher.36 D. The Owner's Last-MinutePromiseto Provide anUpdatedAppraisalCreatesan Unappealable Process As described above,the owner made an eleventh-houramendmentto its RIR at theclose ofthehearing.Theownerstatedthatit would "paythefull on-site,fairmarket valueofeach home...which appraisal shallbe updated within sixmonths orlessofthe homeowner's relocation from the park."57 First,since the amounts ofthe appraisals were unknown at the end of the hearing,the HearingOfficershouldnothavemadea determination as to whetherthe mitigationpackageas a wholewas adequate. Second,whileupdating theoutdatedappraisals (conducted inJanuary2013)iscertainly advisable,theowner's proposalto basethemitigationamounton appraisals to bedoneafter approvalof theclosurecreatesseriousfairnessconcernssinceresidentswillhaveno meansof appealingtheseamounts. Ifthisapproachis approved,theownerwillhaveevadedthe Conversion Ordinance andbeenempowered toset unilaterally thevalueofresidents'homes withoutanyneutralthird-partyreview. Lastly,becausethe ownerplans to use the same appraiser forthesefutureappraisals,itis likelythatthatanyupdated appraisal willcontinueto discredit the value ofthe mobilehomes being inPalo Alto,therefore valuing the homes artificially low.58 E.The Owner Has No Real Plan to Find Housing for Buena Vista Residents Theowner'sproposedrelocation planisnotaplanat all—itis simplyareportofhousing data.The Hearing Officeraccepted theowner's assurance thatthe Relocation Specialistwill find housing options for the residents.59 However,this assurance is not grounded in reality and the Councilshouldreject it. For thefew mobilehomes thatcanbemoved,theRIRfailstoidentifya single mobilehome parkorotherhousing opportunity within 35miles that would allowthecurrent homeowners to transition without significant personal expense.60 The owner's own relocation expert admitted during the hearing thatit would be difficult tofindhousing within 35 miles of the park with the assistance that the owner is providing.61 In fact,the RIR states that the best options for relocation are outside ofSanta Clara County.62 This suggestion isechoed by Thomas "U.S.Department ofTransportation,Federal Highway Administration,"Uniform Relocation Assistance and Real Property AcquisitionPoliciesAct,as amended," <htto://www.mwa.dotgov/reaLestaWpracu^oner8/unifor^ "id.at22(emphasis omitted). "Final Hearing Decision at16. 6&The relocation specialist stated that hecould help displaced residents obtain mortgages tohelp coverthe cost of relocating to another mobilehome.This"offer"is fundamentally flawed intworespects:First,residents should not be forced totakeoutmortgages to payforthe replacement housingthatthe Ordinance requires the ownerto provide. Second,the relocation specialist providesnoexplanation astohowhe wouldensurethatresidents—many ofwhom arelowincome andhave poor,or non-existent,credit—couldobtainaffordablefinancing. "Hearing Transcript at22. fflRIRat67. 8 PRE-HEARING STATEMENTOFTHE BUENAVISTA MHP RESIDENTS ASSOCIATION Appealof Hearing Officer'sDecision Concerning BuenaVista Mitigation Measures Kerr,theowner's rebuttalexpert,whostated,"In my experience,sometimes homeowners opt to relocate tothe Central Valley where living costs are lower."63 Moving residents tothe Central Valleywill not sufficeunderthe Ordinance. V.The Owner Should Detail Fn^iro Plana at the Site The City Council should require the owner to detail future plans at the Buena Vista site. Notonlydoesdie Ordinancerequirethis,but theCityCouncilandthecitizensofPaloAlto have a rightto knowwhat development,if any,is plannedforthefuturesite,includingwhetheror not a zoning change will be required.64 The owner's refusal to provide any details about the future use ofthe site is counter, not only to the Ordinance, but to the City Council's interests in effectively using Palo Alto's limited land resources. The City Council's decision regarding Buena Vista's closure should notoccurin a vacuum. VI.Conclusion Any ofthefailures ofthe RIR and hearing decision alone justify theCouncil overturning theHearingOfficer's decisionandrejectingtheowner's application tocloseBuenaVista;taken together, they certainly do. PaloAlto'sOrdinance requires,asa condition oftheconversion or closure ofthepark, thatthe owner provide mitigation measures thatare"adequate to mitigate theadverse impacts on the displaced residents."65 After over a year and ahalf and five different versions ofthe RIR— including onethatwaseffectively produced during the hearing—theownerhasyetto meaningfully address the "adverse impacts ondisplaced residents."The failures arelistedinthe chart below: Howthe RIR Differs from the Ordinance What OrdinanceRequire* Cost ofphysicallymoving the mobilehomewithin35 miles ofthe park Overnight stay Ina motel whilemobilehome Isbeing moved WhatOwnerHasOffered Willpayforcosts to move mobilehome but falls to Identifyany parkswithin35 miles ofthe park $144/nlght for2nightsatalocal motel.48 WhatTheChvCoundlShould Require Actualcosts formoving mobilehomeand identification ofparksto where homescan bemoved within 35 milesof park Actual costsforovernight stay forthe daysrequiredto move the mobilehome betterfrom Thomas Kerr (June 6,2014),2.Kerr implies that the only reasonable destination for relocated mobilehomes istheCentral Valley;hestates intheprevious paragraph,"Itis possible thathomes could berelocated toaspace inthe Central Valley where there isahigh vacancy rate inmobilehome parks." "Palo Alto Mun.Code §9.76.030 (d)(1). "PaloAlto Mun.Code §9.76.040. "The Hearing decision requires the owner to compensate for actual,reasonable expenses for any required overnight stay,with nolimits onthelength ofthestay.Final Hearing Decision,p.24. PRE-HEARING STATEMENT OFTHEBUENA VISTA MHP RESIDENTS ASSOCIATION Appealof Hearing Officer's Decision Concerning BuenaVista Mitigation Measures 1Cost of purchasing a comparable mobilehome in a comparablemobilehome park Anupdated appraisedvalueofthe residents'mobile homesthat falls to takeintoconsideration in-place value of parkbeingin Palo Alto Costofpurchasing a comparable mobilehome Ina comparable park Ina comparable community to Palo Alto within 35 milesof park 1The lossofInvestment Inthe mobilehome Limited to the updated appraisal value, even though some residents paid more fortheirmobilehomes Compensate residents for any lossIn Investment In their mobilehomes 1Anyremaining loan payments Assumes updated appraisedvalue will cover remaining loan payments. Compensate residents for any remainingloan payments that mustbe paid Moving costs Limitedto $990.6'Actual moving costs 1Firstand last month's rent In new unit Rent basedon a one-bedroom rate.Actual first and last month's rent Security deposit Actual security deposit In unit Actual security deposit in unit One yearrent differential for low-income residents Limited to $1140/month.™Basedon rent In a one-bedroomunit for most families,regardlessoffamilysize One-year rentdifferential based on actual rentofthe unit the familywillmoveto, and the rent at the park when the RIR wasapproved89 Additionalassistance for disabled and senior families Noinformation aboutwhat type of assistance will be provided Specify what assistance disabledand elderly families will receive Theproposedrelocationmeasureslack substance and createnorealisticexpectationthat residentswillbeableto findandsecurecomparablehousingina comparablecommunity;nor doestheRIRguaranteethatresidentswillbe adequately compensatedfor the lossof theirhomes. Asthe Hearing Officerheard,manyofthe400residents ofBuenaVistahavelivedthere for years,ifnot decades.Theyhavespenttheirlife savings on buyingtheirhomes,making additions and improvements,anddecorating their interiors.Thehomeowners in theparkhave jobsinPaloAltoorcloseby;theirchildren attendtheschools neartheirhomes;andtheyare membersofa communitythat willsufferwholesaledisintegrationif the park closes. The families who live at BuenaVistawill likelybe forced to movefarther fromtheirjobs and families,toleavethe high-quality schools thattheirchildrenareattending,andtosaygood byetothe community they havebuiltinthe years—or even decades—that theyhavelived inthe park.Theproposed mitigation measures arenotsufficient,and theCityCouncil should deny the owner's request to close Buena Vista. "id TheHearing decision requires theowner tocompensate foractual,reasonable moving expenses,and isnot limitedto $990.00. ald Although theHearing Officer decision requires that the rents beupdated toreflect rental rates six months prior toclosure,thedecisionstillonlylimitsmostresidentstoa rentdifferential basedona one-bedroom unit "in January 2015,theowner increased rents atBuena Vista by9%. 10 PRE-HEARINGSTATEMENT OFTHEBUENAVISTA MHP RESIDENTS ASSOCIATION EXHIBIT B Margaret ecker nanda March 18,2015 VIA ELECTRONIC MAIL AND FIRST CLASS MAIL MollyS.Stump, City Attorney Grant Rolling,SeniorAssistant CityAttorney CityofPalo Alto 250 Hamilton Avenue, Palo Alto,CA 94301 RE:ParkOwnerCommentsto BuenaVistaMobilehome Park Appeal Procedures DearMollyand Grant Thank you in advance forallowingthe undersigned an opportunity to comment on the AppealProceduresforthe upcomingApril13and 14,2015 hearings. After review,there are a few points Iwould like to confirm. 1.Pleasebe advised that the ParkOwner will present its argument only afterthe conclusion of public testimony and not before.It would be procedurally improper to allow likely multiple hour gapsand possibly multiple day gaps in time to occur between presentations of both sides'arguments because ofthe extensive public testimony anticipated.Therefore this letter confirmsthat at leastas to the Park Owner, its 30 minute opening argument will be made only after public testimonyconcludes. 2.The Park Owner Is the appellee;therefore,the Park Owner should be entitled to present argument second,after the appellant,the Resident's Association, presents first Itiswell established that duringany traditional legal proceeding the moving party presents first Particularly in an appellate trial,the appealing party traditionallypresents firstandthe partywhom the appeal isbeingbroughtagainst presents second.The Park Owner would like to adhere to these established principles and present its openingargument and thereafter its rebuttal after the Resident's Associationopeningargumentand rebuttal. 485 AlbertoWay,SuiteIOO.Los Gatos.CA 95032 •Phone408355.7010 •Fax 408355.7094•Eaiailmarcaretnanda0JNFOCain.com Letter to MollyStump and Grant Rolling Page 2 of3 March18,2015 3.The name ofthe expert witness to be appearing on behalf of the Resident's Associationand any or all materials the expert shall be presenting must be made available to the Park Owner simultaneous with its Pre-Hearing statement The Park Owner,at thispointin time does not intend to call any further expert witness. Park Owner reserves the right to changeits position,based upon the disclosure ofa newexpertwitnessbythe Residents Association.Obviously any expert die Residents'Association intends to call has now been identified. I am requesting that a copy of any written report and the expert's CV be given to the undersigned,astheParkOwner's counsel nolaterthanthe close ofbusiness dayon March 23, 2015.Withholding of this information from the Park Owner would be extremely prejudicial and will not allow adequate time for the Park Owner to prepare a response to such witness testimony and any report 4.All new evidence the Resident's Association seeks to offer,if any, shall be made available to the Park Owner nolaterthan 21 days before the hearing and shall be subject to the City's Attorney's Initial review as to its relevance, andthe City Attorneyto so advise the City Council in a memorandum.Inmy view the Adopted Appeal Procedures that you forwarded did not contain the language of the motion made by the Council as shown in the transcript of the proceedings.Attwo different timesinthe hearing,in a colloquy between youand Councilmember Berman beginning on page 75,line7and continuing topage77,line 14, it is clear that it was intended that you make an initial determination as to the relevance ofany"newevidence."Further inthe Mayor's summary ofthe motion, she stated,"In [sic]request for new evidence shall be submitted to the City Attorney's Office who will analyze proposed evidence and prepare a summary for Council."(Page 88,lines 7 to 9). I wantto confirm that first this is also your understanding sinceitisnotIncluded initem 2 e.,ofthe Appeal Procedures.Further pleaseconfirm thatyour determination will be copied to allcounsel assoonasit is made byyouroffice sothatwecan prepareourarguments accordingly. 5. All PowerPoint presentations or other visual aidsto be used fn presentation byeitherpartyshouldbemadeavailable to die opposingpartyby Wednesday, April 8th atleast 4 days priorto the hearingon or by April 13,2015.The Park Ownerhopes that this willensure a procedurally fairprocessforboth sides. Atthe January hearing the Residents Associations' Power Point was not made available untilhoursbeforethe hearing. Letterto Molly Stumpand Grant Rolling Page3 of3 March 18,2015 Thank you again for your attempts toensure afair hearing occurs byclarifying and confirmingthe appealprocedures. Veiytrulyyours, 'ECKERNANDA cc:Nadia Aziz,LawFoundation of Silicon Valley JamesZahradka,Law Foundation ofSiliconValley (Via electronicandfirstclassmail) PUBLIC INTEREST LAW FIRM Ofidna Legal itInierh Publico lawFoundation ofSilicon Valley 152NorthThirdStreet3*Floor SanJose,California 95112 Telephone (408)293-4790 •Fax (408)293-0106 wwwJawfoundation.org March 20,2015 Viaemail Molly Stump City Attorney GrantRolling SeniorAssistantCity Attorney City ofPalo Alto 250 Hamilton Ave. Palo Alto,CA94301 Re:Letterfrom MargaretNandaRegardingAppealProcedures (March18,2015) DearMs. Stump andMr.Rolling: As youare wellaware,theparties had an opportunity toweigh inontheprocedures that theCity wouldbeusinginthismatterover four monthsago.Bothsidestook advantage ofthat opportunity bothin writing andinthehearing heldatCouncil.Thenyouroffice drafted andsent the procedures to the parties.Thereisno indication thatCouncil anticipated revisions tothose procedures afteryouroffice produced them. Ms.Nanda now unilaterally—with absolutely noconsultation with us—demands araftof changes tothose procedures,less than amonth before the hearing,including demanding thatthe Residents Association comply with unreasonable disclosuredeadlinesthatshehasmanufactured. These changes werenevercontemplated by Council.TheCityshould rebuffMs.Nanda's eleventh-hour effort to altertherulesofthe game. Thank you for your consideration. James F.Zahradka II SupervisingAttorney Cc:Margaret Nanda EXHIBIT C PUBLIC INTEREST LAW FIRM Oficina Legal debtttresPiiblico LawFoundation ofSilicon Valley 152NorthThirdStreet 3rdFloor SanJose,California95112 Telephone(408)293-4790 •Fax (408)293-0106 wwwJawfoundation.org March 23,2015 ByE-mail andMail MollyStump,CityAttorney CityofPaloAlto City Hall,7th Floor 250 Hamilton Ave. PaloAlto,CA94301 Re:Appeal BriefofBueraVista Min>Residents Assod^^ Reportas New Evidence DearMs.Stump: TheBuena Vista MHP Residents Association submits the attached appeal brief contesting the decision ofthe Hearing Officer CraigLabadie. WefurtherwritetorequestthattheCityCouncil allownewevidence ofTrulia.com mobilehome listings inSunnyvale and Mountain View,asintroduced on page 5ofthe Appeal Brief and attached here.Trulia.com isanonline residential real estate site for home buyers,sellers,renters and real estate professionals intheUnited States.Itlists properties forsale and rentaswell astools and information needed tobesuccessful inthe home search process.Evidence ofthe current price of homes innearby communities such asMountain View and Sunnvyale are highly relevant asto whether Buena Vista residents will beable torelocate tocomparable housing with the relocation payments that are currently being offered.1 Lastly,we request that the CityCouncil consider the "Appraisal Review Report"by an expert appraiser Jim Brabant,submittedhereandwiththe Residents Association's brief. The report isprepared byJames Brabant,MAIwho has extensive experience as areal estate appraiserand specific experience with mobile homes.2 Mr.Brabant has beenretained as an expert witness bya variety ofmunicipalities,banks,and law firms fora variety ofreal estate-related cases.3 More specifically inrelation tomobilehome parks,Mr.Brabant has served asan expert witness for a variety ofpurposes including rent hearings,park closures and conversions,eminent domain,and failure to maintainlawsuits. 1&ehttp://eawikipedia.orgMki/rrulia 2James Brabant,MAI,"Appraisal Review Report Review ofAppraisals by Beccaria &Weber,Inc.Re:Buena Vista Mobile Home Park,"attachment,"Qualifications of Appraiser,"dated March 23,2015. 4Id. Resident's AssociationAppeal ofDecisionoftheHearing Officer andRequest forInclusionofNew Evidence March 23,2015 Page2 of3 The report isnot new,undiscovered,factual evidence ofthe type that seems tobeanticipated by the Appeal Procedures,but rather serves more as ananalysis ofthe evidence.Itwill assist the City Council inbeing abletoweigh theevidence regarding appraisals contained intheowner's Relocation Impact Report (RIR).While thereport does contain some evidence pertaining tomobilehome sales in thenearby communities,this evidence isprincipally facilitative oftheexpert's analysis. Itisimportant tonote that the park owner amended the RIR inthe last mmutes ofue hearing by offering to update the park appraisals six months prior to the park closure.3 This last-minute addendum wasdoneattheendofthehearing,afteralltestimony hadconcluded,andwithno opportunity forthe Residents Association toquestion theowneroritswitnesses aboutdieaddendum. Despite theResidents Association's objections to this last-minute addendum,theHearing Officer allowed theownertoamendtheRelocation Impact Report to include thelast-minute addendum without anyfurther testimony ontheissue andrelied onthese unknown future appraisal amounts to support the finding that relocation assistance being provided to the residents was adequate.6 GiventhattheHearing Officerallowed theownertomakelast-minute additions totheRIR regarding theappraisals described intheRIR,without rebuttal andwithout anymechanism to appeal thoseunknown futureamounts,theCityshouldallowthisreporttoserveatleastas rebuttal of the methodology oftheappraiser thatwilllikely beperforming thoseappraisals. Please notethatMr.Brabant willnotbetheResidents Association's expertwitness whowill be testifying attheappealhearing. Should youwishto discuss thismatter further,pleasecontactmeat(408)280-2453 orbye- mailat nadia.aziz@lawfbundation.org. Respectfully submitted, /L*£ Nadia Aziz,Senior Attorney KyraKazantzis,Directing Attorney Public Interest Law Firm and FairHousing Law Project LawFoundation ofSilicon Valley 5ParkOwner's Closing Brief,22-24. 4Final Decision intheMatter ofthe Application ofToufic Jisser,AsTrustee ofthe Jisser Family Tnist,For Qosurc of the BuenaVistaMobilehomeParkinPaloAlto,California,p.24. Resident'sAssociation Appealof Decision ofthe HearingOfficerandRequestfor Inclusion ofNewEvidence March23,2015 Page3 of3 /S/ SueHimmelrich,Special Counsel Western Center on Lawand Poverty Is! MatthewDolan Sicfley AustinLLP End. CC: MargaretNanda(by-email to menanda@infogain.com) APPRAISAL REVIEW REPORT REVIEW OF APPRAISALS BY BECCARIA&WEBER,INC. RE:BUENAVISTA MOBILE HOME PARK PALO ALTO,CALIFORNIA REVIEWED BYJAMES BRABANT,MAI PREPARED FOR LawFoundationofSiliconValley, SidleyAustin LLPand WesternCenter on LawandPoverty DATE OF REPORT March23,2015 PREPARED BY Anderson &Brabant,Inc. 353 West Ninth Avenue Escondido,California 92025 File No.15-016 ANDERSON &BRABANT,INC. BEALESTATEAITRABEKSAKDCOtCSULTANTS J53W.NINTHAVENUE BSCONDmaCALIFORNIAW02M032 TELEPHONE(760)741-4144 FAX (760)741.1049 March 23,2015 Mathew Dolan,Associate SidleyAustinLLP 1001 Page Mill Road Palo Alto,CA 94304 Re: AppraisalReview AppraisalsofHomesinBuenaVistaMobileHomePark PaloAlto,California DearMr.Dolan: As requested,I have completed a review of 32 appraisals of the above referenced property.Standard 3 of the Uniform Standards of Professional Appraisal Practice (USPAP) establishes the criteria tobeaddressed insuch a review.Within the framework of guidelines set forth in Standard 3 of USPAP,I have summarized the following pertinent comments,opinions andconclusions resulting fromthereview process. Identification ofthe Client This review report was prepared at the request of the Law Foundation of Silicon Valley, Sidley Austin LLP,and Western Center on Law and Poverty.Theopinions expressed herein are those of the author anddo not necessarily represent the views of the Resident Association or their attorneys. Intended Use and Users ofthe Review Report Itismyunderstanding thatthereview appraisers'opinions and conclusions will beutilized bymyclienttoassist in evaluating theappraisals of mobile homes/travel trailers thatwere included inaResident Impact Report (RIR). Purpose ofthe ReviewAssignment The primary purpose of this review is to develop an opinion astothe overall adequacy and appropriateness ofthe reports being reviewed,and,specifically not to develop independent opinions of market valueforeachofthe homes.Further,it is intended to determine ifthe results ofthe appraisal are credible for the intended user's intended use and also toevaluate compliance withrelevant USPAP andclientrequirements. Matthew Dolan Review Appraisal March 23,2015 Page 2 of9 Identification ofthe Reports The reports under review are identified as Summary Appraisal Reports as described by Standard 2-2(b)ofUSPAP.The reports were prepared by Beccaria &Weber,Inc.,Realtors, Appraisers and Property Managers.Their office is located at 830-F Bay Avenue,Capitola, California95010.Their client wasToufic JisserofSanJose,California. It appears that Beccaria & Weber prepared 99 appraisal reports and their conclusions were reported in the Resident Impact Report (RIR)for BuenaVista Mobile Home Park.The RIR was prepared by Margaret Ecker Nanda,Attorney at Law andBrian Grasser,Attorney at Law, on behalf of die park owner, The Jisser Family.The Fair Housing Law Project has provided me with copies of 32 ofthe appraisal reports.They have indicated thatthe 32 reports represent all ofthe appraisals they havein this matter.This is a substantial number ofreports and would appear to be a fair representation ofthe entirebody of work that was completed by Beccaria&Weber in this assignment The 32 reports are appraisals of the homes on the following spaces in Buena Vista Mobile Home Park:2,5,13,16,19,21,24,31,32,35,38,46,47,48,50,58,63,71,72,73,74, 76, 82,83, 88,89,102,103,105, 109,110 and 112.The appraisals are dated in January and February of2013. Identification ofthe Appraised Property The appraised property consists ofthehomes located in Buena Vista Mobile Home Park. Buena Vistaisahighdensity park thatwas originally builtas an overnight trailer/RV park but gradually evolved into a place for long term residency.In the 32 appraisals I have reviewed, there isa wide range inthetype,age and sizeofthe homes.The types ofhomes include mobile homes,travel trailers,park models and motor homes.Theage ofthehomes ranges from 1955 to the 2004,andthesizes range from 180to 877square feet Interest Appraised Each appraisal includes an opinion of the in-place market value as well as the offsite value,whereapplicable. Effective Date ofValue and Report The valuation dates for the 32 appraisals are various days in January and February of 2013.The report dates are thesame asthedates ofvalue. Effective Date ofReview and Review Report Thisreview and review report are made asofMarch 23,2015.I personally inspected the subject park,and the five parks mat contain comparable sales,onMarch 19,2015. Matthew Dolan Review Appraisal March 23,2015 Page 3 of9 Scone ofthe Review Process hi developingthisreview,Ihaveundertaken thefollowingtasks: 1.Conducted a thorough office review ofthe 32 appraisal reports thatwere provided. The primary focus ofthe reviewhasbeenthe opinions ofthe in-place marketvalues ofthe 32homes. 2. Also reviewedtheResidentImpactReport(RIR) andotherdocuments. 3.Discussed the property andreports withthe client. 4.Verified theaccuracy ofcertain factual documentation contained inthereports. 5.Field reviewed diesubject property andselected market data.Exterior inspections of the homes.I haverelied on details ofthe interior ofthe subject homesas described inthe appraisal reports. 6.Prepared the reviewreport Extraordinary Assumptions/Hypothetical Conditions The opinions of in-place market value are based on two hypothetical conditions.The first is the assumption that the park isnotgoing tobeclosed.The second is the assumption that any additions to die homes were legally permitted.However,it appears that the second assumption is actually what is termed an extraordinary assumption rather than a hypothetical condition.Unless the appraiser knows that every addition to the homes in the park is not legally permitted it should be labeled an extraordinary assumption.This is considered tobe somewhat ofatechnical matter and didnot appear toeffectthe value conclusions. Completeness oftheReportand USPAP Compliance The intent of the appraiser was to prepare Summary Appraisals in conformance with Standards Rule 2-2(b)ofUSPAP.It appears that all ofthe components ofaSummary Appraisal Report are present inthereviewed appraisal reports according to USPAP Standards in effectas of the date of the reports.While the components of the appraisals appear tobeconsistent with USPAP,Ihave serious disagreements with the choice ofcomparable sales and the way they have been analyzed. Appropriateness ofAppraisal Methods and Techniques The appraisal assignment included providing opinions ofthe in-place market value ofthe homes in Buena Vista Mobile Home Park.The appraiser has adequately set the foundation for the valuation process bydescribing the pertinent physical characteristics and legal constraints of the subject property,and the market in which itwill compete.To solve this appraisal problem, the appraiser has properly identified the Sales Comparison Approach as the most appropriate valuation method for the in-place market values of the homes appraised. Matthew Dolan ReviewAppraisal March 23,2015 Page4 of9 Adequacy and Relevance ofComparable Data As previously mentioned,mere isa wide variety inthe type,size and age ofthe 32homes appraised.However,the appraiser utilized only 13 sales asthe data base for all 32 appraisals. Six of those sales are from Buena Vista,while seven are from five other parks.One sale was utilized from Adobe Wells in Sunnyvale,two from Blue Bonnet Mobile Home Park in Sunnyvale,onefrom Sahara Village in Mountain View,twofrom Santiago Villa Mobile Home Park in Mountain View,andonefrom Harbor Village in Redwood City. Each appraisal has either seven or eight comparable sales that arecompared and adjusted toa subject home for the valuation analysis.Atfirst glance that appears tobealarge comparable data base for the analysis ofeach home.However,in spite ofthe substantial variations in type, sizeand age ofthe 32 homes appraised,many ofthe comparable sales areutilized foralmost all ofthe home appraisals.In fact,Space 202 in Sahara Village and Space 160 in Harbor Village wereused in all 32 appraisals despite significant differences in the subjecthomes. In addition, Spaces 30 and48 in Buena Vista,Spaces 3 and 43 in Blue Bonnet,and Space27 in Santiago Villa,were usedin almost all of die 32 appraisals.It lookslike a very smallsamplingof sales waschosenfromapotentiallylargedatabasethatcouldproduce misleading results. One example of inappropriate marketdata wouldbe from the appraisal of Space74 in BuenaVista. Thisis a smallparkmodelthatwasbuiltin 2004. However,five ofthe sevensales utilizedwerebuiltin the 1960sand arenot comparable. Another example of inappropriate data would be theoneand only comparable sale that wasutilizedfrom SaharaVillage in Mountain View (Space 202). It wasa 1969 homewith576 square feet that sold for $15,000 in September 2012.However,MHousing (HCD records) reports a sale in July 2010,ofa 520 square foot home built in 1963,onSpace 177,that sold for $34,000.They report another salein July2010,of a 550 square foot home builtin 1962,on Space 165,ata price of $22,000.In addition,the MLS reports a sale in May 2011,ofa 688 square foot home built in 1964,on Space 253,for $28,000.The MLS also reports a sale in March 2011,ofa 720square foothome builtin 1967,fora price of $20,000.Thelower saleat $15,000 was utilized inall32oftheappraisals.Focusing onthe lower saleand ignoring higher saleswouldlikelyproducea misleading result A further example would be the two comparable sales that were utilized from Santiago VillaMHP in Mountain View. The first is a 1970home on Space24 with 672 square feetthat soldfor $26,000 in November 2011.The second saleusedisa 1966homeonSpace27with600 square feet that sold for 18,000 in March 2012.However,the MLS reports higher sales during thesame time period thatwere not used.TheMLS reports asalein July 2012,ofa 960square foot home built in 1966,on Space 307,for $50*000.The MLS also reports asalein December 2012,ofan 800square foothomebuiltin 1969,on Space 249,fora priceof $40,000.Again, ignoring higher sales in favor oflower sales would produce a misleading result Matthew Dolan Review Appraisal March 23,2015 Page 5 of9 Six salesofhomes fromBuenaVista wereutilizedas comparables.Five ofthe six sales soldbetweenOctober 2010andJuly2012.However,onesale (Space 54)wasa park modeland sold in May 2006 at a price of $23,000.It appears that this older transaction was utilized becauseit wasthe only sale found ofaparkmodel.However,no time adjustmentwasmade for thesix+yeardifferencebetweenthesaledateandthe appraiser's dateofvalue. The range ofthe six sales from BuenaVista is from$3,000to $29,000.However,I am aware ofat least three ofthehomesinthe parkthatwere purchased for$50,000 or more.The homeon Space 24was reportedly purchased for $55,000 in2006butwasonly appraised in 2013 for $31,500.The home on Space 73 was reportedly purchased for$50,000 in 2003/2004,but was only appraised for $16,000.The home on Space 110 was reported sold by MHousing in July2012 for$50,000 butwasonly appraised for$30,000. Itis important to provide further information about thesaleofthehomeon Space 110.In the appraisal beingreviewed,in discussing the prior purchase ofthehomethe appraiser states, "The current owner has not provided the date purchased or for what price."However, MHousing reported a sale of the home in July 2012 at a price of $50,000.Although the appraisals refer to MHousing as a data source in some ofthe other 32 appraisals,there is no mention ofthis sale.This is significant becauseit wouldhavebeen critical information forthe valuation of the home on Space 110.Of the sue sales from Buena Vista utilized in the 32 appraisals,the highest sale was at a price of $29,000.Ignoring a sale at $50,000 in this park seriously undermines the credibility ofthe valuation conclusions.We interviewed theownerof the home on Space 110,Hariberto Avalos,who confirmed that he purchased it for a price of $50,000 in July of2012,and that the home was ingood condition.He also stated that he was unaware ofthe pending park closure and would nothave purchased if he had known.He was notified of the closure about three months after he bought the home.Appraising this home for $30,000 in February 2013,when it was purchased only seven months prior at $50,000 and the housing market was increasing,is not credible and in my opinion has produced a misleading result.The significance ofthis isnot just the impact on the valuation ofthe home on Space 110, but the fact that this sale could have been utilized as a comparable sale for other homes in the park. AdequacyofAdjustment Process The 13 comparable sales that served as the data base for the appraisals of the 32 homes ranged in date from May 2006 to October 2012,with all but one ofthem recurring in the two year period from October 2010 to October 2012.However,no time adjustments were made for the difference between the sale dates of the comparables and the dates of value.Andin the Neighborhood section of each report,the Property Value box is checked for Stable rather than Increasing.This isin contrast to the data presented inthe report that includes information about the substantial increase in median home price for single-family homes in Palo Alto and the surrounding area,having increased from $1,428,000 in 2011 to $1,726,000 in 2012.The report then says "Conversely themedian sale price for mobile and manufactured homes in mobile home Matthew Dolan Review Appraisal March 23,2015 Page 6 of9 parks throughout Santa Clara Countywas $70,000 in2012up from $63,000 in 2011."The word "conversely"isinaccurate since themarket for mobile homes was going up,albeit notas rapidly as the market for single-family homes.In addition,the "Increasing"box should have been checked in the Neighborhood section,rather than the "Stable"box.More importandy,the appraisals shouldhaverecognized thatthemarket for mobilehomeswas increasing andthat fact shouldhavebeenreflectedby makingtime adjustments. No adjustments are made in the 32 appraisals for differences in Location and/or Site Value.When the comparable saleis from RedwoodCity,Mountain View or Sunnyvale,the report indicates the location isoffsetby the rent.It appears that for location,the appraisers are primarily concerned with the quality of the park and all of the comparable parks are rated superior to Buena Vista.However,meredoesnot appear to be any recognition ofthe superior home prices in Palo Alto compared withthose other cities.Using Space 112 in Buena Vistaas an example,Comparable 1is located in Redwood City,which hasa substantially lower median home price thanPalo Alto.However,the park (Harbor Village)is rated superior to Buena Vista. But,the location isstatedtobe offset bytherent The space rentforSpace 112in BuenaVista is $695 whilethe space rent for Comparable 1 in Harbor Village is $708 which is only $13 per month higher.Apparendy,the higher rent is supposed to be offsetting the superior park. However,the superior PaloAlto location seemsto belost inthis process. The lack ofadjustment for either Location orSite Value isthesame for all32 appraisals. However, it is interesting to note that there is some support for a site value, even in the comparable parks utilized in the appraisals.For example, the home on Space 200 in Sahara Villagesold for $48,000 in November 2014.It wasa 1972 single-wide home with 576 square feet Ithasbeenremovedandanew home is currently being installed.In effect,the buyerpaid $48,000 in sitevalue for therightto control the space andpurchase the new homethatis being installed. The same thing happenedat Space 139 in Santiago Villa MHP. A 600 square foot home, built in 1969,was purchasedfor $43,000 in September2013. It was removed and a new home is on the site. It shouldnot be surprising to find examples ofthis type of site value in mobilehome parkslocatedin areas whereyouhave suchhighhome prices. The 32 appraisals include adjustments forthe difference in the size ofthehomesatarate of $20.00 per square foot This same rate of adjustment was made regardless of the age or qualityofdie home.For example,inthe appraisal ofthehomeon Space 19,Comparable No. 1 isthehomeon Space 37 inBuenaVistawhichis a 1959 homewith 176 square feetthatsoldfor $3,000in November 2011.The saleprice calculates to $17.05 per square feet The home being appraised wasbuiltin 1958 andhas378 square feet The difference inthesize ofthetwohomes is 202 square feet(378 minus 176),andthe size adjustment is202x $20=4,040.Contrast this with the appraisal ofthe home on Space74 in BuenaVista thatwas built in 2004 andhas 441 square feet Comparable No. 7 is the home on Space54 in Buena Vista that was also built in 2004 andhas 286 square feet That home sold for $23,000 in May 2006, which calculates to $80.42 per square foot The difference in the size of the two homes is 155 square feet (441 Matthew Dolan ReviewAppraisal March 23,2015 Page7 of9 minus 286),andthesizeadjustment is 155 x $20=$3,100.Theuseofthe same sizeadjustment rate for the appraisal of these two homes is inappropriate and in my opinion produces an incorrect value conclusion.Thissame incorrect analysis wasusedforallofthe appraisals. Adjustments were made for differences in the age of the homes (yearbuilt) based on $100 per year.This is such a small amount that borders on being nominal.This becomes exaggerated in the appraisal of the home on Space 74 which was built in 2004. Five of the comparable sales used in that appraisal were built in the 1960s but they are not really comparable.Usingan inadequate upwardadjustment of$100per year understates the indicated value ofthathome. Significance ofthe Date ofValue In a Rising Market Although the appraisals ofthe32 homes in Buena Vistaprovidestatistical dataaboutthe rising housing market,mat facthasnotbeenrecognized intheanalyses of comparable sales that goclear back to 2010 (one sale goes back to 2006),while the date of value isinearly 2013.This lack of making time adjustments has already been discussed inthe previous section.However, the determination of the date of value becomes extremely important when you have a rising market Using Zillow asa source,themedian price forresidential properties (allhomes)in Santa Clara County increased from $593,000 asofJanuary 2010,to$853,000 asofJanuary 2015,ora total increase of44percent for thefive year period.However,themedian price for residential properties in Palo Alto increased from $1,100,000 to $2,200,000 during the same period,for an increase of 100 percent For that same time period,Sunnyvale increased 50 percent,Mountain View increased 48 percent and Redwood Cityincreased 34 percent.The increase in Palo Alto for the most recent two years alone (January 2013 toJanuary 2015)was 47percent (see attached Exhibit 1). To further illustrate the significance of the raising housing market I have identified a couple of mobile homes thatsold in2011 or 2012 and then resold more recently.The first sale involvesSpace43 in BlueBonnetMobileHomePark. ThistransactionoccurredinMarch2012 ata purchase price of $25,000 andas previously discussed was utilized in almost all ofthe32 appraisals.According to MLS,this home resold in December 2014 at the significantly higher price of$62,900. I have also identified theApril 2011 sale of Space 228 in Santiago Villa for $38,000. This 860 square foot home was built in 1969 and although it was not used in any of the 32 appraisals I reviewed,it is similar to the data used.According to MLS,this home resold in November 2014atapriceof $85,000. Both of these examples demonstrate the impact that the date of value can have, particularly in a rising market Again,referring to data that occurred after the dates of the appraisals isnot intended asa criticism ofthe appraisals since noappraiser can be responsible for Matthew Dolan Review Appraisal March 23,2015 Page8 of9 failing tousedata thathad notyet occurred.However,it certainly emphasizes the significance ofthe date ofvalue to the homevalues. Appropriateness &Reasonableness ofAnalysis.Opinions &Conclusions The appraiser provided anadequate description ofthe subject properties and employed a valuation technique that is commonly usedby the industry in providing opinions of in-place marketvalue ofmobile homes/travel trailers,etc.However,in my opinion,the selection and analyses ofthe comparable data in the32 appraisals is flawed anddoes not provide reasonable estimates ofin-place market value.It also appears that most ofthe shortcomings haveresulted in anunder valuation ofthe homes. Thank you forthis opportunityto be ofservice.Please let me know ifI canbe offurther assistance in this matter. Respectfullysubmitted, ANDERSON&BRABANT,INC. ,^/3^ C^fames Brabant,MAI State Certification No.AG002100 Attachments: Exhibit 1 (Residential trendsreported by Zillow) StatementofQualifications Matthew Dolan ReviewAppraisal March 23,2015 Page 9 of9 APPRAISER'S CERTD7ICATION I do hereby certify that,to the best ofmy knowledge and belief... 