Beverly Hills Municipal Code Art. 2 Price Gouging

The city council hereby finds that during a state of emergency or local emergency, including, but not limited to, an earthquake, flood, fire, riot, storm, drought, plant or animal infestation or disease, pandemic or epidemic disease outbreak, or other natural or manmade disaster, some merchants have taken unfair advantage of consumers by greatly increasing prices for essential consumer goods and services. While the pricing of consumer goods and services is generally best left to the marketplace under ordinary conditions, when a Declared Emergency results in abnormal disruptions of the market, the public interest requires that excessive and unjustified increases in the prices of essential consumer goods and services be prohibited. It is the intent of the city council in enacting this article to protect citizens from excessive and unjustified increases in the prices charged during or shortly after a Declared Emergency for goods and services that are vital and necessary for the health, safety, and welfare of consumers, whether those goods and services are offered or sold in person, in stores, or online. Further, it is the intent of the city council that this article be liberally construed so that its beneficial purposes may be served. (Ord. 07-O-2522, eff. 8-10-2007; amd. Ord. 25-O-2911, eff. 2-5-2025; Ord. 25-O-2912, eff. 3-22-2025)

For the purposes of this article, the following terms shall have the following meanings:

BUILDING MATERIALS: Lumber, construction tools, windows, and anything else used in the building or rebuilding of property.

CONSUMER FOOD ITEM: Any article that is used or intended for use for food, drink, confection, or condiment by a person or animal.

DECLARED EMERGENCY: The proclamation or declaration of a "local emergency" or "state of emergency" or "state of war emergency" as defined in section 2-4-102 of this chapter.

EMERGENCY SUPPLIES: Includes, but is not limited to, water, flashlights, radios, batteries, candles, blankets, soaps, diapers, temporary shelters, tape, toiletries, plywood, nails, and hammers.

GASOLINE: Any fuel used to power any motor vehicle or power tool.

GOODS: Has the same meaning as defined in subdivision (c) of section 1689.5 of the California Civil Code.

HOUSING: Any rental housing with an initial lease term of no longer than one year.

MEDICAL SUPPLIES: Includes, but is not limited to, prescription and nonprescription medications, bandages, gauze, isopropyl alcohol, and antibacterial products.

RENTAL PRICE:

(A) For housing rented within one year prior to a Declared Emergency, the actual Rental Price paid by the tenant.

For housing not rented at the time of a Declared Emergency, but rented, or offered for rent, within one year prior to the Declared Emergency, the most recent rental price offered before the Declared Emergency.

For housing rented at the time of a Declared Emergency but which becomes vacant while the emergency remains in effect and which is subject to any ordinance, rule, regulation, or initiative measure adopted by any local governmental entity that establishes a maximum amount that a landlord may charge a tenant for rent, the actual rental price paid by the previous tenant or the amount specified in subparagraph (B), whichever is greater. This amount may be increased by five percent (5%) if the housing was previously rented or offered for rent unfurnished, and it is now being offered for rent fully furnished. This amount shall not be adjusted for any other good or service, including, but not limited to, gardening or utilities currently or formerly provided in connection with the lease.

(B) For housing not rented and not offered for rent within one year prior to a Declared Emergency, one hundred sixty percent (160%) of the fair market rent established by the United States Department of Housing and Urban Development. This amount may be increased by five percent (5%) if the housing is offered for rent fully furnished. This amount shall not be adjusted for any other good or service, including, but not limited to, gardening or utilities currently or formerly provided in connection with the lease.

(C) Housing advertised, offered, or charged, at a daily rate at the time of a Declared Emergency, shall be subject to the Rental Price described in subparagraph (A), if the housing continues to be advertised, offered, or charged, at a daily rate. Housing advertised, offered, or charged, on a daily basis at the time of a Declared Emergency, shall be subject to the Rental Price in subparagraph (B), if the housing is advertised, offered, or charged, on a periodic lease agreement after the Declared Emergency.

REPAIR OR RECONSTRUCTION SERVICES: Services performed by any person who is required to be licensed under the California contractors' state license law (chapter 9 (commencing with Section 7000) of Division 3 of the California Business and Professions Code), for repairs to residential or commercial property of any type that is damaged as a result of an event that led to a Declared Emergency.

TRANSPORTATION, FREIGHT, AND STORAGE SERVICES: Any service that is performed by any company that contracts to move, store, or transport personal or business property or rents equipment for those purposes.

RENTAL PRICE:

(A) For housing rented within one year prior to a Declared Emergency, the actual rental price paid by the tenant.

For housing not rented at the time of a Declared Emergency, but rented, or offered for rent, within one year prior to the Declared Emergency, the most recent rental price offered before the Declared Emergency.

For housing rented at the time of a Declared Emergency but which becomes vacant while the emergency remains in effect and which is subject to any ordinance, rule, regulation, or initiative measure adopted by any local governmental entity that establishes a maximum amount that a landlord may charge a tenant for rent, the actual rental price paid by the previous tenant or the amount specified in subparagraph (B), whichever is greater. This amount may be increased by five percent (5%) if the housing was previously rented or offered for rent unfurnished, and it is now being offered for rent fully furnished. This amount shall not be adjusted for any other good or service, including, but not limited to, gardening or utilities currently or formerly provided in connection with the lease.

