Talk Is Cheap And City Official Talk Is Worthless

In an America that is lacking in accountability, the city official – whether zoning or inspections – is a master at that craft. Yet how you interpret what they say can make the difference between buying the deal or walking it. And often you have to bring in reinforcements to protect you interests. In this Mobile Home Park Mastery podcast we’re going to explore the science behind interacting with city officials.

What is Mobile Home Park Mastery?

Welcome to the Mobile Home Park Mastery Podcast where you will learn how to identify, evaluate, negotiate, perform due diligence on, finance, turn-around and operate mobile home parks! Your host is Frank Rolfe, the 5th largest mobile home park owner in the United State with his partner Dave Reynolds. Together, they also own and operate Mobile Home University, the leading educational website for both new and experienced mobile home park investors!

All the mobile home park owners I know wanna do the right thing. We want the straight information from the city. We wanna obey it to the letter. We have no desire in any possible way to circumvent whatever the actual ordinances are. But unfortunately, you'll learn in due diligence that while talk is cheap, city official talk is absolutely worthless. This is Frank Rolfe, the Mobile Home Park Mastery Podcast. We're gonna talk about the dilemma that all park buyers face and park owners face and the fact that zoning officials and city inspectors, when they tell you things, they're seldom right and it's never binding. Now why is that? Why can a zoning official or an inspector tell you a complete lie, a total fabrication, and yet there's no pushback. And that's because the city's a very cleverly designed their laws to make sure that nobody can circumvent their own written ordinance.

You can kind of see why. Let's imagine you had some guy in the zoning department and you were firing him because he did some horrible thing. Embezzlement, who knows what. So in his final day at the office, he thinks, well, I will screw over the city just as I feel they are screwing over me. And a guy happens to walk in, he wants to do an application to build a topless club. And he says, sure, I'll give you that Topless Club application. In fact, you know what? See this land right next to the mayor's house, we'll go ahead and zone that for you to topless club. No problem at all. Here's your written agreement that yes, that land will be topless club. Go ahead and build your topless club. And all you have to defend yourself against that is a simple fact that when that zoning official said that no matter what he said, no matter what he signed, if it did not meet the letter of the law, it's tossed out.

It's not binding. So that's why they have this unique feature in their everyday life. Whereas most of America is fully accountable for their actions. The city officials aren't. They can pretty much say or do whatever they feel like they kind of wanna do. So if the mayor says to them, Hey, let's make sure that mobile home park never gets sold because we don't like having a mobile home park in our town. And maybe if you can't sell it, the owner will just shut it down. Then the zoning official may tell you just that. They might say, oh, you can't use any of those vacant lots and if a home pulls out, you can't put another one back in, even though they know it's completely wrong because they wanna be in the good graces of the mayor. And so they're gonna go ahead and play along with that.

I had that happen to me once, doing due diligence on a wonderful mobile home park in McKinney, Texas, right off the downtown square. Beautiful location. I saw McKinney as a very growing market. I was totally correct. So this park came on the market and I went down to the city and I said, Hey, I'm looking at buying that mobile home park know right off the town square and want to check on its permitting, zoning. And the guy tells me, oh, well if you buy that we're gonna shut it down. So you better not buy that thing. You better not touch that because oh, we will come after you, we'll make you shut that mobile home park down. So I didn't pursue it any further stupidly because I was new to the industry and then I watched as it went ahead and sold to somebody else and they gradually filled up every darn lot.

So I was the big loser 'cause I believed that city official when they were lying to me completely. And that's the big problem, is that you're dealing with a fairly disruptable group when you talk to zoning officials and city inspectors. 'cause they wanna hurt park owners. They wanna get the parks outta town. We all know that. Many people don't realize why Exactly you can imagine. It's the stigma that they hate mobile home parks because they bring in, in their opinion, disruptable people and they scare away good higher class customers who might build bigger nicer homes or move their business there. But the real reason is cities lose a ton of money on every mobile home park in America. It's a very simple formula. Just imagine you have a 50 space mobile home park, and in that 50 space mobile home park, there's two kids per household on average a 100 kids.

And those a 100 kids cost $10,000 a year for public school education. So a million dollars a year is going out the door to tuition, but at the same time, what's coming in the door? Well, not much. That 50 space mobile home park might be valued at $50,000 a space. If it's in Texas, it would be almost 3%. So $75,000 a year of property tax coming in, but a million dollars in skilled tuition going out the door. And that's why cities hate, we'll always hate and we'll never allow any new parks to be built. But at the same time that they don't want 'em built, they don't want 'em around at all. So they kind of think, what can we do to scare you off? What can we do to make you not wanna buy this mobile home park? What can we make you do even if you already own the mobile home park to not use your vacant lots?

