Recent California wildfires activate rent-gouging bans

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Wildfires have returned to California this summer, prompting a new set of emergency declarations from Gov. Jerry Brown and accompanying bans on rent increases exceeding 10 percent.

The most recent emergency declarations are for San Diego, Santa Barbara, Siskiyou and Lake counties.

Emergency declarations trigger the state’s anti-price gouging protections, which prohibit raising the price of many consumer goods and services, including that of rental housing, by more than 10 percent above pre-emergency levels after an emergency has been declared.  The rent-gouging ban applies to existing tenants and at unit turnover.

The governor’s extension of prohibitions on rent-gouging related to wildfires last fall in Northern California’s Wine Country and parts of Southern California also remains in place, creating confusion for many as to the locations where rent increases over 10 percent can lead to criminal prosecution.

Part of the confusion arises from the fact that, although the states of emergency are declared for specific counties, the enforcement of the law does not stop at the county line. California’s attorney general has interpreted the price-gouging law to apply anywhere in the state with an increased consumer demand resulting from the emergency.

Under the recent emergency declarations for Siskiyou and San Diego counties, the price-gouging prohibitions are set to last through Aug. 4 and Aug. 5, respectively, although they can be extended by the governor or local officials.

Brown also declared states of emergency for Santa Barbara and Lake Counties, although price-gouging protections in these counties were already slated to continue through Dec. 4 due to last year’s fires. Other counties named in the governor’s price-gouging ban related to last year’s wildfires include Mendocino, Napa, Solano, Sonoma and Ventura counties. Protections under this extended price-gouging ban are currently slated to expire Dec. 4 but could be extended.

CAA continues to encourage its members with properties anywhere in the state to seek legal advice before raising rents by more than 10 percent, given the patchwork of locations with declared states of emergency and the lack of a clear standard for how to determine when areas outside of those counties are subject to the ban.

In April, prosecutors charged a woman with three misdemeanor counts of price gouging in the city of Novato, part of Marin County, which was not included in an emergency declaration. Following the Tubbs Fire, prosecutors say, the defendant increased the rent on the home from $5,000 per month to $9,000 per month.

Anyone convicted of violating the statewide anti-price-gouging law can face a year in county jail, a fine of up to $10,000, or both, as well as civil penalties. Local ordinances may impose additional penalties.

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