Sunnyvale rental housing providers scored a win Tuesday when the City Council rejected a proposal that would have required landlords to pay three months’ rent in relocation assistance.

The council’s vote leaves in place the city’s Residential Tenant Protections Program, which requires two months’ rent in relocation assistance for no-fault, just-cause evictions.

The California Apartment Association objected to the proposed increase, saying it would add another cost to operating rental housing in Sunnyvale. CAA urged the city to focus instead on lowering housing costs, expanding supply and improving education about existing local and state requirements.

While setting aside the proposed increase to relocation assistance, the council directed staff to study whether to apply just-cause rules from the first day of tenancy, additional protections for vulnerable populations, and changes to how relocation assistance is calculated.

Neither advisory body endorsed the proposal. The Planning Commission did not issue a positive recommendation — a motion to support the ordinance failed to receive enough votes under city rules. The Housing and Human Services Commission also stopped short of supporting the ordinance as drafted and recommended that the council consider a small-property exemption.

A landlord survey in the city’s staff materials showed broad concern about the relocation assistance proposal. Three percent of landlord respondents said the increase would have no impact, while 75% identified it as an unfair or undue burden, 54% cited economic hardship and 56% said the added requirement could increase pressure on rents as housing providers look to offset new costs.

CAA will continue monitoring Sunnyvale as staff studies whether to bring back additional tenant-protection proposals, including day-one just-cause rules.