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Residents of mobile homes are often at the mercy of big companies that own the land

AILSA CHANG, HOST:

We turn now to a David and Goliath fight in Florida. Residents of a mobile home park there are suing the multibillion-dollar company that owns it. Millions of Americans live in mobile home parks because mobile homes are the only homes they can afford to buy. But they only own the structures, not what's underneath them. So many are now at the mercy of big companies that own the land where their homes sit. NPR's Chris Arnold and Robert Benincasa report.

ROBERT BENINCASA, BYLINE: Five years ago, Mike Noel retired and moved from Rhode Island to Florida.

CHRIS ARNOLD, BYLINE: And he thought he'd found the perfect spot - a mobile home community named Heritage Plantation. It's about 20 minutes from the ocean in Vero Beach.

MIKE NOEL: I thought I was moving to paradise and, you know, beautiful weather. And I could fish 12 months of the year instead of three or four months, like in Rhode Island.

BENINCASA: Noel was a manager at a small company that made stainless steel screws. He spent most of his modest retirement savings buying a home here. It looks more like a regular house than what you might think of as a mobile home.

ARNOLD: Yeah. It's got a small yard, a covered carport, a little spot for his gear.

NOEL: This is my shed.

ARNOLD: Nice. So yeah. So you've got a whole bunch of fishing rods.

NOEL: Yeah.

BENINCASA: They're called mobile homes because they get brought in on trucks in big pieces. But then they're screwed together and put up on foundations. And basically, they're not mobile after that.

ARNOLD: And since the mobile home park owns the land underneath them, that makes this a pretty vulnerable form of home ownership. Noel says he learned that the hard way after it started to rain.

NOEL: The first time it flooded here, it was like, holy crap. This is not good.

BENINCASA: And he says whenever a hard rain came through, the roads and driveways flooded, and it wouldn't drain away for hours or sometimes days.

NOEL: When - the 10th time that it flooded, well, I started reaching my limits because now it wasn't just two, three, four or five inches. It was two feet or a foot.

ARNOLD: Residents say that the water has damaged their homes and is often deep enough that people get trapped in their houses. Some are elderly. They say emergency vehicles have refused to respond to calls due to the flooding.

NOEL: The people across the street are in their 90s. I know people that couldn't get to their chemotherapy appointments.

ARNOLD: Residents here say there have been other issues, too - problems with electrical wiring, potholes and bad lighting that's caused people to fall on the roads at night and end up in the hospital.

BENINCASA: People like 79-year-old Stan Paxton. He says he needed shoulder surgery after he fell on slimy residue that regularly gets left behind by the flooding.

STANLEY PAXTON: I was just walking my dog. Next thing I know, my left foot goes up from underneath me, and I'm going down this way, and I hit the pavement with my shoulder.

BENINCASA: A group of residents has detailed these and other complaints in a lawsuit against the park's owner, a company called Equity Lifestyle Properties, or ELS. They allege that ELS has ignored their complaints and failed to fix the broken storm water drain system for about 20 years. ELS denies wrongdoing.

ARNOLD: What these residents say they're dealing with may be part of a much bigger problem. Millions of Americans live in mobile home parks, and many desperately need this affordable housing option. But in recent years, big companies have been buying up mobile home parks around the country.

BENINCASA: And critics say some are making enormous profits, collecting and raising rents on their often lower-income residents without spending enough money even on basic upkeep.

ARNOLD: Complaints about mobile home park companies ranged from sewage backups, water and power outages and, in some cases, aggressive eviction policies and unfair business practices.

BETH FEGAN: They're taking advantage of a group of people that really don't have the resources to fight against it.

BENINCASA: That's Beth Fegan, an attorney whose law firm sued Harvey Weinstein as part of the #MeToo movement. Mike Noel and some other residents managed to track her down.

ARNOLD: And she took the case. She's filed a lawsuit in federal court against ELS.