And therein lies the great dilemma. So what do you do? How do you solve this strange relationship between you as the park owner or buyer in the city? Well, the first thing you wanna do is you wanna just base all decisions on what's in writing. You quickly realize that basically talk is of no value. It's kinda like right now you see all these deep fake audios out there, so you can't really trust what people say at all. All that you can really trust is what you can physically see. So you wanna see the actual ordinance that the inspector or the zoning official is talking about, but you don't wanna hear what they have to say about it. You want to actually see it in writing yourself. And you wanna see from what they're saying, does it match to what is written in the code? Because so many times they have nothing to do with each other.

The zoning official tells you, well, you can't have any RVs in that mobile home park, even though there are several. And then you pull out the ordinance and the ordinance says nothing of the type never said that at all. Or the city says, well, you can't bring any homes in that are 10 years or older into the park, but yet you pull it all out. And lo and behold, that is in no way in rotting anything governing that mobile home park. And when you get into a scruff with the city official, it often will behoove you to go ahead and kick it up a level and bring in what we call a municipal lawyer. This is a lawyer that sues cities that's their specialty. And they're absolutely essential when you have problems with the city because they know how to speak the language that also scares the city.

The city knows they can scare you. Now we bring in an attorney which knows how to scare the city. They have many, many tools at their disposal. They're very, very clever people. These municipal lawyers, they know how to elicit extreme pain on the part of the official very rapidly. And they know based on what the ordinance says, what you can and cannot do. Also, it's essential when you're buying the mobile home park to make sure that you have seen every possible ordinance and and permit that was required from the start of the property. And then you evidence that with a more modern certificate of zoning. This is something that says what the property is zoned, whether it is legal conforming, which means you could build it again today, legal non-conforming, which means it's grandfathered, but you could not build it today or illegal, which simply means that it was never allowed to be built in the first place.

And then additionally, how many lots you get? That is the basic initial building block that every park buyer needs is the certificate of zoning. But you also need to see all kinds of other things. Was there a certificate of occupancy pulled when the park was built? Is there an annual permit? Is there a permit that's done through the state? Is there a health permit? Let's make sure all those things are good and in complete working order. And also remember that with everything you do in analyzing that park, you need to always remember the axiom that you want to ask Permission, not forgiveness. You have to be completely clinical in what you're doing because you don't wanna buy a property to only to later find out it has a problem if it does have a problem with the city, you wanna find that out on the front end so it does not become a burden or a giant legal time bomb to you after closing.

Now, it's also very important to remember whenever you are working with the city officials that you wanna be as cordial as you can. You wanna be friendly, you wanna ask their input, you wanna see whatever it is they're talking about in writing. But don't be the fall guy. Don't be too good nature. Don't allow them to go ahead and abuse you and bully you without fighting back. That's the point of which you typically wanna bring in that municipal lawyer to work on your behalf. Now, we have many, many cases where we brought in the municipal lawyer and in every single one over the past 30 years we have prevailed, except one case where the person was correct. They said we could not use a certain lot, we didn't fully understand what they were talking about. It turned out it was because of a visibility triangle.

That's a common rule of law in which cars have to be able to see the turn. And lo and behold, they were right. The lot did violate the city's health and safety as far as that visibility triangle. But other than that case, every time someone has told us, oh, you can't use that lot, you can't use that park, and everything else, known demand, it's always been proven by us to be wrong. And we've always gotten our way by bringing in municipal lawyers and sticking with the rules. The bottom line to it all is if you wanna be a good mobile home park buyer, park operator, you have to get it in writing and you have to be willing to underwrite what may seem initially a little painful as far as a legal fee perspective to get such issues with the city resolved.

Grandfathering is a very powerful tool. There have been a number of state Supreme Court cases on it, and at every straight Supreme Court case that I've seen, the park owner has won. So don't be shy to stand up for yourself. You're probably going to win. You probably will prevail. The inspector and the zoning official don't really want to have a fight. They don't really want to go to court, but if they can mislead you a little bit, they certainly will. This is Frank Rolfe, the Mobile Home Park Mastery Podcast. Hope you enjoyed this and talk to you again soon.