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29 4%. Mr. McGuire was told that was allowed because the garbage company provides a service to the citizens of the city. Mr. McGuire indicated a mobilehome park is a self-contained city. It has roads, utilities, landscaping and a fence, which are installed and maintained by the park owner at no expense to the City. If the park owner didn't do it, the City would have to. The relationship between the tenant and landlord is one of contract. There is no dual ownership. Contrary to what Mr. Dobro said, this is not a patch of dirt. It is a concrete pad with utilities and a road system. Mr. McGuire indicated he and his client have discussed alternatives such as bankruptcy or sale of the park at a loss. Mr. Wagner purchased this park at fair market value. His attempts to raise rents to a fair market value have been frustrated. The representations of city offices have been reneged upon. Now Council is asking Mr. Wagner to give away those spaces, to subsidize the living costs of the tenants. It is not fair. He refuted the statements of Mr. Arnerich. Mr. McGuire presented his legal opinion stating that the Yee decision clearly allows challenges based on a regulatory taking analysis of ordinances such as one with vacancy control. Council needs to determine where the commitment is. Each member has a commitment to affordable housing. In driving around Pleasanton, there is no new mobilehome park under construction. The reason is that there is no incentive for a developer to come to a city which requires entering into a contract for which you will not receive a fair rate of return or the Council will enact an ordinance against you. Mr. McGuire indicated his client is committed to legal action if Council adopts the ordinance. Mr. Pico believed there is potential to reach an agreement. He felt if the base rent were adjusted from $335 to $340, and increased over three years rather than four years, with the City using its affordable housing fund to supplement the additional rents of the truly needy people, the parties might reach a common ground. It would certainly mitigate Mr. Wagner's concerns and speed up his getting rents closer to market rate and would provide protection to the senior citizens and those facing a rapid increase in rents. Mr. Pico asked if a program such as that be acceptable to Mr. McGuire's client. Mr. McGuire indicated if it also included vacancy decontrol, he would be willing to talk about this. If Council limits his ability to increase space rents on vacancy, then Council is limiting Mr. Wagner's ability to break even. 1/5/93 29