SB 1103 Heads to the Assembly Floor

While Senate Bill 1103 aims to protect small businesses and nonprofits, its provisions could impose harmful mandates on commercial leasing.  

The bill has passed the State Senate and cleared key committees in the Assembly as it heads to the Assembly floor.  

What You Need to Know 

Thanks to BOMA Cal’s efforts, the bill now applies its rules only to "qualified tenants." This includes microenterprises, restaurants with fewer than 10 employees, and nonprofits with fewer than 20 employees. 

Key points:    

• Translating leases into multiple languages could cost $10,000 per translation.  

• Landlords must provide records of operating costs within a strict timeframe. 

• Restricting landlords to recover only certain expenses like maintenance and repair excludes many essential costs. 

• Removes flexibility in lease negotiations by voiding any waiver of rights by qualified tenants. 

• If landlords don't comply, tenants can use this as a defense in eviction cases. 

• Compliance costs may lead to higher rents or fees for tenants. 

How It Impacts You

SB 1103 poses many challenges for property owners and managers by limiting leasing flexibility and increasing administrative costs.  

This could increase leasing risks for new businesses because they might face higher legal penalties. 

It also prevents adjusting expenses according to usage, which could result in financial losses or changes in lease prices. 

Additionally, these problems could make landlords less likely to rent to these "qualified tenants," which might lessen the variety of local businesses. 

Advocating for You

The BOMA Cal team has worked hard to get amendments on this bill.  

This bill used to include restrictions on security deposits and had a broader scope in defining which types of businesses could be considered a "qualified tenant."  

The challenging translation requirement applied to almost any foreign language and applied to all potential tenants. 

Now there is a list of languages that applies to specified qualified tenants.  

BOMA Cal’s advocacy successfully lessened the damaging effects of this bill by narrowing its scope and application.  

Stay Connected

Commercial real estate professionals should oppose SB 1103 to keep leasing fair and efficient for both owners and tenants.  

Stay connected with BOMA on the Frontline for more updates.