Murillo and Gutierrez Float Ambitious 2 Percent Rent Cap

In one of her last actions as Santa Barbara mayor, Cathy Murillo ― alongside her colleague Councilmember Oscar Gutierrez ― is proposing a citywide 2 percent cap on annual rent increases, a reduction from the current 5 percent cap imposed by California in 2019 to address the state’s housing crisis. Murillo and Gutierrez, who plan to bring the discussion before the council at its December 7 meeting, say further lowering the ceiling is necessary to protect local renters.

“What works in other parts of the state won’t necessarily work in Santa Barbara because rents here are so high,” said Gutierrez. “The cost of living here is continually going up and up and up.” Murillo said having more protections for tenants is “critical” and the time for the city to act is now, “with a low vacancy rate and the housing market so tight.” Stabilizing rents also prevents homelessness, she said, suggesting as well that the city create a registry of rental units in order to “monitor evictions, prevent conversions to vacation rentals, and also to monitor properties as SB 9” ― the new state law that allows homeowners to subdivide their lots ― “goes into effect.”

Laura Bode, head of Santa Barbara Rental Property Association, said she fails to see the logic of the city capping rents while it authorizes “big utility companies’ massive rate increases.” Bode claimed that in 2020, “the cost of electricity for some of our multi-unit owners went up 33.58 percent,” gas prices jumped 33.94 percent, and water and sewage bills increased 25.28 percent. (Those figures could not be independently verified.) Bode argued that the 2 percent limit would unfairly impact small mom-and-pop landlords who would lose the revenue needed to keep their units up to habitability standards and force them to sell to “wealthy developers.” Only “big corporations” and “special interest groups that have rent control to check off their playbook” would benefit from such an ordinance, she said.

Gutierrez explained the proposal came from a groundswell of requests from tenants looking to the city for help. “People are asking us to do as much as we can in our power to slow down rent increases so they can continue to live here,” he said. Everyone suffers when residents move away, he continued ― businesses lose their workforce, families are uprooted, and neighborhoods stop being neighborhoods. “I even hear people say they don’t feel like making new friends because in a few months, they’re gone,” Gutierrez said.

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