San Diego City Council Passes First Reading of Short-Term Rental Ordinance

UPDATE: February 23, 2021 at 6:39 p.m.

San Diego City Council took the first step on Tuesday by capping short-term rentals at 1% of the city’s housing supply and prioritizing the “good players” in a lottery to determine who can offer listings. houses for entire vacation rentals.

The council voted 8 to 1 to approve the first reading of the ordinance, which City Council President Jennifer Campbell called a compromise between owners and corporate rental services such as VRBO and AirBnB.

Final approval of the ordinance requires a second vote at a future board meeting. The ordinance will return to the board in October for updates on the lottery and prioritization related to licensing.

“We have looked at many perspectives and believe we have designed what is best for our city,” said Campbell.

Campbell thanked “everyone who participated in the development of this ordinance and who fought so hard to implement common sense ideas in our city.”

“This ordinance shows San Diegans that our municipal government can do what we were elected to do – solve our most puzzling problems with workable solutions,” Campbell said.

The ordinance classifies short-term rentals into four categories: part-time rentals rented 20 days a year; shared rentals; rental of whole houses; and entire home rentals in Mission Beach. The latter two are subject to the strictest restrictions in the ordinance.

Video: San Diego City Council Passes Short-Term Rental Regulation

Highlights of the ordinance include:

– cap short-term rentals of entire homes at 1% of the city’s housing stock according to the San Diego Planning Commission, which currently equals 5,400;

– Reduce short-term rentals for the whole house based on the City Auditor’s estimate that there are over 14,700 short-term rentals, including 1,667 in Mission Beach;

– Do not limit short-term rentals in shared accommodation;

– Allow part-time short-term rental operators to license at lower annual fees to host high-traffic events;

– Annual evaluation of the program to determine if it is fair and effective;

– Require that a local contact be able to respond to disturbances in the property in an hour or less;

– Allow short-term rental owners a maximum of one permit, per person; and

– Creation of a detailed good neighbor policy with strict application guidelines, a fine structure for violations and a standard for license revocation.

More than 130 people called the council meeting, many to express their relief that the city is tackling the long-simmering problem, but others to express their dismay at the “lottery” system that would award rental licenses short term to owners.

A Mission Bay resident described the lottery as inherently unfair because she had used her property “strictly” and did not allow large parties or gatherings.

She said people who have obeyed city laws by renting homes should be given priority to receive a license under the new ordinance.

City councilor Raul Campillo agreed. He successfully amended the ordinance to prioritize “good actors” when licensing begins later this year.

The only vote against was Councilor Joe LaCava, who proposed four amendments that would have been much stricter than the version that was passed. He was concerned about fairness in the ordinance and how to hold rental platforms accountable.

Councilors Monica Montgomery Steppe and Marni von Wilpert and Councilor Sean Elo Rivera shared LaCava’s concerns but voted to pass the ordinance with the intention of refining it later.

The reduced number of short-term rentals will reduce the city’s transitional occupancy tax – essentially a hotel tax – from $ 4.4 million to $ 7.3 million per year, according to a report by the Analyst’s Office independent budget.

Mayor Todd Gloria applauded the council during the vote and said he would do what he could to make sure it gets implemented.

“If the board takes the final step in adopting these regulations, my administration will ensure that they are fully and faithfully implemented and enforced. I undertake to review these regulations and assess their effectiveness after one year, ”he said.

Organizations such as Save San Diego Neighborhoods are far from happy with the plan, which it has called “multibillion dollar housing theft in San Diego, legalizing short-term vacation rentals in residential neighborhoods. the city”.

This organization claims that the ordinance is illegal on the grounds that it does not conform to the general plan and the coastal program of the city. Save San Diego Neighborhoods has threatened legal action if city council passes the ordinance.

Campbell said his ordinance would increase the supply of housing.

“San Diegans will have more homes to buy or rent, neighborhoods will see a massive reduction in STRs in their communities with real application to weed out bad actors,” Campbell said.

“It really represents what San Diegans wants to see: the end of the ‘Wild West’ RTS environment that has negatively impacted so many people.”

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