MINUTES OF MEETING

      ASSEMBLY COMMITTEE ON COMMERCE

 

      Sixty-seventh Session

      April 5, 1993

 

 

 

The Assembly Committee on Commerce was called to order by Chairman Gene T. Porter at 3:35 p.m., Monday, April 5, 1993, in Room 332 of the Legislative Building, Carson City, Nevada.  Exhibit A is the Meeting Agenda, Exhibit B is the Attendance Roster.

 

 

COMMITTEE MEMBERS PRESENT:

 

      Mr. Gene T. Porter, Chairman

      Mr. Morse Arberry, Jr., Vice Chairman

      Ms. Kathy M. Augustine

      Mr. Rick C. Bennett

      Mr. John Bonaventura

      Mr. Val Z. Garner

      Ms. Chris Giunchigliani

      Mr. Dean A. Heller

      Mr. David E. Humke

      Ms. Erin Kenny

      Mr. Richard Perkins

      Mr. Scott Scherer

      Ms. Myrna T. Williams

 

 

COMMITTEE MEMBERS ABSENT:

 

      None

 

GUEST LEGISLATORS PRESENT:

 

      Assemblyman William Petrak, District 18

 

STAFF MEMBERS PRESENT:

 

      Paul Mouritsen, Senior Staff Analyst, Legislative Counsel Bureau

 

OTHERS PRESENT:

 

      Mr. Kirby L. Burgess, Clark County; Mr. C. Joseph Guild, III, Nevada Mobile Home Park Owners Association; Mr. George Flint; Mr. Jeff Beintema, Schmitt & Cook Properties; Ms. Joan Clements, Administrator, Manufactured Housing Division, Department of Commerce; Ms. Lisa M. Stowell, President, Coalition of Manufactured Mobilehome Owners of Nevada, Inc.; Mrs. Lois Lazor; Mr. Galen Varien; Dr. Barbara A. Gunn, State Housing Coordinator, American Association of Retired Persons; Ms. Mary Jo D. Wiese; Ms. Gail F. Burks, Staff Attorney, Nevada Legal Services, Inc.; Mr. Joe Grana; Mr. Larry Osborne, Executive Vice President, Carson City Chamber of Commerce; Mr. Peter Echeverria; Mr. Charlie Joerg, Nevada Manufactured Housing Association; Mr. Mark Brown, Nevada State Apartment Association; Mr. Mike Brierley; Mrs. Mae Thorpe; Mr. Fabio Reginato; Mr. Walter Bantz; Mr. Chris Harris, President, Nevada Association of Realtors; Mr. Roger Service; Mr. John Cole; Mr. Paul Havas; Mr. Bill Van Patton; (See also Exhibit B attached).

 

 

 

ASSEMBLY BILL 163Expands authorized use of money from trust fund for low-income owners of mobile homes to include payment of costs of moving mobile homes under certain circumstances. 

 

Mr. Kirby L. Burgess, Clark County, testified.  Mr. Burgess advised he was speaking on behalf of Karen E. Larson, and read Ms. Larson's testimony into the record as follows:  "AB 163 is proposed by Clark County to address concerns that were expressed before our board of county commissioners regarding mobile homes.  During a hearing at that time, our residents expressed a desire to move their homes rather than accept the rent increase that were mandated by park owners.  Many of the residents stated that they must accept the increase because their financial situation precluded them from moving to another reasonable location.  AB 163 intends to address this concern by allowing the existing rental assistance fund to be used to relocate the mobile homes when appropriate.

 

"NRS 118B established a fund which is supported by a fee charged to mobile home park owners.  This fund is currently available to residents who meet the income criteria and are eligible for rental assistance.  We would propose to allow the Manufactured Housing Division to also utilize this fund to move a manufactured home to a new location when the applicant meets the income criteria.  Through administrative rules, the division would then set the criteria for moving the units and the procedure to determine the cost effectiveness of rental subsidy for moving the unit if requested by the resident.

 

"This bill is only intended to give the mobile home owner the flexibility to request relocation of the mobile home unit if it is in the financial interest of both the mobile home owner and the currently established fund.  It is not intended in any way for anyone but the mobile home owner to request or impose relocation.  It is simply intended to provide an additional option for tenants whose rent is raised beyond their ability to pay."

