CA Health & Safety Code Section 37922.5

(a)

A local agency, in order to prevent precipitous increases in rent which the loans would engender as to residential rental property, may require, as a condition of making a loan pursuant to this part, that the borrower contract during the term of the loan not to raise the rental amount over an amount which the agency by regulation establishes will yield a fair rate of return for similar investments and will allow for increases that are reasonably necessary to provide and continue proper maintenance of the property. This subdivision shall apply only to structures which will contain 12 or more dwelling units after rehabilitation and to structures for which loans exceeding five thousand dollars ($5,000) per dwelling unit have been extended pursuant to this part.

(b)

A local agency may require that an owner of a residential property provide notice to tenants at the time of application for a loan pursuant to this part, so that, in the event of protest by tenants, the amount of rehabilitation work may, at the discretion of the local agency, be limited in order to prevent precipitous rent increases which may cause displacement.