Almost all residents of the San Rafael RV park received eviction notices this week after the property owner lost a rental dispute in the US 9th Circuit Circuit.
In the Feb. 10 decision, the three-judge panel confirmed that the district court dismissed property owner Donna Chessen’s contention that the city ordinance stabilizing RV rentals constituted illegal “earnings.”
The ruling was the latest development in the saga that followed when the city sued Chessen and Harmony Communities, the Stockton-based property management group, in December 2021 for seeking rent increases allowed above the ordinance.
In the Court of Appeals ruling, the judges wrote that the Rent Control Ordinance had been in effect for 15 years before Chessen and her husband bought the property in 2006. Additionally, the ruling states that there was a “final ruling by a state court that found the property is subject to the ordinance.” This refers to a 2004 ruling.
On Monday, eviction notices were delivered to approximately 40 addresses at the RV park at 742 Francisco Blvd. west, according to local residents. The notice says tenants have until October 31 to vacate their homes and remove them from the property, otherwise they could face legal consequences.
“Where can I go? How can I afford to move?” said Alexander Vernimmen, a 70-year-old resident who has lived at the park for 18 years. Vernimmen said he lives with his 96-year-old mother, and her only income are social security payments.
Vernimmen said he was served with a separate eviction notice from the court on Dec. 30, which gave him just two business days to respond due to the bank holiday weekend.
“They prey on old disabled people and poor families with children,” he said.
The dispute began in August 2021 when tenants were notified of the rent increases, which Harmony said would bring the average monthly rent to $650. City officials and residents pushed back, saying the increase violates the city’s RV rental stabilization ordinance, which is designed to protect the park’s affordability.
The argument depends on what type of houses there are. Harmony says they are recreational vehicles and are therefore exempt from a city rental control ordinance that covers mobile or manufactured homes. The city and local residents say otherwise.
Chessen argued in court that there were only mobile homes on the site. If a mobile home is used as a place of residence for nine months or more continuously in the same place, it is considered a mobile home under the country’s civil code.
Marin County Superior Court Judge James Chou in July granted a request for an injunction barring the defendants from charging rents in excess of the city’s rent stabilization ordinance for mobile homes. The regulation caps rent increases for RV sites at 75% of consumer price index adjustments.
In July, the property management gave the tenants letters of intent to close the RV park, but did not give a date. The closure of an affordable housing mobile home park requires the owner to complete a tenant impact report and take steps to move tenants or pay fair market value for eviction.
In the July letters to residents, Harmony staff wrote that “the park has been operating at a loss for several years and is struggling to keep this park open so that no resident has to relocate. The reality is the land is worth a lot more than running an RV park for affordable housing.”
According to the property tax report, the 1.26 hectare property was built in 1952. The property is owned by the K&M Family 1997 Trust, a company controlled by Chessen. The property has an estimated value of $2.92 million recorded in 2022. Property taxes last year totaled $74,006.
Assistant City Attorney Genevieve Coyle said in an email that the city agrees with the 9th Circuit’s ruling and that the city is still pursuing its separate litigation in Marin County Superior Court to enforce the city’s ordinance. A trial is scheduled for May.
“We are aware of the eviction notices and are reviewing them,” Coyle said.
Fabian Quezadas is one of a group of newer residents renting the mobile homes provided by Harmony. He lives in one unit, his brother and family live in a separate one. They both have leaks and plumbing issues, he said. Quezadas said they pay $1,295 a month in rent for each house.
“These units are uninhabitable,” he said. “In the first rainy week we had leaks, plumbing issues, I found black mold in the bathrooms and around the windows. When I told Harmony they said I never informed them of any mistakes and now they are trying to evict me.”
Quezadas said the situation had gotten so bad that he was temporarily staying at a hotel. He said he complained to a Harmony Communities president, Matthew Davies. “He said to me, ‘If I don’t like it, you can move out. We can terminate your lease.’”
Attempts to reach Chessen were unsuccessful. Her attorneys, Dan Rudderow and Chris Chapman, did not respond to a request for comment.
Davies also did not respond to a request for comment, but Heywood Jablóm, a company spokesman, emailed a statement.
“This property consists entirely of RVs, which are legally exempt from city ordinance,” Jablóm wrote.
“The park is losing money because rents aren’t covering expenses. The city has been told that the park will have to close because it is losing money, but the city has refused to compromise,” Jablóm wrote. “The city wants a private landowner to single-handedly subsidize affordable housing in San Rafael, but the park is cash-strapped and losing money every month. Since the city has refused to comply with its own ordinance, the only option is to close the park. We expect all residents to be moving out by October and look forward to remodeling the property for higher and better use.”
Resident Gilbert Nicholls, who has lived there in his home since 2004, said he remains optimistic after hearing the federal ruling.
“You’re picking at straws,” he said. “You won’t win. They won’t beat us.”
Harmony Communities was also involved in a controversial 2018 rent increase for RV sites in San Leandro, which has no rent control. In a case in Fresno County, residents of the Shady Lakes mobile home park filed a lawsuit two years ago, alleging the company unfairly hiked rents and harassed renters. They are reportedly still facing rent increases.
Company representatives rejected the claims in both cases. The company continues to buy affordable housing communities in low-income areas in cities like Gilroy and last year Golden, Colorado.