 

Mr. C. Joseph Guild, III, Nevada Mobile Home Park Owners Association, testified.  He said the intent of the legislation passed in 1991, which created a rental assistance fund, was to provide assistance with rents not with moving costs.  He indicated the fund would not become operational until July 1, 1993, and stated the law should be allowed time to operate in order to determine if any problems existed.  He said if needs other than rental assistance were determined, the law could be changed.  He said he was uncertain the fund could afford to provide both rental assistance and moving costs.

 

Mr. George Flint testified.  He advised he was appearing on behalf of Ms. Vickie Demas (representative for the Mobilehome Owners League of the Silver State, Inc.), who was unable to attend the meeting due to illness.  He reiterated the position taken by Mr. Guild that the rent assistance fund was intended to assist with rents, not moving costs.  He advised rents varied little from park to park, and suggested it made little sense to "......spend $4,000 to save $20 a month."

 

Mr. Jeff Beintema, Schmitt & Cook Properties, testified, expressing the same opinion as that of Mr. Guild and Mr. Flint regarding the rental assistance fund.   He suggested an owner of a mobile home might attempt to use the assistance provided under AB 163 to move from a mobile home park solely because he disliked the park.

 

Chairman Porter closed the hearing on AB 163.

 

ASSEMBLY BILL 161Prohibits, under certain circumstances, disclosure of information obtained pursuant to investigation of complaint alleging violation of provisions governing mobile home parks.

 

Ms. Joan Clements, Administrator, Manufactured Housing Division, Department of Commerce, testified, reading from prepared text (Exhibit C).

 

Ms. Lisa M. Stowell, President, Coalition of Manufactured Mobilehome Owners of Nevada, Inc., testified, reading from prepared text (Exhibit D).

 

Mr. C. Joseph Guild, III, Nevada Mobile Home Park Owners Association, testified.  He expressed the association's support for AB 151.  He suggested, however, as a practical matter, the name of a complainant would have to be divulged because of the difficulty in solving a problem if the source of the problem was unknown.

 

Chairman Porter closed the hearing on AB 161.

 

ASSEMBLY BILL 334Prohibits harassment of tenant of mobile home park by landlord. 

 

Ms. Joan Clements, Administrator, Manufactured Housing Division, Department of Commerce, testified, reading from prepared text (Exhibit E).

 

Ms. Lisa M. Stowell, President, Coalition of Manufactured Mobilehome Owners of Nevada, Inc., testified, reading from prepared text (Exhibit F).

 

Chairman Porter asked Ms. Stowell if she considered the February 9th letter from her landlord to be harassment.  Ms. Stowell replied she considered the last paragraph of the letter to be harassment.

 

Chairman Porter closed the hearing on AB 334.

 

ASSEMBLY BILL 187Limits increase in rent for mobile home lots in certain counties.

 

Assemblyman William Petrak, District 18, testified.  He provided some personal background.  He stated never had he seen a person or group of people "exposed to the shabby and the rent gouging tactics of the many mobile home park owners."  He spoke of a letter he received from a 78 year-old woman, living on Social Security benefits and a small savings account, who had been notified of a rent increase for her mobile home park space.  He also spoke of various conversations he had with individuals who had experienced rent increases.

 

Mr. Petrak discussed section 5, subsection 2 of AB 187.  He advised because 80 percent of Nevadans were "from out of state," it was more fair to use the Social Security Administration's cost of living adjustment (COLA) as the basis for determining what, if any, rent increase would be allowed than to use the consumer price index for the west coast.

 

He reviewed the proposed amendments to AB 187 set forth in Exhibit G.  He suggested the nonrefundable fees which would be established by the proposed amendment to section 6 would address the financial concern raised by the fiscal note.

 

Mr. Petrak advised the "sunset clause" contained in section 13 of AB 187 would provide an opportunity to determine the effectiveness of the bill.

 

He encouraged favorable consideration of AB 187.

 

Mr. George Flint testified.  He advised AB 187 was a simpler version of a bill which failed by two votes to pass in the last legislative session.

