AGENDA REPORT
City Council
MEETING
DATE:
September 23, 2026
PREPARED BY: Charlotte Brenner,
Associate Planner
Patty Anders,
Planning Manager
DEPARTMENT
DIRECTOR:
Scott Drapkin
DEPARTMENT: Development Services CITY
MANAGER:
Jennifer Campbell
SUBJECT:
Public hearing to introduce and consider previously approved City Council amendments to update the City’s short-term rental provisions within Chapter 9.38 (Regulating Short-Term Rentals) of Title 9 (Public Safety, Peace and Welfare); and new amendments to Chapter 3.12 (Transient Occupancy Tax) of Title 3 (Taxes) of the Encinitas Municipal Code to update the City’s short-term rental provisions, including new provisions to implement Senate Bill 346 which strengthens the City’s Code Enforcement and Transient Occupant Tax Collection RECOMMENDED ACTION:
Introduce City Council Ordinance No. 2026-15 titled “An Ordinance of the City Council of the City of Encinitas adopting amendments to Chapter 9.38 (Regulating Short-Term Rentals) of Title 9 (Public Safety, Peace, and Welfare) and amendments to Chapter 3.12 (Transient Occupancy Tax) of Title 3 (Taxes) of the Encinitas Municipal Code” in Attachment 1.
ENVIRONMENTAL CONSIDERATIONS:
The action being considered by the City Council is exempt from the California Environmental Quality Act (CEQA) under Section 15061(b)(3) of the CEQA Guidelines because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. The action is also exempt from CEQA under Section 15378(b)(5) of the CEQA Guidelines because it involves an organizational or administrative activity of government that will not result in a direct or indirect physical change in the environment. Therefore, the proposed project is not subject to further CEQA review.
This item does not relate to the Climate Action Plan.
2026-09-23 Item #12D Page 1 of 26
2 GENERAL PLAN/CITY COUNCIL FOCUS AREAS:
This item relates to City Council Work Plan Goal 1.4.3. Create an enforcement and process review for short term vacation rental (STVRs) and Focus Area 5. Ensuring and Preserving Community Character and Economic Vitality.
FISCAL CONSIDERATIONS:
This Ordinance would result in a more efficient Transient Occupancy Tax (TOT) collection process which is anticipated to result in an increase in TOT revenue for the City.
BACKGROUND:
On October 27, 2021 the City Council directed staff to return with a data driven analysis to identify a process for the City of Encinitas (City) to establish a maximum number of short-term rental (STR) permits including a percentage by population or location, or establish restrictions based upon the location of units such as overconcentration within a particular location, zone, or neighborhood. This analysis was requested due to the number of complaints received regarding the operations of STRs and their impact on residential neighborhoods. These amendments were proposed to Title 30 (Zoning) of the Encinitas Municipal Code (EMC) which is included in the City’s Local Coastal Program (LCP) that requires a Local Coastal Program amendment (LCPA) approved by the California Coastal Commission (CCC).
Additionally, the City Council directed staff to make amendments to extend the length of the permit term from an annual renewal to a three-year renewal period, and to revoke a STR permit that is inactive for a term of 12-months or greater, both of which are currently regulated in Chapter 9.38 (Regulating Short-Term Rentals).
On December 14, 2022, the City Council adopted Ordinance No. 2022-15 to amend Chapter 9.38 (Regulating Short-term Rentals) of the EMC and Ordinance No. 2022-16 to amend Chapter 30.04 (Definitions) and 30.09 (Zoning Use Matrix), add a new Chapter 30.50 titled “Short-term Rental” to Title 30 (Zoning) of the EMC, to amend Section 6.05 (Single Family Residential Zones [“ERSFR3,” “ER-SFR3V” & “ER-SFR5”]) of the Encinitas Ranch Specific Plan, and to amend subsection 3.2.5.A (Table 3-1 Cardiff-by-the-Sea Specific Plan Area Zoning Matix-Use Comparison) of the Cardiff-By-The-Sea Specific Plan.
On October 3, 2023, the City of Encinitas submitted a LCPA application for both the Title 30 amendments (which is part of the LCP) and Title 9 amendments (not part of the LCP) to the CCC.
Between November 2023 and June 2025, staff coordinated with the CCC, resulting in the approval and effectiveness of Ordinance No. 2022-15 and 2022-16, contingent upon certification by the CCC. During this time, staff coordinated closely with CCC staff and provided extensive supplemental data and responses to numerous CCC questions and requested modifications.
Staff’s extensive coordination with CCC staff resulted in only one CCC requested modification to the previously adopted Ordinance No. 2022-16 which added new EMC Chapter 30.50 titled “Short-term Rental” described below.
On July 21, 2025, the CCC filed the City of Encinitas LCPA application as complete.
Subsequently, a one-year time extension was granted on October 11, 2025.
The CCC staff’s January 22, 2026 report that was prepared for the February 5, 2026 CCC public 2026-09-23 Item #12D Page 2 of 26
3 hearing recommended that the CCC approve the City’s LCPA application with one modification.
The CCC staff modification requested that the City incorporate the minimum three-night stay requirement for non-hosted STRs, currently regulated in Title 9, into Title 30 so that this requirement can be regulated under the LCP. By incorporating this language into Title 30 and the LCP, the CCC would have the opportunity to review any future changes to the minimum night stay requirement for consistency with the visitor-serving and public access policies of the certified Land Use Plan which is one of the implementing documents for the City’s LCP. CCC staff found that the minimum night stay requirement affects the intensity of use of STRs and can influence the availability and accessibility of STRs for a broad range of visitors. On January 29, 2026, the City of Encinitas submitted a letter of support to the CCC on, for this one modification.
City staff attended the February 5, 2026 CCC public hearing where the CCC board conditionally approved the City’s LCPA as submitted related to STRs with a modification to change the minimum night stay requirement for non-hosted STR units from the existing three-night minimum to a two-night minimum. The commission’s modification was not a recommendation of CCC staff but was placed on the LCPA at the hearing.
On April 22, 2026, the City Council conducted a duly noticed public hearing to consider Ordinance 2026-08, which included the CCC’s required modifications to incorporate the minimum night stay into Title 30 and reduce the minimum night stay from three nights to two nights within both Title 9 and Title 30 of the EMC. At the hearing, three members of the public expressed concerns for the commission’s requirement for reducing the minimum stay to two nights would promote activity that is not consistent with the residential character and environment. The City Council (3-2) did not accept the CCC modification to change the three-night minimum stay to two-nights and directed staff to return with a subsequent ordinance that retains the three-night stay minimum and include the previously adopted amendments that were proposed in Ordinance Nos. 2022-15 (amendments to Title 9) and 2022-16 (amendments to Title 30), and to provide additional data to support the three-night minimum stay requirement.
