The Santa Barbara Rental Property Association(SBRPA) is taking legal action to invalidate the city’s temporary rent increase moratorium and to halt work on a planned permanent rent stabilization program, according to Cappello & Noël LLP, the law firm representing the association.
The City Council voted 4-3 on January 13, 2026, to enact the Temporary Rent Increase Moratorium Ordinance. The measure took effect on February 26, just 30 days after the council’s second reading.
As part of the same action, the city directed staff to draft a permanent rent stabilization program targeted to take effect by the end of the year.
In their legal challenge, the association argues the temporary freeze and proposed stabilization plan amount to an unconstitutional taking, violate due process and equal protection, and unlawfully interfere with private contracts in violation of the Contracts Clause.
“In an astonishing display of constitutional disregard, the Santa Barbara City Council proposed in October rent control with a rent cap tied to just 60% of CPI—a policy that represents nothing less than the unconditional surrender of property rights,” the SBRPA said in a statement. The group added that the rent freeze, approved on a 4-3 vote, “deprives landlords of a Fair Market Return on investments,” and “directly violate\[s] established law.”
“Rising taxes, insurance and maintenance costs are hitting property owners hard,” said Barry Cappello, managing partner at Cappello & Noël. “Rent stabilization is bad economics. Owners need a return on their investment even as costs rise and must keep their property in a first-rate and safe condition. Rent control has proven over the years that when housing stock is not maintained, housing conditions for the tenants worsen.”
Cappello said the firm intends to “follow this process through to the end and make sure either the City Council rights this wrong or a court with proper jurisdiction orders it stricken.”
During the City Council meeting in January, council members dedicated a considerable portion of the meeting to clarify which properties would fall under the purview of the new regulations. Under state law and the proposed local ordinance, the rent regulations apply only to buildings that were constructed before 1995, while single-family homes and most condominiums are exempt.
Accessory Dwelling Units (ADUs) are typically exempt if they were built after 1995. However, the Council noted that this may result in complications depending on when the unit was legalized.
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What a surprise. Money rallies to protect itself. The elected representatives of the people met with due process and notice and decided on a course of action that was vetted and with precedential history. Instead of accepting the basic idea of democracy these folks (not looking too needy or even stressed in their photo by the way) donned the mantle of victim-hood and used their special power (wealth) to do what their tenants can almost never do, hire expensive attorneys to go court to stop democracy.
The city has many options to help residents by lowering fees, taxes, and parking costs. Instead, it seems focused on raising taxes and taking more from its citizens. It operates more like a for-profit business, with city employees benefiting through higher salaries and expanded benefits. And because the city is essentially a monopoly, there’s no real competition to help keep costs in check.
Con drivel.
How absurd and intellectually dishonest. The city is not a monopoly–if you don’t like this one, move to another one or create your own. (I took this argument directly from cons like yourself.)
And this article is about rent control, not taxes, parking costs, or salaries, so this is completely off-topic trolling.
I won’t even get into the idiocy of the city providing services by cutting its revenue. Again, if you don’t like the social structure provided by modern civil societies, you have options, but you’ll have to fend for yourself: https://en.wikipedia.org/wiki/North_Sentinel_Island
The City made the right move. These land barons are filthy rich and wanting to squeeze as much out of us non-home owners that they legally can get away with.
The gap between local pay and local rent prices currently do not balance out. Not even close.
Our own Police officers and many city first responders can’t even afford to live in the county. Something has got to change and quickly. During the 90s, Santa Barbara effectively dismantled programs to help lower and middle class. It eventually pushed out the middle class leaving a massive hole/vacuum between the poor and struggling familes and the santa barbara wealthy residents. Been here since 1981 and have seen the decline in slow procession. If i’m wrong, then how was i able to support myself with a minimum wage job for 8 years, paying rent on a nice studio with a pool and mountain view…off of 9.75 an hour. Still had $$ left in my account each month too. Now, now i go about -250 a pay period to feed my kids and myself. That same unit that I used to rent now costs $3200 a month and wages currently don’t support that unless you’re making 6 figures a year. I have personally dealt with many of those land owners and they are anything but friendly or caring. They only care about their $. Oh and Capello? hah….i partied in his house many a time during the 1980s when he and his wife left town. Their daughter hung around our crowd and would invite us all over to their place in hope ranch. anyways, no one wants to hear about rich people crying about not charging us crazy amounts in rent. One owner below is saying that she may not be able to afford repairs if the rent freeze happens? BS. Pure BS. how about carving that out of the massive amount of profit you pull in monthly….
Landlords expect their net wealth to constantly increase at the expense of renters.
I am your typical mom-and-pop landlord. My wife and I are both 77. We have and have had small rentals here and other places. I would like to make an assumption, that hopefully, we can all agree on. Landlords are in the business of making money. Those of you who are employed are getting paid, and the businesses that you work for or own are making a profit. The landlord is no different. They have a significant investment in the equity of their properties and considerable costs supporting them. The landlord that is not making money will not stay in business. They will not supply housing.
What are the causes of the high cost and the scarcity of housing? There are several factors. Among them are:
Lack of new housing.
An ever-increasing population.
The high cost of building and construction.
Zoning.
High mortgage rates.
Onerous building codes and regulations.
Ever-rising costs of insurance, maintenance, government fees, taxes, utilities, etc.
Municipal, County, State, and Federal policy.
Adverse legislation.
And now criminal litigation.
Are Landlords, as a rule, the cause of these factors? Landlords want things to be as inexpensive as possible and they want profitable housing to invest in. There is not an ample supply of housing so rents increase. If there was an ample supply of housing, prices would stabilize.
Our legislatures have done little to correct the problems listed above or create additional housing. They have made small steps like allowing Granny-flat construction and modifying subdivision regulations (now tossed out by a lower court decision). The burden of mitigating the problem is placed on the landlord by legislation such as this (Rent Control) and other legislation. Currently, governmental laws and regulations are not only making investing in rentals unprofitable but they are also taking basic ownership rights away from property owners. Property owners no longer have control over who lives in their property or on what terms. On the whole, governmental actions and inaction are to blame and regulate the landlords instead of finding and correcting the root causes. These are complex, difficult issues that require complex and difficult solutions. To date, the government has not been up to the task. They are taking the easy way. They blame the landlord and make him pay for the inability of our government to do its job.
In the short run, rent control, legislation, and regulation, to date, have only been a short-term panacea. It will only create less housing and make the problem worse in the future. If the landlord cannot make a profit, he will stop investing in housing. Exacerbating this lack of profit is the increase in adverse legislation, loss of private property rights, and now the threat of prosecution. Under these conditions, landlords will only maintain their properties at a minimal level because they know they will not be reimbursed for any improvements. Landlords are now leaving units empty rather than letting tenants obtain rights over their property. The landlord can find other easier and less risky places to invest. If no one invests in housing there will be less housing. What is the alternative if the investor does not provide housing?
Nobody read this the first 30 times you’ve copied and pasted it.
> The landlord is no different.
Yes they are … they don’t work for a living, they are in “the business of making money” by taking it from tenants who actually made it. There are non-exploitative options for retirees–investments that actually drive the economy.
You definitely should seek an investment with less risk, since you don’t seem to have expected or planned for it.
Investment does not mean guaranteed success, especially with your entitled attitude.
Let’s have the government (in this case just a few council members) tell property owners how much they can charge to rent their own properties. What could go wrong?
Yeah, who needs things like laws against usury?