 

Mr. Flint related approximately 14 years ago, he moved into a mobile home park where he paid rent of $112 a month.  He stated when he moved from the park, five years later, he paid rent of $496 a month for the same service and the same amount of ground space.  He advised because he did not wish to pay rent of $496 a month, he paid $10,500 to move his mobile home to a park in Reno.  He said when he moved into Reno in 1985, his rent was $248 a month.  He told of subsequent increases in his rent and stated he had just received a notice of an increase to $381 a month.  Mr. Flint stated if he had been able to pay rent of $248 a month over the past eight years, he would have saved $8,000.

 

Mr. Flint said 2-1/2 years ago, tenants of the Palomino Park in Reno were advised their rents would be increased from $300 a month to $675 a month.  He suggested the owner of the park wished to close the park, did not want to pay the cost of moving the tenants, and used the rent increase as a means to cause the tenants, many of whom were elderly and on fixed incomes, to leave the park.  He stated nothing in the NRS prevented the owner from doing what he did.  He said AB 187 would eliminate the opportunity for such action.   

 

Mr. Flint spoke of receiving four rent increases in one year while residing in Verda park and of being told by one individual that she had received as many as three rent increases in one year.

 

He suggested one cause of rent abuse arose when individuals from other states bought mobile home parks in Nevada, for prices higher than they should have paid, and used increased rents to recover their excess expenditures.

 

Mr. Flint said AB 187 would not eliminate rent increases but would eliminate "these gargantuan, ripoff increases" and multiple increases in a single year.  He advised, based on a rent increase of $18 a month, the park in which he resided would recover $72,000 more in the coming 12 months than in the past 12 months, for which the park's residents would receive nothing in return.

 

Ms. Augustine referred to the proposed amendment to AB 187 which would require a landlord wishing to make repairs or improvements to a park to pay an application fee of $750 plus $1 for each lot in the park.  She asked Mr. Petrak why, if the landlord was paying the costs of the repairs or improvements, he should be charged such a substantial application fee.  She suggested the landlord might not recover 100 percent of the cost of the repairs or improvements from the tenants and might not wish to pass those costs on to the tenants.  Mr. Petrak advised in Escondido, California, the fee for such an application was $775 plus $2 per space.  He submitted the effort and cost of processing an application would justify the filing fee.  He stated he felt the fee was fair.   Mr. Flint also responded to Ms. Augustine's question and explained there would be no application fee if a landlord merely wanted to make repairs: a landlord would need to apply only if he was seeking a rent adjustment, in addition to the annual rent increase.

 

Mrs. Williams asked what percentage of mobile home parks were owned by out-of-state owners or syndicates.  Mr. Petrak said he understood approximately 80 percent of the parks in Nevada had out-of-state owners.  He stated nine of the ten mobile home parks in his district had out-of-state owners.  Mr. Flint also answered and advised 80 to 90 percent of the largest mobile home parks had out-of-state owners.

 

Mrs. Williams asked what percentage of complaints came from tenants of parks with out-of-state owners.  Mr. Petrak replied one would assume an abundance of complaints came from tenants of parks whose owners had headquarters outside Nevada.

 

Mr. Petrak referred to information in a packet he distributed (Exhibit H) concerning two mobile home parks in Las Vegas which generated net profits of $1.3 million and whose owners were headquartered in Michigan.  He advised the owner of Cabana Mobile Home Park, a park close to the one in which he resided, was headquartered in New York.  He cited other mobile home properties which had out-of-state owners.  He contended out-of-state owners of mobile home parks sent profits obtained in Nevada out of the state and paid no tax to the state of Nevada.  Mr. Petrak said ".......they're taking taxes right out of our pocket.  They're destroying our economy.  They're building.....another level of poverty by doing this."

 

Ms. Giunchigliani asked if "the old trailer parks which are now considered a mobile home park" were covered by AB 187.  Chairman Porter responded they were.