On October 13, 2025, Senate Bill 346 (The Short-Term Rental Facilitator Act of 2025) was approved by the Governor of the State of California and filed with the Secretary of State, to add Chapter 4.6 to Part 1 of Title 5 of the Government Code (Government Code Sections 50990- 50996 included herein as Attachment 2), which authorizes local agencies to adopt an ordinance requiring STR facilitators to report information necessary for the enforcement of transient occupancy taxes (TOT). Senate Bill 346 (SB 346) allows local agencies, through an ordinance, to gain more control over STRs by improving access to information and direct collection of TOT to public agencies from STR facilitators. Adopting an implementing ordinance for SB 346 would help the City identify and verify STRs have obtained the required STR permit , no longer require the property owner of the STR to submit TOT directly to the City, and would likely strengthen the accuracy and enforcement of TOT collection.
ANALYSIS:
Staff will return to the City Council at a later date with the proposed amendments from Ordinance No. 2022-16 to Title 30 (Zoning) with new data and analysis to support maintaining the existing three-night minimum stay requirement as requested by the City Council and will subsequently submit a new LCPA application as directed by the CCC.
Since Ordinance 2026-08 was not adopted because it included the CCC’s requirement to reduce the three-night stay to two-nights, staff is returning to the City Council at this time with only the 2026-09-23 Item #12D Page 3 of 26
4 previously adopted Ordinance 2022-15 amendments to Title 9, as it is not a part of the City’s LCPA, and therefore is not subject to CCC review and approval. Ordinance No. 2022-15 (Title 9 amendments) primarily address STR enforcement-related regulations that are needed by Code Enforcement staff to bring non-permitted STRs into compliance or abatement.
Ordinance 2022-15 amendments to EMC Chapter 9.38 are summarized below in Exhibit A and included herein as Attachment 1, Ordinance 2026-15.
Exhibit A:
EMC Chapter 9.38 previously adopted amendments
• Renamed EMC Chapter 9.38 from “Regulating Short-term Rentals” to “Regulating Short-term Rental Permits”.
• Removed the reference of “duplex” where it occurs throughout EMC Chapter 9.38 and replaced it with “two-family dwelling” to be consistent with the definition in Title 30. • Revised EMC Subsection 9.38.040 (Permit Application and Issuance.) to change the existing annual renewal cycle from one-year to a three-year permit renewal cycle and specifies that a permit may be revoked if the permit is inactive for a 12-month period which would be monitored through the collection of TOT. The annual renewal cycle added a large workload to code enforcement staff, permitting staff, and planning staff.
Changing the renewal from every year to every three years would allow staff to dedicate more time to compliance and enforcement issues.
• Removed the term “residential zones” in EMC Subsection 9.38.050 (Permit Operating Requirements.) and replaced it with “single-family or two-family dwelling units” as the City does not regulate STRs based on the zone they are located in, but rather the type of use.
• Amended EMC Subsection 9.38.050 (Permit Operating Requirements.) to require the STR permit be posted and visible from the public right-of-way at all times. This amendment is proposed to provide Code Enforcement staff with clearer language to remove ambiguity of permit posting requirements.
In addition to the amendments described above, staff recommends additional amendments to Chapter 9.38 (Regulating Short-Term Rentals) and Chapter 3.12 (Transient Occupancy Tax) of the EMC to implement SB 346, which provides local agencies with tools the City does not currently have to regulate STR permits and administer and enforce the collection of TOT by STR facilitators (defined as platforms and companies including but not limited to Airbnb and VRBO that list and book rentals).
SB 346 provides local agencies with local control to require STR facilitators to provide specified information regarding STRs including access to verified STR data which makes it easier to identify unpermitted operations, enforce local regulations, and collect accurate amount of TOT. Many jurisdictions, including Encinitas, impose a TOT on transient accommodations; however enforcement and compliance can be challenging and inaccurate as STR operators are selfreporting the total rents charged, total rents received, and total tax funds charged.
SB 346 (Government Code Sections 50990-50996) outlines the minimum standards and allows for a local agency to adopt stricter regulations or additional requirements as needed. Pursuant to State Law, City’s cannot obtain access to facilitator data without adopting an ordinance to do so. 2026-09-23 Item #12D Page 4 of 26
5 Staff have added additional requirements to enhance transparency and strengthen TOT reporting and enforcement which are listed below. Staff anticipates using STR facilitators to report TOT collection would improve the current collection process which would result in an increase in the City’s TOT revenue. The adoption of this Ordinance would authorize the City to require the following actions and information:
1. Collect TOT directly from the STR facilitators and paying TOT directly to the City as outlined in Government Code Section 50995 and in this Ordinance.
2. Require the STR facilitator to include the City’s STR permit number and the City TOT certification number, and any other compliance identifiers in the listing as allowed by Government Code Section 50994.
3. Require STR facilitator to submit quarterly or monthly reports which includes the physical address, assessor’s parcel number (APN), and the uniform resource locator (URL) for each listing as outlined in Government Code Section 50993. Additionally, to strengthen TOT reporting, the Ordinance also requires a STR facilitator to provide the number of nights per each reservation, the total gross cost per reservation and any additional information as deemed necessary by the City.
4. Conduct audits on STR facilitators as determined by the Director of Development Services or Finance. Government Code Section 50995(b) requires any cost associated with an audit to be paid by the local agency. The Ordinance requires that the STR facilitator shall provide the City access to records within 10 business days of the City’s request.
5. Authorizes the City to impose administrative fines or take other appropriate corrective action for STR facilitator noncompliance, consistent with the authority provided by the City in EMC Chapters 1.08 and Chapter 3.12.
The new proposed amendments to EMC Chapters 9.38 and 3.12 are summarized below in Exhibits B and C and the complete proposed text amendments are included herein in Ordinance 2026-15, Attachment 1.
Exhibit B:
New amendments to EMC Chapter 9.38 to incorporate SB 346 • Adds language to EMC Subsection 9.38.010 (Purpose–Findings and Determinations.) to discuss the legal authority to implement SB 346.