FEGAN: It's a nationwide company that knows it's wrong and won't do anything about it.

BENINCASA: ELS is a multibillion-dollar publicly traded company that lists about 200 mobile home parks in its portfolio. It also owns RV parks and marinas. Its net income was about $263 million last year.

ARNOLD: Fegan says the problems with mobile home parks go way beyond this one individual case.

FEGAN: We're trying to right a wrong that we see that is systemic in an industry and really use it as an example to let the industry know that we're going to come after them, right? If they don't put the money in to maintain the infrastructure in these parks - that we're willing to take on that fight.

BENINCASA: She says in the case of the residents at the Vero Beach park...

FEGAN: The park knows that they cannot pick up their home and leave. And so these complaints have really just gone ignored.

BENINCASA: The manager at the ELS Park wouldn't talk to us when we visited. ELS said in a statement that homeowners are free to sell their homes and often do. ELS says that the lawsuit misrepresents conditions at the park and that the company invests in it to ensure it remains a desirable neighborhood.

ARNOLD: ELS also says that the suit only involves three residents out of the hundreds who live there. But that's not really true. Technically, there are three plaintiffs, but 27 residents signed court papers in support of the lawsuit getting class action status. And Beth Fegan says more than 75 answered questionnaires to help her with the case. We did meet with some residents, though, who don't support the lawsuit.

BENINCASA: I'm Robert.

ARNOLD: Hi. I'm Chris.

JEAN BRUCE: I'm Jean.

ARNOLD: Nice to meet you.

J BRUCE: You're Chris?

ARNOLD: Yeah.

J BRUCE: Hi.

ARNOLD: Hi. Richard?

DICK BRUCE: Dick.

J BRUCE: Yeah.

ARNOLD: Nice to meet you.

J BRUCE: He prefers Dick.

ARNOLD: Dick and Jean Bruce welcome us into their really nice manufactured home here. They've got an antique banjo clock on the wall - it was her grandfather's - and other keepsakes.

BENINCASA: Dick is a former head of the park's homeowners association, and he's not a big fan of this lawsuit.

D BRUCE: I'm not an advocate, per se, for ELS. I'm just going to say that they're not as bad as what some folks will make it sound like.

ARNOLD: The couple's retired. And they worry that forcing the company to spend more money will result in the company charging them higher rent for the land underneath their home.

J BRUCE: I'm not saying I don't want the flooding fixed, but we need to be aware of what we are asking for and what we may get. We're on a fixed income. But we've seen our rent go up every year.

BENINCASA: The Bruces tell NPR they recently moved out of Heritage Plantation because of differences with their neighbors about the lawsuit. They also say the flooding isn't as bad as it used to be. In its statement, ELS says it has already spent more than $300,000 improving the storm drain system over the last three years and that it is, quote, "fully operational and compliant."

ARNOLD: Some residents say it seemed to them, though, that major repairs only started happening after the homeowners here began organizing and meeting with lawyers. And they say there is still a flooding problem.

BENINCASA: ELS wouldn't do an interview. But a former ELS board member and current shareholder Michael Torres agreed to talk. He says collecting rents without having a lot of expenses is exactly what makes mobile home parks a good investment.

MICHAEL TORRES: It's just basically resurfacing roads and having a shared community center. You don't own walls and roofs.

ARNOLD: The residents have to fix their own roofs.

BENINCASA: Torres now manages more than $2 billion through his company, Adelante Capital Management. It invests in publicly traded real estate investment trusts like ELS.

TORRES: I consider it the kind of the gold standard of investing in property.

ARNOLD: And Torres doesn't seem to have too much sympathy for the homeowners at the park in Florida.

TORRES: Streets flood. You know, you chose that community. Buyer beware. It's like people that move next to the school and complain about the noise. I mean, there's always basically somebody that has, you know, some complaint.

BENINCASA: Torres says nobody forces residents to buy homes in a particular park. He was not speaking on behalf of the company but adds...