 

Mrs. Lois Lazor testified.  She advised over 28,000 owners of manufactured homes in Nevada lived on rented lots in mobile home parks, and were at the mercy of unscrupulous park owners who raised rents as often and as high as they wished.  She said when a park was sold, the new owner would immediately raise space rent because of his large investment.  She advised some mobile home owners were required to sign lifetime leases.  She contended a mobile home owner's only alternatives were to pay high rent or sell his home.  She explained if a mobile home owner's rent became too high, he could sustain a terrible loss when, and if, he was able to sell his home.  She stated virtually all mobile homes were now sold on site.  She advised it was impractical to move a mobile home once it was placed on a site.  She further stated there were very few lots in Nevada, zoned for mobile homes, which were either desirable or affordable.  She said, in effect, a manufactured house, once placed on a lot, was there permanently and must be sold on site.

 

Mrs. Lazor said she and her husband moved into Comstock Mobile Village (Comstock) in Carson City more than eight years ago, and invested a large portion of their retirement money in their home.  She stated when they moved into the park, the park was affordable and represented a good way of life.  She advised the park was now a senior citizens' park.  She said during the eight years she and her husband had resided in the park, there had been repeated rent increases which had not caused them concern; however, in the past 2 years, they had sustained two increases.  She said for some of the park's residents, those two increases amounted to a 28 percent increase in their rent.  She reminded the committee most of the park's residents were senior citizens whose Social Security benefit increases were 3 percent or 3.7 percent.  Mrs. Lazor said many residents of mobile home parks were senior citizens who could not afford repeated, unjustified increases in their rents.  She asserted the last two rent increases in Comstock were not justified by increases in the park's expenses and would augment the gross annual income of the park's owners by approximately $160,000.  She suggested the residents of Comstock were more fortunate than many other mobile home owners in Nevada, some of whom had sustained two increases in rent in one year.

 

Mrs. Lazor said there was no law to prevent a park owner from raising rent as often and as much as he wished; he was required only to give 90 days notice of an increase.  She declared a mobile home owner was at the mercy of a park owner and had no recourse.  She suggested if AB 187 was passed, it would provide recourse for mobile home owners.  Mrs. Lazor advised mobile home lots brought premium rents and said lots at Lake Tahoe rented for as much as $395 a month and lots in Reno for as much as $387 a month.  She suggested those rents might not appear high, but one should remember that the individual who resided on such a lot owned his home and everything on the lot and rented only the lot itself.

 

Mrs. Lazor referred to the two increases in rent in Comstock she mentioned earlier and said she spoke to the park owner's son who said she was the only resident who had complained.  She implied other residents of Comstock had not complained because they feared what the park owner might do.

 

Mr. Heller reminded Mrs. Lazor of a discussion in which she told him that one of the two rent increases about which she testified was based on road repair to be done in the park.  He asked if any of the road repair was done.  Mrs. Lazor replied both increases were based on prospective repair of the streets in Comstock but the streets had not been repaired.  Mr. Heller asked if the notice Mrs. Lazor received had indicated a rent increase effective May 1, 1992.  Mrs. Lazor responded that was correct.  Mr. Heller asked if there had been no repair of the streets during the following summer.  Mrs. Lazor answered very minimal repairs were made on October 14th because the Manufactured Housing Division had advised the owner the streets needed repair.

 

Ms. Lisa M. Stowell, President, Coalition of Manufactured Mobilehome Owners of Nevada, Inc., testified by reading from prepared text (Exhibit I). 

 

Mr. Galen Varien testified.  He said he lived in Oasis Mobile Home Estates.  He stated over the years he had lived in the park, rent had increased constantly and had increased by 485 percent since he moved into the park.  He said such an increase destroyed the purchasing power of mobile home owners and reduced the resale value of their mobile homes.

 

Mr. Varien said mobile home space rents in Nevada were unrealistic and rents for cheap apartments were less.  He said he looked forward to a rent rollback to no more than $150 per space.

 

Dr. Barbara A. Gunn, State Housing Coordinator, American Association of Retired Persons, testified by reading from prepared text (Exhibit J) and urged support for AB 187.  Dr. Gunn provided the committee with a booklet entitled "Manufactured Housing Park Tenants: Shifting the Balance of Power" (Exhibit K available in the research library).

 

Ms. Mary Jo D. Wiese testified by reading from prepared text (Exhibit L). 

