The Ordinance

Santa Barbara does not yet have a permanent rent stabilization ordinance. What it has today is two things: a temporary rent-increase moratorium in force since February 26, 2026 (Ordinance No. 2026-6206), which freezes rents for covered units at their December 16, 2025 levels; and a Public Review Draft of the permanent ordinance — a new Chapter 26.90 of the Santa Barbara Municipal Code — published June 10, 2026 and open for public comment through Thursday, July 9, 2026. The draft is exactly that: a draft. No first reading has occurred and nothing in Chapter 26.90 has been adopted. If the ordinance proceeds on the schedule the council and staff have described — introduction (first reading) in late July 2026, adoption after a second reading — the permanent program becomes operative January 1, 2027, with a first annual rent adjustment of approximately 2.1%.

Status as of July 7, 2026.

The public comment window closes in two days. The 30-day comment period on the draft ordinance, opened at the council's June 9, 2026 meeting, runs June 10 through July 9, 2026. Comments are submitted to the City via the City Clerk's office — see santabarbaraca.gov for the Rent Stabilization Program page and submission instructions. This is the formal opportunity to put corrections, objections, and requests on the record before the ordinance is introduced.

---

Where things stand

The current effort dates to a September 29, 2025 council memorandum from Councilmembers Santamaria and Sneddon (with the RDN 2025 Rent Survey for the South Coast attached), followed by a city press release, "Preliminary Policy Discussions Begin on Rent Stabilization" (December 18, 2025).

On December 16, 2025, the council held its policy-direction session (Item 12, video; staff presentation on file, via docs.santabarbaraca.gov). Councilmembers gave staff feedback on the fundamental policy questions — coverage, the cap, pass-throughs, a board, a registry — targeting adoption by July 2026 and program launch in January 2027. The one formal action passed 4–3 (Noes: Friedman, Jordan, and Mayor Rowse): a direction to return in January with a rent-increase moratorium ordinance, including a rollback date. That meeting date — December 16, 2025 — later became the base-rent date for both the moratorium and the draft permanent ordinance.

On January 13, 2026 (Item 14, video), the council took three roll-call votes. The motion to adopt the moratorium as an emergency/urgency ordinance failed 4–3 — urgency requires five votes (Noes: Mayor Rowse, Friedman, Jordan). The motion to introduce the moratorium as a regular ordinance passed 4–3, and a companion just-cause/"Ellis Act" ordinance (adding SBMC §26.50.100) was introduced 4–3, with the same three dissents on all three votes.

On January 27, 2026 (pulled Consent Item 2, video), the council adopted both ordinances on second reading, 4–3 (Noes: Mayor Rowse and Councilmembers Friedman and Jordan): Ordinance No. 2026-6206, the Temporary Rent Increase Moratorium, and Ordinance No. 2026-6207, the just-cause/Ellis Act amendment. The moratorium took effect February 26, 2026. It froze base rents at the December 16, 2025 level and expires on the earlier of a permanent rent-stabilization program's operative date or December 31, 2026. The moratorium is now the subject of litigation against the City (see Open questions below).

On March 17, 2026 (Item 3, video), the council approved, 4–3 (Noes: Councilmembers Friedman and Jordan, and Mayor Rowse), a $65,105 agreement with consultant RSG, Inc. (Resolution No. 2026-019; Agreement No. 30007) to support development of the ordinance and program.

On April 7, 2026 (Item 14, video; staff report on file), the council selected the centerpiece of the program in a series of straw votes: a rent cap of 60% of CPI or 3%, whichever is lower, one increase per 12 months — passed 4–3 (No: Friedman, Jordan, Rowse). The same 4–3 alignment carried no rent banking, exemptions only as mandated by state law, a comprehensive petition framework, an independent hearing officer with appeal to a board, a comprehensive rental registry, and related directions. Staff was directed to return with a working draft before a 30–45 day public comment period.

On May 19, 2026 (Item 10, video; staff report, "Additional Research on Rent Stabilization," on file), staff presented supplemental research, including RSG's preliminary program-cost estimate: roughly $2 million per year to administer — about $154 per unit across roughly 13,000 covered units. No vote was taken; the April 7 direction stood. Staff also corrected the record that 60% of CPI is not the majority approach among comparable programs.