1.The statementsoffactcontainedin thisreviewreportaretrueand correct. 2. The reported analyses,opinions,and conclusions are limited only by the reported assumptions and limiting conditions,aremy personal,unbiased professional analyses,opinions and conclusions. 3. I have no present or prospective future interest in the property thatis the subject of the work underreview,andIhavenopersonal interest orbiaswith respect tothe parties involved. 4. I haveno biaswithrespectto thepropertythat is the subject ofthe workunderreview or tothepartiesinvolvedwiththisassignment. 5. My compensation is not contingent on an action or event resulting fiom the analyses, opinions,or conclusions in this review or from its use.Further,my compensation is not contingent upon development or reporting of predetermined assignment results or assignment results that favors thecauseofthe client,the attainment ofa stipulated result,orthe occurrence ofa subsequent event directly related to the intended use of this appraisal review. 6.My analyses,opinions,and conclusions were developed,and this review report was prepared,in conformity with the requirements of the Uniform Standards of Professional Appraisal Practice. 7.The use of this review report is subject to the requirements of the Appraisal Institute relating to review byitsdulyauthorized representatives. 8. I have made a personal inspection of the properties that are the subject of this review report 9.Patricia Haskins provided significant professional assistance to the person signing this reviewreport 10.As ofthe date ofthis report,I,James Brabant,have completed the requirements under the continuing education program oftheAppraisal Institute. 11.I have not provided any service regarding the subject property in the three years immediately preceding acceptance ofthis assignment,as an appraiser or in any capacity. March 23.2015 les Brabant,MAI State CertificationNo.AG002100 c Attachments Anderson &Brabant,Inc. I !r s TRENDS - RESIDENTIALPROPERTIES(ALL HOMES) Suta.Chn.CtnXV PaloAlts MooccrioView RedwoodQtv Avg Price %dungs Aoaal %Qmgo Mouthy Avg Pnoc %Cb8ngB Amxsf %CtlBOge MonlUv Avg %Change Ansu*1 %awBB Mocddv Avg HCraDgc Amnl KCflBOgG Avg Price %Osage Amnl %Change MonMv Jmimv46 57?7W ——$947,000 •__$789,000 __$789,000 _mm S83OJ0O0 Jnwv47 S743JQ00 04%0.1%fl,IOO,000 16.2%\A%S79Z0OQ 04%0X1%S807.000 23%02%$836400 0.7%0.1% Jtamn^m S7I9j00O -32%•03%$1300.000 182%15%S8|5j00O Z9%02%$820,000 1.6%0.1%$828,000 •1j0%-0.1% J«bomv-09 ?«>3jp00 -14.7%-12%$1,100,000 -15.4%-13%$746,000 -8,5%-0.7%fTSS.ooo -7.9%-0.7%$733,000 •115%-1.0%JamMy-IO SS93jOOO -3.3%-03%$1,100,000 0.0%0.0%$733,000 -1.7%•0.1%$744,000 -15%-0.1%$745,000 1.6%0.1% JtB»UY-ll SS87J0OO -1.0%-0.1%$1,000,000 4.1%•0.8%$746400 1.8%02%$748,000 05%00%{720400 -3/4%-03% Jnnnv-12 1574,000 -22%-02%$1200,000 20.0%1.7%-04%-0.1%$754,000 04%0.1%$703.000 -X4%-0.2% Jmiary-13 566X000 153%13%$1,500,000 25.0%2.1%$872400 174%15%$930400 233%1.9%$816,000 16.1%13% Jurav-14 $772,000 16.6%1.4%$1,900,000 26.7%22%$977X00 12.0%1.0%$1400.000 75%0.6%$960,000 17.6%1.5% Juuatv-lS S8S3.000 10.5%0.9%$2000.000 154%1.3%$1,100,000 1Z6%1.1%$1,100,000 10.0%0.8%11.000.000 42%0.4% •Mc£anPricctlofFctKKr2O06 Source:Zillow 3W2015&3/10/2015 Qualifications ofthe Appraiser—James Brabant,MAI PageTwo III.ProfessionalAffiliations: A.Member,Appraisal Institute,MAI(1985 President,San Diego Chapter) B.Realtor Member,North County Association ofRealtors C.Member,International RightofWay Association D. Real EstateBrokers License,State ofCalifornia E.Teaching Credential,State ofCalifornia,Community College Level F.Certified General RealEstate Appraiser (AG002100) Office ofRealEstateAppraisers,StateofCalifornia IV.Appraisal Experience: Co-Owner—Anderson &Brabant,Inc.,Since 1979 Co-Owner—Robert M. Dodd &Associates,Inc., 1977 -1979 Appraisal Manager—CaliforniaFirst Bank,Huntington Beach,California,1974-1977 StaffAppraiser—California First Bank,SanDiego,California,1972-1974 StaffAppraiser—O. W. CottonCo.,SanDiegp,California,1970 -1972 StaffAppraiser—Davis Brabant,MAI,Huntington Park,California,1960-1962 V.Teaching Eiperience; Southwestern College,Chula Vista,California,"Real Estate Appraisal" VI.EmertWitness; Superior Court,SanDiego,LosAngeles,Riverside,and San Bernardino Counties Rent Control Hearings:Cities of Oceanside,Escondido,Ventura,Concord,Yucaipa,Carpenteria, Palmdale,San Marcos,Carson,Watsonville Various ArbitrationHearings Assessment Appeals Boards of Riverside County,San Diego County and Orange County Federal Bankruptcy Courts inSanDiego County &Santa Barbara County United States District Court-Northern District ofCalifornia VII.Tvoea ofAppraisals; Residential Property:Single-family residence,condominiums,apartments, subdivisions,existingandproposed Commercial Property:Office buildings,shopping centers,office condominiums,etc., existingand proposed Industrial Property:Single/multi-tenant,business parks,etc.,existing and proposed Vacant Land:Industrial,commercial,residential,and rural Agricultural:Ranches,avocado and citrus groves,etc. Special Purpose Appraisals:Leasehold estates,possessory interest,historical appraisals,etc. Mobile Home Parks:For a variety ofpurposes including renthearings,park closure,park conversions,failure to maintainlitigation,eminent domain,etc. Anderson&Brabant,Inc. Qualifications of the Appraiser— James Brabant,MAI Page Three VIII.Partial List ofAppraisal Clients: Banks Bank ofAmerica Bank ofNew York CityNationalBank Downey Savings FidelityFederalBank First Interstate Bank First Pacific National Bank FlagshipFederalSavings Great Western Bank Industrial Bank ofJapan Palomar Savings & Loan Redlands Federal Bank Union Bank ofCalifornia Wells Fargo Bank GovernmentAgencies and Municipalities California Department of Transportation/Caltrans Carlsbad Municipal Water District City ofCarlsbad City ofChula Vista CityofColton City ofConcord City ofEscondido City ofLaguna Beach City ofLa Mesa City ofSalinas City ofSan Bernardino City ofSan Diego City ofSan Marcos City of Vista City ofYucaipa Countyof SanDiego FallbrookPublicUtilityDistrict Metropolitan Water District Oceanside Unified School District Pacific Telephone PowayMunicipal Water District Ramona Unified School District SANDAG (San Diego Assoc,ofGovts.) SanDiegoCountyWaterAuthority SanDiegoUnifiedPort Dislrict San Marcos Unified School District U.S.Depart,of theInterior Bureauof Indian Affairs U.S. Department ofJustice Anderson &Brabant,Inc. Law Firms Aleshire &Wynder,LLP Asaro,Keagy,Freeland.&McKinley Best,Best & Krieger Daley &Heft Endeman,Lincoln,Turek &Heater Foley &Lardncr,LLP Fulbright &Jaworski Gray,Cary,Ware & Frcidcnrich Higgs, Fletcher & Mack Latham &Watkins Lounsbery,Ferguson,Altona& Peak Luce, Forward, Hamilton & Scripps McDonald &Allen Mcinnis,Fitzgerald,Rees,Sharkey&Mclntyre O'Melveny& Meyers Procopio,Cory,Hargreaves & Savitch Rutan &Tucker Singer, Richard Sullivan Wertz McDade &Wallace Tatro &Zamoyski Thorsnes Bartolotta &McGuire Woodruff,Spradlin& Smart Worden Williams,APC Title Companies Chicago Title FidelityNational Title Insurance First American Title St.Paul Title Title Insurance &Trust Others AvcoCommunityDevelopers Coldwell Banker Dixieline Lumber GoldenEagle Insurance National Sleel &Shipbuilding Co. Northern SanDiegoCountyHospital District Prudential InsuranceCorp. Rosenow,Spevacek,Group San Diego Gas & Electric Co. SanLuisReyDowns(Vessels) Steefel, Levitt & Weiss Tellwright-Campbell,Inc. Transamerica Relocation Service VedderParkManagement Mountain View Mobile/Manufactured Homes ForSale |Trulia.com http://www.trulia.com/for_sale/Mountain_View,CA/MOBlLE|MANU.. 0f3 Buy Sell Rent Mortgage Find anAgent More For Professionalsv My Boards 'Saved Searches Sign In MountainView,CA 0 SAVED •Q. 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Contact a local agent. '"••julleTsalLaw |(650)600-3370 *****(0)PRO Nearby Homes For Rent 1271 LawrenceStationRd $2.404-$4,539 $2,694-$4,046 1-2bd 615w -'"•»1"2ba More Nearby Homes ForRent » Ask a question about Ask agentsor local expertsanything 3/23/2015 4:00 PM EXHIBIT D JVL.AR.GAR.ET ECKER.NANDA March 25,2015 Via Electronic Mail and First Class Mail Molly S. Stump CityAttorney Grant Kolling SeniorAssistantCityAttorney City ofPalo Alto 250 Hamilton Avenue Palo Alto,CA 94301 Email:Molly.Stumpfficitvofpaloalto.orp; Email:Orant.Kolling@citvorpaloalto.org Re:Closure ofBuena Vista Mobilehome Park Mobilehome Park Conversion Ordinance,Chapter 9.6ofthePaloAlto Municipal Code DearMs.Stumpand Mr.Kolling: The undersigned attorneyrepresentstheowners ofBuenaVista Mobilehome Park (the Toufic Jisser Family)with respect to the upcoming Appeal hearings occurring on April 13,2015 and April 14,2015.The correspondence that the Residents Association emailed Monday,March23,2015,containing materials they wishto submit as additional evidence,clearly violates the Appeal Procedures that were adopted bythe City Council on January 12,2015.I write to adamantly encourage you to adhere to those procedures anddeny admission ofthisevidence because itisnotprocedurally proper orrelevant. The Appeals Procedures provide clear requirements. Toreiterate, the Appeal Proceduresstate: 2(e):The evidentiary record is closed.Witness testimony willnot be taken and newdocuments shallnotbe offered asa basis fordecision onappeal,except that Council may_allow new evidence if a party can demonstrate that newly discovered and relevant evidence exists that could nothave been discovered with exercise of 485 AlbertoWay.Sura 100.LosCatos.CA 95032•Phone 408355.7010•Fax40a355.7094•E-mail marcareinanda@infogain.com Letter to Molly StumpandGrant Kolling Page2 of6 March 25,2015 reasonable diligence during the initial proceeding before the Hearing Officer. [Emphasis added]. The evidentiary standards are very clear mat theparty must show that the evidence was:1)newly discovered,2)relevant,3) and could not havebeen discovered with the exercise of reasonable diligence during the initial proceeding before the Hearing Officer. The Residents Association's proffered evidencefails tomeettheabovecriteria. Furthermore,the Appeal Procedures are also clear in limiting each party who wishes to submit a Pre-Hearing Statement to a 10-page limit (See Appeal Procedures 2(f)). 1*The randomly selected Trulia listings are not newly discovered evidence,are not relevant to this Anneal,and fail to meet the criteria that thev could not have not been discovered with the exercise of reasonable diligence during the initial proceeding. First,the evidentiary record oncomparable mobilehome parks is closed sincedata on this exact issue has already been presented and discussedbetween the City and the Park Owner.1 A comprehensive discussion on the parks that comprised the comparable park data,includingwhat specifically makes a mobilehome park comparable to Buena Vista,was discussed indetail in the Relocation Impact Report (RIR)section 19.2 Secondly, the randomly selected Trulia.com mobilehome listings (hereinafter "Trulia evidence"or "Trulia listings") that the Association is attempting to force into evidence forthe appeal areirrelevant.The RIR already canvassed the 98 units whichare at issue in the Park using substantial research.Only 30 of the 98 units are even mobilehomes.The rest of the Park units are various types of Recreational Vehicles (RV's) or "Park models", a specifictype of manufactured housing unit The Trulia listings are not germane,there is no way to determine what other amenities or other restrictions (such as community age restrictions,which may impact price)are in place where the units shown on Trulia arelocated. The Trulia listings do not provideany new or relevant information and mustbe denied admission into evidence. Dueto the irrelevance ofthe Trulia listings,namelythatonly 30 ofthe Park's98 units atissueareeven mobilehomes,thatthe conditionofthe Parks inthe listings relative to the condition ofBuena Vista Mobilehome Park is unknown, that any other restrictions abouttheunitslistedinthe otherparks (whichmayincrease value,isalsounknown),and 1SeeRelocation Impact Report pg.57and Appendix 30and 43. 2SeeRelocation Impact Report,Section 19,pg.55-58. Letterto MollyStump andGrant Kolling Page 3 of6 March 25,2015 finally the possible prejudice to the Park Owner that would result fiom admitting these randomly selected mobilehome listings,the sole conclusion thatcan be drawn is these enumerated factors outweigh any limited probative value that the listings might have. The Trulia listings do not provideany evidence that was not already reasonably obtainable atthe initial hearing with theexerciseofdue diligence.The primeexample of exercisingdue diligence during the requisite initial Hearing is the evidence provided in the RIR, in which, "Appendix 43 ...contained comparable mobilehome sales data for mobilehome parks within a 35 mile range of Buena Vista."3 The Resident Association cannot suddenly cherry pick a handful of listings to replace properly vetted, comprehensive,and already discusseddata fortheirown purposes. Lastly,the Associationattemptsto saythatthe Trulia listings are highlyrelevant to showwhethertenants willbeableto relocate based onthe current payments.Perhaps, the ResidentsAssociation shouldreview the initial Hearing Officer's Decision,wherehe explicitly writesthatthe rentsubsidyshall be updated to reflectcurrent marketconditions within six months of the owner's relocation from the Park and the appraisals will be updated similarly to reflect current market conditions.4 Forthe foregoing reasons,the Truliaevidence must not be admitted as evidence forthe Appeals Hearing. 2.The "Appraisal Review Report"is dearly not newly discovered evidence. patently fails to meet the criteria that it could not have not been discovered with the exercise of reasonable diligence during the initial proceeding,and anv argument that it is a rebuttal to changes to the RIRiswithout merit. The Resident's Association even admits that,"the Report is not new, undiscovered,factual evidence of the type that seems to be anticipated by the Appeal Procedures,"and it underhandedly tries to re-characterize it as,"more an analysis of evidence."This attempt is procedurally and professionally wrong. First,because there is no reason why this Report could not have been obtained during theHearing Process,as bythe Association's ownadmission,theevidence mustbe excluded from the appeal.The Residents Association attempts to obfuscate this issue by inventing some far-fetched argument about how this report is a rebuttal argument to amended mitigation assistance presented on May 14,2014 when;instead,the only issue 3See Relocation Impact Report,pg.58 4See Hearing Officer's Final Decision,Exhibit A,Sections 1and 2. Letterto Molly Stump andGrantKolling Page4 of6 March 25,2015 regarding the appraisals thatthe Resident Association has consistently complained about is that the appraisals were too low5.During the hearing process,the Residents Association had 15 months from time of receipt of resident's appraisals (April 2013)to order other appraisals or order a review of their appraisals to be considered during the initial hearing process.In fact,the Residents Association did put forth an additional appraisal that was considered by the Hearing Officer,the appraisal ofthehome at Space 27 by S. Mark McCullough of EAppraisal Valuation.The Hearing Officer found McCullough's appraisal unpersuasive because of significant flaws inthe assumption that the home was realpropertyand not a mobilehome. Simply put,mere is no reason that through the exercise of reasonable diligence during the initial Tjroceedins.this report could not have been obtained.For the foregoing reasons,this Report must not be admitted as evidence. Secondly, the argumentthat the RIR was amended duringthe Hearing and this new Report is some type ofa "rebuttal argument"is an intentional obfuscation ofissues. To be clear,the amendments made to the RIR,that the Residents Association claims were "at the last minute," were two updates that only benefited the residents and did not change the RIR methodology because the updates only consisted of:1)Increasing the Rent Subsidy from40%to 100%and 2)Offering to provide appraisals to be updated to reflect current market conditions within six months of the owner's relocation from the Buena VistaMobilehome Park.Increasing theamount ofrentsubsidy and ordering more current appraisals does not change the RIR methodology in anyway, it only increases benefits to residents.Here,this new Report is not a rebuttal to an increase of rent subsidyoradecisionto offer updated appraisals.A rebuttal would actually address the updates by taking a rebuttal positionto them; for instance,thatthe appraisals should not be updated or that the appraisals should not be not be updated within 6 months. This Report is not even relevant to the rebuttal argument that the Resident Association is claiming.The Resident Association must not be allowed to circumvent the established Appeals Procedures adopted by the City Council on the basis of manufactured, attenuated,andirrelevant arguments. Thirdly,the pre-hearing statement,is limited to 10 pages.This report combined with theirbrief exceeds the limit. This Reportmust be denied based upon the clear limitations provided by the City Council. Lastly, claims that the Resident Association was not offered time to rebut or challenge changes madetothe RIR are withoutmerit Additional considerations to adjust the hearing schedulesothatthe Association couldhavechallenged the amendments to the RIR was offered by HearingOfficer, Labadie,to the Residents Association,but the 1For example,SeeNadia Aziz,Law Foundation of Silicon Valley,October 10,2013 Letter toCity Attorney,pg.5 Letterto MollyStump and Grant Kolling Page5 of6 March 25,2015 Association never made use of said offer.To quote directly from Hearing Officer,Craig Labadie's,May 23,2014 letter: Ithas been pointed outthat theletter inquestion was submitted after thepost- hearing schedule hadbeendetermined.Ifeither partybelieves that reasonable adjustments to that schedule arenecessary to allow sufficient timefor preparation ofclosing statements and supporting materials,please letme know.[Emphasis Added]6 The Association cannot attempt tonow claim lack ofrebuttal opportunity asa way to sneaknew evidence intothe appeal hearing whenthey clearly already hadthe chance to challengeorrebutany ofthe amendments to the CER.and failedto do so.The Association claimthatthisistheironly rebuttal opportunity is clearly without merit For the foregoing reasons,the Appraisal Report must not be admitted into evidencefortheAppeal. 3.The Identity of the Association's Expert Witness is requested and the Park Owner will not present Argument until after Presentation of the Resident Association's ExpertWitness has completed. The Resident Association stated initsMarch 23,2015 correspondence that it will have anotherexpert witness testify on its behalf;however, it has failed to disclosethe name of that individual.In the interest of due process,the Park Owner requests the identityofthe expert witnesssettotestifyaswellasthe subject matter. Because of the Association's refusal to disclose the identity and subject matter of their expert,the Park Owner re-affirms its previously stated position thatits 30 minute initial argument willtakeplace after the Resident Association and anyexpert witness the Association chooses to call.Due Process requires a fair and balanced proceeding.Ifthe Park Owner does nothear the expert witness testimony until after its30 minute argument, it can only address the expert witness inits rebuttal argument Considering therebuttal argument is only 15 minutesin length,this willnotallowenough timeto rebut both the Associations andtheexpert's arguments,especially anexpert'sopinion whichthe Park Owner will only be hearing for the first time at the Hearing.The Park Owner requests that the proceeding beas fair as possible and that anyAssociation Expert be made to finish his/her presentation on behalfofthe Association and beforethe Owner's 6Hearing Officer,Craig Labadie,May 14,2014 Letter to Parties;See Also Park Owner's Closing Brief, Exhibit 5. Letterto Molly Stump and Grant Kolling Page 6 of6 March 25,2015 presentation.The ParkOwner disclosed evenbeforethe March23,2015 deadline thatit didnot intend to call an expert witness inaneffort tobecollegia!and cooperative tothe City Attorney'soffice andopposingcounsel Conclusion. The Resident Association must not be permitted to benefit from attempting to shirk previously established appeal procedures because they feel entitled to do so. The Trulia listings andthe Appraisal Review Report must be denied admission as evidence. There is no legal loopholethatallowstheir admission.The proposed evidenceis neither relevant,norcanbe shownto havenot be obtainable during the hearing procedure by a party exercising reasonable diligence.Moreover,admitting the additional the evidence would be extremely prejudicial to the Park Owner.The prejudice outweighs any probative value the proposed evidence may offer because the evidence is clearly not relevant and because it has been put forth in a way that intentionally circumvents the agreedupon proceduresgoverningthe process. It is highly ironic that James Zahradka in his letter to you of March 20,2015 accuses the undersigned of unilaterally demanding disclosure deadlines. In fact, the undersigned was attempting to suggest reasonable mutual disclosure deadlines.Perhaps the most telling statement in Mr. Zahradka's letter however is the following,"The City should rebuff Ms. Nanda's eleventh-hour effort to alter the rules ofthe game."I was unaware untilreceiptofMr.Zahradka's letterthat he regarded this process as a"game" andmy client,Joe Jisser has askedme to convey to the City andto Mr.Zahradka thathe considers his characterization offensive and insulting.The closure of Buena Vista MobilehomeParkis not now, norhasit everbeena"game"to my client. Thank you. Verytrulyyoun, ECKERNaANDA cc: Joe Jisser,via electronic email only James F.Zahradka,via electronic email and first class mail Nadia Aziz,via electronic email and first class mail ATTACHMENT B APPEAL PROCEDURES Application for Closure of Buena Vista Mobilehome Park Pursuant to PaloAlto Municipal Code Chapter 9.76 ADOPTED BY PALO ALTOCITY COUNCIL,JANUARY12,2015 Introduction a.The appeal procedures are adopted to implement PaloAlto Municipal Code Chapter 9.76. Ifthere isaconflict between these procedures and the MunicipalCode,the Municipal Code shall govern. Conduct ofthe Appeal a. The appeal hearing shall be taped and/or stenographically recorded. Alldocuments and other materials submitted to the Hearing Officer and at the appeal hearing shall be included in the record of proceedings. b.The appeal is subject to the provisions ofthe Brown Act (California's open meeting law). c. The applicant bears the burden of proving by a preponderance ofthe evidence that the criteria for approval ofthe application,as set forth in Municipal Code section 9.76.040(g),have been met. d. The parties to this proceeding are the Parkowner and the residents,tenants and legal owners ofthe mobilehomes in the Park. e. The evidentiary record isclosed.Witness testimony willnot be taken and new documents shall not beoffered as a basis for decision on appeal,except that Council may allownew evidence ifa partycan demonstrate that newly discovered and relevant evidence exists that could not have been discovered with the exercise of reasonable diligence during the initial proceeding beforethe Hearing Officer.Nolaterthan 21days before the appealhearing,a partyseekingto offer new evidence shallsubmit ashort descriptionof the proposedtestimony ordocumentary evidence, its relevance,and the basis foraccepting new evidence on appeal.In addition, each party may have one expert orother witness testify forupto 10 minutes regarding the inferences to be drawn and the weight to be givento the evidence in the record. f. The Council shallexerciseits independent judgment regarding whetherthe criteria for approvalof the closure application hasbeen met, basedon the recordof proceedings beforethe HearingOfficer and the Council.The parties may make legal arguments to the Council,including regarding the inferences to be drawn and the weight to be given 150113mf00710537 3. h. to evidence in the record.Written pre-hearing statements are not required;any party wishing to submit a written pre-hearing statement not to exceed 10 pages shall do so no later than 21 days before the date that the appeal is scheduled to be heard. The appeal will be heard on or about April 13,2015.Pre-hearing statements and requests to hear new evidence,if any, shall be transmitted to the City Attorney no later than March 23, 2015. The Council intendsto conduct the appeal as follows,though the parties are advised that Council retains discretion to adjust the procedure as appropriate and consistent with law: Owner/applicant - 30 minutes Owner's expert or otherwitness-10 minutes Residents -30 minutes Residents'expert or other.witness-10 minutes Owner/applicant rebuttal -15 minutes Residents'rebuttal -15 minutes The Council willallowtime formembers of the public to addressthe Council,as required by the Brown Act,either before or after the parties have made their presentations.Publiccomment willbe subject to reasonable time limits. Public comment is not evidence.Public comment will not be considered as a basis forthe Council's decision in this matter. These appeal procedures areintendedto provide general guidelines forthe conductof the appealandmaybe modifiedasdetermined appropriate bythe Council. Written Decision The Council will issue a written decision,making specific findings based onthe evidence and resolving the appeal.TheCouncil's staff will prepare the findings anddecision for the Council's reviewandadoption.The proposed decision will be made available to the parties before the Council is scheduled to adopt it,consistent with the Council's regular agenda procedures. Any partywishingto make brief written comments must do so no later than five calendar days before the decision is agendized for Council adoption. The Council's decision shall befinal immediately upon adoption of its written decision, and is notsubject to rehearing orfurther administrative appeal.The procedures and timelines in California Code of Civil Procedure Section 1094.6 shall apply to any judicial proceeding challenging the Council's determination. 