San Diego City Council to hear short-term rental ordinance Feb. 23

A short-term rental ordinance promoted by District 2 Councilwoman Jennifer Campbell is slated to be heard by the San Diego City Council during its meeting Tuesday, Feb. 23.

A staff report outlining the latest version will be available in the days leading up to the meeting.

Campbell’s chief of staff, Venus Molina, said the current iteration has been updated to reflect comments made by San Diego planning commissioners when they heard the proposal in December.

“The Planning Commission had amendments and recommendations, so we incorporated their amendments into the new stuff,” Molina said. “We didn’t incorporate all their comments, but those are the changes we made.”

If approved by the council, the ordinance would go into effect Jan. 1.

The ordinance stems from an agreement Campbell brokered between Expedia, which owns two online platforms for renting STVRs, and Unite Here Local 30, a union that represents hospitality workers. It proposes to define short-term rental occupancy as a stay of less than a month and would include regulations that could then be enforced.

The regulations would require a license to operate a short-term rental unit, put limits on the number of licenses a host may obtain, create caps on the total number of whole-house short-term rental units and create a process to track and manage such rentals and enforce regulations.

The ordinance groups short-term vacation rentals into a four-tier licensing system:

• Tier 1: Home-share or whole-home short-term residential occupancy for an aggregate total of 20 days or less per calendar year
• Tier 2: Home-share short-term residential occupancy for more than 20 days per calendar year
• Tier 3: Whole-home short-term residential occupancy for more than 20 days per calendar year
• Tier 4: Special tier for Mission Beach, which allows whole-home short-term rentals in a manner consistent with recommendations from the Mission Beach Town Council

When the Planning Commission heard the proposal, it voted unanimously to forward the ordinance to the City Council for review and recommended adoption with six suggested amendments:

• Raise the cap rate for Tier 3 to 1 percent of the available housing stock
• Have a division of the cap for Tier 3 equally to each of the council districts or some other defined boundary while maintaining the carve-out for Mission Beach as proposed in Tier 4
• Include a requirement that license holders validate their permanent address and that the address match the STVR property address for Tier 1 and Tier 2 licenses
• Include noise restrictions and other limitations similar to those in the neighborhood commercial zone to enable stricter enforcement regarding noise and other quality-of-life issues
• Include a limitation on Tier 1 licenses to prevent multiple residents from getting subsequent Tier 1 licenses for the same unit during the same year
• Have a one-year review by the Planning Commission and City Council

Molina said the details of which recommendations were incorporated would be outlined in the staff report due out next week. She added that staff members are still meeting with community working groups and doing community outreach.

“We want to make sure we get things right,” she said.

The issue of short-term rentals went before the La Jolla Town Council during its Feb. 11 meeting, which featured San Diego Mayor Todd Gloria as guest speaker.

When asked about the STVR proposal, Gloria said: “I understand it’s still a work in progress and that stakeholders are still submitting feedback. I’m not certain what the council will ultimately adopt. My focus and my attention as the mayor, as a city manager, is making sure that if anything is adopted, we can implement it and we can enforce it. …

“I’m working closely with the council president [Campbell] and with city staff to make sure that we understand how much it’s going to cost to do this, make sure that we get all that money out of any permits fees, fines and taxes that come from it and that we can have a robust enforcement.”

Of specific interest in the coastal zone is the suggestion that there be a division of Tier 3 licenses equally among the council districts to avoid an excess of whole-house rentals in coastal communities.

However, as a cautionary tale, Gloria compared this effort to his writing a cannabis ordinance “many, many years ago” that attempted to limit the number of dispensaries by council district.

“That’s kind of coming back to haunt me at this point,” he said. “With redistricting and the hard cap for council district, the potential of changing the boundary lines and potentially having too many of that use in one council district is going to create a litigation nightmare for the city. … It’s the not most elegant solution and can have long-term problems that ultimately result in liability to taxpayers. That would be something I would have a problem with. So I’m not saying that I wouldn’t sign legislation that would permit that, but I do want people to be mindful that [it] isn’t perhaps as easy and straightforward as it may seem.” ◆