On June 9, 2026 (Item 14, video; staff report, "Review of Draft Ordinance," on file), the council reviewed the draft of Chapter 26.90 and opened the 30-day public comment period running June 10 through July 9, 2026. No vote was taken on the ordinance itself; the item's only formal vote — to release the related Just Cause/Ellis Act amendments for public comment alongside the rent stabilization ordinance — passed 4–3 (Friedman and Jordan abstaining; Rowse dissenting). The Public Review Draft of SBMC Chapter 26.90 was published June 10, 2026.

That is where the process sits today: draft published, comment window closing July 9, first reading expected in late July.

---

What the draft ordinance says, section by section

Everything below summarizes the June 10, 2026 Public Review Draft of SBMC Chapter 26.90 (City of Santa Barbara; full text on file in the project repository). It is subject to change before introduction and adoption. Section numbers are the draft's own.

§ 26.90.010 — Application (coverage and exemptions)

The chapter applies to "all residential rental units in the City except" nine listed categories. The central cut-off is age: units with a certificate of occupancy issued — or final inspection on the building permit completed — "on or after February 1, 1995" are exempt, mirroring the Costa-Hawkins new-construction line. Single-family homes and condominiums ("alienable separate from title") are exempt, unless the owner is "a real estate investment trust… a corporation… [or] a limited liability company in which at least one member is a corporation" — in which case the unit is covered. Other exemptions: owner-occupied duplexes (where neither unit is an ADU/JADU), hotel stays of 30 days or fewer (with anti-churning rules), hospitals/dormitories/treatment facilities, deed-restricted affordable units run by public agencies or non-profits, government-owned units exempted by state or federal law, mobilehome parks (Chapter 26.08), and permitted short-term vacation rentals. Subsection B requires landlords claiming the single-family/condo exemption to give tenants a prescribed written notice — which, in the draft, cites "Chapter 26.20" rather than 26.90, an apparent drafting error.

§ 26.90.020 — Definitions

The definitions carry most of the program's mechanics. Base rent is "the rent for a rental unit in effect on December 16, 2025" for tenancies that began on or before that date; for later tenancies, the initial rate set in accordance with state law. Base year for fair-return purposes "means the 2025 calendar year," resetting after each granted petition. CPI means "the California Consumer Price Index for All Urban Consumers for All Items as published by the Department of Industrial Relations" (DIR), switching to a metro CPI-U if one covering Santa Barbara County is ever published. The change in CPI is measured April-to-April and "shall be rounded to the nearest one-quarter of 1 percent." Note one drafting error here: the definition of fair return points to "the maintenance of net operating income (MNOI) standard outlined in Section 26.90.060" — but the MNOI standard actually appears in §26.90.050; §26.90.060 is the capital-improvements petition.

§ 26.90.030 — Stabilization of rents

The operative prohibition, effective January 1, 2027: a landlord may not charge rent for a covered unit exceeding the base rent plus lawful increases, and may not increase rent except as permitted by §§26.90.040–.060. Vacancy decontrol is preserved: on a lawful vacancy, the landlord "may set the initial rent for a new tenancy… subject only to limitations of California statute" (Costa-Hawkins). Subsection D addresses the transition: if a landlord lawfully raised rent "after December 16, 2025, but before January 1, 2027… the amount of the increase will be counted in full against rent increases authorized under this Chapter" until fully amortized. (In practice the moratorium barred increases for covered units from February 26, 2026, so this mainly reaches increases taken in the intervening window.) One increase per 12 months; a violation occurs on mere delivery of a prohibited increase notice; and every rent-increase or lease notice must disclose the chapter's existence.

§ 26.90.040 — Annual general adjustment (the cap formula)

The formula the council chose 4–3 on April 7: the annual general adjustment (AGA) "will be equal to 60% of annual percentage change in the Consumer Price Index or 3%, whichever is less. If the percentage change in the Consumer Price Index is negative, the annual general adjustment will be zero." The Program Administrator must post each year's AGA by October 1, effective January 1 of the following year. There is no banking: a landlord who does not take the AGA in its calendar year "may not defer implementation… to a later year or from year-to-year." Increases require at least 30 days' written notice, and no AGA may be applied to a unit out of compliance with state habitability codes or with outstanding ordered repairs. Applied to the April 2026 CPI reading (+3.60% April-over-April, per DIR), the formula yields a first AGA of approximately 2.1%, effective January 1, 2027.

