The Santa Cruz City Council made a significant move to protect tenants during their meeting on May 13, 2025, by approving a settlement agreement regarding rent increases at the St. George apartments. This agreement prevents the landlord from raising rents for tenants without housing choice vouchers by more than 8.8%. For those with vouchers, rent can be adjusted to market rates, but any increase must be approved by the housing authority, ensuring that tenants' out-of-pocket expenses do not exceed the 8.8% cap.

Assistant City Attorney Miss Bronson highlighted that tenants will receive a 90-day notice before any rent increases take effect. Additionally, the settlement prohibits the landlord from enforcing previous rent increase notices issued in July 2024, and mandates refunds for any tenants who mistakenly paid under those notices.

The council's decision to pass an ordinance rescinding a specific section of the Santa Cruz municipal code was crucial for the settlement's validity. Failure to do so would have rendered the agreement null and void, leading to continued litigation. Council members expressed gratitude for the collaborative efforts that led to this resolution, emphasizing its importance in preventing displacement and homelessness within the community.

The motion to approve the settlement passed unanimously, marking a pivotal step in tenant protection efforts in Santa Cruz.