San Francisco adds an annual deposit-interest requirement (with a penalty if unpaid) on top of California's § 1950.5 rules.
Both California law and San Francisco's ordinance apply to you.
California Civil Code § 1950.5 applies in full: a 21-day return deadline, up to 2× the deposit for bad-faith withholding plus actual damages, the one-month cap (AB 12), and the AB 2801 photo-evidence rules. The city layer adds interest on top — it does not replace the state remedy.
San Francisco penalty
Interest owed
City ordinance — separate remedy
San Francisco’s overlay is a deposit-interest requirement rather than a separate withholding penalty: Chapter 49 imposes no multiplier or late fee of its own — its remedies section (§ 49.3) simply applies the state remedies of Civil Code § 1950.5. A landlord who fails to pay the required interest owes that interest, and the tenant may pursue it directly.
California penalty
up to 2× + actual damages
State law — still applies
A landlord who retains the deposit in bad faith is liable for statutory damages of up to twice the amount of the security deposit, in addition to the tenant’s actual damages, under § 1950.5(m).
These are two distinct remedies under two different laws — they are not the same claim, and one does not replace the other. The California return deadline of 21 days still applies.
Interest rate — published annually: The SF Rent Board publishes the deposit-interest rate each March; it changes every year. Your letter references the currently published SF Rent Board rate rather than a hardcoded number. For Rent-Ordinance units, a landlord may deduct 50% of the annual Rent Board fee from the interest.
Yes. California Civil Code § 1950.5 applies in full: a 21-day return deadline, up to 2× the deposit for bad-faith withholding plus actual damages, the one-month cap (AB 12), and the AB 2801 photo-evidence rules. The city layer adds interest on top — it does not replace the state remedy.
Pay annual interest on deposits held longer than one year, for ALL residential units except government-subsidized ones Use the interest rate published annually by the SF Rent Board (rate year runs March 1–February 28) Pay the interest on the tenant’s annual due date, by direct payment or rent credit (the landlord chooses the method) On move-out, pay any unpaid accrued interest pro-rata no later than two weeks after the tenant vacates (§ 49.2(c)) — a city clock shorter than the state’s 21 days
San Francisco’s overlay is a deposit-interest requirement rather than a separate withholding penalty: Chapter 49 imposes no multiplier or late fee of its own — its remedies section (§ 49.3) simply applies the state remedies of Civil Code § 1950.5. A landlord who fails to pay the required interest owes that interest, and the tenant may pursue it directly. This is a separate remedy from the California state penalty, which also applies: A landlord who retains the deposit in bad faith is liable for statutory damages of up to twice the amount of the security deposit, in addition to the tenant’s actual damages, under § 1950.5(m).
San Francisco Administrative Code Chapter 49. We verify these against the ordinance text itself; the date we last checked is shown on this page.
Sources & verification
The San Francisco rules on this page were verified against the ordinance text itself:
Last verified against primary sources on .
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San Francisco sits on top of California's statewide security deposit law. Read the full California rule →
Your letter cites the San Francisco ordinance and the California statutes that apply to your situation.
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