150113mf00710537 City of Palo Alto |City Clerk's Office |4/8/2015 11:58 AM Carnahan,David From: Sent: To: Cc: Subject: Attachments: Dolan, Matthew <mdolan@sidley.com> Monday,April 06, 2015 3:52 PM Clerk,City;Council,City;Stump,Molly;Kolling,Grant;menanda@infogain.com Kyra Kazantzis;James Zahradka;NadiaAziz;Sue Himmelrich (shimmelrich@wclp.org) Buena Vista Mobile Home Park Appeal 2015.04.06 - Disclosure Letter.PDF;Enclosure -Seifel Resume.pdf Dear Mayor Holman,CityCouncil Members,Ms. Stump, Mr.Kolling and Ms. Nanda, Attached please find a letter and enclosure regarding the Buena Vista MHP Residents Association's expert for the upcoming hearing in this matter. Best regards, Matt MATTHEW DOLAN Associate Sidley Austin LLP 1001 Page MillRoad Building 1 Palo Alto,CA 94304 +1.650.565.7106 mdolan@sidlev.com www.sidley com 0 SIDLEY AUSTIN LLP ****************************************************************************** **** This e-mail is sent by a law firmand maycontain information that is privilegedor confidential. Ifyou are not the intended recipient,please delete the e-mail andany attachments and notify us immediately. ************************************************************************************************ **** SIDLEY AUSTIN LIP SIDLEY AUSTINUP BEIJING KONG KONG SHANGHAI 1001 PAGE WILL ROAD BOSTON HOUSTON SINGAPORE BUILDING 1 BRUSSELS LONDON SYDNEY PALO ALTO.CA 94304 CHICAGO LOS ANGELES TOKYO (650)S6S 7000 DAUAS NEW YORK WASHINGTON.0 C {6SOJ565 7100 FAX FRANKFURT GENEVA PALO ALTO SANFRANCISCO mdoiansSsuJioycom 6S0.S65 7106 FOUNDED 1666 Apr 16.2015 VIA ELECTRONIC MAIL Mayor Karen Holman and City Council of the City ofPalo Alto Office of the City Clerk City ofPalo Alto 250 Hamilton Avenue Palo Alto,California 94301 Molly Stump,Esq. Grant Kolling, Esq. •ffice of the City Attorney City ofPalo Alto 250 Hamilton Avenue Palo Alto,California 94301 Margaret EckerNanda, Esq. 485 Alberto Way, Suite 100 Los Gatos,California 95032 Re:Buena Vista Mobile Home Park Appeal DearMayor Holman,City Council Members,Ms.Stump,Mr.Kolling and Ms.Nanda: Wc write regarding the April 13 and 14 hearings on the closure of Buena Vista Mobile Home Park.In accordance with Ms.Stump's letter dated March 30,2015,the Buena Vista MHP Residents Association discloses that it intends to offer a statement during the hearing from expert witness Libby Scifcl.Ms.Seifcl is the President of Seifel Consulting,Inc.and has extensive experience advising public and private sector clients regarding real estate and development matters. Ms.Seifel's resume is enclosed and additional information about her can be found at: www.seifcl.com.At this time,wc anticipate that during the hearing Ms.Scifcl will provide an oral presentation regarding the following matters: S«ojAusdn tcA)ui>iiaCKUwuaMrfad tiafctiy pue.mhm ao«o nitronas&aey auiuiui»end ntacteng«i sAMMnwuft «ihuSaieyAuttnpartiwihel f^\JIOIBY AU1IIN HP SlDLEYI April 6,2015 Page 2 1.The unique features of Buena Vista Mobile Home Parkthat must be taken into account whenidentifying housing that is comparable to Buena Vista Mobile Home Park; 2. The current housingmarket inwhich the families livingin Buena Vista Mobile Home Park will haveto llnd comparable housing;and 3. The location and features ofalternative housingthatwould be available to Buena Vista Mobile Home Park residents based on the relocation assistance approved bythe Hearing Officer. Ifyou have any questions,please contact me at650-565-7106 orby e-mail at mdolan@sidley.com. Very truly yours. Matthew J.Dolan Enclosure cc: Kyra Kazantzis,James Zahradka and Nadia Aziz,Law Foundation ofSilicon Valley Sue L.Himmelrich,Western Center on Law &.Poverty Buena Vista MHP Residents Association Elizabeth (Libby)Seifel,President, SeifelConsulting Elizabeth (Libby)Seifel has focused her professional careeron creating high quality infill developments,structuring successful public-private partnerships and encouraging the rcvitalization ofcommunities.She has advised public and private clients on the planning,fundingand development of a broad variety of mixed use and mixed incomecommunities. Prior to founding her firm, Libby served as Associale-in-Charge of Williams-Kuebelbeck & Associates, overseeing the firm's economic and management consulting practice. She also served as the founding Executive Director ofTent City Corporation,a non-profit developer of mixed income housing in Boston. Libby actively promotesbest practice in realestate development and urban reviiali/alion through teaching and writing activities. She has chaired the Urban Land Institute (ULI's)Urban devitalizationCouncil and SPUR Regional Policy Hoard.She isthe local hostprogram co-chairforULI's upcoming 2015 national conference,and she also serves on the boards for ULI's San Francisco District Council and SPUR. She served as the editor for ULI's recent publicationAfter Redevelopment:NewTools andStrategies to Promote Economic Development andBuild Sustainable Communities,andedited the California Affordable Housing Handbook,among other publications.She also has supported the success of women in business,real estate and technology through her work with the WomenPresident's Organization. ULI Women's Leadership Initiativeand MIT.Throughout her professional career,Ms.Seifel has: •Advised on mostof San Francisco's majorpublic-private partnership projects,including Hunters Point Shipyard/Candlestick Point,Mission Bay,Rincon Point/South Beach,San Francisco Center Expansion.Seawall Lot 337/Pier 48.Transbay Transit Center and Treasure Island. Counseled otherclientson numerous public-private partnerships,including the preparation andreview of developer solicitation packages,evaluation of developer responses,development team selectionand/or Structuring of development agreements forContra Costa County and the cities of Berkeley,Emeryville,Folsom, Fremont,Hayward,Livermore, Los Angeles, Mountain View, Richmond,South San Francisco, PresidioTrust and the HawaiiCommunity Development Authority. Fostered the creation and rcvitalization of thriving communities,transit oriented development projects and over 100 successful redevelopment projects in California,including projects in proximity loexisting and future transit stations inConcord,El Ccrrito.Fremont.Hayward,Lafayette.Livermore,Los Angeles.Richmond. Sacramento,San Mateo,San Fernando,San Francisco,and San Jose. •Assisted inthe financing,development and planning of more than 10,000 affordable housing units inCalifornia. Helped secure overSI20 million in funding resources torevitalize public housing and help build affordable housing.Designed programs and prepared implementation strategics to build mixed income housing developments and communities. Prepared siteanalyses,market research,financial proformas.asset management strategies and investment opportunity analyses ofreal estate developments throughout California for clients such as the Bay Area Smart Growth Fund.Hastings Collegeof Law. The RREEFFundsand The Real Estate and Land Use Instituteof California and numerous cities throughout California. Consulted on numerous marina andwaterfront projects,including SanFrancisco'sSouthBeach Marina/Pier 40, Seawall Lot 337/Pier 4K,Alcatraz Landing,Hunters Point Shipyard ami Presidio Trust properties along Crissy Field,as well as waterfront developments in Alameda, Long Beach,Martinez, Richmond,South San Francisco and West Sacramcnlo. Helped communities tosecure funding and strategically leverage public funding tools,including federal transportation funds,tax increment financing,community facilitydistricts, assessment districts and development impact fees,drawing onan in-house dalabase of available funding sources. •Conducted professional training sessions and served aseditor/contributing author onpublications that promote best practice in affordable housing,public-private partnerships,transit oriented development and community reviiali/alion.Libby designed and led ULI training sessions for public officials onthe fundamentals ofrealestate economics,enhancing their ability towork with developers toachieve public goals,served on the "Building the Resilient City"conference committee andwas lead ediiorona policy paper thai recommends newloolsto promote infill and sustainable development afterthedemise of redevelopment inCalifornia. Elizabeth Seifel Resume |Page 1 Professional Background 1990-present President,Seifel Consulting,Inc.,San Francisco,CA 1982-1989 Associatc-in-Charge,Williams-Kuebelbeck & Associates,Belmont,CA 1981-1982 Planner/Economist,Blayney-Dyett,San Francisco,CA 1979-1981 Founding Executive Director,Tent City Corporation,Boston, MA 1977 Urban Intern,Department ofHUD,Washington DC 1974-1979 Research Assistant,MIT,Cambridge,MA Education,Professional Certification and Honorary Recognition Bachelor ofSciencein Urban Studies&Planning,Massachusetts Institute ofTechnology,1978 MasterinCity Planning,Massachusetts InstituteofTechnology,1979 American Institute ofCertified Planners(AICP)Certification,1983 Harold E. LobdellAward for Distinguished Service,Massachusetts InstituteofTechnology, 1995 Lambda Alpha International HonorarySociety for Advancement ofLand Economics, Elected Member, 2007 California Infill BuildersFederation,Leadership Award,2011 Professional Instruction, Presentations and Publications Ms. Seifel hasservedasa professional instructor in real estate,public-private partnerships and strategies forinfill development andurbanrevitalization forULI andUC Berkeley Extension. She hascoordinatedand presentedat conferences and meetings sponsored by the American Planning Association (APA)and California APA,CALED, California and Florida Redevelopment Associations,FordFoundation, Housing California, League ofCalifornia Cities, Non-Profit Housing Association ofNorthern California, Royal Institution ofChartered Surveyors (RICS)- India,Tulane University,Urban Development Institute Pacific Region, ULI and the Victoria Rotary Club. Ms.Seifel writes on realestate,redevelopment and housing related subjects. She has served as the volunteer editor on publications that promote infill development,affordable housing and redevelopment and reuse ofunderutilized properties. Her published works include: After Redevelopment: New Tools and Strategies to Promote EconomicDevelopment and BuildSustainable Communities,Urban Land Institute,November 2013 (Lead Editor and Collaborator) Transbay TransitCenter: Key InvestmentinSan Francisco's Futureas a WorldClass City, Transbay Joint Powers Authority,November 2013 (Publication Coordinatorand Editor) Making Affordable Housing Work in India,RICS,November 2010(Contributing Author) "Sustainable Communities",UrbanLand,September 2009 (Author) Community Guideto Redevelopment,CRA,2007 (EditorandContributing Author) California Affordable Housing Handbook,CRA, 2006andprior 1998edition(Editorand Author) ThePower ofStorytelling,RedevelopmentJournal,March2008 (Author) Designinga Successful lnclusionary Housing Program,Redevelopment Journal,January 2005(Author) BayAreaModelsofUrban Infill Housing,Urban Land,September2003(Author) Associations and Professional Activities BoardMember, ULI, San Francisco DistrictCouncil and Local Host Program Co-Chair for2015 NationalMeeting Former Board Directorand Advisory Board Member, SPUR Certified Plannerand Member, American PlanningAssociation (APA)and APA ofCalifornia ElectedMember, LambdaAlpha International,Honorary Society forAdvancement of LandEconomics Founding Steering CommitteeMember,Urban Land Institute Women's Leadership Initiative (WLI) FormerChair and Member, Urban Land Institute Urban Revitalization Council (URC, formerly ICC) Former President and Director Emeritus,MIT Club ofNorthern California (MITCNC) Member, Non-Profit Housing Association ofNorthernCalifornia(NPH) Member,Women President's Organization (WPO) Partner, League ofCalifornia Cities VisitingCommittee Member,MIT Department ofUrban Studiesand Planning Elizabeth Seifel Resume | Page2 City of Palo Alto |City Clerk's Office |4/8/2015 11:58 AM Carnahan,David From: Sent: To: Cc: Subject: Attachments: Margaret Nanda <menanda@infogain.com> Monday,April 06, 2015 4:53 PM Council, City;Clerk, City Stump,Molly; Kolling,Grant;James Zahradka;Nadia.Aziz@lawfoundation.org;Sonya Welch Buena Vista Mobilehome Park Rebuttal to Residents Association Appraisal Review 4-6-15.pdf Attached please find the Park Owner's Rebuttal to the Residents Association Appraisal Review relating to the appraisals of the homes at Buena Vista Mobilehome Park. Margaret Nanda fAtorafrrtt JLdur 'Hfrnfa Attorney Margaret Ecker Nanda Attorney At Law 485 Alberto Way.Suite 100 Los Gatos.CA 93032 Direct 408.355.7010 Fax,408.355.7094 marqaret.nanda@infoqain.com This email andanyattachments thereto may contain private,confidential,and privileged material for the sole use oftheintended recipient.Any review,copying,ordistribution ofthis email (or any attachments thereto)by others is strictly prohibited.Ifyou arenol the intended rccipiciil.please contact thesender immediately and permanently delete theoriginal andanycopies ofIhis email and any attachments thereto. April 6,2015 Palo Alto City Council Members Cityof Palo Alto 250 Hamilton Ave Palo Alto,CA 94301 Re:ExecutiveSummary ofAppraiser,DaveBeccaria's,ReplyRebuttal to Resident'sAssociation Appraisal Review forthe upcoming Buena Vista Mobilehome ParkAppeal. DearCity Council Members: Purpose The purpose of this supplemental report is to simplify and provide an easy-to-read summary ofAppraiser, DavidBeccaria's,Rebuttal,which isattached, and replies to the criticisms of James Brabant's Appraisal Review.All information is taken directly out of Brabant's Reviewand Beccaria's Reply Rebuttal,which is attached.This summary shows Brabant's criticisms with Beccaria's rebuttal comments followingimmediately after. Background Summary The Review byJames Brabant (hereinafter"Review")purported to determine the credibility of the reports reviewed and not to develop independent opinions of market value.Brabant reviewed 32 appraisals prepared by Beccaria and Weber. The appraisals Brabant reviewed were dated in January and February of 2013.The Review took place March 23,2015. Review Criticisms and Beccaria's Rebuttal 1.Comparable Sales Criticism Brabant Criticism Disagreementwith Comparable Sales choices despite admission that Sales Comparison Approach was most appropriate valuation method. Beccaria Reply -The Criticisms about the comparable data do not hold up to close scrutiny. • Space #110 was not used because the unitowner never reportedthesale,despite having the opportunity to do so from a data sheet Beccaria gave to the unit owner.#110 was also not reported on rn.housing.com and only showed up as a sale after the appraisals were completed. o Beccaria agrees that this data point can be included in upcoming current valuations; however,it is an isolated data point outside of the historical range ofverifiable sales in the Park. o It did not show in the data bank until after valuations were completed and the owner did not provide information aboutthe sale,despite multiple requests that included posting an information request sheet on the unit's front door. •Most of Buena Vista Units are single-wide homes and single-wide homes were selected as a basis for comparison,where appropriate.There is a large discrepancy in value between single-wide and double-widefactory built homes. Addingan addition to a single-wide home does not change thisfact. Executive Summary ofAppraiser,Dave Beccaria,ReplyRebuttal to Resident's Association Appraisal Review. April 6,2015 Page 2 of3 o Ex.The Review suggests #307 at Santiago Villa should have been used as a comparable,but it was not used because it is a double-wide home not a single-wide home. o Ex. The Review suggests #249 at Santiago Villa should have been used as a comparable,but it was not used because it is also a double-wide home not a single- wide •All sales data that was available at the time to Beccariawas used. o The Review Appraiser fails to understand the market that exists for the Buena Vista Mobilehome Park.There is a "black market"of sales within the park,perhaps hidden to avoid taxes or fees. •Space #74 is comparable,despite Review's criticisms.Beccaria used data that was available and because no park model units had sold recently, he was compelled to use data that was available,such as #74. • Space #202 at Sahara Village was included while other sales at Sahara Village (that the Review mentioned)were not because those other sales were not within 12 months of the appraisal report.The mostcurrentdata was used.Noneoftheothersales mentioned inthe Review regarding #202 were within 12 months oftheeffective datesoftheappraisals. •Space #24 was not included as a sale for $55k in 2006 because no supporting documentation ofany sale was provided.Beccaria was unable to confirm any sale data on rn.housing.com that would have substantiated a sale had occurred and Appraisal reports must verify data.It was also not the most currentdata and there were better more recent sales data within the actual park of Buena Vista. • Space#73 was also not includedas asale for$50kbecausenosupporting documentationof any sale was provided and it could also not be confirmedon rn.housng.com.Again,it was unverifiable data and was excluded for that reason. • The Review references market data that sold subsequent to the effective date of the appraisals under review. Thisis not a valid criticism ofthe appraisalsand the inclusion of this data speaks toward client advocacy. 2.Time Adjustment Criticism BrabantCriticism No timeadjustmentwasmadetoshow mobilehome pricesweregoingup. Beccaria Reply - NoTime Adjustments were made because the overallanalysisofthe market data inthesales comparison approach to valuewouldhavenegatedatime adjustment. • 2012 Sales were not adjusted for time. Atime adjustment was considered for oldersales butthe overall datadidnot support a time adjustment because itwould have been negative. o Ex.Themedian salepricein2012formobilehome parksinSanta Clara County was $70,000 butin 2006 theprice was $84,750.Thus,it would have been a negative adjustment. Executive Summary ofAppraiser,Dave Beccaria,Reply Rebuttal to Resident's Association Appraisal Review. April 6,2015 Page 3 of 3 • The stable box was checked because,even though the statistical analysis supported a moderate adjustment increase,the overall analysis of market data typically negated it withinthereportrelativetothe effect datesoftheappraisal reports. 3. Criticism on failure to utilize single-family home data BrabantCriticism There does not seem to be anyrecognitionofthe superior homepricesinPaloAltoand its location value. Beccaria Reply-Single-family home data should not be used to relateto the determination of price increases for mobile homesin parks since the markets are entirely separate. • The verifiable history ofsales in the mobilehome park showed a range of$1000 •$30,000, some of those sales occurred at the peak of the 2005-2007 housing bubble, but none of them supported higher valuations, which proves that the high conventional housing prices in the City simply cannot pierce the market within this mobile home park,despite its Palo Alto location. • Not one purchaser in the market for a single-family home or condominium in Palo Alto would accept housing at the Buena Vista Mobilehome Park. 4.Extraordinary Assumptions/Hypothetical Conditions Brabant Criticism Claims that Beccariashould not have assumed that additions were unpermitted. Beccaria Reply -The fact that the vast majority ofAdditions were not permitted is a relative certaintyand factual truth. • Beccaria Reply:tnly 2 of the 100+units provided permits after copies of permits for additions were requested.The Park iwner /Manager indicated additions were not permitted.Appraiser investigations led us to believe with relative certaintyall but the two additions were not made with permits. 5.Criticism on failure to factor in the Location of the Park Brabant Criticism That superior home prices in the Palo Alto location should affect the rating of the Buena Vista mobilehome park relative to its comparability with other higher rated parks. Beccaria Reply-Despite the PaloAlto location,the Buena Vista Park's limited infrastructure,facilities,and high density negated a need fora location adjustment. • Basedupon reviewed information, higher park caliberwas judgedto be offsetbyspace rent differences. • The Buena Vista Park caters to persons needing very affordably priced housing. The overall caliber of the Park is low with high density.Based on Beccaria's judgment,Park amenities,space rent,and location are intertwined. • The history of the Buena Vista Park sales do not indicate a premium being paid for its location. BECCARIA &WEBER,INC. REALTORS.APPRAISERS.A PROPERTYMANAGERS 830-F Bay Avenue,CapitoJa,CA 95010 Bus:(831)462-1406,Pax:(831)462-3812 Email:davidbeccaria@beccariawebei.com Home Page:www.beccariaweher.com ATTENTION:Margaret EckerNanda,Attorney March 25*,2015 485 Alberto Way Suite 100 Los Gatos,CA 95030 REBUTTALTO APPRAISAL REVIEW DATED MARCH 23rd,2015 Dear Margaret, Thank you for the opportunity to address the issues laid beforeme inthe appraisal review. Withregard to thecommentsmadeby thereviewappraiserinhisreportdatedMarch 23'',2015! offerthe following responses: COMPARABLE SALESELECTION: Thereviewappraiserfailsto understandthe marketthatexists forthis mobile homepark. It isat timesa "blackmarket"withsales perhaps hidden from the government entitiestoavoidtaxesor fees.Inaddition construction projectsarealmostalwayshidden from thegovernmententitiesperhapstoavoid lackof permittingissues,taxes.orfees. Theunits inthis mobile homeparkwhenavailable forsalearethelast bastion foraffordable housing inavery expensivearea. Thoughthemobile home parkis located in PaloAlto,itdoesnotrelatetoanyother market data within theCity limits of Palo Alto.Most ofthe units inthe park aresingle widehomes, mostwith additions,and where appropriate single wide homes were selected asa basis for comparison. Overall,the review appraiser simply doesnotcomprehend the complications with regard tothe assignment inthatregard.The salesdata selected for comparison to the subject units was the bestdata available relative totheeffective datesofthereport.The verifiable history ofsalesinthemobile home park showed a range of$1,000 to$30,000,some ofthose sales occurred at the peak of the 2005-2007 housing bubble but none ofthem supported higher valuations and that fact proves that the high conventional housing prices in the City,simply can not pierce the market within this mobile home park despite it's Palo Alto location. SPACE #74:The review appraiser highlights Space 74 in the park,a park model unit He indicates that the comparable sales were not comparable.That simply isnot true.Market participants riding in a car with a Realtor would have considered all ofthe comparable sales utilized in our appraisal report for this comparable sale,that makes them comparable.The fact that no park model units had sold recently inthesubjectmobile homepark compelled usto utilize datathatwasavailable to us.The review appraisers criticism isunfounded and without merit and demonstrates a lack ofmarket knowledge.He also criticized that lack ofa time adjustment for this comparable sale,ifone was to have been made itwould have been a negative time adjustment,as the median sale price for 2012 for mobile homes in parks in Santa Clara County was $70,000 compared to $84,750 for 2006.The review appraiser's comments again are without substance.We did not make the negative time adjustment as the overall analysis ofthe market data in this extremely complex assignment negated it. TIME ADJUSTMENT:2012 sales were not adjusted for time.We considered atime adjustment for other older sales,however,the overall analysis of the market data in the sales comparison approach to valueconsistently negated atime adjustment.A time adjustment wasnotmadefor thatreason.If primary data doesnot support atime adjustment than utilizing statistical data as abasis isnot reasonable.The review appraiser suggests relying upon the housing prices in the market area for single family homes as a basis for the time adjustment.That is simply ludicrous,not one of the purchasers in the market for a single family home orcondominiums in Palo Alto would accept housing atthis location.Itismuch more appropriate toutilizesales data from mobile home parks in other communitieswheretheincomelevelsof the market participants are most similar.The stable box was checked inthe appraisal reports for direction in values,asthough the statistical data supported a moderate adjustment,overall analysis ofmarket data typically negated it within thereports relative to the effective dates ofthe appraisal reports. With regard to the inclusion ofSpace 202 for Sahara Village and excluding other sales in Sahara Village. None ofthe other sales mentioned inthe reviewer's comments were within 12months ofthe effective date ofthe report.His criticism is unfounded aswe selected themostrecent comparable sale from the parkofasinglewide home. Itwouldhavebeen misleading to selectothercomparable sale data thatwas more dated.It really isaridiculous criticismin lightoftheeffective date ofthe report.If implemented the review appraisers comments would leadto amisleadingreportasthe most current sales data relative to the report would be excluded. With regardto the reviewer's comments on the comparable saleselection in the appraisal report forthe comparable sales selected from SantiagoVilla MHP in Mountain View,againthe review appraiser misses the importance ofthe sales that were selected ahead ofthe other sales that had sold. Sale #307 in Santiago Villa isa double widehome andwas not includedinour valuations forsinglewide homes forthat reason. Space#249 in SantiagoVilla is also adouble wide home. It ismisleading to include higherpriceddatawhen it is notmost similartothe subject. The review appraiser's comments again are incorrect.There isa large discrepancyin value between single wide factory built homes and double wide factory built homes. Adding an addition to a singlewide home does notchangethis basic fact. DATAVERIFICATION:Data Verification:Collect,Verify, Analyze....USPAP2012-2013 ineffectat thetime ofthe assignment -Standard Rule7-4 requires data collected needstobe verified prior tobe included inthe report and analyzed.Onthree occasions we were notable to confirm sales data of prior sales ofunits in the park. With regard to Space #110 in this mobile home park,ourdata sheet that was provided totheunit owner for his completion wasnot returned to ussowe werenotmadeaware ofthis sale by the property owner.Theunitownerhad opportunity to report this sale tousbut did not.In addition this sale mentioned bythe review appraiser wasnot noted inthe M.housing.com web site asasale inthe subject mobile home park atthetimeofthevaluation.//onlylater showed upin M.housing after the assignment was completed.In addition this sale wasnot reported onthelocal MLS. The sale was not included in the valuation as it was not made available to us for verification and only showed up in the data service afterthe assignment wascompleted.We can not report whatwasnot available to us. Perhaps dueto housing pressures inthe area,with regard to Space #110,itismy opinion that the purchaser/owner grossly overpaid for that property in light of the proper comparable sale data analyzed in our report asitisnotsupported atany point in timeby any other verifiable sale inthesubject mobile home park,even those salesthat occurred atthe peak ofthe housingbubble. With regard to Space#24 in thismobilehome park.The owner provided verbal representation thatthe unit sold for $55,000 in 2006. We asked for supporting documentation but were not provided any. We wereunableto confirm this information with m.housing.com that did not notea sale ofthis home in 2006or atanytime thereafter.Again in anappraisal reportwe arerequiredto collect data,verify data, andthen and only then analyze that data. We were unable to substantiatethis sale with a partyor data service independent ofthe partiesto the matter at hand. It was excluded from the valuation for that reason. If it had been included anda time adjustment was made it would not have beena positive adjustment but insteadit would have been anegative adjustment asthe median sale price for 2012 for mobile homes in parksin Santa Clara County was $70,000 compared to $84,750 for2006. The review appraiser's comments again arewithout substance. Itcould not have been included in the report in any event as there was better more recent salesdata even within the parkthat were confirmed by the appraiser (myself). With regard to Space#73 inthis mobile home park.The propertyowner indicated verballythatthe unit was purchased in 2003-2004 for$50,000.We asked forsupportingdocumentationbutwere not provided any. Again we were unable to confirmthis information with m.housing.com thatdid not note a sale ofthishomesincebetween 1980 and2013.Againin an appraisal report we are required to collect data,verify data, and then and only then analyze that data. We were unable to substantiate this sale.Itwasexcluded from thevaluation forthatreason.If ithadbeen included and atime adjustment wasmadeitwould nothave been apositiveadjustment but instead itwouldhavebeenanegative adjustment as themedian sale price for 2012 for mobile homes inparks in Santa Clara County was $70,000 compared to $84,750 for 2006.Thereviewappraiser's comments again are withoutsubstance. WHY A HYPOTHETICAL CONDITIION:With regard tothe selection ofa hypothetical condition for the unpermitted additions,we interviewed all of the residents in the park and requested copies of permits for additions,as I recall only two were provided outof the 100+units appraised.In addition the park owner/manager indicated that the additions were not permitted.Our investigations led usto believe with relative certainty thatall but perhaps two ofthe additions totheunitsinthismobilehome park were unpermitted.Thus we made itahypothetical condition and appraised the properties "as if the units were properly permitted.The fact that our investigation led usaway from making an arbitrary extraordinary assumption toahypothetical condition was due to the fact that wehad relative certainty that there was no permitting for the bulk of the additions built to the units in the park.We believe that to afactual truth,notan assumption. LOCATION:The subject mobile home park is amarket segment catering to persons needing very affordable priced housing in an area of extremely high conventional housing prices.The overall caliber of this park is low with high density noted.In the judgment of the appraiser the issues ofspace rent, location,and park amenities are intertwined.The history ofverifiable sales in the park do not note a premium being paid for sales in the park even at the peak of the housing bubble for units in this mobile home park.We judged that no adjustment for these issues was necessary as the market had not proved an adjustment based upon verifiable sales in the subject's mobile home park.Ibelieve this to be true and correct.In studying the locational issue we noted at the time ofthe appraisal report that sales in Sahara Village ranged from $10,000 to $115,880 with an average sale price of$56,653 for atotal of27 sales reported on M.housing.com during thetwo year period between 1/3/2011 and 1/3/2013. With regard to Santiago Villa sales ranged from alow of$500 to ahigh of$165,000.The average sale price was $71,691 for 45 sales reported on M.housing.com during the two year period between I/3/2011 and 1/3/2013.Based upon this information we judged higher park caliber to be basically offset byspace rent differences.The Palo Alto location of the subject mobile home park due to the park's limited infrastructure,facilities,and high density simply negated the need for a location adjustment. SQUARE FOOTAGE DIFFERENCES:We utilized asquare footage adjustment of $20 per sq.ft.in all of the appraisals as in doing our overall analysis of the market data,that is the adjustment that reconciled values mostclosely in each report.Thisisamarket segment inatightmarket with market participants of this income level having few alternate choices.Perhaps none inthis community. Square footage isvalued bythe market participants,asmany have the need for additional size.There is aminimum adjustment required toall of the comparable sales,that does not parallel appraisals of conventional housing duetothe pressure onthe market participants.Itwasourjudgment on even small units tomakeaconsistent adjustment.With regard tothe review appraisers criticism of the appraisal of Space #74 and the square footage adjustment utilized,the adjustment for square footage doesnot relate to theprice paid persq. ft.oftheunit. The square footage adjustment ismade for incremental differences.It is inappropriate to reference this asa valid criticism and itis misleading. AGEADJUSTMENT:An age adjustment of$100 per year is made tothe comparable sales based upon an overall analysis ofthe market data.The data simplydidnot support a higher adjustment.This isa compressed marketsegmentin an area ofhigh conventional housingcostswith. A higheradjustment would have simply distorted the findings.The adjustmentneedsto be nominalasage ofthe unit isnot a primary reason for purchase ofa unit, there simply is a basic need forhousing that is not met in the community,and age is accepted by market participants,the market dataclearly reflects this statement. A condition adjustment was also made where appropriate in all ofthe valuations. SITE VALUE:The review appraiserreferences market datathat sold subsequent to the effective date ofthe appraisals under review. He indicated that Space 200 in Sahara Village sold for$48,000 in November of2014 and commented that it had been removed from the park.How could we have known that this would occur nearly two years later?Again he criticized ourreports because Space 139 in SantiagoVilla sold for$43,000 inSeptember of2013 andwas removed from the park in favor ofanew manufactured home.Again, how could wehave known that this wouldoccur nearly 8 months later?These arenot a valid criticisms ofour appraisalreports. Their inclusion in this appraisal review speakstowardclient advocacyas it goesbeyond an appraisal review relative to the effective date ofthe appraisal report. Curiously this information demonstrates thereview appraiser's misinterpretation ofthemarketunitsin the subject mobile home park.In these competing parks where abuyer simply was purchasing the pad (leasehold)andnotvaluingthemobilehomethatwasin place,thosecompeting parks are alsocapable of handling new manufactured homes.The subject park's infrastructure is significantly inferior to these competing parks and itis incapable ofhandling newmanufactured homes.That isone ofthe reasons thatthe"black market"has persisted,instead of replacing theolderunits,theyhavebeenrenovated and addedto without building permits.New unitshavenot been installed in thesubjectmobilehome park with the exception ofa few park model units with low amperage.That's where thiscriticism ofthe review appraiser breaks down.The subject park isa high density park oflow quality with dated infrastructure thatcaters to persons oflowincomehouseholds.They valuejusthavinga place to live and they are willing circumvent the permitting process to achieve that goal. COMMENTS ON THE RISING MARKET: Iam inagreementwith the review appraiser thatthe markethasbeen in a period ofrising prices sincethetime ofthe appraisal reports (January and February of2013).As you are aware I havenotedthatin prior correspondence even providingatone time some statistical information to correlatethat statement. Ihave attachedan updated median sale pricehistory for SantaClara County formobile and manufactured homes inmobile home parksthat clearly demonstratesthe pressure on pricesinthis marketsegment. See Chart I that is attached. I disagree thatanincreasingmarket subsequentto ourvaluationsshould beacriticism ofourbody of work aswe hadno way ofknowing prices would increase.I am not a prophet or a seer.I report facts relative to the effective date ofthe assignment.The review appraiser has indicatedthathe did not intend it as criticism,however it does indirectly suggest that, so that is why I provided this paragraph as a rebuttal. In addition an appraisalreview should be focused on the valuation date andnot detailed information that occurred subsequent to the valuation date. Furthermore,it is ludicrous to utilize statistical data forsingle familyhomesto relate to this property for time adjustments or determination ofincreasing prices formobilehomesin parks.Mobilehome park data should besolely utilized forprimaryreference.As background information only, should single family or condominium/townhouse statistical data be referenced. CONCLUSION: Our reports are valid relative to theeffective dateofthe reports.I doagreethe market has increased sincethetimeof the appraisal reports.I also agree thatSpace #110 can be included in the valuations as of acurrent date, but it was not averifiable sale at the time ofthe effective date of the appraisal reports and can notbe utilized as a basis for criticism.In addition it appears tobe an isolated data point,outside ofthehistorical range of verifiable sale prices inthemobile home park. Itdidnotshowinthedata bank until after the valuations were completed and theunitowner didnot provide that information tousdespite several attempts including posting our information request sheet on the unit's front door. In other respects Iam mostly in disagreement with the reviewer's comments as noted on the preceding pages. Sincerely, David F.Beccaria,MBA,IFAS,IFA,ASA,GAA,RAA,MRICS CertifiedGeneral RealEstateAppraiser,#AG001943 Expires 3/3/2017 BUENA VISTA MOBILE HOME PARK TWO YEAR SALES HISTORY VrfViupa L/aia www.mhousing.com •COMPARABLE SALES REPORT F(om:UV20tluinn0ll Reports*te:U3S0U St**PrtMonr?SendmanErrorBcnen Neoectlislinkedto ft*ttove pjrtotwafc ParkNone: PMkAlHWU: Mew Strati)H BUENAVISTA MHP HSOEICMIMOREM. PALO ALTO.CA ttjce 104 i-age i ui I Report MisslnQ Or ErroneousInloimaUon •ClickHoto Ptatec*kondieWukig DaleI&rorReportinglawu raporijoy miningdug »rerareyouM roaroecoiiaiAMntthlrifareport. PfejeepnwkMue«r»0»detalli.Ouruppen«ufl»aretpendtoyourema9wOUn14.4Ahoura. ,r*o-.r 4V i hup://www.rrAousing.