NORTH ADAMS -- Members of the Wheel Estates Tenants Association are seeking a $49 rental increase as they try to secure a $3.8 million mortgage to purchase their mobile home community by a March 27 deadline.
Under state law, the residents have the "right of first refusal" -- the ability to purchase the park by matching a $2.73 million purchase and sales agreement signed by owner Morgan Management and Real Estate Seekers LLC, of New Haven, Conn.
The increase would push lot rental fees to $345 a month, allowing the tenants association to satisfy the commitment being sought by their lender, ROC Capital, which includes the $2.73 million purchase price and $1.1 million for required infrastructure repairs to roads, water pipes and the sewer system.
But to do so, the group must first convince the city's Mobile Home Rent Control Board to grant the increase -- a task that hasn't proved easy under current ordinances and policies which are geared toward private corporate ownership as opposed to a nonprofit tenants cooperative.
Rent Control Board members expressed their desire to help the association secure the funding during a meeting Wednesday, but said their hands were tied until a petition, showing the need for a rental increase, was properly filed. The board's inability to act on the request increase raised the ire of some 30 Wheel Estates residents in attendance, who argued that the board's decision was pivotal to whether they
"It's not our job to determine whether or not this deal goes through. We determine what the rent will be based on a petition," Chairman Wayne Wilkinson said. "We don't have a petition for a rent increase. We don't have any numbers we can work with."
Resident Ray Bass said he didn't understand why the board wouldn't accept the increase with so many tenants present.
"We know its not your job to determine whether or not the deal goes through," he said. "But if you don't approve this increase, it won't happen. The people here want you to raise the rent. Just do it."
Tenants Association advisors Mary O'Hara, director of Resident Owned Communities (ROC) USA, and Andrew Danforth, a representative from the Cooperative Development Institute, who accompanied Tenants Association President Sandra Overlock and Vice President Jesse Martinez, said they had been unclear as to what the board was requiring and had brought both suggested ordinance changes and a petition with them to submit that evening.
"We can't discuss it tonight," Wilkinson said. "It's not on our agenda. The petition also needs to be filed through the City Clerk's office."
He also explained that an ordinance change would not meet the group's deadline, as it would need to be reviewed by the city solicitor and would need the City Council's approval.
Board member Joseph Gniadek said that he'd be willing to "tweak" the financial formula that is used to determine rental fees, a move that would allow the board to list the monthly mortgage payments as a capital expense and to use preliminary estimates and bid figures. The current formula doesn't consider mortgage debt as an expense -- a major difference in considering a corporate petition and a tenant-owned cooperative petition.
Board member Paul Senecal posed a motion to allow the rent increase without the petition, but it did not receive a second.
Instead, the board voted in favor of allowing the group to file a petition, based on Gniadek's changes, and meet on the matter again Tuesday at 5 p.m. Should the petition pass muster with the board, they will consider implementing the fee structure for a year, which will allow the tenants association to secure funding and then return with actual expenditures.
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