§ 26.90.050 — Fair-return petition (MNOI)

The ordinance's escape valve. A landlord may petition the Program Administrator for an upward adjustment; the section's stated intent is that individual increases "be granted only when the landlord demonstrates that such adjustments are necessary to provide the landlord a fair return as required by the California and United States Constitutions." Two presumptions apply: that base-year (2025) net operating income provided a fair return, and that the base rent did when established. The core standard is maintenance of net operating income: the landlord "has the right to obtain a net operating income equal to the base year net operating income adjusted by the change in the Consumer Price Index from the base year to the current year." The presumptions are rebuttable — e.g., unusually high or low base-year expenses, or base-year income "disproportionately low due to exceptional circumstances."

NOI is gross rental income minus operating expenses, with detailed inclusion/exclusion lists (subsection H.1–H.4). Gross income counts rents at 100% occupancy plus other occupancy-related income, but excludes sub-metered utilities, cost-pass-through refuse/sewer charges, laundry, storage, and supplementary charges such as "pet rent." Operating expenses include reasonable operation/maintenance and management costs, landlord-paid utilities, base-year and current-year property-tax assessments, legally required license/registration fees, documented landlord-performed labor (capped at 5% of gross income absent a showing of greater services), certain attorneys' fees, and the rental registry fee "in an amount not to exceed 50%." They exclude capital improvements (routed to §26.90.060), mortgage or other debt service, penalties, land-lease expenses, political contributions and lobbying payments, depreciation, reimbursed expenses, "unreasonable increases in expenses since the base year," master-metered utilities, and expenses attributable to unreasonable maintenance delays. Amortized costs earn an interest allowance at the Freddie Mac 30-year PMMS rate plus 2%. If a decision takes more than 120 days, the landlord may recover the increases that a timely decision would have allowed. No upward adjustment is available for units out of habitability compliance.

Drafting errors to note soberly: the subsection lettering in §26.90.050 skips from F to H (there is no G), and within the operating-expense exclusions the letter "h" is used twice (reimbursed expenses; master-metered utilities), so the list runs …g, h, i, h, j. Together with the definition's miscite of §060 for the MNOI standard (see §020 above), these are exactly the kind of mechanical errors the public comment period exists to fix.

§ 26.90.060 — Capital-improvements petition

A separate petition lets a landlord pass through the cost of "reasonable capital improvements," but only from a closed list of eligible categories: new roof; foundation/seismic upgrades; new or substantially new plumbing, electrical, or HVAC systems; exterior painting or siding/stucco; wood-destroying-pest repairs; water-conservation and energy-efficiency installations (including solar, gas-to-electric conversion, and dual-glazed windows); accessibility upgrades; fire sprinkler/alarm systems; stairs and railings; EV charging stations; and lead-paint stabilization and abatement. Improvements ordered to correct code violations are ineligible, as are improvements completed before or during the 2025 base year; petitions must be filed within two years of completion. Costs are amortized over the improvement's useful life (with the same PMMS + 2% interest allowance), but the monthly pass-through "may not…exceed[] 10% of the current monthly rent or $100 whichever is less." Pass-throughs must be separately itemized and are excluded from future rent-adjustment math; insurance or other reimbursements must be deducted first. (Drafting note: the section contains two subsections labeled "B," and the eligible-improvements list skips item 11.)

§ 26.90.070 — Tenant petitions for downward adjustment

Tenants may petition for rent reductions on three grounds: (1) failure to maintain the unit in habitable condition — which the draft declares "constitutes an increase in Rent"; (2) a decrease in housing services, maintenance, or deterioration beyond ordinary wear and tear without a corresponding rent reduction — likewise treated as a rent increase; and (3) rent demanded or retained above the lawful level, in which case the landlord is ordered to refund the overcharge. If a landlord fails to refund within 30 days, the hearing officer or board may authorize the tenant to withhold a fraction of rent until made whole, and the petition order is a defense to any unlawful-detainer action based on that withholding. A tenant who vacates before full recovery must be paid the balance within two weeks. Petitions on the first two grounds require showing the landlord had notice and an opportunity to correct.

