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Scott Carter, Suburban Management and Brokerage, 2678 N. Main Street ~v22, Walnut Creek, indicated Mr. Wagner has been trying to raise his rents since he bought the park. He believed the rents were artificially depressed and way below market. Mr. Carter acknowledged that rent control ordinances were legal. He reviewed the three elements of the Pleasanton ordinance regarding calculation of rents and went through various calculation exercises using Formulas A and B. He objected to removal of the distinction between government regulated fees and operating expenses. He also stated that the base year rents for 1992 were found by the judge in the fair rate of return hearing to be below market and objected to the continued use of those rents. Instead, the base rent of $335 should be used. He urged further review of the figures before adoption of an ordinance. Jerry Wagner, 4043 Nevis Street, owner of the Pleasanton Mobilehome Park, indicated that five years ago he wanted to buy a "passive investment". He claimed he spoke to the City Attorney and was told that he could raise rents over the next three years to bring them up to what other parks were charging. Mr. Wagner told him that if he could not raise rents, he would not buy the park and would have found another investment. After several meetings and an appraisal, the City Attorney said rents could be $325, but the raises had to be spread over four years. That means it would be 1997 before he would have a positive cash flow. When the original ordinance was written, it did not include the rents as set forth in the appraisal. Mr. Wagner believed he would never receive a fair return on his investment, which led him to file a lawsuit. The final ruling verified the appraisal. He contended the City and the residents gained nothing from the ordinance and alleged the taxpayers have had to pay enormous expenses for the litigation. Mr. Wagner claimed the real losers were the park residents, who suffered through dissension and vandalism to the park, as well as having to pay back rents pursuant to the judgment. It has cost him $80,000 to fight the ordinance and all because the City Attorney would not allow him to raise rents pursuant to the appraisal. If Mr. Wagner had been allowed to charge $335 in rent, he would have signed the agreement and the ordinance would not have been necessary. He claimed his tenants were happy, liked the park owner and management, and did not want the ordinance. He read letters from tenants in support of his position. Jack Dove, 3263 Vineyard Avenue, indicated that the ordinance applied to any of the mobilehome parks if the agreement was not adhered to. He clarified that Michael Roush was not part of the original agreement or drafting of the ordinance, Peter MacDonald was City Attorney at that time. There was also a lot of discussion about allowing Mr. Wagner to phase in rent increases, but no agreement was reached. Since July, the Mobilehome Committee and the City Attorney have been trying to obtain from Mr. Wagner the justification for charging $600 per month for the space rents. Mr. Wagner has not provided any of the requested information. Mr. Dove felt the ordinance was very important and the City has always dealt in good faith. He urged the Council to allow the Pleasanton Mobilehome Committee members to talk to the residents of the Pleasanton Mobilehome Park to find out how they really feel. He believed those residents are afraid they will be evicted if they speak against Mr. Wagner. Ms. Michelotti indicated she has spent many hours trying to work with Mr. Wagner and City staff and she is convinced there is an impasse. 21 12/03/96