• Amends EMC Subsection 9.38.020 (Definition.) to add or revise definitions for “Address data”, “Booking data”, “Compliance data”, “Listing”, “Listing data”, “Marketplace”, “Operator”, “Purchaser”, “Related person”, “Short-term rental”, “Short-term rental operator”, “Short-term rental facilitator” and “Tax data”. • Amends EMC Subsection 9.38.050.N (Permit Operating Requirements.) to include mandatory language to require a STR facilitator to collect TOT revenue on behalf of the City unless otherwise determined by the Director of Development Services. • Adds a new EMC Subsection 9.38.100 titled, “Short-Term Rental Facilitator Reporting” to discuss what information is required within the quarterly reports and obligations of the facilitators all to be in compliance with SB 346. Adopting an ordinance under SB 346 would help the City modernize its approach to regulating STRs, improve tax collection, and protect the interests of both residents and visitors. This subsection would require a quarterly rental record to be submitted to the City, which includes the address of the STR listing, the URL for each listing, the number of nights per reservation, the total gross cost per reservation, and any additional information deemed necessary by the 2026-09-23 Item #12D Page 5 of 26
6 City. The City’s actions are consistent with State law and reflect a commitment to responsible management of STR activity.
Exhibit C:
New amendments to EMC Chapter 3.12 to incorporate SB 346 • Amends EMC Subsection 3.12.010 (Taxable Event.) to add text to allow STR Facilitators or “hotel” operator to be able to collect TOT from the transient (the STR guest) and remit the tax to the City.
• Amends EMC Subsection 3.12.030 (Definitions.) to add to the definition of “hotel” to include both hosted and non-hosted STRs regardless of if the occupancy was arranged by the STR operator or STR facilitator and adds definitions for “Address data”, “Booking data”, “Compliance data”, “Listing”, “Listing data”, “Marketplace”, “Operator”, “Purchaser”, “Related person”, “Short-term rental facilitator”, and “Tax data”. • Amends EMC Subsection 3.12.040 (Collection of Tax.) to add text stating STR facilitators shall collect TOT at the same time as rent is collected; the STR facilitator shall issue a receipt to the City identifying the STR operator, listing data, address data, booking data, tax data, and compliance data; and that STR operators and STR facilitators are prohibited from advertising or stating that the tax would be absorbed without disclosure.
• Renames EMC Subsection 3.12.060 from “Obligation of Operator” to “Obligation of Operator or Short-Term Rental Facilitator” and adds that the STR operator shall file a rental report with specific reservation information on number of nights, total gross rents, and other information requested by the City. The amendments also require the STR operator to disclose all STR facilitators used during the reporting period and if a STR facilitator is required to remit TOT, STR operators shall not remit duplicate tax but must report all facilitated amounts for reconciliation. Amendments also adds text indicating that if a STR facilitator fails to remit tax, the STR operator remains liable for any unremitted tax; and adds that if an STR operator ceases business, monthly or quarterly operator returns must reconcile operator reported data with short-term rental facilitator reported data.
• Amends EMC Subsection 3.12.070 (Penalties and Interest.) to add two new subsections F. and G. New subsection (F) states that if the STR facilitator does not collect, remit or report TOT, the STR facilitator is subject to the penalties identified in EMC 3.12.070 A-E which includes a ten percent penalty of the tax owed. Continued delinquency will result in an additional 10% penalty of the amount of the tax due and first 10% penalty. In addition, this new subsection indicates that non-complying STR facilitators are also subject to the fines established in Chapter 1.08 (described below). • New Subsection 3.12.070(G) adds text consistent with Government Code Section 50993(e) of the Short-Term Rental Facilitator Act, granting the City authority to charge fines pursuant to EMC Chapter 1.08 for STR facilitator for non-compliance and failure to submit accurate quarterly reports. Fines established in EMC 1.08.050 include a fine not exceeding $100 for a first violation; a fine not exceeding $200 for a second violation of the same section of the Municipal Code within one year; and a fine not exceeding $1,000 for each additional violation of the same section of the Municipal Code within one year.
• Amends EMC Subsection 3.12.080 (Records and Inspection.) to add text that states 2026-09-23 Item #12D Page 6 of 26
7 STR operators and facilitators shall retain booking records for at least five years, and the records shall be available to the Directors of Finance and Development Services upon request for the purpose of verifying consistency between STR facilitator and STR operator filings with the City.
• Amends EMC Subsection 3.12.090 (Refunds.) to add text stating STR facilitators shall return incorrectly collected taxes to the transient or STR operator before claiming a City refund or credit.
• Adds a new EMC Subsection 3.12.100 (Collection of Delinquent Taxes on Property Tax Roll.) to allow for outstanding taxes, penalties, and interest to be placed on the county tax roll.
The proposed amendments to Titles 9 and 3 would strengthen the City’s enforcement of permitted and unpermitted STRs and increase TOT revenue. The amendments would also help minimize the potential negative impacts of STRs such as noise, parking, and neighborhood disruption. The proposed amendment would also preserve the benefits that responsibly operated STRs provide such as expanding the number and type of lodging facilities and promote patronage of local businesses.
Update of Unpermitted Short-Term Rental Enforcement
The City’s proactive enforcement efforts are intended to ensure that STRs operate legally and in compliance with the City’s existing regulations. Compliance helps ensure that STRs are operated safely, that appropriate measures are in place to minimize disturbances and protect the character of residential neighborhoods, and that TOT are accurately reported and paid to the City.
The City recognizes the important role that STRs play in providing accommodations for visitors seeking to experience Encinitas and its coastal amenities, supporting local businesses through visitor spending, and providing property owners with an opportunity to generate income through the legal rental of their homes. Accordingly, the City’s enforcement efforts are focused on promoting compliance with established regulations while recognizing and supporting the role of STRs within the community.
As of several months ago, staff returned to proactive code enforcement of unpermitted STRs in the City. There was a short period prior to this time when the City’s Code enforcement team was limited to one individual and therefore focusing on this intensive effort was generally encumbered based on prioritizing normal City daily code enforcement operations. At that time, the City’s short term rental tracking software known as “Granicus Host Compliance”, indicated that approximately 285 unpermitted STRs were operating in the City. This was a significant increase as a result of the summer rental season.
Subsequently, on July 20, 2026, staff via the City’s Granicus Host Compliance contract sent out a staff prepared mailer/notice of violation (NOV) letter to all unpermitted STR property owners. At that time, 267 NOV’s were sent (18 unpermitted STRs were removed from advertising based on incremental staff enforcement). The NOV generally indicated that the subject property was being used for unpermitted short-term rentals and must immediately cease operation and all advertising on any STR facilitator internet sites must be removed until a valid STR permit is obtained. It further required that the owner submits reservation records to determine outstanding TOT remittance.
