San Jose, CA Rental Property Rules: Pass-Through Charges (2026)
Key Facts
- Code
- SJMC Chapter 17.23 (ARO)
- Capital improvement
- Housing Department petition required
- Utility pass-through
- Approval needed for billing change
- Itemization
- Separate line on rent bill
- Sunset
- Ends at full amortization
Summary
Under the San Jose Apartment Rent Ordinance, landlords of pre-1979 apartments may pass through certain capital improvement, debt service, and utility costs only with Housing Department approval. Add-ons must be itemized and sunset when costs fully amortize.
(a) (1) Subject to subdivision (b), an owner of residential real property shall not, over the course of any 12-month period, increase the gross rental rate for a dwelling or a unit more than 5 percent plus the percentage change in the cost of living, or 10 percent, whichever is lower, of the lowest gross rental rate charged for that dwelling or unit at any time during the 12 months prior to the effective date of the increase. In determining the lowest gross rental amount pursuant to this section, any rent discounts, incentives, concessions, or credits offered by the owner of such unit of residential real property and accepted by the tenant shall be excluded.
Full Breakdown
SJMC Chapter 17.23 (Apartment Rent Ordinance) limits how rent-stabilized apartment landlords recover above-base-rent costs. Capital improvement pass-throughs require a Housing Department petition showing the work primarily benefits tenants, with costs amortized over the asset's useful life and shared with tenants on a regulated formula. Debt service pass-throughs are available only after a 1979-era refinance and similarly require petition approval. Utility pass-throughs apply when a landlord shifts from owner-paid to tenant-paid utilities and require an approved adjustment. All approved add-ons must be itemized separately on each rent bill, never folded into base rent, and removed when the underlying cost finishes amortizing or the bond service ends.
Violations & Fines
Unapproved or hidden pass-throughs are excess rent recoverable by tenants under SJMC 17.23 and expose the landlord to Housing Department fines, refund orders, and treble damages in tenant petitions.
Frequently Asked Questions
Can my San Jose landlord raise base rent for a new roof?
Do pass-throughs ever end?
Sources & Official References
Other rules in San Jose
California rules heatmap·Compare San Jose to another location·View the California rental property rules overview
See something wrong?
Help us keep this page accurate. If you notice an error or outdated information, let us know.