Pasadena Rental Housing Fees Paid by Landlords May Nearly Triple by 2030

The Pasadena Rental Housing Board on Thursday will receive a cost-of-service study that projects rental housing unit fees could reach $298.18 by 2030.

Rental housing unit fees are collected from landlords to support the operations of the Rent Stabilization Department, which includes managing rental registries, tenant resources, and compliance with local housing laws.

The study was prepared by Berry, Dunn, McNeil and Parker, LLC (BerryDunn) for the Rent Stabilization Department. The consulting firm examined the department’s revenue and expenses to ensure long-term financial sustainability.

The Rent Stabilization Department was created in December 2023 to support the Pasadena Rental Housing Board. It regulates rent increases on certain rental properties and provides eviction protections.

In a preliminary report, BerryDunn said for fiscal year 2024, the department’s full cost to provide services was $1,902,486. The rental housing unit fee was calculated at $91.85 to cover costs for 27,407 applicable rental properties.

However, the fee was not assessed in fiscal year 2024. No actual revenue was generated that year.

For fiscal year 2025, expenses are expected to rise to $3,936,994, BerryDunn said in the report. The rental housing unit fee is projected at $214.71 to cover both 2024 and 2025 expenditures.

The study projects fees will need to increase annually through 2030. By that year, the estimated fee reaches $298.18 based on projected expenses of $7,454,481.

The increases stem from rising personnel costs and additional full-time positions, according to the study. Four new full-time positions are expected to be added in fiscal year 2026.

The department currently estimates 25,000 rental units will be subject to fees. This is a reduction from the initial estimate of 27,407 units used for 2024 and 2025 calculations.

The study utilized a four-phase approach examining cost analysis, fee structure recommendations, and findings. The project kicked off in early March and was completed in July.

BerryDunn has provided cost-of-service studies to more than 40 public agencies nationwide. The firm examined all relevant data and future projections for the analysis.

The report recommends the department adjust fees to increase revenue and cover rising operational costs. It also suggests adopting new fees for applicable services.

The study advises the department to monitor rental housing demand and trends throughout the city, and to continue reviewing the total rental unit pool for accuracy.

The consulting firm also recommends preparing annual cost-of-service analyses. Fee reviews should be performed whenever there are significant changes in service demand or organizational structure.

The report was submitted to the board by Rent Stabilization Department Executive Director Helen Morales, prepared by Management Analyst IV Will Panza. BerryDunn representatives will present the cost-of-service study at the meeting.

The Pasadena Rental Housing Board meets at 6 p.m. Thursday in the Council Chamber at City Hall.