City reaches settlement in rent control suits with mobile home park

Petaluma has reached a settlement agreement in two costly lawsuits regarding the city's rent control ordinance.

Bill Feeney, the owner of the 178-space Sandalwood Estates mobile home park on North McDowell Boulevard, has agreed to drop all outstanding litigation against the city.

"It's a very good outcome for the city," said City Attorney Eric Danly.

"It's a good outcome for mobile home park residents," said Mayor Pam Torliatt. "We were able to settle without compromising their interests or the city's rent control ordinance."

Since 2001, Feeney has brought four different lawsuits before the city that argued that the city's rent control ordinance unfairly prevents mobile home park owners from making reasonable rent increases on residents. In 2008, Feeney sought to raise rents on eight residents from between $407 and $579 per space to $825 per space in order to help pay for infrastructure improvements, which he said benefited all renters.

The city says that the ordinance is designed to protect residents from unreasonable rent increases, and has spent almost $80,000 in legal fees on the four cases in the last 13 months.

The settlement includes no exchange of money between either party, although each party's legal fees still stand. A 2009 ruling in favor of the city remains intact, and Feeney agreed not to appeal any decisions. Previous litigation from 2008 was dismissed. The city now has no more outstanding litigation related to the Sandalwood park.

"Sandalwood is basically walking away from the lawsuits," said Councilmember Mike Healy. "We'll see what it looks like going forward, but it's very good for a lot of reasons."

Feeney said he agreed to dismiss the lawsuits because they had become increasingly costly.

"Although these two arbitrations originally impacted approximately eight residents, they now impact only three residents; therefore it does not make financial sense to spend tens of thousands of dollars on litigation that will only apply to three residents," Feeney said in an e-mail interview.

Feeney said that he still believes his rent increases were fair, and that the ordinance is designed to make it "cost prohibitive" for park owners to pursue "legitimate" rent increases.

The settlement came in a closed session at Monday's City Council meeting. The council voted unanimously in favor of the settlement.

(Contact Philip Riley at philip.riley@arguscourier.com)