San Leandro council debates rent-stabilization parameters; directs staff toward a mid-range CPI cap

San Leandro City Council members spent the work session weighing options for a draft rent-stabilization ordinance that would limit annual rent increases and set rules for capital-improvement cost recovery.

Council members repeatedly described the proposal as a package of interdependent choices: a percentage cap tied to the regional consumer price index (CPI), whether unused increases may be banked for future years, and how capital-improvement costs would be passed to tenants. No ordinance was adopted at the session; instead the council gave staff direction and asked for a revised draft reflecting majority preferences.

“I'm not supportive of 5%. I would like to start off the conversation at 3% and include a 65% of CPI,” said Council member Rivera Walton, arguing the city’s income levels require a lower starting point. Council member Aguilar urged staff to “amend the rent cap limit to annual allowable rent increases to 65% of the regional consumer price index, not to exceed 3.5% in any year,” and to apply a case-by-case fair-return process for capital improvements.

Several members said they oppose allowing unused increases to be banked for future years. “I do not support no rent banking. Do not allow rent banking under any circumstances,” Council member Aguilar said, adding that banking could undermine predictability for tenants. Council member Bolt said he opposed banking as well and advocated a lower cap tied to typical wage increases: “3% is what we is is an annual income increase.”

Council members also discussed whether smaller “mom-and-pop” landlords should be exempted. Several said they do not support creating exclusions because that would complicate enforcement. Council member Bolt urged a broadly inclusive ordinance: “If you’re providing housing, you’re gonna be under this ordinance.” Council member Simon indicated support for preserving an owner-occupied duplex exemption already in the draft (sometimes called the “golden duplex”).

On capital-improvement pass-throughs, council members favored removing automatic tiered pass-through percentages and handling cost recovery through a fair-return review. “The pass through is one thing that I do wanna make sure we talk about,” Council member Rivera Walton said. Council member Simon and others said property owners should plan and save for large repairs, and that reserve accounts may not be reflected in net operating income calculations used in a fair-return analysis.

Multiple council members said the group should avoid adding means testing (income-based eligibility) because of administrative complexity; Council member Aguilar explicitly said she does not support a means test. Members expressed differing views on the numeric cap but clustered around a CPI-linked formula in the mid-60% range and a cap in the 3.0–3.75% range. The city manager summarized council direction as “somewhere between 3 and 3.75 percent with a cap,” and noted majorities against banking and against automatic capital pass-throughs.

The council did take one formal procedural action: it voted unanimously to extend the meeting time to 11:00 p.m. to continue discussion. Council member Rivera Walton moved to extend the meeting; Council member Bolt seconded. The clerk reported the motion passed unanimously.

The council did not take a final vote on the ordinance draft. Staff and the city attorney were directed to prepare a revised draft that reflects the direction heard at the work session — specifically, a CPI-linked cap (majority support for roughly 60–65% of regional CPI with a ceiling near 3–3.75%), no banking, no means testing, and removal of automatic capital-improvement pass-through percentages in favor of a fair-return review — and to return with the draft for a future meeting.

What’s next: staff will draft the revised ordinance and supporting analysis for a subsequent hearing, including clarifications about the fair-return methodology and how reserve accounts and savings for large repairs would be considered in any cost-recovery review. The council also reiterated the purpose of the city’s rent registry—to supply more local data to inform a final policy.

Votes at a glance

• Motion to extend meeting to 11:00 p.m. — Moved by Council member Rivera Walton; seconded by Council member Bolt; outcome: passed unanimously (extension motion recorded during the session).