«>m/rcport^qhome4.Bsp?parkid"43-0003&reTJOrt=&ditr^VTO 1/3/2013 OFFICE OF THE CITY ATTOWNhV 250 H.imillon Avi-nue.Blh Floor PALO Polo Alto,CA 94301 ALTO 6503292171 April 7,2015 Margaret Ecker Nanda Attorney at Law 485 Alberto Way,Suite 100 Los Gatos,CA 95032 Nadia Aziz James Zahradka Public Interest Law Firm Law Foundation of Silicon Valley 152 NorthThird Street, 3'"Floor San Jose,CA95112 Re:Buena Vista Mobilehome Park Appeal Hearing Dear Ms.Nando,Ms.Aziz and Mr.Zahradka; On April 13 and 14,the CityCouncil is scheduled to hearing the Residents'Association appeal of the Hearing Officer's decision on the Buena Vista Mobile Home Park closure application.The Mayor intends to conduct the hearing as follows. After addressing any housekeeping and procedural issues that may be required for an orderly hearing,the Council will open the hearing by taking public comment.Any member of the public who wishes to be heard may address the Council,including residents of Buena Vista and any other person.The Council requests that speakers fill out a speaker card and submit it to the CityClerk. The Council typically allows speakers three minutes to address the Council,although the Mayor reserves the discretion to reduce the time to accommodate a large number of speakers.Under Council rules,a group of five or more individuals who are present in the Council chambers may select a spokesperson to speak on their behalf for up to 10 minutes. Speakers requiring translation may be allotted additional time,at the discretion of the Mayor After public comment is closed,the Council will hear presentations from the parties',their attorneys and their additional witness.The order of presentation will be adjusted,as follows: 1.Opening presentation (30 minutes)from the Residents'Association,and the Residents' Association's additional witness (10 minutes) 2.Park Owner's opening presentation (30 minutes)and additional witness (10 minutes) I5iiIii7 ,liui.iui n THE HONORABLE CITY COUNCIL April 7,2015 Page2 of 2 Re:Buena Vista Mobilehome Park Appeal Hearing The Mayor and the Council may decide to ask questions or make comments immediately after the parties'opening presentations and before rebuttals, ormay move directlyto the parties' rebuttals. The Council willhearthe Residents'Association rebuttal first(15minutes), followed by the Park Owner's rebuttal (15 minutes). Followingthe parties'presentations,the Councilwilldiscuss,deliberate and direct its staff regardingpreparation of findingsand a decisionon this matter.Council may direct questions to the parties. The Council will continue the hearing onTuesday,April 14th,at6:00 p.m.,ifasecond night is needed.Public comment will notbereopened onthe 14,h.Members ofthe public who wish to address the Council regarding Buena Vista must do soon April 13th. ISlM07sltt1M0l.il Very truly yours, A MOLLY 5.STUMP City Attorney MSS:sh cc: City Council James Keene,City Manager Hillary Gitelman,Director of Planning andCommunityEnvironment Grant Kolling,SeniorAssistantCity Attorney Beth Minor, Interim Cily Clerk CITY OF PALO ALTO CITY COUNCIL ACTION MINUTES Special Meeting April 14, 2015 The City Council of the City of Palo Alto met on this date in the Council Chambers at 6:10 P.M. Present: Berman, Burt, DuBois, Filseth, Holman, Kniss, Scharff, Schmid, Wolbach Absent: Oral Communications None. Action Items 8.Hearing on Buena Vista Mobilehome Park Residents Association’s Appeal of Hearing Officer’s Decision Relating to Mitigation Measures Proposed by Buena Vista Mobilehome Park Owner in Connection with Mobilehome Park Closure Application (continued from April 13, 2015). Council took a break at 9:08 P.M. and reconvened at 9:22 P.M. MOTION: Council Member Scharff moved, seconded by Council Member Kniss to: 1)Approve the Hearing Officer’s decision with the following modifications: a)Updated appraisals of the on-site fair market value of each mobile home shall be completed within 6 months of the owner’s relocation from Buena Vista, at the Park Owner’s expense. Updates shall be prepared by Beccaria & Weber, according to the methodology utilized in the 2013 reports. If for any mobile home the updated appraisal amount is less than the appraisal calculated in the 2013 reports, the Page 1 of 3 ATTACHMENT B ACTION MINUTES Park Owner shall pay the higher of the two appraisals, as may be modified by the Hearing Officer as described below; and b) Within 6 months of the mobile home owner’s relocation from Buena Vista, the Park Owner shall complete an updated market survey of average apartment rents in the cities surrounding Palo Alto, using the methodology in the RIR. This survey shall be the basis for calculating the 12-month rent differential and start-up costs described in the Hearing Officer’s decision; and c) Within 30 days of receiving the updates described above, any mobile home owner may submit a written objection, comment or supplemental data to the Hearing Officer. The Park Owner shall have 15 days to rebut any such submissions. The Hearing Officer shall make a determination regarding the appraisal amount and comparable market survey based on the evidence submitted. The Hearing Officer shall not award less than the amounts contained in the updated analyses of the Park Owner, or more than the amounts supported by evidence submitted by the mobile home owners. The Hearing Officer shall not have jurisdiction to reopen any matter addressed by the Council’s Decision or the Sept 30, 2014, Hearing Officer’s Decision. The Hearing Officer shall issue a short written determination, which shall be final. The Hearing Officer’s determination shall not be appealable to the Council. Any appeal shall be to the Superior Court, to the extent provided by law; and d) Final determination of actual moving costs and additional mitigations for disabled mobile home owners shall be determined by the Relocation Specialist, as set forth in the Hearing Officer’s decision; and e) In addition where a one bedroom mobile home unit has more than one bedroom because of unpermitted additions, where family is greater than three people, the rental compensation will provide for a two bedroom rental unit. 2) Staff shall return to Council for adoption of written findings and decision consistent with this Motion. Page 2 of 3 City Council Meeting Action Minutes: 04/14/15 ACTION MINUTES INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add “permitted and” to Section e) in the Motion. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add “within thirty days or as soon as practical thereafter,” to Section c) in the Motion. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to remove “In addition” from Section e) in the Motion. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER that the appraiser will revise the scope of community amenities to include things such as safety and schools. AMENDMENT: Council Member Burt moved, seconded by Council Member DuBois to add to the Motion “The closure plan shall be effective upon approval by the Hearing Officer of the modified appraisal scope.” AMENDMENT FAILED: 3-6 Burt, DuBois, Schmid yes MOTION AS AMENDED PASSED: 9-0 Adjournment: The meeting was adjourned at 11:28 P.M. Page 3 of 3 City Council Meeting Action Minutes: 04/14/15 Hanks,Sharon From:davidbeccaria@beccariaweber.com Sent:Tuesday, May05, 2015 2:30 PM To:Council,City;Stump,Molly;Kolling,Grant Cc:Margaret Nanda;Sonya Welch;Nadia.Aziz@lawfoundation.org; JamesZ@law.foundation.org Subject:LETTER TO CITY MAYOR FROM APPRAISER REGARDING BUENA VISTA Attachments:Buena Vista Letter to City Mayor from Appraiser.pdf Importance:High The Honorable Karen Holman, Mayor May 5th,2015 City Council,City of Palo Alto Office of the City Clerk 250 Hamilton Avenue Palo Alto,CA 94301 City.councilfSicitvofnaloalto.org Dear Honorable Karen Holman,Mayor, The attached letter explains our company's position on the appraisal issues. Thank you for the opportunity to be of service. Sincerely, Dave B. David F.Beccaria,Chief Executive Officer MBA,IFAS,IFA,ASA,MRICS,GAA, RAA Certified General Appraiser #AG001943 D.R.E.Real Estate Broker #00658104 Beccaria &Weber Inc. 830-F Bay Avenue,Capitola,CA 95010 Bus:831-462-1406,Cell:831-566-9661 Fax:831-462-3812 <t¥f> REAL ESTATE Realtors,Residential &Commercial Appraisals, Property Management,Asset Management &Investor Representation ATTACHMENT C BECCARIA &WEBER,INC. REALTORS.APPRAISERS.&PROPERTYMANAGERS 830-F BayAvenue,Capitola,CA 95010 Bus:(831)462-1406,Fax:(831)462-3812 Email:davidbeccaria@beccariaweber.com Home Page:www.beccariaweber.com TheHonorable Karen Holman,Mayor May 5*,2015 City Council,City ofPaloAlto Office ofthe CityClerk 250 Hamilton Avenue Palo Alto,CA 94301 Citv.cnuncil@citvofpalnalto.nrp Sentviaelectronicemail RE:BECCARIA &WEBER,INC.-BUENA VISTAAPPRAISALS Dear Honorable Karen Holman, Mayor, I have carefully reviewed anddeliberated upon the Scope of Work andthe appraisal methodology utilized to develop opinions of value forthe homes inthe subject mobile home parkwith mypartner, Greg Weber,and with Ray Umphrey.Ray Umphrey isa former ChiefAppraiser at the CIT Group,a lender for manufactured housing.Hehas reviewed over four thousand appraisal reportson mobile and manufacturedhousing in mobilehomeparks locatedinCaliforniaand he isa CertifiedResidential Appraiser.Greg,Ray,andmyselfbelieve thatno changes shouldbemadetoourScope ofWork or our appraisal methodology. #1:With regard to Schools andSafetybeingaddedto the Scopeof Work,it isouropinionthatthese issueswere consideredpreviouslyas theyare inherentinthe locationand neighborhooddata already utilized in the valuations. In our judgment,after careful consideration; no adjustment to the scope of work or our appraisal methodology should be made inthis regard. It would be misleading for us to amend the Scope ofWorkwhen we know that,ifadded, this would not change the outcome ofthe analysis.Wewill not engage in a subsequent appraisal assignment with a differing scope ofwork or a differing appraisal methodology. #2: Withregard to the Hypothetical Condition, the hypothetical condition is essential to this appraisal assignment in ourjudgment.We willnot engage in a subsequent appraisal assignment withoutthe Hypothetical Condition. #3: In regard to the selection of verified sales data from the subject park being included inthe sales comparisonapproachto value,we believethat the marketparticipantsthat havepurchasedunits inthe park over the years and those that purchased in the park since 2000-2001 until the park's closure announcement in 2012,did so with the expectation ofthe park's continued operation. Webelieve that these in-park sales, where appropriate and verifiable, should a part ofthe valuations. They form the basis ofthe locational issue.Wewill not engage in a subsequent appraisal assignment withoutthe ability to select the most appropriate market data for these reports including sales data from within thepark. #4:Senate Bill 223 (Filed with the Secretary ofState October 5lh,2007)protects an appraiser from unduepressure and also outlines acceptable inquiries toanappraiser.Although geared toward the mortgage lending industry,it does setan industry standard inthis regard for this issue.Since the completion of the appraisals over 2 years ago,I have responded toa formal appraisal review,I have reviewed another appraiser's report,I have written numerous letters in defense ofour appraisal reports, and I have spent 6 hours ataCity Council Meeting answering questions regarding our body ofwork.I believe at this point I have more than satisfied the requirements ofan appraiser in responding to inquiries about our appraisal reports.None ofthe criticisms brought against our reports have altered any ofour opinions ofvalue,the methodology utilized,or our Scope ofWork.Inmy judgment further communication totheappraiser inthis regard would be considered pressuring the appraiser.I will not allow that to happen.The appraisal process can not be caught up into the political controversy that exists inthiscommunity regarding this mobile home park.We must maintain ourindependence and impartiality.Iamnotan advocate forany party.Ionly advocate for the opinions of value stated inthe reports.We will notengage infurther discussions about appraisal methodology orScope ofWork issues. #5:Time isthe only variable thatwill change thevaluations inthe subsequent appraisals as market data relative to the effective dateor datesofthe subsequent appraisals is utilized. We respectfully submit thisletterto theCityAttorney,City Council,ParkResidents &their Attorneys, andtheParkOwner &theirAttorneys.IntheeventtheCityCouncil approves our previous-original ScopeofWorkand our previous-original methodologywe will be happyto completethesubsequent appraisals.Intheeventthe City Council changesthe Scopeof Work or ourpreviousmethodology then this letterwill alsoserve as our resignationfromthe subsequentappraisalassignments. The Uniform Standards of ProfessionalAppraisal Practice requires an appraiser to consider and define the appropriate Scopeof Work tocompletea credible analysis and report.We believequitestronglyinour work product and that it relates the TRUTH regarding the valuations ofthe units in this mobile home park. The appraisal reports were honestly and thoroughly prepared with impartiality considering all pertinent factors. Respectfully submitted, David F.Beccaria,MBA,IFAS,IFA,ASA,GAA,RAA,MRICS ChiefExecutive Officer,Beccaria &Weber,Inc. Certified General Real Estate Appraiser,#AG001943 Expires 3/3/2017 This letter hasbeen electronically sentto the following parties: Margaret Ecker Nanda Sonya P. Welch Law Office of Margaret EckerNanda Margaret.nanda@infogain.com sonvaDwelch@gmail.com Molly Stump CityAttorney Grant Kolling Senior Assistant City Attorney City ofPalo Alto Mollv.Stumpffi.CitvofPaloAlto.org Grant.Kollingffi.CitvofPaloAlto.org Nadia Aziz Senior Attorney Public Interest Law Firm and Fair Housing Law Project Nadia.Azizffilawfoundation.org James Zahradka Supervising Attorney Law Foundation ofSilicon Valley JamesZffilaw.foundation.org PUBLIC INTEREST LAW FIRM Oficina Legal deInterns Publico Law Foundation ofSiliconValley 152NorthThird Street,3"1Floor San Jose,California 95112 Telephone (408)293-4790 •Fax (408)293-0106 www.lawfoundation.org May 12,2015 ByE-mail Molly Stump, City Attorney City ofPalo Alto City Hall,7th Floor 250 Hamilton Ave. Palo Alto,CA 94301 Re:BuenaVista MobileHome Park closure application appeal DearMs. Stump: Thank you for your email yesterday concerning theCity'sschedule for release ofthe findings in this matter. Given Mr.Beccaria's statements inhisMay 5,2015,letter to Mayor Holman,we write to share ourviewsregarding what steps theCity should take next.In themotion that it unanimously passed on April 14,2015,Council directed the appraiser to"revise the scope of community amenities to include things such assafety and schools."Mr.Beccaria has expressly refused to follow Council's directive inthis regard,stating that his firm "will not engage in asubsequent appraisal assignment with adiffering scope of work or adiffering appraisal methodology."He threatens toresign if Council "changes"thescope ofworkormethodology. As made clear inthereport drafted bytheResidents Association's expert mobile home appraiser,Jim Brabant,Mr.Beccaria's stubborn defense of his scope and methodology and rigid refusal toconsider modifying them only compound the serious flaws in his original report.In his report,Mr. Brabantnotes that: Noadjustments are made inthe32appraisals for differences inLocation and/or Site Value.When thecomparable sale isfrom Redwood City,Mountain Viewor Sunnyvale,the report indicates the location isoffset bythe rent.It appears that for location,the appraisers are primarily concerned with the quality of the park and all of thecomparable parks are rated superior to Buena Vista.However,there does not appear tobeany recognition ofthe superior home prices in Palo Alto compared with those other cities.1 Given the above,Mr.Brabant tenders his opinion that Mr.Beccaria's use of comparables from Redwood City,Mountain View,and Sunnyvale without a location adjustment means that "the 1James Brabant,"Review of Appraisals by Beccaria &Weber.Inc.,"page 6.attached as Exhibit 1.Note that Council decided to make thisreport part oftherecord onappeal. ATTACHMENT D Letter to Molly Stump May 12,2015 Page 2of3 superior Palo Alto location seems to be lost in this process."2 This view is directly aligned with the direction inCouncil's motion,whichseekstocapturethe significant valueofthe publicschoolsand publicsafetythata PaloAltoaddressconveys.Mr. Becceriahasdecidedtodefythe Counciland ignorethese factors. Thus,itisclearthatforCouncil'sdirective tobefollowed,a different appraiser willneedto be appointed,and new appraisals will have to be conducted.3 Under the Ordinance,a "qualified appraiser"is "to be chosen by the Park Owner from a list supplied by the City."4 The City should promptly supply this list to the Park Owner so that this process can begin.s At the May 26,2015,hearing,Councilshoulddirectstaffto supplythis listand informthe ParkOwnerthatifhewantsto pursuehisclosureapplication,hewillneedto submita new Relocation ImpactReportincluding information basedon the newappraisals. Public Records Act Request Finally,we hereby submita request underthe Public Records Act (Cal.Gov't Code§§6250 et seq.)as follows: Please provide uswith thefollowing public records inpossession oftheCityof Palo Alto, including anyreports,memoranda,communications,oranyotherwritings,as defined insection 6252(e)ofthe CaliforniaGovernment Code: •Any and all Records submitted to the Palo Alto City Council,orany members thereof,relating to theHearing on Buena Vista Mobilehome Park Residents Association's Appeal of Hearing Officer's Decision Relating to Mitigation Measures Proposed byBuenaVistaMobilehome Park Owner inConnection with Mobilehome Park Closure Application,heard bytheCouncil onApril 13 and 14,2015. 2 Ibid 3In addition,the (act that Mr.Beccaria appeared as awitness for the Park Owner throws his impartiality and credibility into serious question,another reason heshould bereplaced.While the Council did notquestion Mr.Beccaria about whether he was being paid anadditional amount totestify onthe Park Owner's behalf,itseems highly likely that he was.This payment would berelevant to"thecredibility ofthewitness and theweight of his testimony."Cal.Evid.Code,§722(b).Council should askthePark Owner to provide thisinformation before itmakes itsfinal decision. 4Palo Alto Mobilehome Conversion Ordinance,§9.76.030(d)(iv).Notably,this process was not followed in the appointment ofMr.Beccaria.Rather,as the attached emailsdemonstrate,Nathan Tuttle from Prometheus Real Estate Group suggested Mr.Beccaria toCity staffas"the appraiser that seems tohave the most complex park closure experience intheBay Area."SeeExhibit2. Inthememorandum inwhich Council was informed ofstaffsapproval ofMr.Beccaria as the appraiser for theowner, staff stated that itexpected that "staff oranoutside appraiser for the City will peer review the appraisal."Palo Alto City Manager,"Status Update for Buena Vista Mobile Home Park,"Dec.17,2012,p.3 (attached as Exhibit 3).This City- sponsored peer review never took place,although the Residents did provide Mr.Brabant's analysis;Council should ensure thatitconducts itsownpeerreview ofthenewsetofappraisals. Letter to Molly Stump May 12.2015 Page3 of3 We requestthatyou producecopies ofthese Records. Pleasealso respond as to (I)the existence ofsuch Records:(2) whether you intendto make such Recordsavailable:and (3)whether you claim any exemption or privilege. Please senda response within 10 days,as required by Government Code §6253(c),to my attention at the address indicated on the letterhead above.Where the information is contained in electronic databases,we request thatsuch information be provided in electronic form,pursuant to Government Code.§6253.9. in lieuofhard copies. Pleaseemail recordsthatare available in electronicformat tojaineszfc law•fotindaiion.org.Inaddition,please forward this letterto any and all persons inyouroffice who can assist incomplyingwith this request. We have attempted tobeas specific aswecanindesignating public records without having accessto the recordsthemselves.If you find this request insufficiently focusedor effective,we request that you providethe assistancerequiredby Government Code Section 6253.1.including "assisting the member ofthe public to identify records and information thatarcresponsive tothe requestor to the purposeof the request." Ifyou believe any portion of the information wehave requested isexempt from disclosure by express provision ofthe law.Government Code Section 6253(a)additionally requires segregation or deletion ofthat material and the release ofthe remainder ofthe infonnation. Wearca not-for-profit legal services organization anddo not charge ourclientsforour services. We thereforerequesta waiver ofany copying charges. Should you wish todiscuss thismatter further,please contact meat (408)280-2423 orbye- mailatjameszfrJawfoundation.org. Respectfullysubmitted. r. James F.Zahradka II SupervisingAttorney PublicInterest Law Firm and Fair Housing Law Project Law Foundation of Silicon Valley End. CC:Margaret Nanda (by-email to menanda@infogain.com) APPRAISAL REVIEW REPORT REVIEW OF APPRAISALS BY BECCARIA &WEBER,INC. RE:BUENA VISTA MOBILE HOME PARK PALO ALTO,CALIFORNIA REVIEWED BY JAMES BRABANT,MAI PREPARED FOR Law Foundation ofSiliconValley, Sidley Austin LLP and Western Center on Law and Poverty DATE OF REPORT March 23,2015 PREPARED BY Anderson &Brabant,Inc. 353 West Ninth Avenue Escondido,California 92025 File No.15-016 ANDERSON &BRABANT,INC. REALESTATEAPPRAISERSANDCONSULTANTS 353W.NINTH AVENUE ESCONDIDO,CALIFORNIA92025-5032 TELEPHONE (760)741-1146 FAX (760)741-1049 March 23,2015 Mathew Dolan,Associate Sidley Austin LLP 1001 Page Mill Road Palo Alto,CA 94304 Re: Appraisal Review Appraisals ofHomes in Buena Vista Mobile Home Park Palo Alto,California Dear Mr.Dolan: As requested, I have completed a review of 32 appraisals of the above referenced property.Standard 3 of the Uniform Standards of Professional Appraisal Practice (USPAP) establishes the criteria tobe addressed insucha review.Within the framework of guidelines set forth in Standard 3 of USPAP,I have summarized the following pertinent comments,opinions andconclusionsresultingfrom the reviewprocess. Identification of the Client This review reportwas prepared at the request of the Law Foundation of Silicon Valley, Sidley Austin LLP,and Western Center on Lawand Poverty.The opinions expressed herein are those of the author and do not necessarily represent the views of the Resident Association or their attorneys. Intended Use and Users of the Review Report Itismy understanding thatthe review appraisers'opinions and conclusions willbe utilized bymyclienttoassistin evaluating the appraisals ofmobile homes/travel trailers thatwere included in a ResidentImpactReport (RIR). Purpose ofthe Review Assignment The primary purpose of this review isto develop an opinion asto the overall adequacy and appropriateness ofthe reports being reviewed,and,specifically not to develop independent opinions ofmarket value for each ofthe homes. Further, it is intended to determine ifthe results oftheappraisal arecredible forthe intended user's intended use and also to evaluate compliance with relevant USPAP and client requirements. Matthew Dolan Review Appraisal March 23,2015 Page 2 of9 Identification ofthe Reports The reports under review are identified as Summary Appraisal Reports as described by Standard 2-2(b)of USPAP. The reports were prepared by Beccaria & Weber, Inc., Realtors, Appraisers and Property Managers.Their office is located at 830-F Bay Avenue,Capitola, California 95010.Their client was Toufic Jisser ofSan Jose, California. It appears that Beccaria & Weber prepared 99 appraisal reports and their conclusions were reported in the Resident Impact Report (RIR) for Buena Vista Mobile Home Park. The RIRwas prepared by Margaret Ecker Nanda,Attorney at Law and Brian Grasser,Attorney at Law,on behalf of the park owner,The Jisser Family.The Fair Housing Law Project has provided mewithcopies of 32 of the appraisal reports.They have indicated thatthe32 reports representall of the appraisals they have in this matter.This is a substantial number of reports and would appear to be a fair representation of the entire bodyof work that was completed by Beccaria & Weber in this assignment. The 32 reports are appraisals of the homes on the following spaces in Buena Vista Mobile HomePark: 2,5,13,16,19,21, 24, 31, 32, 35,38,46,47,48,50, 58, 63, 71, 72, 73, 74, 76, 82, 83, 88, 89,102,103,105,109,110 and 112.The appraisals are dated in Januaryand February of2013. Identification of the Appraised Property The appraised property consists ofthe homes located in Buena Vista Mobile Home Park. BuenaVistais a high density park that was originally builtas an overnight trailer/RV parkbut gradually evolved into a place for long term residency.In the 32 appraisals I have reviewed, thereis a widerange in thetype,age andsize ofthe homes.The typesof homesincludemobile homes,travel trailers,parkmodels and motor homes.Theageofthe homes ranges from 1955 to the 2004,and thesizes rangefrom 180 to 877square feet. Interest Appraised Each appraisal includes an opinion of the in-place market value as well as the offsite value, where applicable. Effective Date ofValue and Report The valuation dates for the 32 appraisals are various days in January and February of 2013.The report dates are the same as the dates ofvalue. Effective Date ofReview and Review Report This reviewand reviewreportare madeas ofMarch23,2015.1personallyinspectedthe subjectpark,andthe fiveparks thatcontaincomparablesales,on March 19,2015. Matthew Dolan Review Appraisal March 23,2015 Page 3 of9 Scope of the Review Process In developing this review,I haveundertaken the following tasks: 1.Conducted a thorough office review of the 32 appraisal reports that were provided. The primary focus of the review hasbeenthe opinions of the in-placc market values ofthe 32 homes. 2. Also reviewedthe ResidentImpactReport(RIR)and otherdocuments. 3.Discussedthe propertyand reportswith theclient. 4.Verified the accuracy of certain factual documentation contained inthe reports. 5. Fieldreviewed thesubjectproperty and selected market data.Exterior inspections of the homes. I have relied on details ofthe interior of the subject homes as described in the appraisal reports. 6. Prepared the review report. Extraordinary Assumptions/Hypothetical Conditions The opinions of in-placc market value are based on two hypothetical conditions.The firstis the assumption thattheparkis notgoingto be closed.The second is the assumption that any additions to the homes were legally permitted.However,it appears that the second assumption is actually what is termed an extraordinary assumption rather than a hypothetical condition.Unless the appraiser knows thateveryaddition to the homes intheparkis not legally permitted it should be labeledan extraordinaryassumption. This is considered to be somewhat ofa technical matter and did not appear to effect the value conclusions. Completeness ofthe Report and USPAP Compliance The intent of the appraiser was to prepare Summary Appraisals in conformance with Standards Rule2-2(b)of USPAP.It appearsthat all of the components of a SummaryAppraisal Report are present in the reviewed appraisal reports according to USPAP Standards in effect as ofthe date ofthe reports. While the components of the appraisals appear to be consistent with USPAP,I haveserious disagreements withthe choiceof comparable salesand thewaytheyhave been analyzed. Appropriateness ofAppraisal Methods and Techniques The appraisalassignmentincludedprovidingopinions ofthe in-place market value of the homes in Buena Vista Mobile Home Park. The appraiser has adequately set the foundation for the valuationprocess by describingthe pertinent physicalcharacteristicsand legal constraints of the subject property,and the market in which it will compete. To solve this appraisal problem, the appraiser has properly identified the Sales Comparison Approach as the most appropriate valuation method for the in-place market values ofthe homes appraised. Matthew Dolan Review Appraisal March 23,2015 Page 4 of9 Adequacy and Relevance ofComparable Data As previously mentioned,there isawidevariety inthetype,sizeandageofthe32 homes appraised.However,the appraiser utilized only 13 sales asthe data base for all32 appraisals. Six of those sales are from Buena Vista,while seven are from five other parks.One sale was utilized from Adobe Wells in Sunnyvale,two from Blue Bonnet Mobile Home Park in Sunnyvale,one from Sahara Village in Mountain View,two from Santiago Villa Mobile Home Park in Mountain View,andone from Harbor Village in Redwood City. Each appraisal has either seven or eight comparable sales thatarccompared and adjusted toa subject home for the valuation analysis.At first glance that appears tobea large comparable data base for the analysis of each home.However,inspite of the substantial variations in type, sizeand age of the 32 homes appraised,many of the comparable salesare utilizedforalmost all of the home appraisals.In fact,Space 202 in Sahara Village andSpace 160 in Harbor Village wereused in all 32 appraisals despite significant differences in the subject homes.In addition, Spaces 30 and48 in Buena Vista,Spaces 3 and 43 in Blue Bonnet,and Space 27 in Santiago Villa,were used in almost all of the 32 appraisals.It looks like a very small sampling of sales waschosen from a potentially large database thatcould produce misleading results. One example of inappropriate market data would be from the appraisal of Space 74 in BuenaVista. This is a smallpark modelthatwas built in 2004. However,five ofthe seven sales utilized werebuiltinthe 1960s andarcnot comparable. Another example of inappropriate data would be the one and only comparable salethat wasutilizedfromSaharaVillagein Mountain View(Space202). It was a 1969home with 576 square feet that sold for $15,000 in September 2012.However,MHousing (HCD records) reports a saleinJuly 2010,ofa 520square foot home builtin 1963,on Space 177,thatsoldfor $34,000.They report another sale in July 2010,of a 550 square foot home built in 1962,on Space 165,at a price of $22,000.In addition,the MLS reports a sale in May 2011,of a 688 square foot home built in 1964,on Space 253,for $28,000.The MLS also reports a sale in March 2011,of a 720squarefoothomebuilt in 1967,fora price of$20,000.The lowersale at $15,000 was utilized inall32oftheappraisals.Focusing on the lower sale and ignoring higher sales would likely produce a misleading result. A further example would be the two comparable sales that were utilized from Santiago Villa MHP in Mountain View.The first is a 1970 home on Space 24 with 672 square feet that soldfor $26,000 in November 2011.Thesecond sale used isa 1966 home on Space 27 with 600 square feet that sold for 18,000 in March 2012.However,the MLS reports higher sales during the same time period that were not used.The MLS reports a saleinJuly 2012,ofa 960 square foothomebuiltin 1966,on Space307, for $50,000.The MLS also reports a salein December 2012,ofan 800 square foothomebuilt in 1969,on Space 249, for a priceof $40,000.Again, ignoringhighersales in favor oflowersaleswouldproducea misleadingresult. Matthew Dolan Review Appraisal March 23,2015 Page 5 of9 Six sales ofhomes from Buena Vista were utilizedas comparablcs. Five of the six sales soldbetween October 2010 andJuly 2012.However,onesale (Space 54)wasa parkmodeland sold in May 2006 at a price of $23,000. It appears that this older transaction was utilized becauseit wasthe onlysale foundofa park model.However,no time adjustment wasmade for the six+ year difference between the sale date and the appraiser's date of value. The range ofthe six sales from Buena Vista is from $3,000 to $29,000. However, I am aware of at least three ofthe homes in the park that were purchased for $50,000 or more. The home on Space 24was reportedly purchased for$55,000 in2006butwasonly appraised in 2013 for $31,500.The home on Space 73 was reportedly purchased for $50,000 in 2003/2004, but was only appraised for $16,000.The home on Space 110 was reported sold by MHousing in July 2012 for $50,000 but was only appraised for $30,000. It is important to provide further information aboutthesaleofthehomeon Space 110.In the appraisal being reviewed,in discussing the prior purchase of the home the appraiserstates, "The current owner has not provided the date purchased or for what price."However, MHousing reported a sale of the home in July 2012 at a price of $50,000. Although the appraisals refer to MHousingas a data source in some of the other 32 appraisals,there is no mention of this sale. This is significant because it would have been critical information for the valuation of the home on Space 110.Of the six sales from Buena Vista utilized in the 32 appraisals,the highest sale was at a price of $29,000.Ignoring a sale at $50,000 in this park seriously undermines the credibility of the valuation conclusions. We interviewed the owner of the home on Space 110,Hariberto Avalos, who confirmed that he purchased it for a price of $50,000 in July of2012,and that the home was in good condition. He also stated that he was unaware of the pending park closure and would not have purchased if he had known. He was notified of the closure about three months after he bought the home. Appraising this home for $30,000 in February 2013, when it was purchased only seven months prior at $50,000 and the housing market was increasing, is not credible and in my opinion has produced a misleading result.The significance ofthis is notjust the impacton the valuation ofthe homeon Space 110, but the fact that this sale could have been utilized as a comparable sale for other homes in the park. Adequacy of Adjustment Process The 13 comparablesales that served as the data base for the appraisals ofthe 32 homes ranged in date from May 2006 to October 2012, with all but one of them occurring in the two year period from October 2010 to October 2012.However,no time adjustmentswere made for the difference between the sale dates of the comparables and the dates of value. And in the Neighborhood section of each report, the Property Value box is checked for Stable rather than Increasing.This is in contrast to the data presented in the report that includes information about the substantial increase in median home price for single-family homes in Palo Alto and the surroundingarea, having increased from $1,428,000 in 2011 to $1,726,000 in 2012. The report then says "Conversely the median sale price formobile and manufactured homes in mobile home Matthew Dolan Review Appraisal March 23,2015 Page 6 of9 parks throughoutSantaClara Countywas $70,000 in 2012 up from $63,000 in 2011."The word "conversely"is inaccurate sincethe market for mobile homes wasgoingup,albeitnotas rapidly as the market for single-family homes. In addition, the "Increasing" box should have been checked in the Neighborhood section,rather than the "Stable" box. More importantly,the appraisals shouldhave recognized thatthemarketfor mobilehomeswas increasing and that fact shouldhavebeenreflectedby makingtimeadjustments. No adjustments are made in the 32 appraisals for differences in Location and/or Site Value.When the comparable sale is from Redwood City,Mountain View or Sunnyvale,the report indicates the location is offsetby the rent.It appears that for location,the appraisers arc primarily concerned with the quality of the park and all of the comparable parks arc rated superior to Buena Vista.However,theredoesnot appearto be any recognition of the superior home prices in Palo Alto comparedwith those other cities. Using Space 112 in Buena Vista as an example, Comparable 1 is located in Redwood City, which has a substantiallylower median homepricethanPalo Alto.However,thepark(HarborVillage)is ratedsuperiorto Buena Vista. But,thelocationis statedto be offsetby therent. ThespacerentforSpace 112 inBuenaVistais $695 while the space rent for Comparable 1 in Harbor Village is $708 which is only $13 per month higher.Apparently,the higher rent is supposed to be offsetting the superior park. However,the superiorPaloAlto locationseemsto be lost in this process. The lackof adjustment foreither Location or SiteValueis the same forall 32 appraisals. However, it is interesting to note that there is some support for a site value, even in the comparable parks utilized in the appraisals.For example, the home on Space 200 in Sahara Village sold for $48,000 in November 2014.It wasa 1972 single-wide homewith 576 square feet.It has been removed anda newhomeis currentlybeing installed.In effect,the buyer paid $48,000in site value for the right to control the space and purchasethe new homethat is being installed.The same thing happened at Space 139in Santiago Villa MHP.A 600 square foot home, built in 1969,was purchased for $43,000 in September 2013. It was removed and a new home is on the site. It should not be surprising to find examples of this type of site value in mobilehome parkslocatedinareas whereyou havesuch high homeprices. The 32 appraisals include adjustments for the difference in the size ofthe homes at a rate of $20.00 per square foot.This same rate of adjustment was made regardless of the age or quality of the home. For example, in the appraisal ofthe home on Space 19, ComparableNo. 