 

Mrs. Williams referred to Ms. Wiese's testimony regarding living with raw sewage and asked if the Health Department had visited Ms. Wiese's park and issued citations.  Ms. Wiese replied the Health Department came to the park and issued citations on a regular basis, after which corrective action would be taken, but the following week, the problem would recur on some other street in the park.  She suggested the problem had been neglected so long and the pipes were so old that removal and replacement of the entire system would be required to correct the problem.

 

Ms. Gail F. Burks, Staff Attorney, Nevada Legal Services, Inc., provided written testimony (Exhibit M) and highlighted certain portions thereof with oral testimony.  She advised in a 20 month period there had been 166 evictions of mobile home owners for failure to pay rent.  She said 40 of those evictions occurred in the first six months of 1991, 102 occurred in 1992, and 24 occurred in the first two months of 1993.  She explained when a mobile home owner was unable to pay rent, the park's owner could take a lien against the mobile home and the owner would then lose the mobile home through a sale by auction.  She stated in a 14 month period, 627 liens were taken against mobile homes, and assuming those mobile homes were single occupancy homes, 627 people had lost their homes.

 

Ms. Burks directed attention to a breakdown of expenses on page 3 of Exhibit M and advised it represented an average estimate of costs to move a single-wide mobile home.

 

She stressed the importance of using the Social Security COLA standard (in determining annual rent increases).  She stated 75 percent of those who resided in mobile homes were senior citizens.  She said if those individuals received Social Security Title II benefits, their average income for 1993 was only $640 per month.  She advised in order to receive more than $640 per month, those individuals would have had to earn over $100,000.

 

Ms. Burks referred to Mrs. Williams earlier question regarding the number of mobile home parks which had out-of-state owners. She said it was difficult to determine the number due to the rate at which mobile homes changed hands, but Nevada Legal Services, Inc., would provide an answer by April 14, 1993. 

 

Mr. Joe Grana addressed the Chair.  He asked if Chairman Porter could explain why AB 187 did not pertain to Douglas County or to any county with a population of less than 35,000.  Chairman Porter answered the bill drafter had included a clause in AB 187 to exempt rural counties and asked if Mr. Grana would like that clause removed from the bill.  Mr. Grana answered, "Yes."

 

Mr. Galen Varien gave further testimony.  He suggested the state of Nevada provide a place to which mobile home owners could move their mobile homes if they were unable to afford park rents.

 

Mr. C. Joseph Guild, III, Nevada Mobile Home Park Owners Association, testified.  He said he would offer three reasons why the legislature should not pass AB 187.  He said, first, AB 187 would cost the state too much money.  Mr. Guild provided a booklet of articles and position papers (Exhibit N available in the research library).  He said the booklet (Exhibit N) contained the fiscal note on AB 187 and advised the Division of Manufactured Housing estimated a cost to the state's general fund in excess of $1.5 million over a three year period.  He stated he understood Mr. Petrak's proposed amendment to section 6 of AB 187 which would create a filing fee.  He explained calculations he used to determine the offset which could be generated by the proposed filing fee against the $1.5 million

estimated cost of AB 187 and advised there would be a shortfall of $834,000. 

 

Mr. Guild said a second reason not to pass AB 187 was that there was "no problem to fix."  He stated, according to the Manufactured Housing Division's figures, between 1991 and 1992, the average rent increase in Carson City for triple-wide, double-wide and single-wide mobile homes was 3 percent and in Clark County the net increase was 4.6 percent.

 

Chairman Porter asked what Mr. Guild defined as a "net increase."  Mr. Guild explained the calculations he employed to arrive at his figure of 4.6 percent.

 

Mr. Guild offered a third reason why AB 187 should not pass.  He said in 1991, the legislature passed a law which created a low income rental assistance fund, effective July 1, 1993, from which needy people would be able to obtain assistance with their rents.  He said he had heard the fund criticized as welfare for individual tenants, and proposed, if that were the case, then AB 187 was collective welfare and by the same logic should be defeated.   

 

Mr. Larry Osborne, Executive Vice President, Carson City Chamber of Commerce, testified.  He advised the Carson City Chamber of Commerce opposed AB 187.  He stated rent control was fundamentally bad government policy and said the result of limiting the income of private property owners would be to reduce the supply and quality of the housing involved and increase the cost to the entire community.  He contended rent controls would in fact discriminate against the poor and those on fixed incomes and increase their problems.  He stated the chamber did not believe AB 187 would solve the problem which the legislature felt it must address.