Lastly, the letter indicated specific penalties and fines for subsequent unpermitted operations 2026-09-23 Item #12D Page 7 of 26
8 (described in further detail below). To facilitate voluntary compliance, the letter included an affidavit form which could be signed by the STR owner/operator, and returned to the City. The affidavit states that the operator/owner understands that a STR permit from the City must be obtained prior to advertising or operating as a STR and would no longer be using the property as a STR until a permit was provided by the City .
By the end of August, the unpermitted STRs advertised on Host Compliance reduced by approximately 35% (or 99 STR) to under 186 advertised unpermitted STRs in the City, and staff continues to work diligently to reduce the remaining violations. The 99 STRs have either applied for a STR permit, obtained a STR permit, or ceased operation and removed all advertisements.
City staff are still in the process of auditing each property to ensure all delinquent TOT is paid to the City.
The following is an example of some of the staff efforts that have recently contributed to improving the City’s unpermitted STR enforcement:
• Staff has prepared a draft “process map” to maintain an effective, consistent and reliable internal enforcement process for unpermitted STRs. The goal of this process mapping is to use a multi-phased approach that can be repeated and followed by current and new staff. This process uses the systems of “Six Sigma” which relies on a data driven methodology focused on improving quality and efficiency by reducing defects and minimizing process variation. Staff is also seeking a consultant that specializes in Six Sigma to review and add recommendations for the City’s STR processes. • As part of the staff draft STR enforcement process mapping, staff have implemented revised specific local policies for penalties and fines for unpermitted STR violators. For example, the City’s typical enforcement and penalty provisions are stipulated in the Encinitas Municipal Code (EMC) Section 1.08.050. These provisions allow the City to set maximum progressive penalty fines for any violations of the City’s Municipal Code for $100 for the first violation, $200 for the second violation, and $1,000 for any violation thereafter.
However, EMC 9.38.060 (B) references California State Government Code Section 36900(d) which provides increased violation fees specific to STRs; and under State law, a City can increase violations progressively up to $1,500 for the first violation, $3,000 for the second violation, and up to $5,000 for any violation thereafter. Worth noting is that each citation amount may vary depending on the number and type of violations on a single property related to the rental.
• The NOV’s are a warning notice which outlines the citations to be expected if the property is not brought into compliance by the date established on the NOV. As previously indicated, staff sent out NOV’s to the unpermitted STR operators and the letter indicated that the citations would be based on the State allowed fee ranges, consistent with EMC Section 9.38.060(B).
• Staff have further enhanced the enforcement process by creating and updating a spreadsheet that accounts for unpermitted STR operations in the City. This spreadsheet is used to accurately track specific data and progress for each unpermitted STR violation that is initially retrieved using the Granicus Host Compliance software and subsequently updated by staff managing the enforcement effort. The spreadsheet is updated weekly, and violations are prioritized based on length of time that an unpermitted STR has 2026-09-23 Item #12D Page 8 of 26
9 operated and the lack of STR operator compliance effort/response. • Staff have also prepared a summary handout/FAQ for unpermitted operators to reference when pursuing compliance. In addition, the Department of Development Services web page includes a “dashboard” of the City’s STR enforcement efforts that is updated monthly.
• The City has mobilized a significantly larger team of dedicated personnel to spearhead this enforcement effort, marking a substantial increase over past staffing levels. This includes reallocating two existing staff analysts to assist in reducing the number of unpermitted STRs and assisting property owners with legalizing their STRs hiring an additional Code Enforcement Officer, backfilling a vacant Code Enforcement Officer position, and immediately hiring two temporary Program Assistants, with the potential for initiating recruitment of two additional Program Assistants to be dedicated to the administration of the STR enforcement process. The City Council approved additional code enforcement officer and the vacant code enforcement officer position are both set to begin by the end of summer/start of fall. The two to four temporary Program Assistants will each maintain the administration of STR cases and assist the Code Enforcement team with sending out letters and contacting unpermitted STR operators to assist them in resolving their individual violations.
• The Finance Department’s role in the collection of TOT taxes and penalties follows the standard accounts receivable process of reviewing TOT submittals, requesting supporting documents for any TOT exemptions, and recording revenue received. Currently, STR operators self-report TOT amount without providing reservation records, these amendments will allow Finance to secure the proper data to confirm if the TOT amount submitted is accurately aligned with total rental revenues. • As part of the TOT audit process, Finance staff analyze reservation records submitted by the STR operators, identifies exemptions and reportable revenues, calculates TOT, penalties and interest, creates billable invoices, and pursues TOT collections as appropriate. To bring 186+ unpermitted STR into compliance, it will require significant staff time to provide data analysis and pursue TOT collections. Due to amount of effort required, the Finance Department is currently pursuing identifying a separate consultant to support STR revenue audits and TOT collection services. A request for quotes was released on August 26, 2026, and bids are due in September 2026. The awarded vendor will support revenue collection efforts for the current outstanding unpermitted STRs as well as TOT revenue audit services for short-term rentals and hotel stays. The additional revenue collected will offset any additional costs incurred.
