California Attorney General Rob Bonta, together with the Marin County District Attorney’s Office, announced a settlement with Mission Rock Residential California, Inc., a property management company overseeing more than 30 apartment buildings in the state. The agreement addresses findings from a joint investigation that Mission Rock imposed unlawful rent increases and other violations of tenant protection laws.
According to the investigation, in 2022, Mission Rock raised rents for around 140 families near the maximum allowed by California’s Tenant Protection Act (TPA). At the same time, it began charging tenants for water, sewer, and garbage services that had previously been included in their rent. The company implemented a ratio utility billing system (RUBS), allocating costs using a formula rather than actual usage. This resulted in total monthly payments that exceeded TPA rent caps for several months.
Attorney General Rob Bonta said: “Some California landlords have tried to get away with illegal rent increases by shifting utilities and other fees to tenants and pretending those new charges are not ‘rent’ under the TPA. That violates the law. We appreciate that Mission Rock quickly rescinded the unlawful utility charges once we raised the issue, and that it has now agreed to be bound to several terms meant to ensure compliance with tenant protection laws going forward. Today’s settlement should put others on notice: If you violate state or local tenant protections, you will be held accountable. I’m grateful for the partnership of the Marin County District Attorney’s Office. At a time when Californians are rightfully concerned about the cost of living, we are once again showing that our laws can help reduce housing costs for families.”
Marin County Deputy District Attorney Michael Wear added: “Misrepresenting rent increases through utility or fee add-ons threatens housing stability, misleads tenants, and violates the law. It also disadvantages landlords who play by the rules and contribute to fair, stable housing in our community. Our office is committed to protecting tenants and honest landlords by ensuring full compliance with the law.”
The TPA was co-authored by Bonta during his time as an assemblymember and signed into law in 2019. It limits annual rent increases statewide for most tenants and prohibits evictions without just cause. Landlords cannot raise rents more than 10% or 5% plus inflation—whichever is lower—within any 12-month period. Recent legislation has strengthened these protections and expanded enforcement authority.
Mission Rock’s use of RUBS led to monthly utility charges up to $200 while also increasing base rents close to legal limits. Additionally, they charged tenants a new $10 insurance fee each month. The complaint alleges these combined charges pushed many renters over what was allowed under state law.
Other alleged violations include failing to provide required mediation information on rent increase notices in San Rafael; requiring some tenants to pay only via an online portal without offering check or money order options; and not having on-site managers at properties with more than 16 units as required.
As part of the settlement filed with Marin County Superior Court—which still requires judicial approval—Mission Rock will pay approximately $435,000 in civil penalties and nearly $60,000 in restitution to affected consumers. They must also restore lawful rental rates; ensure future utility fees comply with legal caps; offer alternative payment methods; notify tenants about payment options and late fee policies; fill vacant manager positions; and fully comply with all relevant tenant protection laws.
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