Hayward, California: security deposit interest
Hayward has not required interest on residential security deposits since 2019, when the city repealed the rent stabilization ordinance that carried the duty.
Cited to Hayward Muni. Code § 12-1.11 (Security Deposits) and 3 more sources · Verified August 28, 2026
The old rule, section 13 of Ordinance No. 16-19, made landlords of five-or-more-unit properties pay annual interest on deposits held longer than a year at a rate the Rent Review Officer set each November, with treble damages for non-payment. Ordinance 19-12, adopted June 25, 2019 and effective about thirty days later, repealed and replaced that whole scheme. What took its place is one sentence — Hayward Municipal Code § 12-1.11, "Security Deposits shall be collected by the Landlord and administered in accordance with state law" — and California's deposit statute, Civil Code § 1950.5, says nothing about interest. The catch for anyone researching Hayward is that the city never took its old rate tables down: three separate city pages still present the repealed duty in the present tense, with no repeal notice on any of them.
Hayward deposit interest at a glance
| Interest owed under local law | No longer — a past local rule has no current force |
|---|---|
| How the rate was set | Formerly — a figure announced on a published cycle |
The rate history
While the duty was live, the rate was set each November by Hayward's Rent Review Officer and governed a November-to-November year. Ordinance No. 16-19 § 13(b) tied it to an outside benchmark: the Federal Reserve Bank Monthly Survey of Selected Accounts, using "the latest September percentage for the average rate paid on personal savings accounts for Bank Insurance Fund (BIF) insured savings banks," or any comparable successor survey the Rent Review Officer chose. Landlords and tenants were told to obtain the figure from the Rent Review Office after November 1 each year. Where a tenancy year spanned two rates, each rate applied for the months, or the days, it covered. The last figure the city published was 0.13% for November 2017 to November 2018.
Accrual and payment
Under the repealed § 13(a), interest accrued from the first day the tenancy began and was owed on deposits held longer than one year. Payment was annual, starting on the first anniversary of the tenancy, made either directly to the tenant within ten calendar days of each anniversary date or by crediting it against the next month's rent, and prorated monthly when a tenancy of more than a year ended. The landlord could not impose or collect any handling, service, or other charge in connection with it.
Who and what is covered
The repealed duty reached a rental unit only where it was one of at least five residential dwelling units under common ownership within Hayward, and mobilehomes were excluded from that definition (Ordinance No. 16-19 § 2(l)). Small landlords were never covered, and deposits held a year or less were never covered.
Penalty for violation
Under the repealed § 13(a), a landlord who failed to pay or credit the interest was liable to the tenant for three times the amount wrongfully uncredited or unpaid, and the tenant could sue to collect that penalty. The remedy ended with the duty in 2019.
How this interacts with state law
California leaves this question to cities. Civil Code § 1950.5 imposes no interest duty, and no state law stops a California city from adding one — several have. Hayward had such a rule and gave it up. Section 12-1.11 of the municipal code now reads, in its entirety, "Security Deposits shall be collected by the Landlord and administered in accordance with state law," which hands the subject back to a state statute that says nothing about interest. The result is no duty at either level.
Mobile home parks
Mobilehomes sat outside the repealed rule from the start: Ordinance No. 16-19 defined a covered rental unit to exclude them. For mobilehome park space tenancies anywhere in California, the Mobilehome Residency Law, Civil Code § 798.39(f), expressly says park management need not place a homeowner's deposit in an interest-bearing account or pay interest on it.
Published rate tables
Hayward deposit-interest rates, 1980–2018 (closed)
Each figure was set in November by the Rent Review Officer and governed the November-to-November year named in its row; the first two rows predate the settled annual cycle and cover longer spans. The series ends where the duty ends — the last published figure covers November 2017 to November 2018, and the ordinance carrying the duty was repealed in 2019. These figures answer historical questions about a Hayward tenancy that ran while the rule was in force; they set nothing for any current tenancy.
| Period | Rate | Note |
|---|---|---|
| March 1980 – October 1983 | 5.25% | |
| October 1983 – November 1992 | 6.5% | |
| November 1992 – November 1993 | 3% | |
| November 1993 – November 1994 | 2.75% | |
| November 1994 – November 1995 | 2.78% | |
| November 1995 – November 1996 | 2.97% | |
| November 1996 – November 1997 | 2.84% | |
| November 1997 – November 1998 | 2.84% | |
| November 1998 – November 1999 | 2.3% | |
| November 1999 – November 2000 | 2.5% | |
| November 2000 – November 2001 | 2.5% | |
| November 2001 – November 2002 | 2.5% | |
| November 2002 – November 2003 | 1.46% | Absent from the rate table the city attorney's office page carries; present on the city's ordinance-section table and on the city's own rate document. |
| November 2003 – November 2004 | 0.92% | |
| November 2004 – November 2005 | 1.62% | |
| November 2005 – November 2006 | 2.07% | |
| November 2006 – November 2007 | 1.98% | |
| November 2007 – November 2008 | 2.15% | |
| November 2008 – November 2009 | 1.36% | |
| November 2009 – November 2010 | 0.24% | |
| November 2010 – November 2011 | 0.16% | |
| November 2011 – November 2012 | 0.12% | |
| November 2012 – November 2013 | 0.07% | |
| November 2013 – November 2014 | 0.05% | |
| November 2014 – November 2015 | 0.03% | |
| November 2015 – November 2016 | 0.06% | |
| November 2016 – November 2017 | 0.13% | |
| November 2017 – November 2018 | 0.13% | The last figure Hayward ever published. |
| November 2018 – November 2019 | No official figure published | No figure was published for this period. The Rent Review Officer owed one in November 2018 and the duty was still live until the repeal took effect around July 25, 2019, but no Hayward page or document carries a rate for it. A genuine gap in the record, not a zero. |
A closed series that will not grow. Source: official source · verified August 28, 2026.