1 is the home on Space 37 in Buena Vista which is a 1959 home with 176 square feet that sold for $3,000in November 2011.The sale price calculates to $17.05 per squarefeet. The homebeing appraised was built in 1958and has 378 square feet. The difference in the size ofthe two homes is 202 square feet (378 minus 176),and the size adjustment is 202 x $20 = 4,040. Contrast this with the appraisal of the home on Space 74 in Buena Vista that was built in 2004 and has 441 square feet. Comparable No. 7 is the home on Space 54 in Buena Vista that was also built in 2004 and has 286 square feet. That home sold for $23,000 in May 2006, which calculates to $80.42 per square foot.The difference in the size of the two homes is 155 square feet (441 Matthew Dolan Review Appraisal March 23,2015 Page 7 of9 minus 286),and the size adjustment is 155 x $20 =$3,100.The use of the same size adjustment rate for the appraisal of these two homes is inappropriate and in my opinion produces an incorrect value conclusion.This same incorrect analysis was used for allof the appraisals. Adjustments were made for differences in the age of the homes (year built)based on $100 per year.This is such a small amount that borders on being nominal.This becomes exaggerated in the appraisal of the home on Space 74 which was built in 2004. Five of the comparable sales used in that appraisal were built in the 1960s but they are not really comparable.Usingan inadequate upward adjustment of $100per year understates the indicated value ofthat home. Significance ofthe Date ofValue in a Rising Market Although theappraisals ofthe32 homes in Buena Vista provide statistical data about the rising housing market,thatfact hasnotbeenrecognized inthe analyses of comparable sales that goclearbackto 2010 (one salegoes back to 2006),while thedate of value isin early 2013.This lackof making time adjustments has already been discussed in the previous section.However, the determination of the date of value becomes extremely important when you have a rising market. Using Zillow asa source,the median price for residential properties (all homes)in Santa Clara County increased from $593,000 asof January 2010,to $853,000 asof January 2015,ora total increase of 44 percent forthe five year period.However,the median price for residential properties in Palo Alto increased from $1,100,000 to $2,200,000 during the same period,foran increase of 100 percent.Forthat same time period,Sunnyvale increased 50 percent,Mountain View increased 48 percent and Redwood City increased 34 percent.The increase in Palo Alto forthemostrecent two years alone (January 2013 to January 2015)was 47 percent (seeattached Exhibit 1). To further illustrate the significance of the raising housing market I have identified a couple of mobile homes thatsoldin 2011 or 2012 andthen resold more recently.The firstsale involves Space 43 in Blue Bonnet Mobile Home Park. This transaction occurred in March 2012 at a purchase price of $25,000 and as previously discussed was utilized in almost all of the 32 appraisals.According to MLS,this home resold in December 2014 at the significantly higher price of$62,900. I have also identified the April 2011 sale of Space 228 in Santiago Villa for $38,000. This 860 square foot home was built in 1969 and although it was not used in any of the 32 appraisals I reviewed,it is similar to the data used.According to MLS, this home resold in November 2014 at a price of$85,000. Both of these examples demonstrate the impact that the date of value can have, particularly in a rising market. Again, referring to data that occurred after the dates of the appraisals is not intended asa criticism ofthe appraisals sinceno appraiser canbe responsible for Matthew Dolan Review Appraisal March 23,2015 Page 8 of9 failing to use data that had not yet occurred.However,it certainly emphasizes the significance ofthe date of value to the home values. Appropriateness &Reasonableness of Analysis.Opinions &Conclusions The appraiser provided an adequate description of the subject properties and employed a valuation technique that is commonly used by the industry in providing opinions of in-place market value of mobile homes/travel trailers,etc.However, in my opinion, the selection and analyses of the comparable data in the 32 appraisals is Hawed and does not provide reasonable estimates of in-placc market value.It also appears that most of the shortcomings have resulted in an under valuation ofthe homes. Thank you for this opportunity to be ofservice. Please let me know if I can be of further assistance in this matter. Respectfully submitted. ANDERSON &BRABANT,INC. t—Jfafncs Brabant,MAI State Certification No.A(i()()2l()() Attachments: Exhibit 1(Residential trends reported by Zillow) Statement ofQualifications Matthew Dolan Review Appraisal March 23,2015 Page 9 of9 APPRAISER'S CERTIFICATION I do hereby certify that,to the best of my knowledge and belief... 1.The statements of fact contained inthis review report arctrueandcorrect. 2.The reported analyses,opinions,and conclusions are limited only by the reported assumptions and limiting conditions,arc my personal,unbiased professional analyses,opinions and conclusions. 3. 1have no present or prospective future interest in the property that is the subject of the work under review,and I haveno personal interest or bias with respect to the parties involved. 4. I have no bias with respect to the property that is the subject of the work under review or to the parties involved with this assignment. 5. My compensation is not contingent on an action or event resulting from the analyses, opinions,or conclusions in this review or from its use.Further,my compensation is not contingent upon development or reporting of predetermined assignment results or assignment results that favors the cause ofthe client, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intendeduse of this appraisal review. 6. My analyses, opinions, and conclusions were developed,and this review report was prepared, in conformity with the requirements of the Uniform Standards of Professional Appraisal Practice. 7. The use of this review report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 8. I have made a personal inspection of the properties that are the subject of this review report. 9. Patricia Haskins provided significant professional assistance to the person signing this review report. 10. As ofthe dale of this report. I.James Brabant,have completed the requirements under the continuing education program of the Appraisal Institute. 11.I have not provided any service regarding the subject property in the three years immediately preceding acceptance of this assignment,as an appraiser or in any capacity. -Janics Brabant,MAI State Certification No.AG002100 March 23.2015 Attachments Anderson &Brabant,Inc. 3 t O 3 bo 5 3 TRENDS -RESIDENTIAL PROPERTIES (ALL HOMES) Santa ClaraCouray Palo Alto Sunnyvale MountainView RedwoodCity Avg Price % Change Annual % Change Monthly Avg Price % Change Annual % Change Monthly Avg Price %Change Annual % Change Monthly Avg Price % Change Annual % Change Monthly Avg Price % Change Annual % Change Monthly Januarv-06 $737,000 .. ..$947,000 •.. ..$789,000 —«S789.000 „_$830,000 „„ Januarv-07 $743,000 0.8%0.1%$1,100,000 16.2%1.4%$792,000 0.4%0.0%S807.000 2.3%0.2%$836,000 0.7%0.1% January-08 $719,000 -3.2%-0.3%$1,300,000 18.2%1.5%$815,000 2.9%0.2%S820.000 1.6%0.1%$828,000 -1.0%-0.1% Jamorv-09 $613,000 -14.7%-1.2%$1,100,000 -15.4%-1.3%$746,000 -8.5%-0.7%$755,000 -7.9%-0.7%$733,000 -11.5%-1.0*/. January-10 $593,000 -3.3%-0.3%$1,100,000 0.0%0.0%$733,000 -1.7%-0.1%S744.000 -1.5%-01%$745,000 1.6%0.1% January-11 $587,000 -1.0%-0.1%$1,000,000 -9.1%-0.8%$746,000 1.8%0.2%S748.000 0.5%0.0%$720,000 -3.4%-0.3% January-12 $574,000 -2.2%-0.2%$1,200,000 20.0%1.7%$740,000 -0.8%-0.1%S754,000 0.8%0.1%$703,000 -2.4% -0.2% January-13 $662,000 15.3%1.3%SI.500.000 25.0%2.1%$872,000 17.8%1.5%S930.000 23.3%1.9%$816,000 16.1%1.3% January-14 $772,000 16.6%1.4%$1,900,000 26.7%2.2%$977,000 12.0%1.0%SI.000.000 7.5%0.6%$960,000 17.6%1.5% January-IS $853,000 10.5%0.9%$2,200,000 15.8%1.3%SI,100.000 12.6%1.1%SI.100.000 10.0%0.8%$1,000,000 42%0.4% MedunPrice asofFebruary2006 Source:Zillow 3/5/2015 &3/10/2015 QUALIFICATIONS OF THE APPRAISER James Brabant,MAI Anderson &Brabant,Inc. 353 W.Ninth Avenue Escondido.CA 92025 (760)741-4146 Ext.312 I.Resident ofSan DiegoCountysince 1977 II.Educational Background: A.University ofSouthern California,B.S.degreein RealEstate—1960 B. SchoolofTheology at Claremont,Masterof Theology —1966 C.Professional Education Completed: 1. Appraisal Institute a."Basic Appraisal Principles,Methods and Techniques"— Course I-A b. "CapitalizationTheoryand Techniques"— Course I-B c. "Urban Properties"— Course II d. "InvestmentAnalysis"— CourseIV e."Standards of Professional Practice" f. "Litigation Valuation" g. SpecialApplications of Appraisal Analysis Course301 2.Lincoln Graduate Center a.Manufactured HousingAppraisal Course669 3.Continuing Education (Partial List): San Diego Economic Forecasts,2/05,2/07,2/08,2/09,2/11 USPAP Course,9/04,5/06,4/08,3/10,3/12 OperatingExpenseSeminar4/11 FundamentalsofSeparatingReal Property,PersonalProperty,and Intangible Business Assets 4/12 Eminent Domain Case Update,10/95,3/97,10/07,4/10 Business Practice and Ethics, 6/07 San Diego Apartment & Housing Seminar,10/98,5/07,9/11 Appraiser as Expert Witness, 12/06 Deal and DevelopmentAnalysis- Downtown S.D., 9/05 Litigation Seminar,11/04,11/07,11/10 AppraisingManufacturedHousing,1/04 Economic and Real Estate Forum, 09/02 Gramm-Leach-Bliley Act,10/01 Condemnation on Trial (Participant), 5/00 Attorneys, Appraisers & Real Estate; 9/98 Damages, Diminution & Mitigation; 8/98 Appraisal ofPartial Interests; 6/98 Anderson &Brabant,Inc. Qualifications ofthe Appraiser —James Brabant,MAI Page Two HI.Professional Affiliations; A.Member,Appraisal Institute,MAI (1985 President,SanDiego Chapter) B. RealtorMember,NorthCountyAssociation of Realtors C. Member,International Right ofWayAssociation D. Real Estate Brokers License,State ofCalifornia E. TeachingCredential,StateofCalifornia,Community CollegeLevel F. CertifiedGeneral RealEstateAppraiser(AG002100) Officeof RealEstateAppraisers,StateofCalifornia IV.Appraisal Experience: Co-Owner—Anderson & Brabant, Inc., Since 1979 Co-Owner — Robert M. Dodd &Associates,Inc.,1977 -1979 Appraisal Manager—California FirstBank,Huntington Beach,California,1974-1977 StaffAppraiser—CaliforniaFirstBank,San Diego,California,1972 -1974 Staff Appraiser—O.W.CottonCo.,SanDiego,California,1970-1972 StaffAppraiser— DavisBrabant,MAI,Huntington Park,California,1960-1962 V.Teaching Experience: Southwestern College,Chula Vista,California,"RealEstateAppraisal" VI.Expert Witness: SuperiorCourt,San Diego,LosAngeles,Riverside,and San BernardinoCounties Rent Control Hearings:Cities of Oceanside,Escondido,Ventura,Concord,Yucaipa,Carpenteria, Palmdale,San Marcos,Carson,Watsonville Various Arbitration Hearings Assessment AppealsBoardsof Riverside County,San DiegoCountyandOrangeCounty Federal Bankruptcy CourtsinSanDiegoCounty& SantaBarbaraCounty United States District Court-Northern District ofCalifornia VII.Types ofAppraisals: Residential Property: Single-familyresidence,condominiums,apartments, subdivisions,existingand proposed Commercial Property:Office buildings,shopping centers, office condominiums,etc., existingand proposed Industrial Property:Single/multi-tenant,business parks,etc.,existingandproposed Vacant Land:Industrial,commercial,residential,and rural Agricultural:Ranches,avocadoandcitrusgroves,etc. SpecialPurposeAppraisals: Leasehold estates,possessory interest,historical appraisals,etc. Mobile Home Parks:Fora variety of purposes including rent hearings,parkclosure,park conversions, failure to maintain litigation, eminent domain, etc. Anderson &Brabant,Inc. Qualifications ofthe Appraiser—James Brabant,MAI Page Three VIII.Partial List ofAppraisal Clients: Banks Bank ofAmerica Bank ofNew York City National Bank Downey Savings Fidelity Federal Bank First Interstate Bank First Pacific National Bank FlagshipFederalSavings Great Western Bank IndustrialBankofJapan PalomarSavings& Loan Redlands Federal Bank Union BankofCalifornia Wells Fargo Bank Government Agencies and Municipalities CaliforniaDepartment of Transportation/Caltrans Carlsbad Municipal Water District City ofCarlsbad City ofChula Vista City ofColton City ofConcord City ofEscondido City ofLaguna Beach City of La Mesa City ofSalinas City ofSan Bernardino City of San Diego City ofSan Marcos City of Vista City ofYucaipa County ofSan Diego Fallbrook Public Utility District Metropolitan Water District Oceanside Unified School District Pacific Telephone Poway Municipal Water District Ramona Unified School District SANDAG (San Diego Assoc,of Govts.) San Diego County Water Authority San Diego Unified Port District San Marcos Unified School District U.S.Depart,ofthe Interior Bureau ofIndian Affairs U.S. Department ofJustice Anderson &Brabant,Inc. Law Firms Aleshire& Wynder, LLP Asaro,Keagy,Freeland.&McKinley Best,Best&Krieger Daley & Heft Endeman,Lincoln,Turek &Heater Foley &Lardner,LLP Fulbright& Jaworski Gray, Cary, Ware & Freidenrich Higgs, Fletcher & Mack Latham &Watkins Lounsbery, Ferguson, Altona & Peak Luce,Forward,Hamilton & Scripps McDonald &Allen Mclnnis, Fitzgerald, Rees, Sharkey & Mclntyre O'Melveny & Meyers Procopio, Cory, Hargreaves & Savitch Rutan &Tucker Singer, Richard Sullivan Wertz McDade &Wallace Tatro & Zamoyski Thorsnes Bartolotta &McGuire Woodruff, Spradlin & Smart Worden Williams,APC Title Companies Chicago Title Fidelity National Title Insurance First American Title St.Paul Title Title Insurance &Trust Others Avco Community Developers Coldwell Banker Dixieline Lumber Golden Eagle Insurance National Steel & Shipbuilding Co. Northern San Diego County Hospital District Prudential Insurance Corp. Rosenow, Spevacek, Group San DiegoGas & Electric Co. San Luis Rey Downs (Vessels) Steefel,Levin &Weiss Tellwright-Campbell,Inc. Transamerica Relocation Service Vedder Park Management City of Palo Alto (id #3367) PALOalto CitV Council Informational Report Report Type:Informational Report Meeting Date:12/17/2012 Title: Buena Vista Mobile Home Park Update Subject:Status Update for Buena Vista Mobile Home Park From:City Manager Lead Department:Planning and Community Environment Recommendation Thisisan informational update only and no Council action is required. Background On November 9,2012,an application was submitted by Joe Jisser,the owner of the Buena Vista Mobile Home Park (Park), to close the Park in accordance with the City's Mobilehome Park Conversion Ordinance (Ordinance)Chapter 9.76 of the Palo Alto Municipal Code. By Ordinance, the Park owner and the City are required to follow a set of rules for determining the potential impacts of the closure on the mobilehome owners residing in the Park and to determine appropriate relocation assistance for the Park residents.The Ordinance (Attachment E)includes the following basic steps in the process,and in some cases,timelines for each: 1.Applicant files closure application. 2.Applicant retains with the City's approval,a Relocation Specialist and an Appraiser. 3.Applicant distributes a Resident Questionnaire to all residents,outlining their particular circumstances (mobile home ownership and value,family and special needs,etc.). 4.Relocation Specialist meets individually (generally multiple times)with each household to outline options for relocations and financial assistance. 5. A Relocation Impact Report (RIR)is provided to the City,to address the proposed relocation assistance to be provided to each eligible household. 6. An appraisal of the value of the Park is provided to the City. 7. A hearing with a City-selected Hearing Officer is conducted to determine whether residents have agreed upon relocation assistance terms or to adjudicate disputes. 8. If desired by any resident,an appeal to the City Council is available to consider individual relocation concerns or objections;and 9.Following final determinations,a Notice of Relocation is issued and a minimum of six (6) months is afforded to residents in order to relocate from the Park and for the park owner to provide the relocation assistance required by the City as a condition of conversion. December 17,2012 Page 1 of 5 (ID #3367) The overall timeline for the above process is likely to take at least six (6)months,prior to the Notice of Relocation,soat least12 months from the application to relocation.Staff also notes that the Ordinance and relocation assistance requirements are not applicable to the 13 rental housing units on the site,which may be converted or redeveloped without respect to these provisions. Steps pursued thus far in the process are outlined in the Discussion section below. Development Proposal On September12,2012,a Pre-screening application for preliminary review of the rezoning of the site was submitted by Prometheus Real Estate Group, on behalf of the Parkowner. The Pre- screening application isfor the rezoning of the site from RM-15 (low density multi-family;15 units/acre)to RM-40 (high density multi-family;40 units/acre).The proposed design would be for a 180-unit apartment development consisting of a mix of one- and two-bedroom apartments.The development would consist of five separate buildings,ranging in height from two- to four- stories. Staff is currently reviewing the application and it is anticipated that the Pre-screening application will be presented to the Council in early 2013. A tentative December 10, 2012 date was deferred due to the developer's need to revise plans to reflect some initial staff concerns and to allow the Mobile Home ParkClosure process to begin. Discussion The Park is located at 3980 El Camino Real (Attachment A)and is situated on four parcels encompassing a total land area ofapproximately 4.5 acres (196,020 sq. ft.). The existing mobile home park consists of 104 mobile homes,12 studio units and one single family home.The studios and single family units are rental units.The site is zoned RM-15 (low density multi- family)with a Comprehensive Plan land use designation of Multi-Family. The site is located within the Barron Park neighborhood,just south of the corner of Los Robles Avenue and El Camino Real. Directly across the street from the site along Los Robles Avenue are the three- story 46-unit Montage Apartments and the 37-unit two-story Villa de Las Plazas.The western border of the property is adjacent to a 16-unit,two-story apartment building and one and two- story single family homes,all located on Magnolia Drive.The southern border of the site is shared with a two-story affordable apartment community owned by the Palo Alto Housing Corporation and the northern border is shared with an existing retail building that includes Baja Fresh,Jamba Juice, C2 Education Center,Imperial Spa (formerly Blockbuster Video)and the Valero Gas Station,which all front on El Camino Real.The commercial areas are owned by the same owner but are not proposed for conversion or land use change. Proposed Mobile Home Park Closure Process The Background section outlined the primary steps required by the City's Mobilehome Park Conversion Ordinance.To date,the following has transpired: • An application for closure of the Park was submitted on November 9,2012 (Attachment B). December17,2012 Page 2 of 5 (ID#3367) • The City mailed notice to all Park residents (in English and Spanish)that an application forclosure was submitted anda summary of some ofthe next steps in the process was provided (Attachment C). • TheCity reviewed and subsequently approved the hiring of David Richman of Autotemp as the Relocation Specialist.Mr. Richman and his firm have conducted a number of mobilehome park closures or conversions withgood success and a record of working well withresidentsinother cities.They also provide bilingual (English/Spanish)staffand can accommodate other language needs as required. • The City also approved Beccaria and Weber Real Estate as the Appraiserfor the owner, and expectsthat staffor an outsideappraiserforthe City will peer review the appraisal. • A Resident Questionnaire (based on the specific requirements of the Ordinance)was prepared by staff and delivered to the applicant/Park owner. • The Parkowner scheduled four separate meetings duringa two- day span on December 11 and December12, 2012 (letter invitation included as Attachment D).The purpose of the meetings is to provide an overview of the conversion process,introduce the Relocation Specialist and answer questions the residents have. Staff will attend the meetings,and the Planning Director will report backto the Council about any significant outcome. The followingtimeline outlines likely next steps in the process: •January/February 2013: The Relocation Specialist will meet with and assist each household with completing the confidential Resident Questionnaire.The questionnaires are to be kept separately from the rest of the application materials and will not be included in the Relocation Impact Report. The Relocation Specialist will continue to meet with residents to draw up proposed relocation assistance plans as input to the RIR. •March 2013:The Relocation Impact Report (RIR)and appraisal would be submitted to staff for review, outlining the relocation assistance package provided for each household (e.g.,relocation to another mobilehome park,relocation to some other form of housing,and/or financial assistance).Staff has 30 days to determine the request is "complete"orto ask for additional information. •April 2013:Assuming the application is then complete,a date (within 60 days)would be set for a Hearings Officer to consider any objections.The basis for the determination (and Council's as well, if necessary)is that the relocation proposals are reasonable, given individual circumstances.Staff will confer with the City Attorney's Office in order to select a Hearing Officer from outside City staff. •May 2013:The Hearings Officer would conduct a hearing and render a decision.The decision is appealable to the CityCouncil. •June 2013:The City Council would hear the appeal(s),and its determination would be final. •July 2013:Notice of Closure and Relocation would be issued to the residents of the Decern ber 17,2012 Page 3 of 5 (ID#3367) Mobile Home Park. A minimum of 6 months would be required for relocation.The Park would need to be vacated by the end of2013 if this schedule is maintained. Outreach to Park Residents and Neighbors Staff has initiated two outreachmeetings with about ten residentsof the Mobile Home Park, who are helping to represent othersas well.The meetings have been informational in nature, and staff believes the meetings also have been helpful to provide abetter understanding ofthe process.The most recent meeting was held on December 5,2012,prior to the upcoming community meetings scheduled by the Park owner, and also included two attorneys from a public interest law firm who are assisting the residents. Staff also provided a notice to all residents upon receipt of the closure application,and has provided all a copy of the City's Ordinance (both documents are in English and Spanish).Staff will also participate in the upcomingresident community meetings and hasstronglyencouraged the Park owner/applicant to allow the Palo Alto Mediation Program (Project Sentinel)to facilitate those meetings (which they have agreedto). A Spanish translatorwillalsobe available.In addition, staff has provided most of the same information to the Barron Park Homeowners Association,primarily through their president,and has responded to several inquiries from that group.Staff is scheduled to attend the Barron Park HOA meeting on February 10, 2013, to discussthe issues pertaining to the Park. Lastly,staff has talked to a couple of representatives of the Palo Alto Unified School District (PAUSD)to convey information about residents'concerns regarding attendance in the school district if they are relocated.Staff is aware of PAUSD's ongoing discussions about this issue. Alternatives The Ordinance does not grant discretion to the City to deny a closure request,but only to determine that reasonable relocation assistance has been offered.Potential alternatives to the closure generally include some other entity purchasing the Park and retaining the mobile homes,or working with the owner to co-develop the site to include affordable housing that may provide for some of the residents to be displaced.Staff continues to try to contact a non profit housing organization in Sacramento which has intervened in mobile home closures or conversions elsewhere in California,but staff has not been able to make contact to date.A group of Palo Alto community residents has indicated an interest in pursuing something along these lines with the owner,but has not reported back to staff on their efforts. Proposed Rezonine/Redevelopment As stated earlier,Prometheus Real Estate Group submitted a Pre-screening application for the purposes ofgetting some initial feedback from the Council regarding the proposed zone change from RM-15 to RM-40.The applicant has deferred the request from December 10,2012,to as yet undetermined date in the first quarter of 2013.Staff has informed the applicant of the highly discretionary nature of the rezoning process,and the likelihood that the rezoning process could become intertwined with the closure process.The Park owner has indicated an intention to proceed with the Park closure regardless of the outcome of any rezoning request by December 17,2012 Page 4 of 5 (ID n 3367) Prometheus. Prometheus, nevertheless, is the primary contact for staff on both the closure process and the potential redevelopment. Policy Implications Comprhensive Plan Program H-41 (Housing Element)specifically recognizes the Buena Vista Mobilehome Parkas providing low-and moderate-income housing opportunities in Palo Alto, and that anyredevelopmentofthe site mustbeconsistentwiththe Ordinance and applicable state law.The Program further indicates that, to the extent feasible,the City will seek appropriate local,state and federal funding to assist in the preservation and maintenance of the existing units in the Park. Environmental Review Environmental review isnot required for an information report on the subject.Staff is evaluating whether an Initial Studyand an environmental review will be required, pursuant to the CaliforniaEnvironmental QualityAct (CEQA),inconjunction with the closure of the Park. CEQA review will be required for the subsequent entitlement review for the Prometheus proposal. Attachments: •Attachment A:Location Map (PDF) •Attachment B:Mobile Home Park Closure Application (PDF) •Attachment C:City Courtesy Notice Informing Residents of Upcoming Owner Meetings (DOCX) •Attachment D:Letter to Residents re:Owner Meetings (DOCX) •Attachment E:Mobile Home Park Conversion Ordinance (PDF) December 17,2012 Page 5 of 5 (ID#3367) |T«orB.»12-t3-lOlQ«25 P»r*l Papon <V«^n*cV^*J'9*\**rv>P»*w"«t,.Pl»rr.i"gr-«jb)Thr«coc.jr*nr4 agr^pf-crep's* l C1BWto!013 Ct,c'PmioA.*3 Development Review Application Department ofPlanning &Community Environment 250 Hamilton Avenue,Palo Alto,CA94301 650-329-2441 -PlanneronDuttf(SBCItvoPaloAlto.oro Appointmentsare required forallapplication submittals,pleasecallto schedule. ©Application Request O Architectural Review CD Conditional Use Permit O Design Enhancement Exception D Historic Review O Home Improvement Exception O Individual Review O Planned Community Zone Change O Protected Tree Removal O Site and Design O Subdivision O Temporary Use Permit O Transfer of Development Rlghts/HRB D Variance ED Mobilehome Park Conversion O Zone Change, O Othen RECEIVED NOV 09 2012 Department ofPlanning & Commune Environment ©Property Location Address ofSubject Property:3980 El Camino Real.Palo Alto.CA94306 Zone District:RM15 Assessor's ParcelNumber: 0 Requested Action/Project Description (Applicant may attach additional pages,as appropriate) Conversion of Buena Vista Mobile Home Park (104 Mobile Homes)pursuantto Palo Alto Municipal Code,Chapter9.76Mobilehome Park Conversion,Section 9.76.030, ubsection(a)which provides in pertinent part that,"Priorto conversion ofa parMne parK ownersnailmewitn tnecity anapplicationto convertthe park" O Applicant/Primary Contact Name:JoeJisser Email:|oe@tylonHne.com Address:3980 El Camino Real Phone 1:65Q-493-S700 CHy:Palo Alto CA ap:94306 Phone*408-315-3303 0 Property /Park Ownerfs)(State full legal name(s)ofproperty ownerfs)ofrecord) TOUPIC JI8SBR,TRUSTER OP THB TOUPIC AND Name:bva .ttbbbr RBvocaBT.R tmibt nuTRD qctobrh i«.anno Email:BfflJIBBBR REVOCABLE TRIIBT nATBO OflTOBBB Ifi,aftflfl Address:39B0 F.1 Paminn Pe>*1 Qty:Palo AltO State:CA 2p: iToftfiPt-.yj on 1 i tip>nnm Phonal:fi5n-4Ql-q7nQ_ Iherebycertify that Iamtheowner of ertydescribed In Box#2 above endthai Signature ofOwner O Action Taken D Planning Manager CD Director ofPlanning O City Council wM«.c»wafBa3artto.«ft 3A2&£Phoned 408-315-3303 Decision RevOad10-28.10 November 26,2012 Address Block Address Block Address Block Dear BuenaVista Resident: We arewritingto inform you that the Cityhas received an applicationto close the BuenaVista Mobile Home Park.We receivedthe signed application fromthe parkowner, Mr. TouficJisser,on November 9,2012.Basedon the Cityof Palo Alto Municipal CodeSection9.76(Mobilehome Park Conversion Ordinance),the Cityisrequiredto followaset of rulesfor determining the potentialimpactsof theclosureon the mobilehome owners residing inthe parkandto determine appropriaterelocationassistanceforthe residents. This processisexpected to take a minimum periodof approximately6- 12 months,and the Cityhopes to assist the residents to better understand the process and schedule. In aneffortto further explain the nextstepsinthe process andto address anyquestionsorconcernsyoumayhave,the owner willbe holdinga few upcomingmeetings. The dates, times and locationforthe meetings willbe provided ina letter providedby the owner that isanticipatedto arrive laterinthe week.During these meetings,the personsinvolvedwith the closureprocesswillbe introduced andtheir rolesinthe processwillbe explained. Citystaff willalsoattend the meetings. Ifyou have any additional questions or concerns, please feel free to contactJason Nortz at (650) 617-3137 or Jason.nort2@citvofpaloalto.org. Sincerely, Curtis Williams Director, Planning and Community Environment Cc:Joe Jisser Estimado"Buena Vista"Residente: Leescribimos parainformarle que laCiudad ha recibido una aplicaci6n paracerrarel Buena Vista Mobile Home Park. Hemos recibidola aplicacidn firmada porel propietariodel parque, el Sr.Toufic Jisser,el 9 de noviembre de 2012. Consistentecon laSeccion del C6digo Municipal 9,76(MovilesOrdenanza de Conversion Park),laCiudad esta obligada a seguirunaseriede reglas para determinarlosposiblesefectos delcierredel Buena Vista Mobile HomePark para los propietarios de casas mdvilesque residen en el parque y para determinar las opciones de asistencia de reubicacidn para los residentes.Este proceso se espera quetengaunaduracion mmima de aproximadamente 6-12 meses,y la ciudad espera ayudar a los residentes a comprender mejor el proceso y el calendario. En unesfuerzopara explicar conmasdetallelospasosaseguirenel proceso y para respondera cuatquier pregunta o preocupacidn que usted puedatener,el propietario llevara acabounaseriede reuniones futuras.Las fechas,horarios y ubicaciones de las reuniones seranproporcionados en unacarta provista porel propietario del parque.Esta carta llegara mastardeesta semana.Durante estasreuniones,las personas implicadas enel proceso de cierre seranpresentadas, tambien se explicara lasfunciones que ellos desempenaran en el proceso. Empleadosde laciudad tambien estaran presentes en las reuniones. Siusted tiene algunapreguntao inquietud, porfavorno dude en ponerse en contacto con Jason Nortzen (650)617-3137o Jason.nortz(a>citvofpaloalto.org Sincerely, CurtisWilliams Director, Planning and Community Environment CC:Joe Jisser November 27,2012 Address Block Address Block Address Block Dear BuenaVista Resident: You mayrecall that Iwroteto youinSeptember ofthisyear to inform youthatourfamily had started the process ofevaluating possibilities to redevelop the Buena Vista Mobile Home Park.Aftermuchconsideration andthought and 26years of managing the Park our family hasdecided to begin the process of closing the park.Asthe first stepinthis process,we havefiled an application for Park closure withthe City of Palo Altoin accordance withtheir Mobile Home Park Conversion ordinance.Recently youmayhave receiveda"courtesy notice" from theCityinformingyou that this application had been filed. In orderto provide youwithadditional information related to the timing and process for closing the Park we wouldlike to invite you tomeetwith usatoneof four separate informational meetings ononeoftwo separate evenings,Tuesday December 11*or Wednesday December 12*.Due tothe size ofthe meeting facilities,each meeting will include roughly one fourth ofthe Park's mobile homeowners.Identical information will beshared ineach separate meeting.Atthese meetings wewill beaccompanied by our consultants whowill outlinethe stepsofthe closure process andtiming,the differententitiesinvolved,and pursuant to the City's ordinance,the potential benefitsthatmaybe provided to mobile homeowners asmitigation for impacts to them caused by closing the Park.Oneofthe consultants will bea housing relocation specialist whowill be working with youto helpyouidentifyand find new housing.Youwill alsohavethe opportunityto askquestionsduring the meeting. Spanish translation will be provided forall meetingsifneeded. Ifyouareinneed of transportation to or from the meeting,other specialaccommodations, orif you cannot attend on the evening oratthe time assigned,pleasenotify me at the Park office (650.493.5700ph)assoonaspossible sowe can makearrangements for you.Light refreshments will be provided for eachmeeting. Buena Vista Mobile Home Park Closure -Informational Meeting Invitation: What type of meeting?:An informational meetingto explain the next steps ofthe Buena Vista MobileHomePark Closure process. Who shouldattend?:All mobile home owners. (Rentersarealsowelcome to attend althoughmuch of the information shared may not apply directly to theirspecific situation) Where?:Key's Middle School (Library,2nd floor,elevator available),3981 El Camino Real,Palo Alto,CA (across the street from BuenaVista) When?:Four separate meetings for four separate groups • Mtg#1 --»12/11/12 at5:30pm-Mobile HomeSpaces1- 27, Rentersat Units1C,2C,3C,4C, 5C, 6C,and 7C • Mtg#2 --»12/11/12 at 7:00pm- MobileHomeSpaces28- 52 • Mtg#3 -->12/12/12 at 5:30pm- MobileHomeSpaces53-78 • Mtg#4 -->12/12/12 at7:00pm - MobileHomeSpaces79 -104,Rentersat Units 8C,9C,10C,21C,22C,and HOME. Sincerely, Joe Jisser cc: CurtisWilliams, Director,Planningand Community Environment, Cityof PaloAlto November 27,2012 Address Block Address Block Address Block Estimado "Buena Vista"Residente, Ustedes recordaran queyoescribf en septiembre deeste afio para informarles que nuestra familia se habfa comenzado el proceso de evaluaddn delasposibilidades de reurbanizaci6n de la propiedad "Buena Vista Mobile Home Park."Despues de mucha consideracidny pensamiento yde26aiios de gestidn del Parque nuestra familia hadecidido iniciar elproceso de cierre del parque. Comoprimerpasoen este proceso,se ha presentado una aplicacion de cierredel parquecon laciudadde Palo Alto,en conformidad consu ordenanza "Parque de Casas M6viles de Conversidn".Recientementeusted puede haber recibido un "aviso de cortesla"de laciudadque le informaque esta aplicacidn habfasidopresentada. Con el fin de darle information adicional relativa alcalendario yel proceso para el cierre del parque,nosgustaria invitarle a reunirse connosotrosen unade lascuatroreunionesseparadas de informacion sobreunade lasdos noches separadas,Martes11de diciembre oel miercoles 12de diciembre.Debido al tamafio de las salas de reuniones,cada sesi6n incluira aproximadamente una cuarta parte delos propietarios del parque de casas mdviles.Identica informaci6n sera*compartid aencada reunidn separada.En estas reuniones,estaremosacompafiados pornuestrosconsultores quese describen los pasos del proceso de cierre yel momento, las distintas entidades involucradas,ydeconformidad con la ordenanza de la Ciudad,los beneficios potenciales quese pueden ofrecer a los propietarios de casas moviles comomitigacidn delos impactos aellas causadas por elcierre del Parque.Uno delos consultores sera unespecialista en reubicacidn de viviendas quevayan atrabajar conusted para ayudarle a identificar y encontrar una nueva vivienda. Usted tambien tendra laoportunidad de hacer preguntas durante lareunidn. Traduccidn al espafiol se prestara para todas las reuniones sies necesario.Si ustedestaen necesidad de transporte hacia ydesdela reunidn,otros servicios especiales,osiustedno puedeasistir alanocheoalahora asignada,porfavor notifiqueamien laoficina del Parque (650.493.5700ph)loantes posible para que podamoshacerlosarreglos para usted.Refrescos se proporcionard para cada reunidn. "Buena Vista Mobile Home Park"Clausara-Invitacion Reunion Informativa: dQue'tipode reunions?:Una reunidn informativa para explicar lossiguientes pasos del proceso de Buena Vista Mobile Home Park Clausura. dQuien debe asistir?:Todoslos propietarios de casas mdviles.