 

Mr. Peter Echeverria testified.  He advised he and his wife owned the Lucky Lane Mobile Home Park which they had built over 15 years earlier.  He said the current space rent in his park was $270 for a single-wide mobile home and $290 for a double-wide mobile home and there had been no rent increase for over one year.  He advised his and his wife's retirement depended upon their park.

 

Mr. Echeverria suggested the problem being addressed by the legislature could be solved in other, easier ways, than those proposed by AB 187.  He indicated one solution was through zoning.  He stated the reason for the mobile home problem throughout Nevada was that zoning authorities were not granting permits to build mobile home parks. 

 

He said most of the problems he'd heard discussed during the meeting pertained to Clark County.  He proposed if a problem pertained to a specific county or municipality, the legislature  should authorize that county or municipality to solve the problem at the local level.  He maintained the problem faced by the legislature was a local problem and should be solved by local government.  He suggested the legislature grant authority to county governments to exercise rent control within their jurisdictions.

 

Mr. Charlie Joerg, Nevada Manufactured Housing Association, testified.  He said he agreed with the statements of Mr. Osborne and Mr. Echeverria.  He stated the zoning problem was one of the major issues faced by the manufactured housing industry.  He said in at least the four major counties of Nevada, Clark, Washoe, Carson City and Douglas, there was discrimination against placement of manufactured housing and low income housing in general.

 

Mr. Mark Brown, Nevada State Apartment Association, testified.  He stated the association had received numerous commitments from members of the committee that AB 187 was not intended to affect the apartment industry, but the association still had serious concerns.  He said the association believed the rental assistance program provided the solution for those in need.  He stated, "If we want to take a broad brush approach, I think we need to amend this bill to include a restriction on any increase in grocery prices, any increase on utility prices, any increase on veterinary prices.  If we're out to protect those that can't afford any increases because they're on fixed incomes, let's really address the problem.  Let's take the whole problem on and not just go after one segment of that."

 

Mr. Brown advised legislation such as AB 187 had a chilling effect on the apartment industry.  He suggested recent rent increases in mobile home parks were a result of such legislation.  He indicated the mobile home industry was already experiencing a problem due to zoning and suggested AB 187 would further deter investment in the industry.

 

Mrs. Williams asked the Chair for permission to comment.  She said she did not doubt AB 187 had a chilling effect.  She emphasized she had no mobile homes in her district.  Mrs Williams stated AB 187 was not, nor had it ever been, rent control and was never intended to apply to apartments.  She said previously there had been a lack of recognition that when discussing mobile home owners, those discussions concerned people who had property rights and had made an investment, not "........ people who rent an apartment and can just pick up and leave."

 

Mr. Brown responded he understood AB 187 was not intended to affect the apartment industry but it still had a chilling effect.  He suggested out-of-state investors were encouraged to come into Nevada and then made to appear to be "slumlords" with no concern for their investments, which he proposed violated the trust and agreement created by encouraging those individuals to invest in Nevada. 

 

Mr. Mike Brierley testified.  He advised he owned Yorkshire Mobile Home Park in Reno, Nevada, which he and his wife had built as a park for residents 55 years old and older.  He stated numerous programs and services had to be provided in order to continue the park as one for residents 55 and older.  He said the park was completely equipped for the handicapped, had a small clubhouse, contained all new coaches and was one of the more nicely landscaped parks in its area.

 

Mr. Brierley advised rents in his park were low compared to many he had heard discussed.  He stated there had been two increases in rent in his park since its inception and none for a period of 22 months as of July 1, 1993, at which time an increase was proposed.  He said there was one tenant in his park who received rental assistance through the Department of Housing and Urban Development.  He said the department had reviewed the proposed rent increase and determined the increase was within the department's guidelines.

 

Mr. Brierley enumerated some of the increases in the park's  operating expenses experienced over the previous 22 months.  He stated the provisions of AB 187 would result in a decrease in services provided in his park and might necessitate making the park a family park.  He said ultimately the quality of his park would be reduced.

 

Mrs. Mae Thorpe testified by reading from prepared text (Exhibit O). 