§ 26.90.080 — Petition procedures

One procedural track serves all three petition types. The Program Administrator must accept or reject a petition within 30 days on completeness only, notify all parties within 14 days of acceptance, and schedule a hearing before "an impartial hearing officer" within 60 days of acceptance, with at least 20 days' notice. Landlord petitioners must be current on program fees; repeat petitions on substantially the same grounds are barred for 180 days. Hearings are informal — "[f]ormal rules of evidence shall not apply," hearsay is admissible if credible and relevant — with the burden of proof on the petitioner by a preponderance of the evidence. The hearing officer must deliver a written decision within 30 days of the hearing. Either party may appeal to the Rent Stabilization Board within 30 days; decisions are not stayed pending appeal, but a reversal requires retroactive true-up payments. If no board exists, the hearing officer's decision is final, subject to judicial review within 30 days.

§ 26.90.090 — Rent Stabilization Board

A seven-member board appointed by the City Council: two tenants, two landlords or property managers, and three at-large members "with no financial interest in or ownership of rental housing in the City." All must be city residents; terms are four years (with some initial two-year terms to stagger), and "the City Council may remove a board member at any time for any reason." The board's duties are comparatively contained: meet at least annually, approve regulations promulgated by the Program Administrator, hear appeals from hearing-officer decisions, conduct studies, and perform duties the council assigns. Four members are a quorum, and granting or denying a petition requires four affirmative votes. Appeals are decided on the hearing record unless the board elects a de novo hearing; board decisions are subject to judicial review within 30 days. The Program Administrator serves as the board's secretary. (Whether regulatory authority should sit with the board or the council was a live dispute at the June 9 review — see The Council Record.)

§ 26.90.100 — Rental registry

Every landlord must register each covered unit with the Program Administrator — initial registration due "not later than January 1, 2027, or within 30 days after the Program Administrator has made the registration form available whichever is later" — and pay the registry fee per unit at filing. Registration discloses, per unit: address, bedrooms/bathrooms, landlord and manager contact information, date ownership was assumed, current rent, date and amount of the last increase, and the current tenants' move-in date; the Program Administrator "shall not require a landlord to provide identifying information of tenants." Exemption claims must be filed with supporting documentation under penalty of perjury. Ownership changes, management changes, and re-rentals after vacancy each trigger a 30-day update obligation. The enforcement teeth are broad: an unregistered landlord may not advertise, demand or accept rent, or evict — and no AGA, and no petition of any kind, is available for an unregistered unit.

§ 26.90.110 — Rental registry fee

The fee that funds the program. It is set (and adjustable "at any time") by City Council resolution, with a cost-recovery cap: "Revenue generated from fees shall not exceed the amount found by the City Council to be necessary to administer the provisions of this Chapter." The draft does not state a dollar amount — the closest sizing on the record is RSG's estimate of roughly $2 million per year, about $154 per unit across roughly 13,000 covered units (staff report, May 19, 2026). After timely payment, a landlord "may pass through up to 50% of the fee" to the tenant in 12 equal monthly installments, separately itemized and excluded from rent for cap purposes; no pass-through is allowed for tenants of deed-restricted affordable units, and unpaid pass-throughs cannot be collected from departing tenants. Late filers face charges and penalties set by council resolution; unpaid fees become a debt to the City.

§ 26.90.120 — Remedies and enforcement

Violations are punishable offenses under SBMC Chapter 1.28, and the City Attorney may enforce the chapter "through civil or criminal action," including injunctions, with recovery of costs and fees. The chapter also creates a private right of action: "Any aggrieved person may bring a civil action for damages for any violation," by a preponderance of the evidence, with no administrative exhaustion required before suing. A landlord's noncompliance with any requirement of the chapter "may be asserted as a complete affirmative defense" in an unlawful-detainer or other possession action, and attempts to recover possession in violation of the chapter expose the landlord to wrongful-eviction damages, with costs and attorneys' fees to the prevailing party. Remedies are expressly non-exclusive.

