May I prohibit my tenants from operating a day care facility out of the apartment?
No. In California, all residential tenants have the right to operate family day care businesses from their apartments regardless of zoning rules, lease provisions, or even condominium homeowner association (HOA) restrictions. Many housing providers are unaware of this allowance and may also be ignorant of the fact that denying or prohibiting your resident from engaging in this business is unlawful and a violation of their civil rights.
The law states that, “[a] prospective family daycare home provider who resides in a rental property shall provide 30 days’ written notice to the landlord or owner of the rental property prior to the commencement of operation of the family daycare home.” Effective January 1, 2020, there are two types of licensed family day care operations defined as follows:
(i) “Large family daycare home” means a facility that provides care, protection, and supervision for 7 to 14 children, inclusive, including children under 10 years of age who reside at the home.
(ii) “Small family daycare home” means a facility that provides care, protection, and supervision for 8 or fewer children, including children under 10 years of age who reside at the home.
There are additional licensing requirements pertaining to the number and age of the children for both the large and small family daycare homes. Please consult the CAA Day Care Addendum for this information.
Moreover, a property owner or manager shall not refuse to rent to an applicant because of the desire or intent to use the apartment for day care. The resident or applicant need only provide 30 days’ advance notice to the housing provider and must be licensed by the state. Regarding insurance, all family day care homes shall maintain in force either liability insurance covering injury to clients and guests in the amount of at least $100,000 per occurrence and $300,000 in the total annual aggregate, or a bond in the aggregate amount of $300,000. However, in lieu of the liability insurance or the bond, the family day care home may maintain a file of affidavits signed by each parent with a child enrolled in the home acknowledging that the parent has been informed that the family day care home does not carry liability insurance or a bond according to standards established by law. In addition, the affidavit shall also state that the parent has been informed that the liability insurance of the property owner, or the HOA if the facility is a condominium, may not provide coverage for losses arising out of, or in connection with, the operation of the family day care home, except to the extent that the losses are caused by, or result from, an action or omission by the owner of the property or the HOA, for which the owner of the property or the HOA would otherwise be liable under the law.
A family day care home that maintains liability insurance or a bond shall name the property owner or the HOA as an additional insured on the liability insurance policy or bond if all the following conditions are met:
(1) The owner of the property or governing body of the HOA makes a written request to be added as an additional insured party.
(2) The addition of the owner of the property or the HOA does not result in cancellation or nonrenewal of the insurance policy or bond carried by the family day care home.
(3) Any additional premium assessed for this coverage is paid by the owner of the property or the HOA.
Finally, do not raise someone’s rent on account of a day care operation. You may, however, increase the security deposit to the maximum allowed by statute, and in most instances that amount cannot exceed one month’s rent. If your tenant notifies you that a day care operation will be opening in your building, please use the CAA Day Care Addendum: https://caanet.org/topics/day-care/.