CONCLUSION:
The overall goal of the amendments to EMC Titles 3 and 9 are to identify unpermitted STRs, create a new process to require and ensure payment of all outstanding TOT, fines and penalties and to assist unpermitted STR operators who want to operate legally. Staff is available to assist such STR operators through the compliance and permitting process. In addition, the amendments in Chapter 3 allowed under SB 346 will result in a process improvement for the STR operator by having the STR facilitator collect and remit taxes to the City. These process improvements should result in efficiencies for both the STR operator and the City. 2026-09-23 Item #12D Page 9 of 26
10 ATTACHMENTS:
1. Draft City Council Ordinance No. 2026-15 titled “An Ordinance of the City Council of the City of Encinitas adopting amendments to Chapter 9.38 (Regulating Short-Term Rentals) of Title 9 (Public Safety, Peace, and Welfare) and amendments to Chapter 3.12 (Transient Occupancy Tax) of Title 3 (Taxes) of the Encinitas Municipal Code”
2. Senate Bill 346 (Government Code Sections 50990-50996)
3. Notice of Violation with attached affidavit
2026-09-23 Item #12D Page 10 of 26
ORDINANCE 2026-15
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ENCINITAS ADOPTING AMENDMENTS TO CHAPTER 9.38 (REGULATING SHORT-TERM RENTALS) OF TITLE 9 (PUBLIC SAFETY, PEACE, AND WELFARE) AND AMENDMENTS TO CHAPTER 3.12 (TRANSIENT OCCUPANCY TAX) OF TITLE 3 (TAXES) OF THE ENCINITAS MUNICIPAL CODE
WHEREAS, on October 27, 2021, the City Council directed staff to return with a data driven analysis to identify a process for the City of Encinitas (City) to establish a maximum number of short-term rental (STR) permits including a percentage by population or location, or establish restrictions based upon the location of units such as overconcentration within a particular location, zone, or neighborhood. This analysis was requested due to the number of complaints received regarding the operations of STRs and their impact on residential neighborhoods. These amendments were proposed to Title 30 (Zoning) of the Encinitas Municipal Code (EMC) which is included in the City’s Local Coastal Program (LCP) that requires approval from the California Coastal Commission (CCC). Additionally, the City Council directed staff to make amendments to extend the length of the permit term from an annual renewal to a three-year renewal period and if a STR permit that is inactive for a term of 12-months or greater will result in the revocation of the permit, both of which are currently regulated in Chapter 9.38 (Regulating Short-Term Rentals); and
WHEREAS, on December 14, 2022, the City Council adopted Ordinance No. 2022-15 to amend Chapter 9.38 (Regulating Short-term Rentals) of the EMC and Ordinance No. 2022-16 to amend Chapter 30.04 (Definitions) and, 30.09 (Zoning Use Matrix) and adding a new Chapter
30.50 titled “Short-term Rental” to Title 30 (Zoning) of the EMC, amending Section 6.05 (Single Family Residential Zones [“ER-SFR3,” “ER-SFR3V” & “ER-SFR5”]) of the Encinitas Ranch Specific Plan, and amending subsection 3.2.5.A (Table 3-1 Cardiff-by-the-Sea Specific Plan Area Zoning Matrix-Use Comparison) of the Cardiff-By-The-Sea Specific Plan; and WHEREAS, on October 3, 2023, the City of Encinitas submitted a Local Coastal Program amendment application (LCPA) for the Title 30 amendments which is included in the City’s LCP and Title 9 amendments to the CCC, resulting in the approval and effectiveness of Ordinance No. 2022-15 and 2022-16, contingent upon certification by the CCC; and WHEREAS, between November 2023 and June 2025, staff coordinated with CCC staff by providing extensive supplemental data and responses to numerous CCC questions and requested modifications; and
WHEREAS, on July 21, 2025, the CCC filed the City of Encinitas LCPA as complete; however, CCC staff was not able to complete their review of the City’s application within the required 60-day period and requested a one-year time extension that was granted on October 11, 2025; and
WHEREAS, the CCC staff’s January 22, 2026 report that was prepared for the February 5, 2026, CCC public hearing by CCC staff recommended that the CCC approve the City’s LCP amendment with one modification, to incorporate the minimum night stay requirement currently regulated in Title 9, into Title 30 so this requirement can be regulated under the Local Coastal Program; and
WHEREAS, at the February 5, 2026, CCC public hearing, the CCC approved the City’s LCP amendment, with two modifications, reducing the three-night minimum stay to a two-night minimum stay for non-hosted short-term rentals, and adding the two-night minimum stay requirement for non-hosted units to the new Chapter 30.50 of Title 30 of the EMC; and WHEREAS, on April 22, 2026, the City Council of the City of Encinitas conducted a duly noticed public hearing to consider Ordinance No. 2026-08 which included the CCC modification to reduce the three-night minimum stay to a two-night minimum stay for non-hosted short-term rentals, and denied Ordinance No. 2026-08 and directed staff to return with a subsequent ATTACHMENT 1
2026-09-23 Item #12D Page 11 of 26
ordinance that addresses the three-night minimum stay requirement, includes percent caps on STRs, establishes a 200-foot radius requirement, the Title 9 amendments that were previously proposed through Ordinance 2022-15, and incorporates any additional requirements proposed by staff for amendments to the Encinitas Municipal Code to be reviewed by the City Council and subsequently only the LCP amendments considered by the CCC; and WHEREAS, on October 13, 2025, Senate Bill 346 (The Short-Term Rental Facilitator Act of 2025) was signed by the Governor of the State of California and filed with the Secretary of State, and became effective January 1, 2026, adding Government Code Sections 50990-50996, which authorize local agencies to adopt an ordinance requiring STR facilitators to report information necessary for the enforcement and collection of transient occupancy taxes; and WHEREAS, to be consistent with Government Code Sections 50990-50996, amendments are proposed to Chapter 9.38 (Regulating Short-Term Rentals) of Title 9 (Public Safety, Peace, and Welfare) and Chapter 3.12 (Transient Occupancy Tax) of Title 3 (Taxes) of the Encinitas Municipal Code; and
WHEREAS, the City Council conducted public hearings on September 23, 2026, and ______, 2026 for the purpose of considering proposed amendments to the Encinitas Municipal Code; and
WHEREAS, notices of said public hearings were made at the time and in the manner required by law; and
WHEREAS, based on the totality of the record and evidence described and referenced in this Ordinance, the City Council finds that the proposed text amendments are consistent with the purposes of the General Plan, Municipal Code, Specific Plans, and adopted Local Coastal Program.
NOW, THEREFORE, the City Council of the City of Encinitas, California, hereby ordains as follows:
SECTION ONE: The recitals above are each incorporated by reference and adopted as findings by the City Council.
SECTION TWO: Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby renamed to read as follows “REGULATING SHORT-TERM RENTAL PERMITS.”
SECTION THREE: Subsection 9.38.010 (Purpose–Findings and Determinations.) of Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
…
This chapter is not intended to regulate non-vacation type rental arrangements not generally characterized by the adverse impacts referenced in this section, nor is it intended to unreasonably obstruct the lawful use of short-term rentals in the City. This chapter is not intended to provide any owner of a single-family or duplex two-family dwelling unit with the right or privilege to violate any Covenants, Conditions and Restrictions (CC&Rs) applicable to the owner’s singlefamily or duplex two-family dwelling unit.
This chapter also establishes requirements for short-term facilitator’s operating within with City of Encinitas and reporting requirements to improve the administration of transient occupancy tax (“TOT”) and to implement the provisions of California Government Code Sections 50990–50996 which was enacted by California Senate Bill 346 (Short-Term Rental Facilitator Act of 2025). The City Council enacts this ordinance under the authority granted to cities by Article XI, Section 7 of the California Constitution and Government Code Section 50990, et seq., and as amended. This Ordinance hereby requires a short-term rental facilitator that is operating within the boundaries of 2026-09-23 Item #12D Page 12 of 26
the City to collect and remit TOT revenue on behalf of the City of Encinitas as required in this chapter and Chapter 3.12 of the Encinitas Municipal Code.
