701 Security Deposits 702 Payment of Interest on Security Deposits 703 Payment of Interest where Funds are not Deposited 704 Deduction of Interest from Rent 705 Prohibiting the Increase of Security Deposit during a Tenancy 706 - 799 (RESERVED)
(A) Any security deposit or payment, as that term is defined in Section 7 of the Ordinance, shall be placed by the landlord in an interest bearing account at an institution whose accounts are insured by the Federal Savings and Loan Insurance Corporation until such time as it is returned to the tenant or entitled to be used by the landlord pursuant to Section 1950.5 of the California Civil Code.
(B) The landlord shall clearly designate the account in a fashion that indicates that the monies deposited therein are held in a fiduciary capacity for the benefit of the tenant or tenants.
[Effective Date: February 8, 1984]
(A) Once a year in December, the landlord shall return to each tenant the actual amount of interest earned by said security deposit either as a rent rebate or cash payment. The landlord shall furnish the tenant with a clear statement indicating the amount of each deposit or payment held on behalf of the tenant, the rate of interest paid by the financial institution on the deposit, the time period in which the interest was earned and the amount in dollars and cents of interest paid.
(B) The tenant may request that the landlord provide verification that deposits or payments held on behalf of the tenant have been properly placed at a financial institution. Upon receipt of a written request from the tenant, the landlord shall obtain written verification from the financial institution that the landlord has deposited funds which are sufficient to cover all deposits or payments held on behalf of the tenant. Said verification shall include the name of the financial institution, branch and location, type of account, current rate of interest paid on said account and the names and capacities of persons holding title to the account.
(C) If a landlord has not previously returned interest to which a tenant is entitled, the landlord shall return to the tenant all interest earned on said security deposit which has accrued from June 28, 1980, or the date of commencement of tenancy, whichever is later, until the date upon which the payment was made.
[Effective Date: February 8, 1984]
(A) If the landlord fails to place the payment or deposit at an institution whose accounts are insured by the Federal Savings and Loan Insurance Corporation, the landlord shall nevertheless pay interest on said deposit or payment to the tenant. The interest due the tenant shall be the greater of:
(2) The legal rate of interest on unpaid judgements established by the State of California; (Code of Civil Procedures 685.10)
(3) The interest actually earned by the deposit or payment in the use to which the landlord put the monies.
[Effective Date: February 8, 1984]
Where a tenant has not received refund of security deposit interest by January 10 of any year for any preceding calendar years, the tenant may recover the interest by deducting the interest amount from rent, under the procedure in this regulation.
For purposes of this regulation, the interest rate is ten percent simple interest per year. The tenant must first give the landlord fifteen days' notice in writing of the tenant's intention to deduct the interest from a future rent payment. The landlord may respond to the notice by paying the interest at the ten percent rate to the tenant prior to the date that the deduction from rent is to be made.
[Regulation 704 effective May 25, 1990.]
Any amount demanded, accepted or retained by a landlord as a security deposit within the meaning of Section 1950.5 of the California Civil Code shall not be increased for any tenant during the term of the tenancy. Landlords may demand, accept or retain the amount of security allowed in Civil Code Section 1950.5 upon the commencement of a new tenancy.
[Effective July 19, 1991.]