San Rafael affordable housing site to close amid rent fight
After facing steep rent hikes this past year, the tenants of the R.V. Park of San Rafael face a new threat: displacement.
Harmony Communities, the property management company, delivered a notice to tenants July 25 stating the owner’s intent to close the park at 742 Francisco Blvd. West.
The impending closure, the letter says, is in response to ongoing litigation with the city to determine whether a rent-control ordinance applies to the property. The suit has resulted in a court order, issued in July, barring the park from continuing to collect a $100 a month rent increase that began in November.
“Unfortunately, due to the measures taken by the City the park will be forced to close,” the letter says.
“The park has been operating at a loss for several years and has been fighting to keep this park open so no resident will have to move,” the letter continues. “The reality is the land is worth much more than operating an RV Park for affordable housing. The City of San Rafael has not allowed the park to raise rents fast enough to keep up with inflation which is at an all-time high.”
The letter does not indicate a closure date, and alleges that the city would not cooperate in finding a resolution.
The site has more than 40 residents. Some put the blame on the property management and the owner.
“They’re creating this frenzy of fear,” said Beverly Mason, a 20-year resident of the park. “I don’t feel they have any positive will. They are unscrupulous and have no regard for the law or anyone in this park.”
The dispute began in August 2021 when tenants were given notice of the rent increases, which Harmony said would bring the average monthly rent to $650. City officials and residents pushed back, stating that the increase was in violation of the city’s mobile home rent stabilization ordinance, designed to protect the affordability of the park.
The argument hinges on what kind of homes are there. Harmony says they are recreational vehicles and thus exempt from a city rent control ordinance covering mobile or manufactured homes. The city and the residents say otherwise.
In December, the city sued Donna Chessen, the property owner, and Harmony Communities, which is based in Stockton.
City attorneys cited previous litigation involving the property and San Rafael. That 2004 case established the park as a mobile home park subject to the rent control ordinance.
Marin County Superior Court Judge James Chou granted a motion for a preliminary injunction in July, prohibiting the defendants from collecting rent in excess of the city’s mobile home rent stabilization ordinance. The ordinance caps the mobile home park rent increases at 75% of consumer price index adjustments.
According to court records, Donna Chessen and her husband Erwin Chessen purchased the property in 2006. After Erwin Chessen died in 2019, a grant deed was recorded transferring the park to his wife, trustee of the family trust.
From 2006 to 2020, the park submitted a rent roll that conformed with the city’s rent-control ordinance, Chou’s ruling says. The $100 monthly increase exceeded what the ordinance allows, and the park failed to submit the required rent roll and calculations to the city, the order says.
Chessen argues that the property is no longer a mobile home park, because there are mostly recreational vehicles on the site. Under state civil code, if an RV is used as a residence for nine or more continuous months at the same site, it is a mobile home.
Following the ruling, the park announced it would retract the $100 rent increase, but then submitted a rent roll application to the city for a $15 rent increase instead, said Genevieve Coyle, assistant city attorney.
That increase, set to begin in November, was approved, Coyle said.
The notice of closure was delivered to the city attorney’s office last week, Coyle said.
“The owner has not formally contacted the city to start any closure process,” Coyle said.
Closing an affordable housing mobile home park requires the owner to prepare a tenant impact report as well as take steps to relocate tenants or pay fair market value for displacement.
Coyle said the city attorney’s office is continuing its litigation regarding the rent increase.
Sue Crabtree, a resident of the park for more than 30 years, said the price of rent is only one concern of several.
“There are a lot of issues,” Crabtree said. “They’re sending these notices, making rule changes, changing rents and now saying they’re closing the park. It’s a strategy to make us leave. It’s harassment.”
Resident Gilbert Nicholls agreed. Nicholls moved to the park in 2004 after losing his home in Fairfax.
“This is supposed to be rent-controlled, low-income housing for people like me,” Nicholls said. “We’ve got old people, disabled people, families with kids. We’re a community. It’s unfortunate.”
In an email, Chessen said she plans to formally begin the closure process within 10 days. The process is expected to take a year, and she expects to close the site in 2023.
“This is heartbreaking for our residents,” Chessen wrote. “They are so scared and confused.”
“The city did this, and I don’t know how the city staff can live with themselves,” Chessen said. “We wanted to run this as an RV park forever, but that’s impossible if our rents don’t cover our expenses.”
“I just wish the city would let us charge fair rents so that we could keep this park open,” she said. “But we’ve already litigated with the city in court and they have not budged an inch, so at this point we have no choice.”
Harmony Communities deferred to Chessen’s comments.
The company was also involved in a controversial 2018 RV park rent hike in San Leandro, which does not have rent control. In a Fresno County case two years ago, residents at the Shady Lakes Mobile Home Park filed a lawsuit alleging the company unfairly hiked rents and harassed tenants.
Company representatives denied the claims in both cases. The company continues to buy affordable housing communities in low-income areas in cities such as Gilroy and more recently in Golden, Colorado.