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Wednesday, September 16, 2015

City's Mobile Home Park Rent Control Ordinance Survives Challenge

Rancho de Calistoga is a mobile home park in Calistoga, California that was developed in 1970.  In 1984, the City enacted an ordinance that allowed mobile home park tenants to challenge rent increases. That ordinance was amended several times over the years. In 2007, the City adopted a rent stabilization ordinance that restricts any annual rent increase to the CPI or 6% of the base rent. It also establishes an administrative appeal process for park owners to seek a higher rent increase. 

In 2010, Rancho proposed to increase park rent from $471.39 to $625 per month. Through its administrative appeal process, the City rejected the request, but allowed a rent increase to $537.59 per month. Shortly after that ruling, Rancho sued the City, claiming that the application of the rent stabilization ordinance to Rancho violated the Takings Clause and its due process and equal protection rights. 

The case made its way to the Ninth Circuit Court of Appeals, which dismissed all of Ranch's claims in Rancho de Calistoga v. City of Calistoga.

First, the court dismissed Rancho's regulatory takings claims, finding that the ordinance did not rise to the level of a constitutional taking where Rancho could not establish it had an investment-backed expectation to be free from rent control (or any regulation).

Second, the court rejected Rancho's self-styled "private as-applied takings" claim, finding that it was really a thinly veiled facial challenge to the rent control ordinance which was time-barred.

Third, the court dismissed Rancho's due process claims finding that the claim was covered by the Takings Clause, which had already been addressed. 

Finally, the court dismissed Rancho's equal protection claim because the City had a rational basis for adopting and applying the rent control ordinance, and the City's conduct was neither politically motivated or otherwise arbitrary.

Post Authored by Julie Tappendorf


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