§ 26.90.130 — Hearing officers

The City Administrator may staff hearings four ways: hiring city-employee hearing officers; appointing a volunteer panel of at least five active or retired attorneys or retired judges (four-year terms); contracting with attorneys or retired judges ad hoc; or contracting with a dispute-resolution firm. Non-employee hearing officers are independent contractors who may provide no other services to the City, and — a structural independence guarantee — their "appointment, selection, employment, performance evaluation, compensation, and benefits… shall not be directly or indirectly conditioned upon the outcome of hearings."

The companion pieces: the moratorium and Chapter 26.50

Two measures already in force sit alongside the draft. Ordinance No. 2026-6206 — the Temporary Rent Increase Moratorium, adopted 4–3 on January 27, 2026, effective February 26, 2026 — freezes rents for covered units at the December 16, 2025 level and expires on the earlier of a permanent program's operative date or December 31, 2026. It is currently being defended in litigation (below). SBMC Chapter 26.50 — Just Cause for Residential Evictions — is the city's existing eviction ordinance (just-cause grounds, notice requirements, relocation-assistance payments for no-fault evictions). Ordinance No. 2026-6207, adopted the same night as the moratorium, added §26.50.100: an owner removing a unit from the rental market must remove all units on the parcel, and the property is barred from residential rental use for five years after removal (the draft's "completed within one year" sentence was deleted at introduction, with staff directed to return with the remaining Ellis Act provisions). On June 9, 2026, the council voted 4–3 to release further Just Cause/Ellis Act amendments for public comment alongside the draft rent stabilization ordinance.

---

What happens next

The expected path, per the council record:

1. July 9, 2026 — public comment closes. The 30-day window opened June 10 ends. Submit comments via the City Clerk (santabarbaraca.gov); the June 9 meeting record indicates staff will compile comment for the council.
2. Late July 2026 — introduction (first reading), expected. Staff told the council on June 9 that introduction is scheduled for late July. As of July 7, no hearing has been formally noticed; check the council agenda archive at docs.santabarbaraca.gov.
3. Adoption after a second reading. Santa Barbara ordinances are adopted at a second reading, typically about two weeks after introduction (the moratorium's own path: introduced January 13, adopted January 27, effective 30 days later).
4. January 1, 2027 — program operative, if adopted on schedule. §26.90.030's prohibitions take effect; the first annual general adjustment — approximately 2.1%, from the April 2026 CPI — becomes available; initial rental-registry registration comes due (January 1, 2027, or 30 days after forms are available, whichever is later); and the moratorium terminates by its own terms on the permanent program's operative date.

If adoption slips past year-end, the moratorium still expires December 31, 2026 by its own sunset.

To comment before July 9: the repo's primary-source set does not include a specific comment-submission address, so we will not invent one — submissions go through the City Clerk's office; see santabarbaraca.gov (Rent Stabilization Program page) for the current channel, and docs.santabarbaraca.gov for agendas and eComment on noticed items.

---

The open questions

• The moratorium is in litigation. The City is defending a lawsuit over the temporary rent-increase moratorium. On April 28, 2026 the council took up — and voted 5–2 to continue — a $400,000 litigation-defense appropriation (described in the record as a $300,000 increase over $100,000 already spent), which returned on the May 12, 2026 consent calendar. The outcome could affect the moratorium, the base-rent date, or the permanent ordinance's design.
• There is no fiscal or economic-impact analysis of the policy. The record repeatedly notes its absence: the City Administrator conceded on December 16, 2025 that no cost/fiscal analysis existed; the Finance Director listed the program as an unbudgeted "unknown" at the April 21, 2026 budget overview. The RSG estimate (~$2M/year, ~$154/unit) sizes administration cost only — not market or economic impact. Mayor Rowse has repeatedly cited Santa Monica's ~$6M/year program as a cost benchmark.
• Implementation is unsettled. From the council record: whether regulatory authority sits with the board or the council; the fee structure (the council directed staff to explore fee "options B and C"); the Housing Authority's request for Section 8 and deed-restricted exemptions (brought back for future discussion on a 6–1 vote, April 7); staff's June 9 commitment to red-line the exemptions and the health-and-safety capital-improvements definition; and the draft's mechanical errors catalogued above. Three to four councilmembers will be termed out before the January 2027 launch. See The Council Record for the quotes and votes behind each.