TORRES: I mean, unfortunately, it's called landlord for a reason.

ARNOLD: Meaning the landlord controls the universe there and their tenants are at their mercy, basically.

TORRES: Pretty much, pretty much.

BENINCASA: As for the lawsuit, Torres says he doesn't know all the facts. But he's not particularly worried about it as an investor in ELS.

TORRES: It's a nuisance. It's just part of the cost of doing business.

ARNOLD: OK, maybe. But the lawsuit says that ELS is responsible for providing an adequate stormwater drainage system. This case involves the residents at this one ELS Park. But NPR spoke to a former manager, Ann, at a different ELS Park in Florida. She described very similar problems.

ANN: We would have constant flooding. And we would have, like, catfish swimming in the roads.

BENINCASA: Ann says she worked there for several years until 2017 and doesn't want to use her whole name for fear of hurting her ability to get another job. She says sometimes people would get stuck in their homes at that park, too, because the water was too deep to drive through.

ANN: They wouldn't be able to leave because if they did try, the water would then get into their engine.

ARNOLD: How often did this happen?

ANN: Any time it rained heavily.

ARNOLD: Ann says as the park manager, she repeatedly asked ELS to fix the flooding problems.

ANN: Oh, well, at least three times a year. But we never received any kind of response, basically saying that there was, like, nothing that they could really do.

ARNOLD: This is not the first time that residents have banded together to sue ELS.

BENINCASA: Jim Allen is a lawyer in California who brought a case involving an ELS park there in 2009. He remembers there were kids in that park, and his suit alleged the playground was dangerous.

JIM ALLEN: It had sharp edges. It had a slide you couldn't use. They had a lake, and the lake basically stunk. It was just - it was putrid.

ARNOLD: Allen says there are so many mobile home parks neglecting residents that representing residents is now the heart of his law practice. In the case of the California ELS park, he alleged that the electrical system in the park was shot. Power would go out to the homes regularly. Sewage backed up in some houses.

BENINCASA: And there's something else. Allen argued in the trial that ELS had a bonus structure that incentivized managers to squeeze out more profits by forgoing maintenance.

ALLEN: So what happens then is, you know, you want to get your bonus, so you don't authorize repairs. And that's why it was such a rundown condition.

ARNOLD: ELS says that it encourages park managers to act in the best interests of the property and the residents and that the manager at the Heritage Plantation Park in Florida received her full bonus last year despite the property being overbudget.

BENINCASA: In addition to the lawsuit at that park, the local government has gotten involved. Indian River County has been fining ELS $100 a day because the broken stormwater system appears to be dumping water into county sewers. When we visited the park, we met with Joe Earman, the county commissioner.

JOE EARMAN: I think as of today, they're up to owing the county $146,700 because basically, their stormwater is going in our sewer system.

ARNOLD: ELS says it's repaired the problem and is now working to resolve the issue with the county. But Earman says it shouldn't take 20 years for the flooding problems residents have been struggling with here to get fixed.

EARMAN: It's frustrating to me as a county commissioner because how about you just do the right thing? This company needs to fix the stormwater issue here. And I think they can afford it.

BENINCASA: In the California case, the residents eventually got a $10 million settlement, though ELS did not admit liability. But that took more than seven years. Beth Fegan expects the current case will go to trial in January. I'm Robert Benincasa.

ARNOLD: And I'm Chris Arnold, NPR News.

(SOUNDBITE OF BUN B AND STATIK SELEKTAH SONG, "STILL TRILL (FEAT. METHOD MAN AND GRAFH)") Transcript provided by NPR, Copyright NPR.

NPR correspondent Chris Arnold is based in Boston. His reports are heard regularly on NPR's award-winning newsmagazines Morning Edition, All Things Considered, and Weekend Edition. He joined NPR in 1996 and was based in San Francisco before moving to Boston in 2001.