The requirements of Government Code Section 50990-50996, et seq., and any amendments thereto, shall prevail over any conflicting provision of this Chapter.
SECTION FOUR: Subsection 9.38.020 (Definition.) of Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
For purposes of this Chapter, the following definitions, including definitions from Government Code Section 50991, and as amended, shall apply:
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“DuplexTwo-family dwelling unit” as defined within this chapter shall mean a building or buildings on a single lot containing not more than two dwelling units. An accessory unit constructed in accordance with Chapter 30.48 of this Code and pursuant to Government Code Sections 66310-66339.5, and as amended, shall not be counted as a dwelling unit for purposes of this definition.
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“Address data” shall mean any verifiable physical location including the full address and nine digit zip code and the assessor’s parcel number.
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“Booking data” shall mean information on actual reservations made through the platform, including but not limited to the number of nights booked; booking identification number; booking dates and transaction records; and gross rental amounts collected or payable. “Compliance data” shall mean information demonstrating compliance with all local STR requirements, including but not limited to a valid City STR permit; City TOT certificate number; and any other identifiers/data mandated by the Director of Development Services Department. “Compliance data” shall mean information demonstrating compliance with all local STR requirements, including valid STR permit number, City TOT certificate number, and any other identifiers/data mandated by the Development Services Director. …
“Listing” shall mean any advertisement or offer for transient occupancy displayed by a shortterm rental operator or facilitator. “Listing data” shall mean any information that appears on the public listing of a short term rental, including, but not limited to the listing URL(s); displayed permit number(s); displayed TOT certificate number(s); and any required compliance identifiers/data. “Marketplace” shall mean a physical or electronic place, including, but not limited to, a store, booth, internet website, catalog, television or radio broadcast, or a dedicated sales software application, where a marketplace seller facilitates the occupancy of a short-term rental for delivery in this state regardless of whether the short-term rental, marketplace seller, or marketplace has a physical presence in this state.
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“Operator” means any person who is proprietor of the hotel, whether in the capacity of owner, lessee, sublessee, mortgagee in possession, licensee or acting through a short-term rental facilitator any other capacity. Where the operator performs his or her functions through a managing agent or any type or character other than an employee, the managing agent shall also be deemed an operator for the purposes of this chapter and shall have the same duties and 2026-09-23 Item #12D Page 13 of 26
liabilities as his or her principal. Compliance with the provisions of this chapter by either the principal or the managing agent shall, however, be considered to be compliance by both. …
“Purchaser” means a person who is required to pay the transient occupancy tax and who uses a short-term rental facilitator to facilitate the occupation of a short-term rental within the jurisdiction of the local agency imposing the transient occupancy tax. “Related person” shall mean, as stated in Government Code Section 50992, a person is related to another person if both persons are related pursuant to Section 267(b) of Title 26 of the United States Code, as that section was amended by Public Law 114-113, and the regulations thereunder.
“Short-term rental” means the rental of any single-family or duplex two-family dwelling unit that is a privately-owned structure, or any portion of any structure (non-accessory dwelling unit as that term is defined in Government Code Section 66313, and as amended65852.2, which may be amended from time to time), for occupancy for dwelling, lodging, or sleeping purposes of 30 consecutive days or less in the City. For purposes of this chapter, non-monetary forms of compensation shall also qualify a property as a short-term rental. “Short-term rental operator” means any person offering a dwelling, structure, or portion thereof for short-term rental use.
“Short-term rental facilitator” shall mean a person or entity that facilitates for consideration, regardless of whether it is deducted as fees from the transaction, the occupancy of a short-term rental that is not owed by the person facilitating the rental, through a marketplace operated by the person or a related person or entity, and that does both of the following:
A. Directly or indirectly, through one or more related persons, engages in any of the following:
1. Transmits or otherwise communicates the offer or acceptance between the purchaser and the operator.
2. Owns or operates the infrastructure, electronic or physical, or technology that brings purchasers and operators together
3. Provides a virtual currency that purchasers are allowed or required to use to facilitate the occupancy of a short-term rental from the operator.
4. Software development of research and development activities related to any of the activities described in paragraph 2, if such activities are directly related to facilitating shortterm rentals.
B. Directly or indirectly, through one or more related persons, engages in any of the following activities with respect to facilitating short-term rentals:
1. Payment processing services
2. Listing homes, houses, or rooms in homes or houses, campsites, or other lodgings that are not a hotel or motel, on a marketplace, and that are not owned by that person or a related person, for rental on a short-term basis.
3. Setting prices.
4. Branding short-term rentals as those of the short-term rental facilitator.
5. Taking orders or reservations.
“Tax data” shall mean information required for enforcement of transient occupancy tax (TOT) including but not limited to, gross receipts subject to TOT, amounts of TOT collected/remitted, payout and tax-calculation data usable for audit.
2026-09-23 Item #12D Page 14 of 26
SECTION FIVE: Subsection 9.38.040 (Permit Application and Issuance.) of Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
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B. Contents of Application. Applicants shall submit an application for a short-term rental permit to the City of Encinitas each year for each unit, and every three years. A permit application must include all of the following information, which shall be updated when there is any change to ensure that the City has current information on file at all times relating to the short-term rental and its owner(s)/agent(s), as applicable:
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E. Granting of Application. The application shall be granted unless the applicant does not meet the conditions and requirements of the permit or fails to demonstrate the ability to comply with this Code or other applicable laws, rules or regulations. All permits issued under this ordinance must be renewed 12 months every three years from the initial date of issuance. If the term of liability insurance expires within the permit term, the permit approval is automatically revoked unless evidence of insurance renewal is provided to the City in advance of expiration.
The permit may also be revoked for inactivity during a 12-month period, which will be monitored through the collection of Transient Occupancy Tax pursuant to 9.38.050.N. …
SECTION SIX: Subsection 9.38.050 (Permit Operating Requirements.) of Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
Short-term rentals shall be permissible and regulated in all single-family or two-family dwelling units, residential zones including residential developments in PRDs (planned residential districts), pursuant to the short-term rental land use regulations identified in the Encinitas Municipal Code, and as follows:
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K. Exterior Display of Short-Term Rental Unit. Owner/agent shall display, at a minimum size of eight and one-half inches by 11 inches on the exterior of a short-term rental unit during the period of short-term rental operation, a notice provided by the City containing a 24-hour, sevenday per week local phone number of the owner/agent responsible for the short-term rental unit.
