by Bulbul Rajagopal | Source|
The San Luis Obispo County Board of Supervisors unanimously shot down controversial mobile home park management company Harmony Communities’ attempt to increase rent at two local mobile home parks through a hardship request.
“When revenue fails to keep pace with inflation while expenses grow dramatically faster, the long-term viability of the community is at serious risk,” Harmony spokesperson Nick Ubaldi said. “The proposed rent adjustment is not about generating excess profit; it is the minimum necessary to allow the park to keep up with inflation and remain sustainable.”
To close the gap, rent increases were on the horizon for tenants of Oak Terrace mobile home park in Cambria and Buena Vista mobile home park in Nipomo. For Oak Terrace, the proposed $106 rent hike would have been roughly a 20 percent increase.
At the Nov. 18 meeting, the Board of Supervisors deliberated the rent increase as an appeal hearing after the Mobilehome Rent Review Board denied Harmony’s request in May.
“I hear the appellants’ concerns, and I sympathize with the concerns of additional costs,” 4thDistrict Supervisor Jimmy Paulding said at the meeting. “My reading of the situation based on reading our ordinance, reading our findings that have been prepared by staff, is that the appellant doesn’t meet the standard by which it’s necessary to prove the hardship in order to substantiate us granting it.”
Mobile home park manager Harmony Communities has a fraught history with many park residents around the state.
It’s been at odds with Del Cielo Mobile Estates tenants in Orcutt and the Santa Barbara County Board of Supervisors about converting the senior mobile home park to an all-ages park.
A bankruptcy judge ruled in favor of residents of Fresno’s La Hacienda Mobile Estates by appointing a trustee to oversee its sale to a nonprofit trying to keep the park as affordable as possible. The ruling elbowed out Harmony Communities, with the judge accusing it of operating in bad faith.
The number of tenants at a mobile home park in Soquel, Santa Cruz County, shrunk after Harmony took over management, according to the Golden State Manufactured-Home Owners League.
Residents of a Harmony-managed San Rafael RV park claimed that the company issued repeated violation notices for minor infractions, tried raising rents beyond legal limits, and filed eviction notices—culminating in a lawsuit.
Last year, the SLO County District Attorney’s Office entered a civil settlement with Harmony for allegedly failing to reimburse background fees the company charged as required by state mobile residency law. Harmony had to pay $61,000 in civil penalties and contribute to a nonprofit organization offering free legal assistance to tenants.
While the county staff report called Harmony the applicant seeking the rent increase and the owner of Oak Terrace, company spokesperson Ubaldi told New Times that Harmony doesn’t own any mobile home parks.
“It is strictly a third-party property management company that my family hired in 2022 to handle day-to-day operations,” he said. “My family has owned the park for over 20 years.”
A business filing on the California Secretary of State website lists Ubaldi as the agent of Oak Terrace MHP LLC. Applicant attorney Jason Dilday told supervisors at the meeting that Oak Terrace MHP LLC owns Oak Terrace mobile home park.
Business filings for Harmony Communities Inc.—with Bruce Davies as the agent—show it shares the same Stockton-based principal and mailing addresses with Oak Terrace MHP LLC.
Oak Terrace’s proposed rent upcharge hinges on the applicant’s claim that its original capital investment in the property should be almost doubled for inflation. That increase would consequently require rent for the now all-ages park to be upped as well to maintain the same rate of return on the $1.6 million purchase price in 2002.
But the county doesn’t allow a park owner to adjust their initial capital investment for inflation.
“Based on the applicant’s submission, the net profit … divided by the actual capital investment, without the inflationary adjustment, yields a 7.49 percent rate of return,” a county memorandum said. “This exceeds the allowable base year rate of return of 6.25 percent and therefore does not qualify as a hardship under Title 25.”
The proposed rent increase won’t go into place thanks to the supervisors upholding the review board’s decision to reject the hardship application.
[ED. NOTE: Oak Terrace has a GSMOL Chapter which includes more people than the park has spaces.]
