California SB-1103: What Small Business Tenants Can Do About CAM Overcharges
California's Commercial Tenant Protection Act — SB-1103, effective January 1, 2025 — gives qualified small commercial tenants the right to demand documented, proportional allocations of CAM and building operating costs. Real money is at stake: the law allows actual damages, plus treble and punitive damages for willful violations. If you run a small business in California and your CAM bill looks off, this is the law that may let you ask the landlord to show its work.
What is California SB-1103?
SB-1103 is the Commercial Tenant Protection Act, a California law that took effect on January 1, 2025, extending certain tenant protections to qualified small commercial tenants. It requires landlords to allocate building operating costs proportionally, to provide supporting documentation on written request, and it adds notice requirements for rent increases on month-to-month tenancies. Before SB-1103, most of these protections existed only for residential tenants; the act brings a defined slice of commercial small-business tenants under similar rules.
Do you qualify as a "qualified commercial tenant"?
You may qualify if you are a microenterprise, a restaurant with fewer than 10 employees, or a nonprofit with fewer than 20 employees — and you self-certify that status to your landlord. A microenterprise is generally a business with 5 or fewer employees. The protections are not automatic for every commercial tenant; you have to fit one of these categories and notify the landlord that you do. Consult an attorney about your specific situation if you are unsure whether you meet the definition.
What must the landlord disclose about operating costs and CAM?
The landlord must allocate building operating costs proportionally among tenants and, on written request, provide the supporting documentation behind those costs. That documentation comes with a signed attestation, and the landlord must respond within 30 days of your written request. The landlord also cannot change the method of allocating those costs to your detriment without giving you notice. In plain terms: the share of building costs passed through to you is supposed to be proportional, documented, and stable — not an unexplained line item.
How do you request the documentation?
You make the request in writing, and the landlord generally has 30 days to provide the supporting documentation with a signed attestation. Keep your request and the response in writing so there is a clear record of what you asked for and what you received. This is a right to request records — it is informational and a starting point for understanding your bill, not a determination that anything is owed. If the documents are confusing or incomplete, that itself is useful information to bring to an attorney.
What are the remedies if a landlord violates SB-1103?
The remedies can include actual damages and attorney's fees, and for willful or oppressive conduct the law allows treble plus punitive damages. That treble-and-punitive exposure is what gives the documentation right real teeth — a landlord that knowingly misallocates costs faces more than just paying back the difference. Whether a particular situation rises to a willful violation is a legal question; an attorney can advise on the remedies that may apply to your facts.
What about rent-increase notice?
On month-to-month tenancies, SB-1103 requires 90 days' notice for rent increases over 10%, and 30 days' notice for smaller increases. This is separate from the CAM and operating-cost rules but is part of the same act, and it matters because some landlords fold cost pass-throughs into effective rent. If a sudden jump shows up without the required notice, that is worth flagging.
What should you do if your CAM bill looks off?
Start by cross-checking whether the pro-rata share you're being billed actually reconciles with the numbers in your lease and reconciliation statement. Independent industry analysis has found material errors are common — Tango Analytics reported in 2023 that roughly 40% of CAM reconciliations contain material errors — so an off-looking bill is not unusual. ReCAM's free Cross-Check lets you enter a few numbers (no upload, no sign-up) to see whether the share math reconciles and to cross-check against public data where available, such as REIT filings and BOMA cost ranges. If something doesn't add up, you may have the right under SB-1103 to request the landlord's supporting records in writing — and to consult an attorney about next steps. For a fuller walkthrough of SB-1103 for California tenants, see recam.app/california-tenants.
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Informational only; not legal advice and not an audit or attest service. ReCAM is not a CPA firm and these services are not regulated by the Texas State Board of Public Accountancy. © ReCAM Technologies LLC.