(B) For housing not rented and not offered for rent within one year prior to a Declared Emergency, one hundred sixty percent (160%) of the fair market rent established by the United States Department of Housing and Urban Development. This amount may be increased by five percent (5%) if the housing is offered for rent fully furnished. This amount shall not be adjusted for any other good or service, including, but not limited to, gardening or utilities currently or formerly provided in connection with the lease.

(C) Housing advertised, offered, or charged, at a daily rate at the time of a Declared Emergency, shall be subject to the rental price described in subparagraph (A), if the housing continues to be advertised, offered, or charged, at a daily rate. Housing advertised, offered, or charged, on a daily basis at the time of a Declared Emergency, shall be subject to the rental price in subparagraph (B), if the housing is advertised, offered, or charged, on a periodic lease agreement after the Declared Emergency. (Ord. 07-O-2522, eff. 8-10-2007; amd. Ord. 25-O-2911, eff. 2-5-2025; Ord. 25-O-2912, eff. 3-22-2025)

A. Consumer Goods And Services:

1. Upon a Declared Emergency, and for a period of thirty (30) days following a Declared Emergency, it is unlawful for a person to sell or offer to sell any consumer food items or goods, goods or services used for emergency cleanup, emergency supplies, medical supplies, home heating oil, building materials, housing, transportation, freight, and storage services, or gasoline or other motor fuels for a price of more than ten percent (10%) above the price charged by that person for those goods or services immediately prior to the Declared Emergency.

2. A person may increase prices in excess of the amount permitted in subsection (A)(1) of this section if the seller or vendor can demonstrate that the increase in price is directly attributable to additional costs imposed on that person by the supplier of the goods, or directly attributable to additional costs for labor or materials used to provide the services, provided that in those situations where the increase in price is attributable to additional costs imposed by the seller's supplier or additional costs of providing the goods or service during the Declared Emergency, the price represents no more than ten percent (10%) above the total of the cost to the seller plus the markup customarily applied by the seller for that good or service in the usual course of business immediately prior to the Declared Emergency.

3. A person offering an item for sale at a reduced price immediately prior to a Declared Emergency may use the price at which it usually sells the item to calculate the price increase permitted pursuant to this subsection.

B. Construction, Repair, And Cleanup Services:

1. Upon a Declared Emergency, and for a period of one hundred eighty (180) days following a Declared Emergency, it is unlawful for a person to sell or offer to sell any repair or reconstruction services or any services used in emergency cleanup for a price of more than ten percent (10%) above the price charged by that person for those services immediately prior to the Declared Emergency.

2. A person may increase prices in excess of the amount permitted in subsection (B)(1) of this section if the person can demonstrate that the increase in price is directly attributable to additional costs imposed on that person by the supplier of the goods, or directly attributable to additional costs for labor or materials used to provide the services, provided that in those situations where the increase in price is attributable to the additional costs imposed by the person's supplier or additional costs of providing the service during the Declared Emergency, the price represents no more than ten percent (10%) above the total of the cost to the person plus the markup customarily applied by the person for that good or service in the usual course of business immediately prior to the Declared Emergency.

3. A person offering a service at a reduced price immediately prior to a Declared Emergency may use the price at which he or she usually provides the service to calculate the price increase permitted pursuant to this subsection.

C. Hotel And Motel Rates:

1. Upon a Declared Emergency, and for a period of thirty (30) days following a Declared Emergency, it is unlawful for an owner or operator of a hotel or motel to increase the hotel or motel's regular rates, as advertised immediately prior to the Declared Emergency, by more than ten percent (10%).

2. A hotel owner or operator may increase prices in excess of the amount permitted by subsection (C)(1) of this section if the owner or operator can prove that the increase in price is directly attributable to additional costs imposed on it for goods or labor used in its business, to seasonal adjustments in rates that are regularly scheduled, or to previously contracted rates.

D. Rental Property Rates:

1. Upon a Declared Emergency, and for a period of thirty (30) days following a Declared Emergency, it is unlawful for any person to increase the rental price, as defined in Section 2-4-202, advertised, offered, or charged for Housing, to an existing or prospective tenant, by more than ten percent (10%) of the regular rate, as advertised immediately prior to the Declared Emergency.

2. A person may increase prices in excess of the amount permitted by subsection (D)(1) of this section if the person can prove that the increase in price is directly attributable to additional costs for repairs or additions beyond normal maintenance that were amortized over the rental term that caused the rent to be increased greater than ten percent (10%) or that an increase was contractually agreed to by the tenant prior to the Declared Emergency.

3. It shall not be a defense to a prosecution under this subdivision that an increase in Rental Price was based on the length of the rental term, the inclusion of additional goods or services, except as provided in Section 2-4-202 with respect to furniture, or that the rent was offered by, or paid by, an insurance company, or other third party, on behalf of a tenant. This subdivision does not authorize a landlord to charge a price greater than the amount authorized by a local rent control ordinance. (Ord. 07-O-2522, eff. 8-10-2007; amd. Ord. 25-O-2911, eff. 2-5-2025; Ord. 25-O-2912, eff. 3-22-2025)

The provisions of this article may be extended for additional thirty (30) day periods by the director of emergency services or the city council, if deemed appropriate to protect public health, safety, or welfare. (Ord. 07-O-2522, eff. 8-10-2007)