The exterior display must also contain the number of bedrooms, maximum number of occupants permitted to stay in the unit, and the maximum number of vehicles. The notice shall be posted at all times in an area which is in plain view of the general public and legible from the public right-ofway and/or common areas and shall be maintained in good condition. …
N. Payment of Transient Occupancy Tax. Owner/agent shall comply with all provisions of Chapter 3.12 of this Code concerning the payment of Transient Occupancy Tax (TOT). The TOT calculation shall include cleaning fees, resort fees, and other fees as part of the total rent charged for the short-term rental unit. If the owner/agent operator uses a hosting platform short-term rental facilitator, the hosting platform short-term rental facilitator shall be considered an agent of the host operator for purposes of collecting and remitting the TOT to the City. …
Y. Advertisements. It is unlawful for any person or entity to advertise a short-term rental in the City without a valid and current permit issued by the City. All advertisements for a property 2026-09-23 Item #12D Page 15 of 26
operating with a valid short-term rental permit, including those advertisements posted on or by short-term rental facilitators hosting platform sites, must include the short-term rental permit number provided by the City, the maximum number of occupants permitted to stay in the unit, and the maximum number of vehicles permitted to be parked at the unit. Listings through a marketplace lacking required identifiers/data shall be removed or corrected within 7 days of notice. Each short-term rental facilitator shall require STR operators to display:
1.Valid City STR permit number;
2.City TOT certificate number; and
3.Any other compliance identifiers/data required by the Development Services Director.
SECTION SEVEN: Subsection 9.38.100 (Applicability to Existing Short-Term Rental Permits.) of Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby removed in its entirety.
SECTION EIGHT: Subsection 9.38.100 (SHORT-TERM RENTAL FACILITATOR REPORTING) of Chapter 9.38 (REGULATING SHORT-TERM RENTALS) of Title 9 (Public Safety, Peace, and Welfare) of the Encinitas Municipal Code is hereby added to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
§ 9.38.100 Short-Term Rental Facilitator Reporting
A. Mandatory Quarterly Reporting Requirements. Pursuant to Government Code §50993(c), each facilitator shall submit a quarterly report to the City containing, at minimum:
1. Physical address of each STR listing in Encinitas, including full 9-digit ZIP code;
2. Assessor’s Parcel Number (“APN”), where available or requested;
3. URL(s) for each listing;
4. Number of nights per reservation;
5. Total gross cost per reservation; and
6. Any additional information, including but not limited to address data, booking data, compliance data, listing data and tax data or records as deemed necessary by the City Manager, Director of Finance, or Director of Development Services.
B. The City may require reports to be submitted in a structured electronic format provided that the format and manner of submission shall be subject to the approval and satisfaction of the City.
C. Audit Authority.
1. The City may audit short-term rental facilitator records, including listing data, booking data, tax data, and address data and compliance data information, pursuant to Government Code Section 50995, and as amended. Audits shall occur as determined by the Director of Development Services or Finance.
2. Short-term rental facilitators shall provide access to such records within 10 business days of City request.
3. Any costs associated with audit or examination shall be the responsibility of the local agency or as established by Government Code Section 50995(b), and as amended.
D. Administrative Penalties for Short-term Rental Facilitator Noncompliance. Penalties for failure by facilitators to report the information required by the City shall be subject to the fine or penalty amounts provided in Chapter 1.08 and Chapter 3.12 of this Code. 2026-09-23 Item #12D Page 16 of 26
SECTION NINE: Subsection 3.12.010 (Taxable Event.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
A. For the privilege of occupancy in any hotel, each transient shall pay a tax in the amount of eight percent of the rent charged by the operator or STR facilitator. In addition, each hotel guest shall pay an additional tax of two percent of the rent charged by the hotel operator or STR facilitator which shall be used only for beach sand replenishment and stabilization projects. The transient satisfies this tax obligation by paying the tax to the hotel operator or short-term rental facilitator authorized to collect and remit the tax.
B. The tax is payable at the time that rent is paid. If the rent is paid in installments, a proportionate share of the tax shall be paid with each installment. The balance of the tax shall be due upon the transient's ceasing occupancy in the hotel.
C. If sufficient funds are not paid to the operator or short-term rental facilitator by the transient to pay the tax in full, the tax administrator may commence an action against the transient to recover the amount of the tax.
SECTION TEN: Subsection 3.12.030 (Definitions.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
“Address data” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). “Booking data” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). “Compliance data” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). …
"Hotel" means any structure or any portion of any structure which is occupied or intended or designed for occupancy by transients for dwelling, lodging or sleeping purposes, including any hotel, inn, tourist home or house, short-term rental hosted or non-hosted regardless of whether occupancy is arranged by the operator or short-term rental facilitator, motel, studio hotel, bachelor hotel, lodging house, rooming house, apartment house, dormitory, public or private club, mobilehome or house trailer at a fixed location or other. “Listing” shall have the same meaning as set forth in EMC 9.38.020 (Definition.) “Listing data” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). “Marketplace” shall have the same meaning as set forth in EMC 9.38.020 (Definition.) …
“Operator” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). “Purchaser” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). “Related person” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). …
“Short-Term Rental Facilitator” shall have the same meaning as set forth in Chapter 9.38.020 (Definitions.)
“Tax data” shall have the same meaning as set forth in EMC 9.38.020 (Definition.). …
2026-09-23 Item #12D Page 17 of 26
SECTION ELEVEN: Subsection 3.12.040 (Collection of Tax.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
A. It shall be unlawful for an operator or short-term rental facilitator to fail to collect from the transient the tax imposed by this chapter at the same time as the rent is collected from the transient. The operator or short-term rental facilitator shall deliver to the transient a receipt for payment which states the amount of the tax separately charged from the amount of the rent charged.
B. The operator shall deliver to the transient a receipt for payment which states the amount of the tax separately from the amount of the rent charged. It shall be unlawful for a short-term rental facilitator to fail to collect from the transient the tax imposed by this chapter at the same time as the rent is collected from the transient. A short-term rental facilitator collecting tax on behalf of an operator shall issue a receipt to the City identifying the operator, address data, listing data, booking data, tax data, and compliance data.
C. No operator shall advertise or state in any manner, whether directly or indirectly, that the tax or any part thereof will be assumed or absorbed by the operator, or that the tax will not be added to the rent, or that, if added, any part will be refunded except in a manner provided in this chapter.
D. No short-term rental facilitator may advertise or state that TOT will be absorbed, included without disclosure, or not applied, except as permitted under this chapter.