---

Sources

Ordinance and municipal-code text (City of Santa Barbara; full text on file in the project repository)

• City of Santa Barbara, Rent Stabilization Ordinance — Public Review Draft (draft SBMC Chapter 26.90), published June 10, 2026 for the public comment period opened at the June 9, 2026 council meeting. The primary text for every section summary above.
• City of Santa Barbara, Ordinance No. 2026-6206, Temporary Rent Increase Moratorium (adopted January 27, 2026; effective February 26, 2026; base rent as of December 16, 2025; sunset the earlier of a permanent program's operative date or December 31, 2026).
• City of Santa Barbara, Ordinance No. 2026-6207 / SBMC §26.50.100 — Just Cause "Ellis Act" eviction requirements (adopted January 27, 2026), and SBMC Chapter 26.50, Just Cause for Residential Evictions (codified text).

City staff reports, memos, and releases (City of Santa Barbara; via santabarbaraca.gov and the docs.santabarbaraca.gov OnBaseAgendaOnline agenda archive; on file in the project repository)

• Councilmembers Santamaria and Sneddon, council memorandum, Rent Stabilization, September 29, 2025 (with the attached RDN 2025 Rent Survey for the South Coast).
• Council staff presentation, Policy Direction & Work Plan for Development of a Rent Stabilization Program (Item 12), December 16, 2025.
• Council staff report, Update on Development of a Rent Stabilization Program (Item 14), April 7, 2026.
• Council staff report, Additional Research on Rent Stabilization (Item 10), May 19, 2026 — includes the RSG, Inc. program-cost estimate (~$2M/yr; ~$154/unit across ~13,000 covered units).
• Council staff report, Review of Draft Ordinance (Item 14), June 9, 2026.
• City of Santa Barbara press release, Preliminary Policy Discussions Begin on Rent Stabilization, December 18, 2025.
• City of Santa Barbara, Executed Contract No. 30017 — legal-services agreement with Colantuono, Highsmith & Whatley, PC (May 12, 2026 amendment).

Council meetings (City of Santa Barbara City Council, Regular Meetings; official video; approved minutes on file where published — December 16, 2025 and January 13/27 and March 17, 2026; later tallies transcribed from the meeting audio)

• December 16, 2025 (Item 12 — policy direction): youtube.com/watch?v=UyOUAB3PZUE
• January 13, 2026 (Item 14 — moratorium introduction; urgency version failed): youtube.com/watch?v=7OMw43rEPbc
• January 27, 2026 (Consent Item 2 — adoption of Ordinance Nos. 2026-6206 and 2026-6207): youtube.com/watch?v=O-dtRagm8cE
• March 17, 2026 (Item 3 — RSG, Inc. agreement): youtube.com/watch?v=g1EHoy-T__A
• April 7, 2026 (Item 14 — final policy direction; the 60%-of-CPI / 3% cap vote): youtube.com/watch?v=33OWM8XMR2s
• April 21, 2026 (FY2027 budget overview; program cited as a budget "unknown"): youtube.com/watch?v=Ifyk0Gx_G8Q
• April 28, 2026 (Item 5 — litigation-defense appropriation, continued 5–2): youtube.com/watch?v=yOU99hvNGNw
• May 12, 2026 (Consent Item 6 — litigation-services agreement; Item 11 — mid-cycle budget): youtube.com/watch?v=UKGI2DEnBl0
• May 19, 2026 (Item 10 — supplemental research; RSG cost estimate): youtube.com/watch?v=6Tc4fEYHXmY
• June 9, 2026 (Item 14 — draft-ordinance review; comment period opened): youtube.com/watch?v=UqTaTlW6SRg

Other

• California Department of Industrial Relations, California Consumer Price Index (CPI-U, All Items) — the index named by the draft's §26.90.020; April 2026 reading (+3.60% April-over-April) drives the first AGA estimate.
• Santa Barbara Association of REALTORS, letter to the City Council opposing the moratorium and Ellis Act just-cause amendments, January 13, 2026 (on file in the project repository).

SBRSO — Santa Barbara Rent Stabilization Observatory. Every claim above traces to a document or meeting listed here; see also Sources and The Council Record.