(Inquilinos tambienestan invitados a asistir,aunquemuchade lainformacidn compartida no puedenaplicarse directamenteasu situacidn especffica) dDdnde?:"Key's Middle School"(en la Biblioteca,2 aplanta,ascensor disponible),3981El Camino Real,Palo Alto, CA(cruzando lacalle El Camino de "Buena Vista") dCuando?:Cuatro reunionesseparadas para cuatrogruposseparados • Mtg# 1-12/11/12, el martes,a las 5:30 pm-Los espacios para casas mdviles desde 1a27,Inquilinos de casas 1C,2C,3C, 4C,5C,6C,7C • Mtg#2 -12/11/12,el martes, alas7:00pm -Los espaciospara casasmdvilesdesde 28a52 • Mtg #3 -12/12/12,el miercoles,alas5:30pm -Los espaciosparacasasmdviles desde 53 a78 • Mtg n 4 -12/12/12,el mieVcoles,a las7:00 pm-Los espacios para casasmdvilesdesde 79a 104, Inquilinos de casas 8C, 9C, 10C, 21C, 22C, HOME. Atentamente, Joe Jisser cc:CurtisWilliams, Directorde Planificacidn y Medio Ambiente de laComunidad de laCiudadde PaloAlto Sections: Page 1 of 10 Palo Alto Municipal Code Chapter 9.76 MOBILEHOME PARK CONVERSION 9.76.010 Purpose and findings. 9.76.020 Definitions. 9.76.030 Application and relocation impact report. 9.76.040 Hearingprocedures. 9.76.0S0 Acceptance ofconditions required. 9.76.060 Appeals! 9.76.070 Relocation notice. 9.76.080 Exceptions to requirement to provide relocation assistance. 9.76.090 Expiration andextension ofapproval ofconversion. 9.76.100 Enforcement. 9.76.110 Provisions to prevent eviction priorto determination ofrelocation assistance. 9.76.120 Rentincrease reviewpetitions. 9.76.130 Interpretation. 9.76.140 Challenges to decisions. 9.76.010 Purpose and findings. The mobilehome owners who rent spaces for their homes in mobilehome parks make a considerable investment in purchasing,mamtaining and improving their homes and in maintaining the rented space for their homes.Ifa park closes orisconverted toa new use,the mobilehome owners may lose their homes and theinvestment in them due tothehigh cost and risk ofinjury involved inmoving a mobilehome,thefactthat improvements to a homemaynotbe movable andthelack ofvacant mobilehome spaces inparks within areasonable distance from the closing park mat will accept relocating homes.In recognition ofthe unique situation and vulnerability ofmobilehome owners,the State Legislature adopted the Mobilehome Residency Law,Civil Code Section 798,etseq.,which http://www.amlegal.com/alpscripts/get-content.aspx 10/1/2012 Page 2 of 10 «• protects them from eviction except for specified and limited causes,and Government Code Sections 65863.7 and 66427.4,which authorize thecityto require park owners who want to close aparkor convert itto another use to provide reasonable relocation assistance asa condition ofclosing and converting a park. This chapter isadopted pursuant toGovernment Code Sections 6S863.7 and 66427.4 and the city's policepower to provide a procedure and standards for assessing the adverse impacts ofamobilehome park closure orconversion on thedisplaced mobilehome owners residing inthepark that isbeing closed andtodetermineappropriate relocation assistance for those residents. (Ord.4696 §l(part),2001) 9.76.020 Definitions. (a)"Comparable mobilehome"means a mobilehome that is similar insize,age,condition,number ofbedrooms andamenities toa mobilehome thatisbeing displaced by conversion ofamobilehome park. (b)"Comparable mobilehome park"means a mobilehome park that is similar incondition,age,size andamenities totheparkthatisbeingclosedandis located withinacommunitysimilar to thatinwhich the park that isbeing closed is located and has similar access tocommunity amenities such as shopping, medicalservices,recreational facilities and transportation. (c)"Comparable housing"means housingin anapartment complexorcondominium thatis Similar in size,number ofbedrooms andamenities to themobilehome thatis being displaced andis located ina communitythathassimilar access to shopping,medical services,recreational facilities and transportation ora comparable mobilehomeina comparable mobilehomepark. (d)"Conversion"means the closure ofamobilehome park and the cessation of holding out spaces inthepark for rental evenifnonewuseis planned andconversion ofa mobilehome park to another use. (e)"Legal owner"means any person orentityhaving alegalinterest ina mobilehome,suchasa lenderormortgagor. (f)nMobilehome"shall havethemeaningset forth inthe Mobilehome ResidencyLaw,CivilCode Section 798,etseq.asnowineffectorsubsequently amended and shall also mean vehicles designed or usedforhumanhabitation,including campingtrailers,motorhomes,slide-in campers andtravel trailers iftheyhavebeeninthe park beingclosed or converted and usedastheoccupant's primary residence,as established byninemonths'continuous residency prior tothe filing ofa conversion application. (g)"Mobilehome park"or "park"means anarea of land where twoormore mobilehome spaces are rented or held out for rentto accommodate mobilehomes used for humanhabitation. (h) "Mobilehome residenf'or "residenfmeans a registered owner ofamobilehome who residesin themobilehome. (i)"Park owner"means a person orentitythatownsa mobilehome park ora person orentity authorizedto acton behalfofthe owner ofamobilehomepark. http://www.amlegal.com/alpscripts/get-content.aspx 10/1/2012 Page 3 of 10 (Old.4696 §l(part),2001) 9.76.030 Application and relocation impact report (a)Prior to conversion ofapark,the park owner shall file with the city an application toconvert the park,aresident questionnaire and relocation impact report ("RIR").The application shall bemade on a form provided by the city.No application shall be deemed complete until aresident questionnaire for each affected resident and tenant and acompleted RIRhave been filed. (b)No notice mat the park isbeing converted or ofany proposed new use ofthe park shall be given and no signs indicating that the park isbeing converted or closed or indicating the future use of the park shall be posted prior to the date on which the city has approved the conversion and the park owner has signed and filed acertificate accepting the conditions ofapproval adopted by the city. (c)Resident Questionnaire.A confidential resident questionnaire shall besent toeach resident and tenant ofthe park on aform provided bythe city as soon as the conversion application has been filed. The form shall require the following information for each mobilehome space inthe park: (1) Theregistered owner and legal owner ofthemobilehome; (2)The identity,ages,number and any mental or physical handicap or special needs ofthe residentsoccupyingthemobilehome; .(3)The date of manufacture of the mobilehome,thename ofthemanufacturer,the size ofthe mobilehome,the number ofbedrooms in the mobilehome,any special amenities in the home,including but not limited to equipment needed because ofthe medical condition,age,or handicap or disability of any residentortenantin the home; (4)Anyimprovements or renovations tothe mobilehome orimprovements tothe mobilehome space made by the current resident,including,but not limited to,anew roof,porches,patios,awnings, pop-out rooms,recreational equipment,barbecue equipment,landscaping,etc.,whether such improvements are movable and thecost ofsuch improvements; (5)The purchase price paid bythecurrent resident ofthemobilehome and theamount and terms of any renaming mortgage orloanonthehome; (6) Any special circumstance that wouldlimitthearea towhichthe resident ortenant is able to relocate; (7)Whether the residents receive Supplemental Social Security Income or qualify as low or very low income persons or families under the standards issued bythe Department of Housing and Urban Development ("HUD"); The questionnaires shall bekept separately from the rest oftheapplication materials and shall notbe included intheRIRsent toeach resident and tenant The identity ofeach resident and hisorher responses shall be kept confidential and used only todetermine the relocation assistance tobe provided toa particular resident ortenant.Ifthe park owner does not submit questionnaires containing sufficient information,thecitymayseekthe information directly from theresidents. ht^://www.amlegal.com/alpscripts/get-contentaspx 10/1/2012 rage <»oi 10 (d)Contents ofthe RIR.The RIR shallinclude the following information: (1) A descriptionofanyproposednewuse forthe site; (2) A proposed timetable fortheconversionofthe park; (3) A legal description ofthe park; (4)The number ofspaces in the park; (5) Foreachspaceinthe park: (i) The size,number ofbedrooms,manufacturer and date ofmanufacture ofthemobilehomeonthe space, (ii)The namesand ages ofthe occupants ofthe mobilehome andtheir lengthofresidencyin the park, (iii)Any special needs,handicaps ordisabilityofthe occupants andrelated special equipment, modificationsor improvements to the home known to the park owner, (iv)Thevalue themobilehome would have ifthepark were notbeing closed,thedepreciated replacement valueofthe mobilehome and itsvalueifitistobe removed from the park andcannotbe relocated to a space ina comparable mobilehomepark,these values shall bedetermined by appraisals by a qualified appraiser to bechosenby theparkownerfrom alistsupplied bythecity.Thecost ofthe appraisals shall be paid bytheparkowner. (v)Any improvementsto the home, includingbut notlimitedto,patios,porches,pop-out rooms andany recent major improvements tothehome,including butnot limited to,anewroofornew siding. (vi) Any information available to the parkowner concerning any handicap,disability orspecial needofthe residents. (vii) Two setsofmailing labelsforboththe residents and legal owners ofeachmobilehome. (e) The purchase price paidforthe parkby the park owner andany amount incurred tomake capital improvementsto the park. (f) An appraisal ofthepark ifcontinued inuseasamobilehome park and anappraisal ofthe park she ifused for thehighest and bestuse permitted bythezoning for the site oranynew zoning being requested by the park owner.The appraiser shall be selected bythe park owner,subject totheapproval ofthe city, andshallbe paidby the parkowner. (g) Whetherthe park ownerhasofferedto sellthemobilehome parkto the residents and termsof thatoffer. (h).The purchase priceofcomparable mobilehomes incomparable mobilehome parks. (i) The cost ofcomparable housing,including the purchase price ofcomparable condominiums and comparable mobilehomes ina comparable mobilehome park andthecostofmovingintoa comparable http://www.amlegal.com/alpscripts/get-contentaspx 10/1/2012 Page 5 of10 apartment,including such items as first and last months rent,security deposits and higher rent or mortgage payments atthecomparable housing. 0) A list ofcomparable parks within athirty-five-mile radius and for each such park,the space rents and the qualifications for residency ineach park (e.g.,age restrictions,no pets),whether the park has any vacant space and will accept homes being relocated and if so,any restrictions,such as size and age,onthe relocated homes that would be accepted. (k).Estimates from two moving companies approved bythe city,and qualified tomove mobilehomes on public streets and highways,ofthe cost ofmoving each mobilehome in the park, including the cost ofpermits and tearing down and setting up the home at the new location,including the cost ofany upgrades to comply with applicable building,plumbing,electrical and health and safety codes and the cost ofmoving any improvements,including,but not limited to,patios,porches and pop- out rooms. (1)Proposed measures to mitigate theadverse impacts of the park conversion onthe residents in the park. (m)Identification ofarelocation specialist toassist the residents in finding and moving to relocation spaces and comparable housing.The relocation specialist shall be selected bythe park owner subject tothe approval ofthecityand shall be paid bythe park owner. (Ord.4696§ l(part),2001) 9.76.040 Hearing procedures. (a)An application shall bedeemed complete within thirty days unless written notice is given specifying theinformation that must besupplied to make the application complete. (b)Ahearing on application shall be set within sixty days ofthe date the application is completed. (c)Thirty days prior to hearing,the park owner must verify to the city that the residents and legal owners ofthe mobilehomes inthe park have been given the required notice oftheapplication. (d)A copy ofthe RIRmust be provided toresidents at least thirty days before the hearing. -(e)At least thirty days mailed notice ofthe hearing ontheapplication shall be given to each affected resident,tenant,andlegal owner. (!)The application shall beheard byaqualified hearing officer selected bythe city.The park owner shallpay allhearing officer fees. (g)The hearing officer shall approve tiie application onthe condition that the mitigation measures proposed bytiie park owner are adequate to mitigate theadverse impacts onthe displaced residents and may condition the approval on additional conditions,including,but not limited totiie following, provided that such conditions do not exceedthe reasonablecosts ofrelocation: (1)For residents whose mobilehomes can berelocated toaspace inacomparable mobilehome park: htto://www.amlegal.com/alpscripts/get-contentaspx 10/1/2012 rageoonu (a)The cost ofphysically relocating the mobilehome,asdefined above,withinthirty-five miles of the park thatis closing. (b)The costofmovingthe personal property inthemobilehome. (c)The cost of staying overnight inamotel for the number-ofnights required to move and set up tiie mobilehome inthe new park. (d)Costs incurred tomoveintothenew park,such as first andlast months rent and security (e)For those residents who qualify as lowor very low income persons orfamilies,as defined by HUD orare receiving supplemental social security,a lump sumbasedonconsideration ofthe difference betweenhigherrentatthenewparkforoneyearandthe parkthatis closing. (i)For thoseresidents whoarehandicapped ordisabled,a lump sumbasedon consideration ofthe cost ofobtaining anyassistance necessary to move,suchashelpwith packing or other physical tasks thatthe resident cannot dowithout assistance and to offset thecostofreplacing any special equipment thatcannot bemovedand isusedbecause oftiieresident's disability. (2)For residents whosemobilehomescannot berelocated to a space ina comparable park: (a)A lumpsumbased onconsideration ofthecostofmovingto and purchasing orrenting comparable housing,including,butnotlimitedto,thecostofpurchasing acomparable mobilehome ina comparable mobilehome park,thecost ofmoving personal property from the mobilehome intheclosing parkto comparable housing,paymentoffirstandlastmonth's rentandany security depositatthe comparable housing,the loss ofinvestment inthe mobilehome thatcannot berelocated and any remainingloanpaymentsthat mustbe made even thoughtiie residentcannotcontinueto live in the mobilehome. (b)Iftheresident is disabled orhandicapped,an additional sumtoward thecost ofobtaining any assistanceneeded to enable the resident to move. (c)Ifthe residents arelow income personsoralowincome family,asdefinedby HUD,or are receiving supplemental social security,an additional sumto partially offset anyhigherrentatthe comparable housingduringtiie first yearatthe new location. (Ord. 4696 § l(part), 2001) 9.76.050 Acceptance ofconditions required. The city'sapproval ofa conversion application shall notbevalidandeffectiveuntilthe park owner has filed a certificate ofacceptance ofthe conditions ofapproval with the city. (Ord. 4696 §l(part),2001) 9.76.060 Appeals. htto://v^vw.amlegal.com/alpscripts/get-content.aspx 10/1/2012 <••Page7 of10 Anyaggrieved person may appeal the hearing officer's decision tothe citycouncil by filing a written notice ofappeal withthe city,clerk within tendays ofthe date thehearing officer's decision becomes final.The appeal shall beinthe form specified bythe city and shall be accompanied bya filing fee specified in tiiemunicipalfee schedule. (Ord.4696§1 (part),2001) 9.76.070 Relocation notice. No resident shall berequired toremove hisorher mobilehome and notenant shall berequired to vacate amobilehome until (i)the park owner has given the sixmonths'notice of closure required bythe Civil Code Section 798.56,(ii)that six-month period has elapsed,(iii)the city's decision approving the closure is final,and (iv)the park owner has provided tiie relocation assistance required bythe city as a condition ofconversion. (Ord. 4696 §l(part),2001) 9.76.080 Exceptions to requirement to provide relocation assistance. (a)Theprovisions of this chapter shall not apply toapark that isclosing due to bankruptcy. (b) An applicant mayseekatotal exemption on tiieground that imposition ofanyrelocation assistance would eliminate substantially all reasonable use or economic value oftiie property for alternate uses.The application mustprovide evidence demonstrating that thisresult would occur. (c) An applicant mayseeka partial exemption ontheground that the imposition ofaparticular relocation obligation would eliminate substantially all reasonable use or economic value oftiie park for alternate uses.Theapplication must specify theparticular obligation that would cause this result and provideevidenceto demonstrate thatthis resultwould occur. (Ord.4696 §l(part),2001) 9.76.090 Expiration and extension ofapproval ofconversion. Conversion approvals shall expire one year after thedate they are issued.The city manager may upon request grant extensions oftimebased upona showing that good faith progress hasbeenmade toward fulfilling theconditions ofapproval orsomeintervening eventnotthe fault ofthe park owner has preventedtimely compliancewith the conditionsofapproval. (Ord.4696 § l(part),2001) 9.76.100 Enforcement Any person,firmorcorporation violatingany provision ofthis chapter is guilty ofamisdemeanor and,uponconviction thereof,shall be punishable as provided by law. http://www.amlegal.com/alpscripts/get-content.aspx 10/1/2012 fageSoflO (Ord.4696 §l(part),2001) 9.76.110 Provisionsto prevent eviction prior to determination ofrelocationassistance. (a)Any resident already rentingaspaceinthe park on tiie datethe application forconversionis filed shall be eligibleforrelocation assistance. (b) No parkownershallrequireanyresidentto waivehis/her rightsto relocationassistance asa condition ofrenting aspace inthe park,exceptwhenthe resident movesintotheparkafterthe datethe conversion application is filed andnoticehasbeengiventhatthe conversion application hasbeen filed. Any suchwaiverwillonlybevalid iftheparkowner completes the conversion hearing processwithin year (c)Residents whoare eligible for relocation assistance shall be entitled tothe assistance required by tiie city as aconditionofconversioneven ifthey move out ofthe parkbeforethe city's final determination concerning requiredrelocation assistance. (Ord.4696 §l(part),2001) 9.76.120 Rent increase review petitions. (a)A resident may,withthe writtensupport ofnolessthaii25%ofthetotalnumberofresidents, petitionforreview ofanynotice ofrentincrease thatalone orin combination with anyotherrent increases imposed in the last twelve months exceeds the sum ofthe then-current Bureau ofLabor Statistics Consumer Price Index - All Urban Consumers - SanFrancisco -Oakland -San Jose,plus 6%. (b) The petitionmust be filed withthe city clerkwithinthirty days afternotice ofthe rentincrease is givenby the parkownerandmust contain sufficient information to allowthe cityto determine whetherthe rent increase which is the subject ofthe petitionmeets tiie criteria ofthis subsection.The petitionshallincludethe following information: (1) The numberofeligibleresidenthouseholdsin the park; (2) The spacenumberandmembers ofeach eligible residenthouseholdsigningthe petition; (3) The signature ofoneadultmemberofeach eligible resident household signing the petition; (4) The date ofnoticeandamount ofthe rent increase thatis tiie subjectofthe petition; (5)The amount ofthe existing rent,the date(s)ofany increase imposed during theimmediately preceding twelve monthsandthe amountoftiie rentbeforethose increases were imposed; (6) A statementdescribing the efforts ofthe residents andparkownerto resolvethe dispute through formalorinformal dispute resolution,includingbut not limited to mediation; (c) The city shall givenotice ofthe petition by certified mailor personal delivery tothepark owner and the petitioning resident within fifteen days ofthe date it is received. The notice shall statea http://www.amlegal.com/alpscripts/get-contentaspx 10/1/2012 Page 9 of 10 preliminary determination whether thepetition meets thecriteria ofthissubsection.Ifthepreliminary determination is that it does meetthecriteria,thenoticeshall include alist ofqualified hearing officers who are available,attheparkowner's expense,toconductahearing onthe matter.Theparkownerand petitioning resident shall attempt to agree on the selection ofahearing officer,butiftheydonot or cannotagree withinten days,tiiehearing officer shallbechosenby thecity. (d)Ifthe city'spreliminary determination isthatthe petition does notmeet tiiecriteria ofthis section orthatitis otherwise incomplete,the notice shallstate thatthepetition isbeingrejected andthe reasons for the rejection.Insuchcase,the petitioners may submitarevised petition,whichcurestiie reason for rejection,withintendays ofreceiptofthe rejection notice.The revised petition shall be processed inthe samemannerasthe original. (e) Uponselection ofthehearing officer,thecity shall givenotice ofthehearing date by certified mailorpersonal delivery tothe park ownerandthepetitioning residentThe hearing date shall benot soonerthanthirtyandnolaterthan eighty days afterthe datethe petition was received.The notice shall also state that tiie park ownerhasthirty daysinwhichto provide justification fortiierentincrease pursuant tothis chapter andnoticethatthe noticed increase cannotbecharged,demanded,collectedor retainedunlessanduntilapprovedbythe city. (f) In determining whether arentincrease should be granted and ifso,the amount ofthatincrease, the hearing officer shall approve suchincreases asarerequired to provide ajust,reasonable and fair return oninvestment tothe park owner and shall consider allrelevant evidence and facts,including but not limitedto,tiie following: (1) Changes in the CPI sincethe last rent increase; (2) Rentsin comparable mobilehome parks; (3) Increasesor decreasesin the level ofservices, amenities andmaintenance; (4)Changes in operating and maintenance costs,including utilities not paid by theresidents and taxes,since tiielast rentincrease.These costs shall notinclude interest on mortgage debt or principal payments on mortgagedebt; (5) Costs incurred forcapital improvementsor unusualrepairs not reimbursable by insurance since the last rent increase; (6) Changesinthe park'sprofitssince tiie lastrent increase; (7) Length oftime since tiie lastincrease; (8)Evidence demonstrating thatarent increase is necessary toallowtiie park to earn ajustand reasonable return; (g)The hearing officershall render hisorherfindings and decision inwriting within ninety days ofthe datethe petitionwas received by the city.The decisionofthe hearing officer shall be final. (h) This sectionshallnot applyto spacessubjectto aleaseexempt fromlocalrentregulations pursuant tothe Mobile Home Residency Law,California Civil Code Section 798,etseq.,shall not apply to spacesfirst held out forrentafterJanuary 1,1990,orthe rent firstcharged to a purchaser ofamobile http^/www^mlegal.com/alpscripts/get-contentaspx 10/1/2012 Page 10 of10 homeinthe park orfor avacant space,provided that aspace shall notbe deemed vacant when an existingmobilehomeresident removeshisorhermobilehometo replace itwithanewmobile home. CO An eligible resident may refuse to pay any rent inexcess ofthemaximum rent permitted bythis section.The fact that such unpaid rentisin excess ofthemaximum rentpermitted bythissectionshall be adefense in any action brought torecover possession ofamobile home space and for nonpayment of rent orto collecttheillegalrent (j)Notice ofthe hearing officer'sdecision totiiepark ownerand affected resident shall statethat the ninety daystatute oflimitations in Code ofCivilProcedure Section 1094.6 is applicable. (Ord.4696 §l(part),2001) 9.76.130 Interpretation. This chapter shall be interpreted soasto be consistent withthe Mobilehome Residency Law, Evidence CodeSection 798,etseq.and Government Code Sections 65863.7,65863.8 and 66427.4,as now in effect orassubsequentlyamended. (Ord.4696 §l(part),2001) 9.76.140 Challengesto decisions. Any action challenging a decision made pursuant to this chapter shall bebrought within the ninety-. day statuteoflimitationperiodset forthin Code ofCivil Procedure Section 1094.6. (Ord. 4696 § l(part), 2001) Disclaimer: ThisCode ofOrdinances and/or anyotherdocuments (hatappear onthissitemaynotreflect themostcurrent legislation adopted bythe Munlcipatity.AmericanLegalPublishing Corporation providesthesedocuments forinformational puiposes only.These documents should not be reliedupon as the definitiveauthorityforlocallegislation.Additlonaly, the formatting and paginationof the posted documents varies from the formatting andpagination oftheofficial copy.The official printed copyofaCodeofOrdinances should be consulted prior toanyaction being taken. Forfurther Information regarding the official versionof any of thisCode of Ordinancesorother documents posted on (hissite, please contact the Municipality directlyorcontact American Legal Publishingtod-freeat 800-445*5588. ©2011 American LegalPublishingCorporation tachsucportflaamleaal.com 1800.445.5588. http://www.amlegal.com/alpscripts/get-content.aspx 10/1/2012 DRAFT – NOT YET APPROVED Findings and Statement of Final Decision in the Matter of the Appeal by the Buena Vista Mobile Home Park Residents Association of the Hearing Officer’s Decision Approving the Application of Toufic Jisser, as Trustee of the Jisser Family Trust, for Closure of the Buena Vista Mobile Home Park Summary The matter of the closure of the Buena Vista Mobile Home Park is before the Council for determination. For many years, the Park has been a significant provider of a scarce commodity in Palo Alto – housing that is affordable to persons with modest incomes. The Park is home to approximate 400 Palo Altans, who are longtime and valued members of this community, including many families with children who attend local public schools. The Council’s task here, however, is a limited one. The law requires the Council to determine whether the park owner has met his burden to establish that the mitigation measures he proposes, together with additional conditions ordered by the independent Hearing Officer and the City Council, are adequate to mitigate the adverse impacts of park closure on the displaced residents, provided that those conditions do not exceed the reasonable costs of relocation. If so, the City must approve the closure application. Having considered the factual evidence and legal arguments of all parties, and for the reasons stated in the Hearing Officer’s Decision dated September 30, 2014 and as supplemented here, the Council finds that the park owner has met his burden. Accordingly, the Council denies the appeal and approves the park owners closure application conditioned on mitigation described in the Hearing Officer’s Decision and this Decision. In reaching this conclusion, the Council is deciding only that the legal standard has been met. The law does not require, and likely would not permit the City to order, that the owner make park residents whole by preventing or compensating them for all of the negative consequences that may result from closure of the park. The Council is aware and acknowledges that the mitigation measures will leave unaddressed many adverse impacts on individuals, families, and the entire community, both tangible and intangible, including economic, education, social and even emotional matters. The Council acknowledges the reality of these losses, even as it discharges its duty under the law to fairly and impartially adjudicate the closure application. Background and Procedural History On November 9, 2012, Toufic Jisser, as Trustee of the Jisser Family Trust, which owns the Buena Vista Mobile Home Park, filed an application with the City to close the park. The City accepted the application as complete on February 20, 2014, and the matter proceeded to a hearing before the Hearing Officer over three days in May 2014. The Hearing Officer issued a final decision on September 14, 2014. The Hearing Officer’s Decision contains comprehensive information relevant to this matter, including a description of the Buena Vista Mobile Home Park, a summary of state and local laws pertaining to mobile home parks and description of the procedural history of this matter 1 ATTACHMENT E DRAFT – NOT YET APPROVED through the date of the Hearing Officer’s Decision on September 30, 2014. We incorporate this information by reference, and will not repeat it at length here. The Residents Association timely appealed the Hearing Officer’s Decision on October 14, 2014. On October 20, 2014, the Park Owner requested that the City dismiss the appeal on the grounds that the conversion ordinance authorizes appeals by individual residents only. In correspondence submitted on October 24, 2014, the Residents Association responded that it appropriately represents the interests of its member residents and that the appeal puts at issue the mitigation measures to be provided to all eligible residents. On January 12, 2015, the Council held an initial public meeting to resolve this procedural matter, adopt additional procedures regarding the appeal and establish a schedule for hearing the matter. Both parties had a full opportunity to address the Council on these issues. The Council denied the owner’s request to dismiss the appeal. The Council also adopted procedures to guide the appeal. The parties submitted pre-hearing statements addressing various issues and additional supplemental materials. On April 13 and 14, 2015, the Council heard oral testimony and legal arguments on the merits of the appeal. The appeal hearings were held in the evening to facilitate attendance and participation by residents and members of the public. Contemporaneous translation into Spanish was available both nights, and all proceedings were transcribed by a certified court reporter. The park owner offered testimony from appraiser David Beccaria, President of Beccaria & Weber, Inc., the independent appraiser who provided appraisals of the in-place value of each of the residential units subject to mitigation payment obligations. The Council questioned Mr. Beccaria regarding the methodology that he used and possible alternative methodologies that may be appropriate for the site. The Residents Association offered testimony from Elizabeth Siefel, President of Siefel Consulting, who has experience with redevelopment and affordable housing. Attorneys representing both sides offered extensive comments and argument. The Council questioned each side further regarding areas of concern to the Council. After the hearing, on May 5, 2015, the Council received correspondence from appraiser David Beccaria. Mr. Beccaria opined that on further study and review, he has concluded that the existing appraisal methodology incorporates all elements of neighborhood location, including public schools and safety, and that it is not necessary and would not be appropriate to change the scope of work for the purposes of updating the appraisals. On May 12, 2015, the Residents Association submitted correspondence responding to Mr. Beccaria’s correspondence. The Association asks the City to order the owner to retain a new appraiser to perform appraisals consistent with the Council’s May 14th direction, and submit a revised Relocation Information Report. 