Clear View Court:
Collateral damage triggers damage-control
by the Santa Cruz City Council April 22, 2004
by Becky Johnson

Santa Cruz, Ca. --- In an unusual Thursday City Council meeting--held in the afternoon maximizing the inability of residents to attend the meeting, the City unveiled its deal of 34 year leases for the current residents of Clear View Court. These leases will replace the "irrevocable" leases "in perpetuity" that the City signed with residents guaranteeing rent control and then abandoned when the rapacious Manufactured Home Communities sued the City for unfair practices. MHC claimed it was unfairly prevented from maximizing profits. Last September, the City settled out of court in a deal which deprived virtually all DeAnza residents of their equity. Clear View Court residents braced for the collateral damage the council\u2019s decision would undoubtedly cause.

Immediately, as the ink was still wet on the contracts, Clear View Court owners Corbett Wright and Barry Swenson contacted the attorneys for MHC in order to retain them. They wanted the same lucrative deal the out of town park owners wanted.

In December, residents of Clear View Court were shocked to get notices of rent increases that doubled or tripled their existing rents with no increase in services. They were simply renting the same patch of bare ground the owners had operated at a profit for years. The City stepped in hoping to help negotiate a fair deal for both park owners and coach owners, and owners offered to forego the rent increases until May 1st if the residents agreed not to sue the City or the Park owners before April 26th, 2004.

At today's City Council meeting, Jim Major spoke on behalf of Park Owners Swenson, Corbett, Cliff Swenson, and Steve Carmichael saying the owners only want "an estimation of the true market value." He cited a number of gracious overtures the owners had made to the tenants and concluded that "these are not the actions of those who are out to screw the little guy." He reminded the residents that if they sign the new leases, "they will have 34 years of rental security."

Anita Webb, a member of the board of directors of the Clear View Court Homeowners Association, questioned how the City came up with its baseline market values. Unlike the highly paid professional Redevelopment Agency staff and the City Attorney's office, Webb is an ordinary person with a day job and who owns a coach at Clear View Court. She checked the HUD website for information on fair market rent guidelines. She found that the City had used the baseline for fair market rent on a 2 bedroom unit as their baseline for a zero bedroom unit for Clear View Court residents. Rents rose from there increasing as bedrooms were added on. Webb also said that HUD fair market rates include utilities and Clear View Court residents pay them separately.

"In all its an 82% increase from the HUD's fair market value baselines."

Vice-mayor Mike Rotkin said "But those are rent-controlled units."

"They are the fair market value,"she responded.

"And these rents are twice as high as the rental space for any other park in the County of Santa Cruz," she told the council. "The equity we have in our units is already shot," she said. "I tried to get a $20,000 loan on my unit, which is worth much more than that, and no bank would touch it."

Major argued that the residents of Clear View Court don't need special help paying higher rents. "I know of at least one man that is subletting his unit," said Major. " Another has a second home and another one has some income producing property somewhere else."

No one asked if The Swensons, Corbett, or Steve Carmichael had other income properties or had a real financial need to increase the rents for a park that had been operated for a profit even with rent control in place.