Notes and caveats
- The city still publishes the dead rule — Three pages on Hayward's own website still set out the deposit-interest schedule as if it were live: the city attorney's office page, an ordinance-section document page, and a stub page that carries the caption "Annual interest of more than one year's tenancy for controlled units covered by the Residential Rent Stabilization Ordinance" with no table under it. None carries a repeal notice, and all three describe a duty that ended in 2019. They are the most likely source of the claim, circulating on landlord-advice sites, that Hayward requires deposit interest today. The rate figures on them are real history; the present tense is not.
- Which of the city's rate tables is reliable — The two city pages that carry tables disagree. The city attorney's office version has four defects: a row printed as "October 1993 - November 1992," whose end date falls before its start date (the correct span is October 1983 to November 1992); the November 2002 to November 2003 row at 1.46% missing entirely; the label "November 2008 - November 2009" appearing twice, once at 1.98% and once at 1.36%, from a block of rows shifted out of line; and the table stopping at November 2015 to November 2016, dropping the last two published years. The ordinance-section document page is internally consistent, matches the city's own rate document row for row, and carries the final two rows. The figures shown here follow that version.
- The repeal is stated in the code itself — Hayward Municipal Code § 12-1.02 records it in the codified text: the 1983 Rent Stabilization Ordinance and the 2019 Emergency Just Cause for Protection Ordinance "are hereby repealed and replaced with this newly adopted Residential Rent Stabilization and Tenant Protection Ordinance." Ordinance No. 16-19 was an amended compilation of that 1983 ordinance, so it falls inside the repeal. Section 12-1.21 sets the effective date at thirty days after adoption, which puts it at about July 25, 2019.
- No custody or account rule, then or now — Neither the repealed section nor anything in the current chapter 12 says where a Hayward deposit must be held. The old rule barred handling and service charges but named no account, and § 12-1.11 now defers to state law, which requires no segregated or interest-bearing account either. The custody question and the interest question are separate, and in Hayward both answers are the same: nothing local applies.
- The one interest duty still in chapter 12 — The current chapter does contain a money-interest rule, and it has nothing to do with deposits: § 12-1.05(e) lets a tenant recover interest on rent overpaid on a capital-improvement increase, at the rate the California Constitution sets for judgments, calculated as simple interest. Every other use of the word "interest" in chapter 12 is about ownership of property or a conflict of interest.
Cite this page: "Landlord Atlas, Hayward, California: security deposit interest (verified August 28, 2026), landlordatlas.com/laws/deposit-interest/california/hayward/" — free to cite and quote with a link (how these records are verified).
Citations
- Hayward Muni. Code § 12-1.11 (Security Deposits) (verified 2026) Official source
- Hayward Muni. Code ch. 12, art. 1 (Residential Rent Stabilization and Tenant Protection Ordinance), incl. § 12-1.02 (Background) and § 12-1.21 (Applicability) · 12-1.02 (verified 2026) Official source
- Hayward Ordinance No. 16-19 (Residential Rent Stabilization Ordinance), § 13 — the repealed duty · § 13(a)–(b) (verified 2026) Official source
- City of Hayward, Interest On Security Deposits (Section 13) — the city's rate table (verified 2026) Official source
How this record was verified: Hayward Municipal Code chapter 12, articles 1 and 2 read in full from the city's official code as codified through Ordinance No. 26-06, adopted May 5, 2026, with all nine occurrences of the word 'interest' in the two articles examined in context and enumerated and every use of the term 'security deposit' traced to its section; the repealed duty read verbatim in the city-hosted text of Ordinance No. 16-19, section 13, together with the definition of 'rental unit' in its section 2(l); the repeal clause read at Hayward Municipal Code section 12-1.02 and the effective-date rule at section 12-1.21; the city's current rent-stabilization summary and tenant-protection factsheet read in full for any surviving interest duty; and the city's three published deposit-interest rate pages and its own rate document compared row by row against each other.
This page records local law on deposit interest. The statewide position — California's security-deposit statute says nothing about interest — no part of Civil Code § 1950.5 requires a landlord to pay or credit a tenant any interest on a residential deposit. — lives on the California deposit-interest page with its own citations and verification date.