2 DRAFT – NOT YET APPROVED Discussion Standing to Appeal As a preliminary matter, the Park owner claimed that the Residents Association lacked standing to appeal the Hearing Officer’s Decision. The owner contended that the conversion ordinance authorizes appeals by individual park residents only. Because the appeal was filed by the Residents Association, the owner asked the Council to dismiss it, or, in the alternative, require that the individual residents who wish to appeal be identified by name, so that Hearing Officer’s order becomes final as to all other residents. The Owner appears to argue that in the absence of an explicit definition in the Ordinance, “person” should be interpreted as it is used in everyday speech, meaning a specific human individual. The Association responded that it has organizational standing to pursue the claims of its members, and pointed out that the Hearing Officer recognized the Association as representing the interests of the residents generally. The City’s conversion ordinance provides that “[a]ny aggrieved person” may appeal the Hearing Officer’s decision. (PAMC Section 9.76.060.) The Municipal Code defines “person” to mean “natural person, joint venture, Joint Stock Company, partnership, association, club, company, corporation, business trust, organization, or the manager, lessee, agent, servant, officer or employee of any of them.” (PAMC Section 1.04.050(5).) This definition applies throughout the Code except where a particular Code section includes a different definition. The conversion ordinance does not include a different definition of “person” or “aggrieved person.” Accordingly, the general definition of person in PAMC Section 1.04.050 applies, meaning that a “person” includes an association. In addition, it is reasonable to interpret the appeal provision in PAMC Section 9.76.060 to mean that an appeal by any individual or group contests the Hearing Officer’s decision as to all similarly-situated residents, not merely those who file an appeal. This is because the ordinance contemplates that mitigation measures will be applied consistently to similarly-situated residents or sub-groups of residents (such as the disabled). For these reasons, the Council concludes and finds that the Residents Association is authorized under the ordinance to file an appeal. The Owner’s request to dismiss the appeal or require individuals to be identified is denied. Hearing Officer’s Decision Incorporated Except as Specifically Modified; Precedence of Council Decision The Hearing Officer’s decision is adopted in its entirety and incorporated by reference as part of this Council’s determination, except as specifically modified herein. If there is any conflict between the Hearing Officer’s Decision and the Council’s Findings and statement of Final Decision, the Council’s Findings and statement of Final Decision shall take precedence. Adequacy of Mitigation Measures The law requires the Council to determine whether the park owner has met his burden to establish that the mitigation measures he proposes, together with additional conditions ordered by the independent Hearing Officer and the City Council, are adequate to mitigate the 3 DRAFT – NOT YET APPROVED adverse impacts of park closure on the displaced residents, provided that those conditions do not exceed the reasonable costs of relocation. The parties disagree on the adequacy of the mitigation measures, and this is the central dispute that the Council must resolve. The park owner contends the mitigation package is more than adequate to meet the requirements of state and local law. The park owner relies on the evidence in the RIR and as submitted by Mr. Beccaria, the independent appraiser. The Residents Association contends that the ordinance requires a specific relocation plan and sufficient funding to allow the park’s low income residents to maintain key aspects of their current living situation, including proximity to current jobs, access to Palo Alto’s exceptional public schools or comparable institutions, and the benefits of a close-knit, safe and supportive neighborhood. The Association offered testimony of Ms. Seifel, who argued that the proposed mitigation package will not be adequate to allow low income residents to maintain their current standard of living within a 35-mile radius of the park. The Council finds that the Residents Association misreads the requirements of the ordinance and overstates the discretion of the Council in requiring mitigation measures. The park is a privately owned parcel. The ordinance does not limit comparable communities to a 35-mile radius. While Ms. Seifel’s observations may be well taken, neither local nor state law obligates the park owner to eliminate all adverse impacts on relocated residents. The Residents Association also offers a critique of the appraisals of in-place value prepared by James Brabant of Anderson & Brabant, Inc. Mr. Brabant suggests that the existing appraisals may be lower than appropriate, but does not propose alternative valuations. The Council finds Mr. Beccaria’s responses to Mr. Brabant’s comments to be persuasive and adequate. In addition, without alternative valuations, the Council lacks an evidentiary basis for reaching a contrary conclusion on appraised value. Updates to Appraisals. Updated appraisals of the on-site fair market value of each mobile home shall be completed no more than 6 months prior to the expiration of the 6-month notice of termination of tenancy, at the park owner’s expense. Updates shall be prepared by Beccaria & Weber, according to the methodology utilized in the 2013 reports. If for any mobile home the updated appraisal amount is less than the appraisal calculated in the 2013 reports, the park owner shall pay the higher of the two appraisals, as may be modified by the Hearing Officer as described below. Updates to Market Survey of Average Apartment Rents. No more than 6 months prior to the expiration of the 6-month notice of termination of tenancy, the Park Owner shall complete an updated market survey of average apartment rents in the cities surrounding Palo Alto and average space rents in the Buena Vista Mobile home Park, using the methodology in the RIR, except that where a residential unit at Buena Vista is legally a one bedroom unit but has more than one bedroom because of permitted and unpermitted additions, and where three or more people currently reside in the unit, a two bedroom rental unit shall be used for comparison purposes. This survey shall be the basis for calculating the 12-month rent differential and start- up costs described in the Hearing Officer’s decision. The Council finds this modification is 4 DRAFT – NOT YET APPROVED appropriate in light of the longstanding de facto living circumstances of larger families at the Buena Vista site, which the park owner is aware of and has acquiesced to. Using a two bedroom apartment for comparison purposes is appropriate to mitigate the closure impacts on the larger families residing at Buena Vista with the owner’s consent. Actual Moving Costs and Additional Mitigations for Disabled Residents. Final determination of actual moving costs and additional mitigations for disabled residents shall be determined by the Relocation Specialist, as set forth in the Hearing Officer’s decision. Conclusion on Adequacy of Mitigation Measures. Having considered the factual evidence and legal arguments of all parties, and for the reasons stated in the Hearing Officer’s Decision dated September 30, 2014 and as supplemented here, the Council finds that the park owner has met his burden to establish that the mitigation measures he proposes, together with additional conditions ordered by the independent Hearing Officer and the City Council, are adequate to mitigate the adverse impacts of park closure on the displaced residents and do not exceed the reasonable costs of relocation. Limited Supplemental Review by Hearing Officer Within 30 days of receiving the updates to the appraisals and market survey described above, any mobile home owner may submit a written objection, comment or supplemental data to the Hearing Officer. The park owner shall have 15 days to rebut any such submissions in writing. Based on the written evidence and submissions, the Hearing Officer shall make a determination regarding the appraisal amount and comparable market survey. The Hearing Officer shall not award less than the amounts contained in the updated analyses of the park owner, or more than the amounts supported by evidence submitted by the mobile home owners. Except as specifically provided in this paragraph, the Hearing Officer shall not have jurisdiction to reopen any matter addressed by the Council’s Decision or the Sept 30, 2014, Hearing Officer’s Decision. The Hearing Officer shall issue a short written determination within thirty days or as soon as practical thereafter, which shall be final. The Hearing Officer’s determination shall not be appealable to the Council. Approval of Closure Application Because the park owner has met his burden to establish that the mitigation measures he proposes, together with additional conditions ordered by the independent Hearing Officer and the City Council, are – within and according to the legal standards established by state and local law to govern closure of mobile home parks – adequate to mitigate the adverse impacts of park closure on the displaced residents, the Council hereby denies the appeal and approves the park owners closure application conditioned on the mitigation measures described in the Hearing Officer’s Decision and in this Decision. This is a final decision. No further action by the City is required or available. 5 DRAFT – NOT YET APPROVED Effective Date; Notice to Tenants; Expiration; Procedure and Effect of Recision Under the City’s Mobile Home Park Conversion law the City's approval of the closure application is not valid and effective until the park owner has filed a certificate of acceptance of the conditions of approval with the City. (PAMC Section 9.76.050.) No resident shall be required to remove his or her mobile home and no tenant shall be required to vacate a mobile home until (i) the park owner has given the six months' notice of closure required by the Civil Code Section 798.56, (ii) that six-month period has elapsed, (iii) the city's decision approving the closure is final, and (iv) the park owner has provided the relocation assistance required by the city as a condition of conversion. (PAMC Section 9.76.070.) Conversion approvals shall expire one year after the date they are issued. The city manager may upon request grant extensions of time based upon a showing that good faith progress has been made toward fulfilling the conditions of approval or some intervening event not the fault of the park owner has prevented timely compliance with the conditions of approval. (PAMC Section 9.76.090.) In the event that the park owner, prior to closure of the park, determines to abandon the closure process and continue to operate the park, the park owner is instructed to so notify the City by submitting a written notice to the City Council through the City Clerk, and to notify park residents using the same notification procedures required by the conversion ordinance. Any such formal notice ending the closure process shall be irrevocable, shall fully and finally resolve the application filed on November 9, 2012, and shall terminate any obligation to make mitigation payments to residents who may thereafter move from the park. If the park owner at any time thereafter again determines to close the park, the owner must file a new closure application and RIR, and otherwise comply with the procedures described in Palo Alto Municipal Code Chapter 9.76. INTRODUCED AND PASSED: AYES: NOES: ABSENT: ABSTENTIONS: ATTEST: ___________________________ ______________________________ City Clerk Mayor APPROVED AS TO FORM: APPROVED: ___________________________ ______________________________ City Attorney City Manager 6 City of Palo Alto | City Clerk's Office | 5/11/2015 2:10 PM Carnahan, David From:M. Fruth <mafruth@yahoo.com> Sent:Thursday, May 07, 2015 7:35 PM To:BoardOperations@cob.sccgov.org; Council, City Subject:Supporting Buena Vista Residents as Homeowners pac scc Thank you for your work to save the Buena Vista low income housing project. It has been pointed out that the $14+ million the residents secured, plus the $8+ million from the City of Palo Alto's low income housing fund, plus the $8+ million from Santa Clara County, totals the $30 million Prometheus Group is alleged to have offered for the land. I say alleged because there is no hard evidence that this offer ever existed. Anyone willing to live in a trailer to get their children into the Palo Alto schools is akin to two gentlemen who started a company in a garage during the Great Depression. Involving a nonprofit to own & run the park ignores the evidence that the residents are capable of running it as a conversion to a condo complex: they obtained competent legal representation and expert advice about condo conversions for mobile home parks. The experience of several mobile home parks in Santa Cruz shows that housing costs are higher when residents are tenants of a nonprofit organization, which adds the expense of an extra layer of administration. Several nonprofits appear to be attracted by the paternalistic opportunity to provide services, for a fee. The residents deserve to become homeowners, receiving ownership of the land in exchange for paying the mortgage. Margaret Fruth ATTACHMENT F City of Palo Alto | City Clerk's Office | 5/11/2015 4:03 PM Carnahan, David From:Caryn Huberman <yackybooks@hotmail.com> Sent:Monday, May 11, 2015 3:56 PM To:Council, City Subject:Support Caritas Dear Council Member: After nearly three years of hard work, Buena Vista Mobile Home Park residents and their many supporters in the Palo Alto community have reason to rejoice now that the non-profit Caritas Corporation has signed a contract with the County to put together a deal to purchase and manage Buena Vista. This is a giant step in the right direction for securing the park and ensuring a future in Palo Alto for its 400 residents. Much work lies ahead to raise sufficient funds and to create an offer acceptable to the Jisser family. As a longtime resident of Palo Alto and former neighbor of BV, I urge you, as a City Council member, to do everything in your power to facilitate the acquisition of Buena Vista by Caritas Corporation, including giving them the time to put a viable offer on the table. This golden opportunity to preserve existing affordable housing in our community simply must not be lost. You and I do love our neighbors as ourselves, don't we? Caryn Huberman Yacowitz 567 Lincoln Avenue Palo Alto, CA 650-326-0600 *** http://www.carynyacowitz.com I Know an Old Lady Who Swallowed a Dreidel Arthur A Levine Books, Scholastic City of Palo Alto | City Clerk's Office | 5/13/2015 10:07 AM Carnahan, David From:jon spar <jsparkkuli@yahoo.com.au> Sent:Tuesday, May 12, 2015 2:44 PM To:Council, City Subject:CLEAN program City Council of PA PA is doing the right thing with its CLEAN program that encourages renewable energy projects by giving the assurance neeeded to stablize the markets and attract the capital needed to fund these projects. Don't dismantle or in any way cripple the CLEAN program now. Jon Spar,MD, 951 Hamilton Ave. 94301 J 1 2 COPYING PROHIBITED PURSUANT TO GC 69954(d) at adjustments that are in our power to make about reflecting a bit of that value to the community, and I 3 would hope for some adjustments that take into account 4 the value of schools and safety and maybe recognize the 5 family notion of Buena Vista which are one and 6 two-bedroom equivalents in apartments. 7 MAYOR HOLMAN: Council Member Wolbach. 8 COUNCILMAN WOLBACH: There's not a whole lot I 9 can add to as far as the general frame of questions. 10 There's not a whole lot that I can add by what's already 11 12 been said by my colleagues. I fully support the comments I think made by 13 all of my colleagues so far. I'll just add a couple of 14 things. 15 One, you know, as I mentioned before, I'm a 16 product of our school district. That's been a key theme 17 this night and I fully recognize how valuable that is. 18 Also, when I was a teenager, I spent countless 19 hours at Buena Vista. One of my best friends in the 20 world, his family used to live there, and I've spent 21 countless hours there, and I know how special a part of 22 our community it is. 23 But, again, as my colleagues have pointed out, 24 how much we love our schools, and how much we love Buena 25 Vista and its residents, is not the question before us 290 COPYING PROHIBITED PURSUANT TO GC 69954(d) 1 tonight. I know this is not the time to be making 2 motions, but I'll say that when it comes time to make 3 motions, I'm gonna be inclined to --to agree with the 4 hearing officer for the large part. 5 If there are within --within reason, 6 opportunities to modify the relocation package so that it 7 fully reflects the value of having a home in Palo Alto, I 8 will be eager to hear my colleagues' suggestions about 9 how to do that. 10 And I look forward to, once we have concluded 11 this quasi-judicial function, I look forward to engaging 12 in further policy discussions that may relate to Buena 13 Vista in a way that brings all parties to the table to 14 find positive solutions. It pains me greatly to --to 15 say that but that's where we're at. 16 17 MAYOR HOLMAN: Council Member Burt. COUNCILMAN BURT: Well, I want to focus on us 18 trying to talk about where we're headed. I think that 19 the --both the appraiser and the hearing officer and 20 really all the parties have proceeded with a good faith 21 effort on this and largely done an effective job. 22 But I think we've been pursuing a couple of 23 areas that, that maybe the --guidance of the council to 24 25 have reconsideration of a couple elements of the compensation package and appraisal methodology. 291 1 Nadia Aziz From:Stump, Molly <Molly.Stump@CityofPaloAlto.org> Sent:Wednesday, April 22, 2015 11:56 AM To:James Zahradka; Margaret Nanda; Nadia Aziz Cc:Kolling, Grant; Minor, Beth; Hanks, Sharon Subject:RE: Buena Vista Mobilehome Park closure - response to Residents' Association's questions Mr. Zahradka et al – Council asked Mr. Beccaria to confirm that he had identified a methodology, consistent with professional standards applicable to the field of residential property appraisal, to implement a revised scope of work that includes safety and schools. The draft Findings and Decision will reflect this instruction but will not contain details regarding appraisal methodology. The parties will have an opportunity to review the draft Findings and Decision and submit detailed written comments in advance of the meeting. Counsel should plan to keep their oral comments brief. I will provide more specific instructions on the time limit during the week of May 18th. Regards, Molly Stump 2 1. As you will recall, the Council requested that Mr. Beccaria report back after he consulted with his colleagues regarding how he proposes to meet the Council’s directive that he “revise the scope of community amenities to include things such as safety and schools.” Please confirm that the information from Mr. Beccaria will be part of the draft findings to be released on May 1 for the parties’ comment. 2. Given the significance of the issues before the Council and the fact that the May 26 hearing will represent the first—and only—opportunity for the parties to fully address Council’s findings and direction, we request that the parties each be given 15 minutes to verbally address the Council during the hearing. I look forward to your prompt response regarding these important issues. Thank you, James Zahradka | Supervising Attorney Fair Housing Law Project | Public Interest Law Firm jamesz@lawfoundation.org | p 408.280.2423 | f 408.293.0106 www.lawfoundation.org Forty Years of Advancing Justice in Silicon Valley 152 North Third Street, 3rd Floor San Jose, California 95112 3 250 Hamilton Avenue | Palo Alto, CA 94301 D: 650.329.2171 | E:molly.stump@cityofpaloalto.org Please think of the environment before printing this email – Thank you. This message contains information that may be confidential and privileged. Unless you are the addressee, you may not use, copy or disclose the message or any information contained in the message. If you received the message in error, please notify the sender and delete the message. From: James Zahradka [mailto:JamesZ@lawfoundation.org] Sent: Wednesday, April 15, 2015 2:12 PM To: Margaret Nanda; Stump, Molly; Nadia Aziz Cc: Kolling, Grant Subject: RE: Buena Vista Mobilehome Park closure - possible dates Thanks Molly. We are available on those days as well, but would suggest the 27th to avoid the day after Memorial Day. James Zahradka | Supervising Attorney Fair Housing Law Project | Public Interest Law Firm jamesz@lawfoundation.org | p 408.280.2423 | f 408.293.0106 www.lawfoundation.org Forty Years of Advancing Justice in Silicon Valley 152 North Third Street, 3rd Floor San Jose, California 95112 4 To: Margaret Nanda; Nadia.Aziz@lawfoundation.org; James Zahradka Cc: Kolling, Grant Subject: Buena Vista Mobilehome Park closure - possible dates Counsel – We are looking at May 26, May 26 and June 1 for adoption of findings in this matter. I do not have final confirmation that all of those dates are possible on our end, but would like your confirmation that you can attend an evening hearing on those dates. Tentatively, we are looking at releasing the draft findings on May 1st, with parties’ comments, objections and briefings due May 15th. No replies. Please respond today with your input on this schedule. Regards, Molly Stump 5 Los Gatos, CA 95032 Direct 408.355.7010 Fax: 408.355.7094 margaret.nanda@infogain.com This email and any attachments thereto may contain private, confidential, and privileged material for the sole use of the intended recipient. Any review, copying, or distribution of this email (or any attachments thereto) by others is strictly prohibited. If you are not the intended recipient, please contact the sender immediately and permanently delete the original and any copies of this email and any attachments thereto. 0 CITY Or PALO ALTO OFFICE OF THE CITY ATTORNEY 250 Hamilton Ave nue, 8th Floor Pa l o Alto. CA 94301 650.329.2171 THE HONORABLE CITY COUNCIL Palo Alto, California May 21, 2015 Re: Buena Vista Mobilehome Park: Adoption of Findings and Decision Dear M embers of the Council: The staff report for the Council's adoption of findings and final decision in the Buena Vista Mobilehome Park appeal, scheduled for May 26, 2015, states that staff would research potential alternatives to address the Council's concern to ensure that the updated appraisals of the in-place value of the Buena Vista mobile units reflect all of the relevant attributes of valuation, including the high-quality public schools and public safety characteristics of the Palo Alto community. I write to inform the Council and the parties of the results of that research. My office has had preliminary di scussions with two certified appraisers regarding the feasibility, schedule and cost of a potential peer review of the updated appraisals anticipated to be completed by Beccaria & Weber, LLP. The peer review would include the preparation of alternative opinions of value if the peer review indicated a need. Both appraisers informed us that peer reviews are an appropriate assignment within the appraisal profession. Both stated that a peer review of the Buena Vista unit appraisals cou ld be conducted in 2 to 5 weeks after receipt of the updated appraisals. Cost estimates for this work are within current City budgets. We also conferred with Hearing Officer Craig Labadie regarding his ability to receive and consider a peer review. Mr. Labadie is willing and able to consider a peer review, provided that if the peer reviewer identifies flaws in the original appraisal, the peer reviewer also provides an alternative opinion of value. Mr. Labadie is unavailable between June 18 and July 12. Thereafter, his schedule would permit him to complete the follow-up work that Council identified in its April 14 motion, including a peer review of the appraisals if Council so orders. 150521 sh0140134 CityOfPa loAlto .org Printed with soy-base d inks on 100% recycled p ilp or processed without chlorine. THE HONORABLE CITY COUNCIL May 21, 2015 Page 2 of 2 Re: Buena Vista Mobilehome Park: Adoption of Findings and Decision The two potential peer review firms are: Norman Hulberg, Senior Managing Director Valbridge Property Advisors (formerly Hulberg & Associates) One North Market Street San Jose, CA 95113 Michael Yovino-Young, President Yovino-Young, Inc. 2616 Telegraph Avenue Berkeley, CA 94 705 Mr. Hulberg has the most extensive experience valuing mobile home units. His firm, however, recently performed a scope of work related to the Buena Vista Mobilehome Park. The firm appraised the owner's interest in the entire property for a confidential client that is not a party to the closure proceedings. This assignment did not include appraisals of the value of the residents' units. We have copied the parties to this proceeding, and invite their comments. Very truly yours, ~~ City Attorney MSS:sh cc: Margaret Ecker Nanda, Esq. Nadia Aziz, Esq. James Zahradka, Esq. James Keene, City Manager Hillary Gitelman, Director of Planning and Community Environment Grant Kolling, Senior Assistant City Attorney Beth Minor, City Clerk 150521 sh 0140134 CltyOfPaloAl to.org Prlntod w ith soy·basod Inks on 100% rocyclod paper p rocossod without chlorine. ANDERSON & BRABANT, INC. REAL ESTATE APPRAISERS AND CONSULTANTS 353 W. NINTH AVENUE ESCONDIDO, CALIFORNIA 92025-5032 TELEPHONE (760) 741-4146 FAX (760) 741-1049 May 22, 2015 Mathew Dolan, Associate Sidley Austin LLP 1001 Page Mill Road Palo Alto, CA 94304 Dear Mr. Dolan: As requested, I have reviewed portions of the testimony of David Beccaria at the appeal hearing of the Palo Alto City Council on April 13 and 14, 2015. I have also been asked to comment on the letter from the City Attorney to the City Council dated May 21, 2015. My comments follow. This is considered to be a supplement to my Review Report dated March 23, 2015, and my follow-up letter dated April 10, 2015. 1. One of the main issues in this matter appears to be whether Mr. Beccaria has adequately reflected the unique locational qualities of this park in Palo Alto in his 2013 appraisals, and whether he would reflect them in an update of his appraisals. Several of the Council members had questions about the lack of location adjustments in his appraisals when he utilized home sales from parks in Sunnyvale, Mountain View and Redwood City, all of which have substantially lower housing prices. In his appraisals Mr. Beccaria writes “offset rent” in the column for a location adjustment for those cities. In his testimony at the appeal hearing he explained that the lower space rent at Buena Vista reflects the lower quality and condition of the park and that offsets the superior location in Palo Alto. Using his appraisal of Space 112 as an example, the comparables from Sunnyvale and Mountain View had monthly space rents about $135 to $140 higher than the rent at Buena Vista. However, the rent for the comparable from Redwood City was almost identical, only $13 higher than Buena Vista ($708 for Redwood City and $695 for Buena Vista). That slight difference would certainly not be an offset for the substantial difference in housing prices in those two cities. The average home price in January 2013 in Redwood City, reported by Zillow, was $816,000 while in Palo Alto it was almost double at $1,500,000. Even for Sunnyvale and Mountain View, the differences in space rent were only about 19 to 20 percent, while the average home price in Palo Alto was 61 to 72 percent higher. So, offsetting the location with space rent does not appear to be a fair analysis. There was a lot of discussion at the hearing about “safety and schools” as being important reasons why people want to live in Palo Alto. Those factors are certainly inherent in an analysis of location. The Council even made a request that in his updated appraisals that Matthew Dolan Comments on Appeal Hearing May 22, 2015 Page 2 of 5 Mr. Beccaria add to his scope of work that he would consider those factors. He even offered a possible methodology of comparing the differences in the median home prices of the other three cities with Palo Alto to calculate an adjustment. However, in his later correspondence on May 5, 2015, to the Council, he backs away from that and states that “these issues were considered previously as they are inherent in the location and neighborhood data already utilized in the valuations.” So, we are left with the question, in his 2013 appraisals did he adequately consider the superior location of Palo Alto. In my view he did not. And, it appears that his inadequate location analysis will be repeated in his updated appraisals. 2. Questions were raised about the use of comparable home sales from Buena Vista that occurred prior to the formal announcement of the park closure (application for closure filed in November 2012). In his appraisals Mr. Beccaria utilized six sales from Buena Vista that occurred between May 2006 and July 2012. The issue has to do with the fact that it was fairly common knowledge that Buena Vista had a short remaining life span and was likely to be closed. This knowledge goes back to about 2001 when the City passed the closure ordinance for mobile home parks. Of course, there was only one mobile home park in the City and everyone knew that the ordinance was for the closure of Buena Vista. Mr. Beccaria did not use any sales in Buena Vista subsequent to the closure application in November 2012 because they would have been tainted by the closure. The question is, should ANY of those sales from Buena Vista have been utilized, since they all occurred after the passage of the closure ordinance that was understood to be referring to Buena Vista? In his May 5, 2015 letter, Mr. Beccaria states that he believes that the buyers of those sales purchased their homes with the expectation of the park’s continued operation. However, that “belief” may still not qualify the sales as market transactions. First of all, we do not know how many of the six sales he was able to personally verify with the buyer to make that determination. But, even where he verified the sale with the buyer, it is still possible that the seller knew full well of the park owner’s intention and kept his price low so he could sell it before the closure was formally announced. A related question has to do with the condition of the park. While Mr. Becarria correctly assumed for his analyses that the park was not going to be closed, it appears that he did not make a similar assumption regarding the condition of the park. It seems obvious that the park owner has known at least since 2001 that the park was going to be closed, even though the formal announcement did not occur until November 2012. The pending closure no doubt has resulted in a cutback in maintenance of the infrastructure and common areas, and in the enforcement of maintenance requirements for the homeowners. Wouldn’t it have been reasonable for the appraiser to make some kind of an assumption regarding the condition of the park rather than penalize the residents for some things that were out of their control? Matthew Dolan Comments on Appeal Hearing May 22, 2015 Page 3 of 5 If you assume that the park owner had no intention of closing the park, it would seem reasonable to assume that instead of cutting back on maintenance, he would have invested some money in improving the park which could lead to increasing rents and home values. This is a strategy that is often followed by park owners. In my letter to you dated April 10, 2015, I made reference to The Sands Mobile Home Park in Encinitas. This was an older park with very small spaces that had a mix of single-wide homes and some RVs. A few years ago, the park owner made a number of improvements and started replacing older homes with new Park Models, some two stories. Now, almost all of the spaces have newer Park Models and the appearance of the park has totally changed, in a positive direction (See attached photos of The Sands). Perhaps the reason that the current owner of Buena Vista has not employed this strategy is because of the plans for the closure. Isn’t it reasonable to assume that the condition and appearance of this park would be very different if it were not for the closure? If today Buena Vista was on the way to looking anything like The Sands, the demand and pricing of homes there would likely be very different. By the way, Mr. Beccaria has stated that Park Models are not able to be financed because they are not classified as manufactured homes. That is not true. A number of the sales at The Sands have been financed by lenders. 