1 PRESENTATION:
DRAFT RENT
STABILIZATION ORDINANCE
Rules Committee
Housing Services Division / Community Development Department July 17, 2025
2 Agenda
• Background
• Draft Ordinance: Key Elements
• Program Cost Impacts
• Timeline
• Next Steps
2 3
Background
4 Background
May 28, 2025: Rules Committee Direction
• Summer / Fall 2025: Prepare a draft Ordinance for public review to include the following based on City of Alameda’s Rent Stabilization Ordinance:
• Rent cap not to exceed 5% (not tied to Consumer Price Index) • Capital improvement pass through
4 Rent Stabilization: 7,693 Eligible San Leandro
Units (est.)
Unit Type
Eligible for Rent
Stabilization Total Units
Single-Unit 19,108
Duplex 1,288 1,298
Triplex 393 417
Fourplex 532 532
5-8 Units 815 815
9-19 Units 792 808
20+ Units 3,873 3,873
Multi-Family Restricted 2,094
Mobile Home Spaces 855
Condos/Townhomes 3,040
Total 7,693 32,840
• 7,693 units:
• Duplex
• Triplex
• Fourplex
• 5+ units
• Mobile home spaces excluded
• Regulated under existing City
Mobile Home Space Rent
Stabilization Ordinance
(MHRSO)
5 Source: City parcel data
6 Draft Ordinance:
Key Elements
7 Key Definitions
• Rent: Amount of fixed periodic compensation paid by a tenant to a landlord, as defined by the rental lease. Rent shall only include additional services defined in lease (pet deposits, storage, additional parking, utilities, etc.). • Base Rent: Rent in effect for a unit on date determined, or the rent in effect following a change pursuant to Ordinance. Base Rent serves as the reference point for any upward or downward adjustments to the maximum allowable rent. • Effective date determined after public outreach and City Council direction • Capital Improvement: An improvement or repair to a unit or property that adds value, excluding maintenance and repairs.
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Key Definitions (cont.)
• Hearing Officer: A qualified neutral individual appointed by the City Manager to conduct an administrative hearing pursuant to the Ordinance. The Hearing Officer shall not be a tenant or landlord of any property located within the San Leandro city limits.
• Program Administrator: An individual appointed by the City Manager to carry out the duties and responsibilities of the Program.
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Ordinance: Notable Exemptions
• Costa Hawkins Act
o Rental units built after February 1,1995
oSingle family homes
o Condos / townhomes
• Mobile homes / lots regulated under existing MHRSO
• Accessory Dwelling Units
• Golden Duplexes (owner occupied)
• Short-term rentals (Airbnb, VRBO, etc.)
• Deed restricted affordable rental housing (Marea Alta, La Vereda, etc.) • Emergency/transitional housing (Lewelling Interim Housing, etc.) • Shared housing (room in a house with shared kitchen/bath) 9 10
Rent Cap - Limit on Rent Increases
• Maximum annual rent increase = 5%
• No more than one rent increase allowed in a 12-month period • Vacancy decontrol allowed under Costa Hawkins Act
• Landlord may seek a Capital Improvement or Fair Return rent increase 10 11
Petition Process - Additional Rent Changes
• Applicant may only file one rent change petition per year • Capital Improvements
• Fair Return
• Decrease in Housing Services
• Hearing Officer
• Conducts administrative hearing and renders a decision • Decision may be appealed to the courts
11 Petition Process - Capital Improvements
• Must be initiated within 6 months of
completion
• Minimum cost: $10,000 total or
$1,000 per rental unit
• Cost must be amortized over
useful life or 10 years, whichever is
longer
• Pass through cap to tenant and as
percent of current rent, based on
City of Alameda
12 Yes
Table A
Pass Through Cap
to Tenant
2-4 units = 100
5-15 units = 75%
16-24 units = 50%
(>25 units processed thru
fair return process)
Pass Through Cap
as % of Current
Rent
5%
13 Petition Process - Fair Return
• Landlord is entitled to a Net Operating Income (NOI) equal to the base year NOI, adjusted by the percentage increase in the Consumer Price Index (CPI) since the base year
o NOI = Annualized gross income - operating expenses
o NOI in base year is presumed to provide fair return
• Hearing Officer
• Determines whether the landlord will receive a fair return • Any party may submit evidence to rebut the presumption regarding the base year NOI, which the Hearing Officer shall consider in making their decision
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Petition Process - Decrease in Housing Services
• A decrease in Housing Services (laundry facilities, common area maintenance, amenities, etc.) of a covered rental unit, without a corresponding reduction in rent, is considered an increase in rent
• Hearing Officer may consider:
o Decreases in Housing Services and living space
o Substantial deterioration of the rental unit (beyond ordinary wear and tear) o Landlord's failure to comply with Ordinance or applicable housing, health and safety codes
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Other Key Elements
• Written notice to existing and prospective tenants regarding the Ordinance • Buyout Agreements
o Establishes transparent, mutual conditions to protect tenants from unfair buyouts • Prohibition of retaliation
• Penalties and remedies for violations
• Annual performance report to City Council
• Program Fee
o Reasonable program fees established by City Council resolution o Up to 50% may be passed through to tenant in 2 equal installments, 6 months apart
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Program Cost Impacts
17 Program Cost Impacts
• October 2025: City Council Work Session - Updated Ordinance and Program Cost Evaluation
o City retained a consulting firm to conduct a cost analysis to determine potential program costs and budget
oProgram cost evaluation will include an analysis of cost recovery through fees and the staffing levels necessary to effectively administer the program 17 18
Typical Rent Stabilization Program Costs Covered
By Fees
• Program Administration (staff salaries/benefits, etc.) • Consulting (Hearing Officers, staffing support)
• Legal (enforcement, litigation)
• Public information (outreach, translation)
• Other (software, supplies, insurance, indirect costs, etc.) 18 19
Timeline
20 Timeline (updated)
20 • May 28, 2025: Rules Committee
• July 17, 2025: Rules Committee - Draft Ordinance for Public Review • July 17 - September 17, 2025: 60- day Public Review of Draft Ordinance / Community Outreach
• Posted on City website for review and comments
• (2) community meetings
• (2) key stakeholder meetings
• October 2025: Council Work Session - Updated Ordinance, Program Cost Evaluation
• January 2026: City Council - Ordinance 1st Reading
• January 2026: City Council - Ordinance 2nd Reading
21 Next Steps
22 Next Steps
• July - September 2025: Community Outreach - 60-day Public Review of Draft Ordinance
• Submit comments to: [email protected]
• October 2025: City Council Work Session
• Updated Ordinance
• Program cost evaluation
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Questions ??
• www.sanleandro.org/RentProgram (coming soon!)
• [email protected]
• (510) 577-6011
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