The Santa Barbara City Council worked late into the night on Tuesday, hammering out the details of the city’s rent-stabilization ordinance.

There were 127 policy items for the council to discuss after the city received more than 650 written public comments from the community about the ordinance. 

“The community has been heard,” said Barbara Andersen, senior assistant to the city administrator. “We are not debating for or against rent stabilization. Community direction is clear. Council direction is clear. This is moving forward.”

The ordinance, set to take effect Jan. 1, limits how much landlords can raise rents, creates a rental-property registry and forms a rent-stabilization board to oversee the program. 

Rent increases would be limited to one time within a 12-month period at 60% of the rise in the Consumer Price Index (CPI), with a maximum of 3%, whichever is lower.

The ordinance wouldn’t apply to units built after Feb. 1, 1995; single-family homes; condos and townhomes; owner-occupied duplexes; mobile home parks; government-owned and -operated units; or deed-restricted affordable housing. 

The stabilization ordinance has the housing community divided, with tenant advocates, housing providers and the city all at odds.

During public comment, resident Ana Garcia held up a sign depicting a guillotine that read, “Your term ends when we say so.”

She advocated for strong tenant protections and program enforcement, claiming that the Meridian Group just raised her rent despite the temporary rent freeze. 

“Our working-class neighbors who make Santa Barbara what it is deserve to have their basic needs met,” Garcia said. “Especially over greedy businesses who are referred to as landlords or housing providers here, who seek to profit from exploiting us.”

Written comments from the Santa Barbara Tenants Union, the Central Coast Alliance United for a Sustainable Economy and the Santa Barbara County Action Network generally supported the ordinance but opposed the lack of enforcement mechanisms, the ability to raise rents based on elective improvements and the limited role of the Rent Stabilization Board.

Those groups also requested a rental registry that covers all rental units, not just those subject to the ordinance, limited exemptions from the ordinance and a rental-stabilization board that directs program policies, according to the city staff report.

On Tuesday, numerous landlords argued that the ordinance would lead to big corporations buying up properties operated by smaller, mom-and-pop landlords.

Jim Terzian advocated for small landlords to be exempted from the ordinance, claiming it would be burdensome and costly for families.

“It ends up meaning for the rentals they have, often rentals they depend on for their retirement or their future income, that they can’t make a profit at all no matter what they do,” Terzian said.

Most of the written comments against the ordinance were regarding the rent cap formula. 

Commenters said the cap was structurally below the rate at which their operating costs are rising, noting the increase in property insurance along with increases in utilities, labor, materials, property taxes and city fees.

The rental registry earned concerns regarding privacy and data-security, with commenters saying the required ownership and financial disclosures were invasive, according to the city staff report.

Numerous criticisms were thrown at City Administrator Kelly McAdoo and staff members for their handling of the procedures, with one commenter claiming McAdoo was trying to undermine the council and public.

Mayor Randy Rowse, who’s been against the ordinance since the beginning, had to take a moment to defend city staff.

“Staff is working their butt off to do this,” Rowse said. “They’ve scheduled every one of these things as an evening session to accommodate the people that are tenants.

“I think we should take that into consideration and not dissolve into some very nasty little push and pull. Smile all you want, but being a bully is not a way to get things done.”

One policy aspect that the council debated was who should be exempted from the new law.

Councilwoman Megan Harmon made it clear that she wanted to exempt only deed-restricted affordable housing.

“These units are already subject to a separate rent-setting system, and to me the RSO (rent-stabilization ordinance) doesn’t add any meaningful price protection,” Harmon said.

There was also some debate over whether privately owned units that accept Section 8 housing vouchers should be exempt.

Councilwoman Wendy Santamaria said she worried that exempting those units would put families at risk.

“The more exemptions that we put in, we’re not just excluding tenants from the protections, we’re not just exposing tenants to these rent shocks, but what we’re also doing is putting more of a burden on our staff,” Santamaria said.

Councilman Eric Friedman asked staff to work with the Housing Authority of the City of Santa Barbara on this issue, as its executive director, Rob Fredericks, has repeatedly asked for those units to be exempt, fearing that fewer landlords would accept Section 8 vouchers.

There is still work to be done.

City staff is looking for a third-party consultant to conduct a fee study to determine the cost of registering units for the rental registry and how much it will cost the city to operate the program.

While the council provided feedback on dozens of policy details, no final decisions were made. The ordinance is expected to return for approval in August.