Stockton housing providers could face stricter local rent caps

Rental housing providers in Stockton could face a new local rent control proposal after a City Council committee asked staff to study options that would go beyond California's statewide rent cap.

No ordinance has been introduced or approved. But members of the Stockton Council Legislation/Environmental Committee directed staff to return with policy options, including possible rent-cap scenarios, a comparison of stronger and weaker local rent control models, and information on a possible rent board and tenant-enforcement issues.

The discussion centered in part on AB 1482, passed in 2019 as the California Tenant Protection Act. The state law already limits annual rent increases for many covered rental units to 5% plus the local consumer price index, or 10%, whichever is lower, and includes just-cause eviction protections for many tenancies.

City staff told the committee that AB 1482 and the Costa-Hawkins Rental Housing Act serve as a baseline for local regulation, not a ceiling. Staff also described local rent control policies in other cities, including San Francisco, which Vice Mayor Jason Lee asked staff to compare with a less restrictive local model.

Lee also asked staff to examine current tenant-rights enforcement and seek input from housing providers on how lower rent caps would affect their ability to operate.

The California Apartment Association is monitoring the city's review and opposes local rent control measures that would add new restrictions on rental housing providers. CAA is working with the Central Valley Association of Realtors and the Building Industry Association in opposition to potential local rent control policies in Stockton.

During public comment, Greg Terzakis of CAA urged committee members to scrutinize the rental data behind any future policy proposal, saying some figures discussed by the city appeared to reflect advertised rents rather than what tenants actually pay.

"Some of the data staff brings is what we call in the business 'asking' rent," Terzakis said. "It's not actual rent. And I would suggest that's the difference between what the sticker price of a car is and what you pay for the car."

Terzakis said CAA could provide additional data showing actual rents, which he said are typically lower than advertised rents.

CAA has also been speaking with Stockton City Council members to express the association's opposition to local rent control. The association will continue tracking the city's review and working with local partners as staff develops additional options for the committee.