21st Century Mortgage loans on Park Models in the State of California. It seems to me that a strong case could be made for either the exclusion of the sales from Buena Vista that were utilized, or at least a recognition that some of them might be low indicators. That recognition, plus a more adequate analysis of the locational differences between Palo Alto and the other three cities where the comparables are located, could produce a very different result. In addition, if any of the sales from Buena Vista are utilized, the selection should certainly include the sale of Space 110 that sold for $50,000 in July 2012, and perhaps even the older sale of Space 24 that sold in 2006 for $55,000. Both of those sales occurred within the time period Mr. Beccaria used in his analyses, but neither of the sales were utilized by him. It is also noticeable that of the 32 appraisals of Mr. Beccaria that I reviewed, his values on 11 of them are lower than the reported purchase prices of the residents. Those 11 homes are on Spaces 24, 32, 46, 63, 71, 73, 83, 102, 103, 105, and 110. All but one of those purchases were between the dates of 2001 and 2012. In my Review Report, dated March 23, 2015, I commented on the purchase of the home on Space 110 for $50,000 in 2012. Mr. Becarria did not know about that purchase and did not use that as a comparable sale. However, he was quick to respond to my comments in his rebuttal letter of March 25, 2015, and concluded that “…it is my opinion that the purchaser/owner grossly overpaid for that property …” That certainly appears to be a rush to judgment to defend his conclusions and I wonder if he would say the same thing about the other 10 resident/purchasers. Matthew Dolan Comments on Appeal Hearing May 22, 2015 Page 4 of 5 3. In his letter dated May 5, 2015, Mr. Beccaria refuses to engage in a subsequent appraisal assignment with a differing scope of work or a differing appraisal methodology. This was in reference to the Council’s concern about whether the locational factors of school and safety have adequately been recognized, or will be in his updated appraisal. In fact, he even claims: “It would be misleading for us to amend the Scope of Work when we know that, if added, this would not change the outcome of the analysis.” That appears to be an overreaction to what sounds like a reasonable request from the Council. It has been pointed out that the factors of safety and schools are only a part of a locational analysis that is already a requirement of his analysis. So, adding wording to a Scope of Work that simply states that he will be recognizing those factors cannot be considered misleading. What would produce a misleading result would be the failure to adequately recognize the superior locational characteristics of Palo Alto. 4. There appears to be a substantial difference in the tone and willingness to address the questions and concerns of the Council when you listen to Mr. Becarria’s comments at the hearing compared to his follow-up letter dated May 5, 2015. At the hearing he seemed to be open minded and willing to consider the questions and concerns of the Council and even offered a possible methodology for addressing the issue of the superior location of Palo Alto, especially with regard to schools and safety. However, his follow-up letter is like drawing a line in the sand, making it clear that there will be no changes in his Scope of Work or appraisal methodology and goes so far as to say, “We will not engage in further discussions about appraisal methodology or Scope of Work issues.” He has made it clear that if he completes updated appraisals the approach to the valuations will be just like his original appraisal, with time being the only variable. 5. The City Council is recommending that one of two appraisers be hired to complete a peer review of updated appraisals that would be completed by Mr. Beccaria. Since substantial issues have been raised about his approach to the valuations, and he has made it clear that his approach will be the same for the updates, it seems like his updates would be a waste of time and money. Why would you need an update of an appraisal that, in my view, was done incorrectly? Many of these issues are already public knowledge, having been discussed in the newspaper and online. If I was the review appraiser I would want to have all the cards put on the table so I would understand all of the issues before deciding on a methodology and scope of work. Instead of having Mr. Beccaria update his appraisals, I would respectively suggest that the chosen review appraiser conduct his review of Mr. Beccaria’s original appraisals, and that he also be provided with copies of my appraisal review, and copies of the various follow-up letters prepared by me and Mr. Beccaria, as well as the link to the appeal hearing so he could listen to the questions and concerns of the Council and Mr. Beccaria’s testimony. After digesting all of that, the review appraiser could then prepare a written review of that information, along with a proposed methodology and scope of work for the current appraisal. The Council would then have a Matthew Dolan Comments on Appeal Hearing May 22, 2015 Page 5 of 5 good basis for deciding if the appraiser appears to understand the issues and would likely prepare a credible appraisal. This way, only one current appraisal would need to be prepared after an objective consideration of all of the issues. In addition, the scope of work would be determined by the appraiser and would be consistent with the Uniform Standards of Professional Appraisal Practice (USPAP). With respect to the possible selection of Norman Hulberg as the appraiser, it sounds like he properly made a disclosure about his firm’s previous appraisal of the owner’s interest in the property. I would think the Council would want to make further inquiry about the relationship (personal and/or business) between that client (confidential) and the park owner. Thank you for the opportunity to be of service. If you have any questions, please contact me at your convenience. Sincerely, James Brabant, MAI Attachment Anderson & Brabant, Inc. THE SANDS MOBILE HOME PARK, ENCINITAS Looking westerly along an interior street in the Sands MHP, taken February 28, 2013. Looking easterly along an interior street in the Sands MHP, taken February 28, 2013. Nortz, Jason From: Sent: To: Subject: Attachments: Importance: Hello Jason, Tuttle, Nathan <NTuttle@prometheusreg.com> Friday, October 26, 2012 3:36 PM Nortz, Jason BV -Housing Relocation Specialists & Appraiser_SOQ's Buena Vista Mobile Home Park Closure SOQ.pdf; 2012- StatementofQualifications_DaveRichman_Autotemp.pdf; 2012.10.22- BeccariaWeber_AppraiserSOQ.pdf High I have attached two SOQ's from Dave Richman and OPC, both are Housing Relocation Specialists. I have also attached the SOQ for the appraiser that seems to have the most complex park closure experience in the Bay Area, Beccaria & Weber, Inc .. Hopefully this info. will assist you in your meeting next Wednesday to feel comfortable approving any of these firms to work on the Buena Vista Mobile Home park conversion. Please don't hesitate to contact me if you re quire additional information. Thank you, NATHAN TUTTLE, SENIOR DEVELOPMENT :MANAGER PROMETHEUS REAL ESTATE GROUP 1900 SOlJTIINORFOUC ST. STE. 150 SAN .MATEO, CA 94403 PH01'1E: 650.931.3472 FJ\X: 650.931.3672 NTUTILE@PROMETHEUSREG.COM I WWW.PROMETHEUSREG.COM PROPERTY M t\NACE:tv!EN'l' COMPANY OJl THE YEAR, 2010 & 2012 BY lVIBN PROPERTY MANAGElVITTNT COMPANY OF THE YEAR, 2011 BY NABB CONFIDENTIALITY NOTICE This communication and any accompanying document(s) are confidential and may be privileged. They are intended for the sole use of the addressee. If you received this transmission in enor, you are advised that any disclosure, copying, distribution, or the taking of any action in reliance upon the communication is strictly prohibited. Moreover, any such inadvertent disclosure shall not compromise or waive the attomey-client privilege as to this communication or otherwise. If you have received this communication in enor, please contact me at the above Internet address or by telephone at 650-931-3400. Thank you. 1 ' ' May22, 2015 Palo Alto City Council c/o Molly S. Stump Office of the City Attorney 250 Hamilton Avenue Palo Alto, CA 94301 Emailed to Molly S. Stump PUBLIC INTEREST LAW FIRM Oftci.na Legal de Interes PUblico Law Foundation of Silicon Valley 152 North Third Street 3rd Floor San Jose, California 95112 Telephone (408) 293-4790 • Fax (408) 293-0106 www.lawfoundation.org Re: Response to April 14, 2015, Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park Dear Mayor and City Council: I. Introduction This response is submitted on behalf of the Buena Vista MHP Residents Association.1 On April 14, 2015, the City Council tentatively approved the closure of Buena Vista conditioned on the Park Owner's providing certain assistance to mobilehome residents.2 The City Council additionally determined that the future appraisals should reflect the value of Palo Alto's schools and safety and instructed the appraiser, Mr. Beccaria, to change his scope of work to account for these factors. Mr. Beccaria has since declined to adjust the scope of his appraisal, threatening to quit if Council orders him to change the scope of the future appraisals. 3 Ori May 14, 2015, the City Attorney circulated draft findings for the City Council to consider. The Buena Vista MHP Residents Association disagrees with those findings because they would have the City Council reverse itself and remove the instruction to the appraiser regarding schools and safety.4 On May 21, 2015, the City Attorney sent another letter to the City Council explaining the option of hiring another appraiser to conduct a peer review of Mr. Beccaria' s appraisal methodology. 5 1 This response is submitted by the Law Foundation of Silicon Valley, Western Center on Law and Poverty, and Sidley Austin LLP, attorneys for the Buena Vista MHP Residents Association. 2 Transcript, Vol. II, p. 372, lines 10-11. 3 Le~r from David F. :Qeccaria to Karen Holman, Mayor (May 5, 2015). 4 Staff Report: Adoption of Findings and Final Decision in the Matter of the Appeal by the Buena Vista Mobilehome Park Residents Association of the Hearing Officer's Decision Approving the Application for Closure of the Buena Vista Mobilehome Park and Establishing Mitigation Measures and Additional Conditions of Approval (May 26, 2015), Att. E, 4. 5 The City Attorney's recommendation to Council that it consider commissioning a peer review of Mr. Beccaria's appraisals is consistent with the City's prior statements that it would conduct such a peer review. In the memorandum in which Council was informed of staff's approval of Mr. Beccaria as the appraiser for the owner, staff stated that it expected that "staff or an outside appraiser for the City will peer review the appraisal." Palo Alto Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May22,2015 Page 2of9 The Residents Association agrees with the City Council's determination on April 14 that the mobilehome appraisals used to determine mitigation assistance must incorporate the valrie conferred by the homes' location in Palo Alto.:_which, in turn, necessarily incorporates the high value of Palo Alto's schools and safety. Accordingly, the Residents Association believes that the best course of action is to relieve Mr. Beccaria of his appraisal duties and hire an appraiser who is willing to comply with the City Council's directive. Should the City Council decide to commission a peer review of Mr. Beccaria's appraisal methodology, the Residents Association strongly believes that such a review should be of the methodology used by Mr. Beccaria in his 2013 appraisals and the peer review should be done prior to the City Council voting to close the Park. · II. Mr. Beccaria should be replaced by an expert, independent appraiser who will explicitly take Palo Alto's schools and safety into account. As stated above, the Residents Association agrees with the City Council's determination on April 14 that the mobilehome appraisals used to determine mitigation assistance must incorporate the value conferred by the homes' location in Palo Alto-which, in turn, necessarily incorporates the high value of Palo Alto's schools and safety. City Council should reaffirm its decision to require these factors in the appraisals. Although appraisals alone are insufficient to determine the cost-et-relocating Bueria Vista residents to comparable housing in a comparable community, fair, accurate, and impartial appraisals are essential to ensuring that Buena Vista residents are adequately compensated for the loss of their current homes. However, as noted in the report by James Brabant-and by many community members that provided public comment-the appraisal methodology employed by Beccaria and Weber in appraising the homes at Buena Vista did not properly account for the homes' location in Palo Alto.6 Adjusting an appraisal for location necessarily takes into account the value of schools and safety, as well as other community amenities. When asked by City Council about this critique, Mr. Beccaria argued that a location adjustment was not warranted because Buena Vista, despite its superior location in Palo Alto, was an inferior park to those in othe:r; cities: "[B]asically I drew an equal sign, plus or minus, you know, between the locational issue and the park deficiencies, the buyer's acceptance of the park deficiencies."7 As discussed in Mr. Brabant's earlier letter, as well as the letter attached, these assumptions do not bear out. 8 City Manager, "Status Update for Buena Vista Mobile Home Park," Dec. 17, 2012, p. 3. This City-sponsored peer review never took place, although the Residents did provide Mr. Brabant's analysis. 6 See James Brabant, "Review of Appraisals by Beccaria & Weber, Inc.," page 6. Note that Council decided to make this report part of the record on appeal. See also Letter from James Brabant to Matthew Dolan (May 21, 2015) f p. 1-2 (attached as Exhibit 1). Transcript, Vol. II, p. 234, lines 17-21 (attached as Exhibit 2). 8 Letter from James Brabant to Matthew Dolan (May 21, 2015) pp. 1-2. I,···, Ii Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May22, 2015 Page 3 of9 Following this discussion, the City Council acknowledged the value of schools and safety in pprticular in assessing the price of a home in Palo Alto and asked Mr. Beccaria to consider a new scope of work that would expressly take these factors into account. Mr. Beccaria was open to this possibility and suggested that he might be able to compare single family home purchases or apartment prices in Palo Alto versus other cities and apply that percentage differential to mobilehome prices at which he was looking in other cities as comparators; he did express some uncertainty about the exact approach and requested the opportunity to discuss the matter with his colleagues. 9 At the conclusion of the meeting, Mr. Beccaria gave the City Council a roadmap for how to incorporate schools and safety into the scope of work for the future appraisals: · All's we have to do, I think, if you're adding that to it is [say] "the appraiser-the appraiser will revise the scope of work to include safety and schools." And then it's directed toward me.10 · .. Twenty-one days later, Mr. Beccaria sang a distinctly different tune. In his May 5 letter, he accused City Council of effectively asking him to commit an unethical act and of violating state law by requesting the expansion in scope to address City Council's concerns about the appraisals.11 As made clear in Mr. Brabant' s report, Mr. Beccaria' s stubborn defense of his scope and methodology and his rigid refusal to consider modifying them only compound the serious flaws in his original report. In his report, Mr. Brabant notes that: · No adjustments are made in the 32 appraisals for differences in Location and/or Site Value. When the comparable sale is from Redwood City, Mountain View or Sunnyvale, the report indicates the location is offset by the rent. It appears that for location, the appraisers are primarily concerned with the quality of the park and all of the comparable parks are rated superior to Buena Vista. However, there does not appear to be any recognition of the superior home prices in Palo Alto compared with those other cities.12 Mr. Brabant notes that Mr. Beccaria' s use of comparable mobilehome prices from Redwood City, Mountain View, and Sunnyvale without a location adjustment means that ''the superior Palo Alto location seems to be lost in this process."13 This analysis aligns with the Council's motion, which seekS to capture the significant value of the public schools and public safety that a Palo Alto address conveys. Although Mr. Brabant's critiques are consonant with City Council's direction from April, City staff summarily brushes them off in thf'. draft decision: , 9 Transcript, Vol. II 313:15 -314:19. 10 Transcript, Vol. II 371:25 -372:3. 11 Letter from David F. Beccaria to Karen Holman, Mayor (May 5, 2015). 12 James Brabant, "Review of Appraisals by Beccaria & Weber, Inc.," page 6. Note that Council decided to make this report part of the record on appeal. 13 Ibid. Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May22,2015 Page4of9 Mr. Brabant suggests that the existing appraisals may be lower than appropriate, but does not propose alternative valuations. The Council finds Mr. Beccaria' s responses to Mr. Brabant' s comments to be persuasive and adequate. In addition, without alternative valuations, the Council lacb an evidentiary basis for reaching a contrary conclusion on appraised value.14 This change is startling and inappropriate, particularly in light of the fact that on April 22 the City Attorney represented to the parties that this instruction would be part of the draft findings and decision.15 The proposed elimination of the City Council's direction regarding schools and safety is arbitrary, capricious, and lacks evidentiary support. The City Council had Beccaria' s March 25 responses to Mr. Brabant' s critique before it when it considered this matter at the April hearings, yet it still instructed Mr. Beccaria to include the value of the .safety and schools in his scope, implicitly rejecting his responses to Mr. Brabant' s critique.16 The City Council's concern regarding the limited scope was evinced, not only in the final motion, but in the substantial and probing questions that a number of councilmembers directed at Mr. Beccaria. The only change between the Council's motion and the draft written findings is the fact that Mr. Beccaria threatenedto resign as appraiser. Moreover, this change flouts notions of due process, as it is based on a letter submitted outside of the context of a hearing, thus preventing the City Council or the Residents Association from probing the reasoning for Mr. Beccaria' s changed position.17 Staffs statement is also untenable as it improperly places the burden of proof regarding the appraisals on the Residents Association. As stated in the proced,ures memo that the City Council adopted: [t]he applicant [i.e., Park Owner] bears the burden of proving-byapreponderance of the· evidence that the criteria for approval of the application, as set forth in Municipal Code section 9.76.040(g), have been met.18 By proposing that the City Council ignore Mr. Brabant's critique based on his failure to propose alterative va.J.uations, staff is effectively putting the burden on the Residents to pay thousands of dollars to hire an appraiser to conduct alternative appraisals and to prove the value of the mobile homes. Per the Ordinance, this is Owner's job, 19 and it is to be performed by a "qualified appraiser" who is "chosen by the Park Owner from a list supplied by the City."20 Notably, this does not appear to be the process by which Mr. Beccaria was selected as the Park Owner's appraiser. Rather, Nathan Tuttle from Prometheus Real Estate Group suggested Mr. Beccaria to City staff as ''the appraiser that seems to have the most complex park closure experience 14 Staff Report: Adoption of Findings, p.4. . 15 Email from Molly Stump to James Zahradka, et al. (April 22, 2015) attached hereto as Exhibit 3. 16 Mr. Beccaria's May 5 letter consisted of a summary refusal to follow Council's direction and added nothing substantive to the analysis. 17 Manufactured Home Communities, Inc. v. Cnty. of San Luis Obispo, 167 Cal. App. 4th 705, 711 (2008)(finding failure to allow cross-examination violated due process where hearing decision based on material facts alleged by those witnesses). 18 Appeal Procedures§ 2(c) (Jan. 12, 2015). 19 Palo Alto Mun. Code, § 9.76.040(g)(2)(a) (referencing "loss of investment in the mobilehome that cannot be relocated"). 20 Palo Alto Mobilehome Conversion Ordinance,§ 9.76.030(d)(iv). Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May 22, 2015 Page 5 of9 in the Bay Area.'m Rather than the Park Owner selecting the appraiser from a City-generated list, the developer wjth whom the Park Owner was in contract to sell the Park hand-picked an appraiser with an eye to getting to a result that would facilitate closure. Beccaria' s letter and the dramatic change in tone and outlook also raise serious questions about Mr. Beccaria's impartiality.22 And although Mr. Brabant did not himself perform alternate appraisals, he certainly gave the City Council enough information about the errors in Mr. Beccaria' s methods to give the City Council an idea of the order of magnitude of what those errors will cost Buena Vista residents. In Mr. Brabant' s most recent letter, he compares the negative offset of rent that Mr. Beccaria imposed versus what would be a positive offset of higher Palo Alto housing prices. i ! In his appraisals Mr. Beccaria writes "offset rent" in the column for a location adjustment -for those cities. In his testimony at the appeal hearing he explained that the lower space rent at Buena Vista reflects the lower quality and condition of the park and that offsets the superior location in Palo Alto. Using his appraisal of Space 112 as an example, the comparables from Sunnyvale and Mountain View had monthly space rents about $135 to $140 higher than the rent at Buena Vista. However, the rent for the comparable from Redwood City was almost identical, only $13 higher than Buena Vista ($708 for Redwood City and $695 for Buena Vista). That slight difference would certainly not be an offset for the substantial difference in housing prices in those two cities. The average home price in January 2013 in Redwood City, reported by Zillow, was $816,000 while in Palo Alto it was almost double at $1,500,000. Even for Sunnyvale and Mountain View, .. the differences in space rent were only about 19 to 20 percent, while the average home ------ price in Palo Alto was 61to72 percent higher. So, offsetting the location with space rent does not appear to be a fair analysis.23 This analysis demonstrates the way in which Mr. Beccaria's failure to account for location artificially lowered the appraised values of mobile homes at Buena Vista. It also suggests that if Mr. Beccaria modified his scope as he initially suggested-adding a multiplier for the price of single family homes in Palo Alto-the initial appraisals might have been higher by as much as 72 percent. Thus, for the City Council's directive to be followed, a different appraiser will need to be appointed, and new appraisals will have to be conducted employing a correct methodology and scope. At the May 26, 2015, hearing, the City Council should direct staff to supply a list of independent appraisers to the City Council and inform the Park Owner that if he wants to pursue his closure application, he will need to select a new appraiser.24 21 See Email to Jason Nortz from Nathan Tuttle (Oct. 26, 2012) (attached as Exhibit 2)(emphasis added). 22 Indeed, the mere fact that Mr. Beccaria appeared as a witness for the Park Owner throws his impartiality and credibility into serious question, another reason he should be replaced. Did the Park Owner pay him for his testimony? This payment would be relevant to "the credibility of the witness and the weight of his testimony." Cal. Evid. Code,§ 722(b). Council should ask the Park Owner to provide this information before it makes its final decision. 23 Letter from James Brabant to Matthew Dolan (May 21, 2015) pp. 1-2. 24 The list of two appraisers in the City Attorney's May 21, 2015, letter should be expanded to three options. The list may need to exclude Valbridge Property Advisors, who may have a conflict of interest. Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May22,2015 Page 6 of9 111.H a peer review of Mr. Beccaria's appraisal methodology is commissioned, the City Council should commission and consider the peer review of the 2013 appraisal methodology before it closes the Park. Assuming that Council agrees to commission a peer review of Mr. Beccaria' s appraisal methodology rather than hire a new appraiser, this peer review should be conducted of the methodology used by Mr. Beccaria in his 2013 appraisals, rather than any new set of appraisals done by Mr. Beccaria. First, it does not make sense for Mr. Beccaria to update his appraisal prior to a peer review because the City Council has already rejected his methodology. What does make sense is for the peer reviewer to review Mr. Beccaria's 2013 appraisals as well as the parties' arguments, expert submissions and public testimony, and the City Council's dialogue regarding the same. The peer reviewer should develop a scope and methodology for a new appraisal based on that information and his or her own market analysis. There is no reason to ask a peer review to look at new appraisals by Mr. Beccaria since the only difference should be the.differential to reflect the changed market conditions between 2013 and the present, independent of the safety and schools issues identified by the City Council. Second, should the peer reviewer determine that Mr. Beccaria' s methodology was inadequate, it would be a waste of time and resources to ask Mr. Beccaria to apply that methodology to determine alternative values for residents' homes. Moreover, the City Council should not make a decision about the park closure until the peer review is conducted. Because of the efficiency reasons listed above, the City Council should approve one appraiser's methodology or the other's; that appraiser should then conduct the actual appraisals of homes rather than having both appraisers perform the considerable work of appraising all 117 mobile homes. More importantly, the City Council cannot make a reasoned decision with support in the record regarding the closure and a mitigation package that is based on an appraisal scope/methodology that has not been determined. The proper course of action on Tuesday-should the City Council decide to commission a peer review-is for the City Council to: (1) InstriJ.ct staff to retain a second appraiser-who will include consideration of the Park's location in Palo Alto, thereby including schools and safety in his or her analysis- to perform a peer review, (2) Instruct the second appraiser to perform that review on Mr. Beccaria's 2013 appraisals, and (3) Set a date for the second appraiser to submit a report to the City Council and appear at a hearing and answer any questions from the City Council and the parties, and for the City Council action to select an appraiser, and approve or deny the application based on this new information. Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May22, 2015 Page? of9 IV. The rent differential should be based on the size of the home the family will need and should not be limited to the cost of a one-bedroom apartment. The City Council's tentative findings improved upon the decision of the Hearing Officer in that the City Council found that, for resident households of 3 or more people whose mobilehomes have additions, the rent differential should be based on the cost of a 2-bedroom unit rather than a I-bedroom unit, even if the addition to the original I-bedroom mobilehome was unpermitted. Guaranteeing that large families whose mobilehomes have additions get relocation assistance that is sufficient to move them to homes larger than one bedroom is appropriate; and, contrary to the statements of both the hearing office~. and counsel for the park owner, dqes not provide a windfall to these residents. Many residents purchased their mobilehomes with additions already in place; the park owner had allowed previous owners to build the additions and had allowed those owners to sell the homes with the additions intact. As Mr. Beccaria noted in his testimony on April I 4 ''the issue of permitting is largely ignored by market participants,"26 meaning that purchasers pay more for larger homes, regardless of whether the additions to those homes are permitted or not. Residents either paid more for their homes because of additions, or they increased the value of their homes by investing in additions. As discussed in our earlier briefing and at the hearing on April I4, landlords are generally unwilling to rent I-bedroom apartments to families of 3 or more. Formitigation assistance to provide residents with realistic options for alternative housing, it needs to be sufficient to allow . tliem to rent a home that is the appropriate size for their family,--regardless of the size or . appearance of their current home. The City Council was correct in.its tentative findings not to limit the rent differential based on the cost of a I-bedroom apartment for larger families whose homes have additions. The City Council should go further and base the cost differential on the actual family size for families of 3 or more, using the 2+ I standard outlined in HUD' s Keating Memorandum. 27 -· V. A process that Jlllows individual residents to appeal the amount of their relocation assistance is necessary and appropriate. Consistent with the earlier requests of both the Park Owner and the Residents Association, 28 and the advice of the City Attorney, the City Council voted on April I4 to establish a process for individual residents to appeal their mitigation assistance. Although the process tentatively approved by City Council falls short of the hearing process recommended by the Residents Association,29 it at least provides a mechanism for individual residents to seek review of their relocation benefits. Having such a procedure in place is especially important in light of the fact 25 See Final Decision in the Matter of Touftc Jisser, as Trustee of the Jisser Family Trust, for Closure of the Buena VistaMobilehome Park in Palo Alto, California (Sept. 30, 2014) 15. 26 Transcript Vol II, p. 158, lines 18-19. 27 Fed. Reg. vol. 63, p. 70,255. 28 See Post-Hearing Brief Submitted on Behalf of Buena Vista MHP Residents Association to Hearing Officer Craig Labadie (July 16, 2014) pp. 50-51; Park Owner's Closing Brief (July 16, 2014) pp. 30-32. 29 See Post-Hearing Brief Submitted on Behalf of Buena Vista MHP Residents Association to Hearing Officer Craig Labadie (July 16, 2014) pp. 50-51. Response to Draft Findings of the City Council Regarding the Closure of Buena Vist~ Mobile Home Park May22, 2015 Page 8 of9 that the City Council has tentatively approved a mitigation assistance package where the primary determinant of individual relocation benefits-appraisals of current homes-has yet to be , performed. Additional moving assistance for seniors and people with disabilities will also be assessed on an individualized basis after this appeal has ended; it is essential for those residents to have some means of challenging any inaccurate or unfair amount that is awarded to them. The draft findings would have the City Council circumscribe the Hearing Officer's role in these future appeals to "making a determination regarding the appraisal amount and comparable market survey."30 This language would prevent the hearing officer from making a determination regarding other aspects of the individual assistance-such as moving expenses or supplemental . payments for seniors and people with disabilities-and runs contrary to the spirit of haying such a process. The City Council should use broader language to ensure that individual residents' ability to appeal their own relocation packages is comprehensive and meaningful. · VI. Meaningful mitigation assistance would neither exceed the "reasonable cost(s) of relocation" nor effect a taking. Mitigation assistance that takes into account the value of Buena Vista's location in Palo Alto would not exceed the "reasonable cost of relocation." The requirements in state and local law prohibiting park closure conditions that exceed the reasonable cost of relocation prevent local jurisdictions from conditioning park closures on requirements that are in no way related to the park closure or the relocation of the displaced residents. It does not give the Park Owner the right to reject out of hand any requirement that it finds to be burdensome and, therefore, subjectively unreasonable. Furthermore, despite the Park Owner's attorney's threats of litigation and allusions to thy City Council's actions modifying the mitigation package being a "taking," the City Council should not shy away from adopting what it finds is an adequate relocation package. The Ordiri~ce contains a provision for the Park Owner to obtain an exemption if the relocation benefits would effect a taking: 9.76.080: Exceptions to requirement to provide relocation assistance. (c) An applicant may seek a partial exemption on the ground that the imposition of a particular relocation obligation would eliminate substantially all reasonable use or economic value of the park for alternate uses. The application must specify the particular obligation that would cause this result and provide evidence to demonstrate that this result would occur. If the Park Owner believes that the relocation assistance that the City Council orders is excessive, he can seek this exception, and prove this claim with sufficient evidence. 30 Staff Report: Adoption of Findings, p. 5. Response to Draft Findings of the City Council Regarding the Closure of Buena Vista Mobile Home Park May22, 2015 Page 9 of9 VII. Conclusion The Residents Association continues to believe that mitigation assistance that is based on appraised values alone-and that does not reflect the cost of relocating to comparable housing- violates the Ordinance, as well as state and local laws. The Resident Association reasserts this argument by reference here. Likewise, the Residents Association does not waive any claims related to legal issues previously articulated, including due process concerns regarding the conduct of hearings and the City's obligations under the Federal Fair Housing Act,31 the state Housing Element Law,32 and other laws. The City Council is not only permitted to reject a mitigation package that fails to comply with the Ordinance; it is required to do so. If the City Council chooses to continue in the direction it took in its April 14 tentative findings-to base mitigation assistance on the appraised values of Buena Vista residents' homes without attention to the cost of comparable housing, it will need to take these steps to ensure that residents are fairly compensated and have a meaningful opportunity to find new housing elsewhere: • The City Council should accept the resignation of Mr. Beccaria and require the appointment of a new appraiser via the procedure set forth in the Ordinance. The City should compile a list of appraisers and set forth a scope of work that explicitly requires the new appraisal to account for the value of Buena Vista's location in Palo Alto, including the value of schools and safety. Since the process of selecting a new appraiser and conducting the new appraisals may take several m~the Park Owner should not be allowed to issue a 6 month closure notice until after these new appraisals are performed; • Should the City Council decide to commission a peer review of Mr. Beccaria's appraisals, it should wait until the peer review report is produced before deciding which appraiser should create individual valuations and before it approves or denies closure of the park; • Park residents should be allowed to appeal all of their individual relocation benefits; and • The rent differential for families of 3 or more should be based on a 2+ 1 standard and not limited to the size of their existing home to increase the likelihood of their finding adequate long-term housing. We look forward to answering the City Council's questions about these comments on May 26, 2015. Sincerely, IS Kyra Kazantzis Directing Attorney 31 Specifically, 42 U.S.C. § 3608 requires recipients of CDBG and other federal funds to "affirmatively further fair· housing." 32 Gov. Code, § 65580-65589.8. [I