 

Mr. Fabio Reginato testified.  He said he owned Oasis Mobile Estates, had been a resident of Nevada for 18 years, and was a member and past president of the Nevada Mobilehome Park Owners Association.  He stated he opposed AB 187.  He declared he was shocked to see the issue of rent control resurface every two years.  He asserted it was obvious additional staff would be needed to administer the provisions of AB 187, and asked, rhetorically, if the necessary funding would come from park owners and would those park owners then be prohibited from passing that expense on to park residents. 

 

He stated in 1991, a statute was enacted to provide assistance, funded by Nevada's mobile home park owners, to low income residents.  He asserted with the rental assistance program in existence, rent control would be redundant and suggested the existing program be given a chance to work. 

 

Mr. Reginata referred to increases in rents over the past decade and said he, personally, had experienced a strong impact on his operating expenses due to new government regulations.  He stated no law, whether federal, state, county or city, had been conducive to his business and most had added to his costs of operation.  He suggested an opportunity existed to restore credibility to the government process by showing concern for private business and asked that the legislature stop regulating an industry already overregulated.   

 

Mr. Walter Bantz testified.  He advised he was the owner of a 50 unit mobile home park in Reno, Nevada.  He said he obtained information from the Manufactured Housing Division that there were 6,123 mobile home spaces in Washoe Valley.  He said the day's morning newspaper advertised only two mobile home spaces for rent.  He contended the shortage of spaces for rent was due to zoning laws, which did not permit mobile home spaces in most neighborhoods.

 

Mr. Bantz said if the legislature passed AB 187, the worth of his mobile home park would be reduced by $100,000 to $150,000, and implored the committee members to vote "no" on AB 187.

 

Mr. Jeff Beintema, Schmitt and Cook Properties, testified.  He stated he was a general manager for Schmitt and Cook Properties, which two years earlier had purchased five mobile home parks.  He said since the purchase all utilities had been newly installed, and each of the parks had been upgraded.  He said in some of the parks, the number of spaces were to be reduced to create larger spaces and make the parks both better and more attractive.  He said if the provisions of AB 187 went into effect, his company would be unable to do many things it intended to do.  He said the company alone could not pay the costs but needed the help of the tenants.  He asked that AB 187 not be passed. 

 

Mr. Chris Harris, President, Nevada Association of Realtors, testified.  He stated the association had long opposed rent control, in any form, because rent control artificially set rent prices rather than allowing the market to do so.

 

Mr. Roger Service testified.  He said he did not understand why rent control would ever exist in this country.  He suggested by limiting park owners to rent increases on a percentage basis, those who had been "gouging" would be rewarded and those whose rents were low would be punished.

 

Mr. John Cole testified.  He advised he lived in Riverview Mobile Home Park.  He said rents in the park were raised 7 percent the previous year and, as of July 1, 1993, would have been raised 25 percent in the current year.

 

Mr. Paul Havas testified.  He said he was a general partner in Sierra Shadows Mobile Home Park in Reno, Nevada.  He stated rent control would result in deferred maintenance and would reduce eligibility for refinancing and new loans.  He said with rent control based on cost of living increases, every mobile home park owner would increase rents on an annual basis.  He stated, as a mortgage broker and owner of a mortgage company, he did not feel AB 187 was positive legislation.  He expressed pride in the mobile home park in which he was a partner and said the park had some of the lowest rents in the state and in the area and had high standards with regard to aesthetic values.  He contended the mobile home park industry was a good industry and with the support of the legislature and the state, should improve. 

 

Mr. Bill Van Patton testified.  He stated he was a long time resident of Carson City and was owner of Parc de Maison mobile home park.  He advised all tenants in his park had 25 year leases which provided for rent increases based on the cost of living, with a three percent cap.  He stated some mobile home park owners had as stringent controls on rents as those provided by AB 187 and lived well with that fact.

 

Chairman Porter closed the hearing on AB 187.

 

 

 

There being no further business before the committee, Chairman Porter adjourned the meeting. 

 

                                        RESPECTFULLY SUBMITTED,

 

 

 

                                       ________________________                                          SARA J. KAUFMAN

                                        Committee Secretary               

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Assembly Committee on Commerce

April 5, 1993, 1993

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