SECTION TWELVE: Subsection 3.12.060 (Obligation of Operator) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby renamed to read as follows “Obligation of Operator or Short-Term Rental Facilitator.”
§ 3.12.060 Obligation of Operator or Short-Term Rental Facilitator.
SECTION THIRTEEN: Subsection 3.12.060 (Obligation of Operator or Short-Term Rental Facilitator.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
A. If either an the operator or short-term rental facilitator receives any consideration for allowing the transient to occupy the hotel, the value of such consideration shall be first applied by the operator to satisfy the tax owed. It shall be unlawful for the operator or short-term rental facilitator to fail to hold the tax collected by the operator or short-term rental facilitator in trust for the benefit of the City. It shall be unlawful for the operator or short-term rental facilitator to fail to remit the collected tax to the City in accordance with the provisions of this chapter.
B. On or before the last day of each month, or if determined appropriate by the Director of Finance, the last day of the month following the close of each calendar quarter, the operator or short-term rental facilitator shall file a return with the tax administrator, on a form approved by the City, setting forth for the previous month or quarter (if appropriate) a rental report record which includes but is not limited to:
1. The total rents charged;
2. The total rents received;
3. The amount of tax funds held by the operator or short-term rental facilitator;
4. An explanation if the amount of paragraph 3 of this subsection B is less than eight percent of the amount of paragraph 1 of this subsection B.
5. Operators shall disclose all short-term rental facilitators used during the reporting period.
6. Number of nights per reservation
2026-09-23 Item #12D Page 18 of 26
7. Total gross rents received per reservation.
8. Any additional information, including but not limited to address data, booking data, compliance data, listing data and tax data or records as deemed necessary by the City Manager, Director of Finance, or Director of Development Services.
C. The tax funds collected for the previous month/quarter shall be remitted together with the return for that reporting period. When a short-term rental facilitator is required to remit TOT, operators shall not remit duplicate tax but shall report all facilitated amounts for reconciliation.
D. The operator shall comply with shorter reporting and payment periods if imposed by the tax administrator in order to facilitate the collection of this tax. If a short-term rental facilitator fails to remit tax or fails to include the operator in its quarterly report, the operator remains liable for any unremitted tax.
E. If the operator ceases business, it shall be unlawful for the operator to fail to file immediately with the City the return and tax funds for the previous month/reporting period and the return and tax funds for the period of the current reporting period in which the operator ceased business. Monthly or quarterly operator returns must reconcile operator reported data with shortterm rental facilitator reported data.
SECTION FOURTEEN: Subsection 3.12.070 (Penalties and Interest.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
…
F. Facilitator Non-Compliance. A short-term rental facilitator that fails to collect, remit, or report TOT as required shall be subject to the same penalties imposed on operators under
3.12.070 subsections A–E, in addition to any administrative penalties provided in Chapter 1.08 of this Code.
G. Quarterly Reporting Penalties. Failure to submit accurate quarterly reports shall result in administrative fines provided in Chapter 1.08 of this Code per report period.
SECTION FIFTEEN: Subsection 3.12.080 (Records and Inspection.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
It shall be the duty of every operator liable for the collection and payment to the City of any tax imposed by this chapter to keep and preserve, for a period of three five years, all records as may be necessary to determine the amount of such tax as he or she may have been liable for the collection of and payment to the City, which records the Director of Finance shall have the right to inspect at all reasonable times. Short-term rental facilitators shall retain booking, listing, operator registration, payment, and tax collection records for at least five years. Records shall be made available to the Directors of Finance and Development Services upon request for the purpose of verifying consistency between short-term rental facilitator and operator filings.
SECTION SIXTEEN: Subsection 3.12.090 (Refunds.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby amended to read as follows (strikeout is used to denote existing text being deleted; underline is used to denote new text being added):
…
E. Refunds of TOT collected by a short-term rental facilitator shall follow the same procedures applicable to operators. Short-term rental facilitators must return tax incorrectly collected to the transient or operator prior to claiming a City refund or credit. 2026-09-23 Item #12D Page 19 of 26
SECTION SEVENTEEN: Subsection 3.12.100 (Collection of Delinquent Taxes on Property Tax Roll.) of Chapter 3.12 (TRANSIENT OCCUPANCY TAX) of Title 3 (Taxes) of the Encinitas Municipal Code is hereby added as a new subsection to read as follows; (underline is used to denote new text being added):
A. Alternative Remedy. In addition to any other remedies available under this Chapter or under Chapter 9.38 of this Code, the amount of any delinquent tax, penalty, and interest owed by an operator under this Chapter shall constitute a special assessment against the real property upon which the transient occupancy lodging was operated, or against the real property owned by the operator within the City.
B. Procedure. The Finance Department shall prepare a report of delinquent Transient Occupancy Taxes, including penalties and interest, and may provide notice to the property owner of a public hearing before the City Council. Following the hearing, the City Council may, by resolution, confirm the report and direct that the delinquent amounts be transmitted to the San Diego County Auditor-Controller to be collected on the secured property tax roll.
C. Collection and Penalties. The special assessment shall be collected at the same time and in the same manner as ordinary ad valorem municipal taxes are collected by the County of San Diego and shall be subject to the same penalties and the same procedure and sale in case of delinquency as provided for such taxes. All laws applicable to the levy, collection, and enforcement of property taxes shall be applicable to this special assessment.
SECTION EIGHTEEN: ENVIRONMENTAL COMPLIANCE.
The action being considered by the City Council is exempt from the California Environmental Quality Act (CEQA) under Section 15061(b)(3) of the CEQA Guidelines because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. The action is also exempt from CEQA under Section 15378(b)(5) of the CEQA Guidelines because it involves an organizational or administrative activity of government that will not result in a direct or indirect physical change in the environment.
Therefore, the proposed project is not subject to further CEQA review.
SECTION NINETEEN: CONSISTENCY.
Any provision of the Encinitas Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to affect the provisions of this Ordinance.
SECTION TWENTY: SEVERABILITY.
If any chapter, article, section, subsection, subdivision, sentence, clause, phrase, word, or portion of this Ordinance, or the application thereof to any person, is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portion of this Ordinance or its application to other persons. The City Council hereby declares that it would have adopted this Ordinance and each chapter, article, section, subsection, subdivision, sentence, clause, phrase, word, or portion thereof, irrespective of the fact that any one or more subsections, subdivisions, sentences, clauses, phrases, or portions of the application thereof to any person, be declared invalid or unconstitutional.
SECTION TWENTY ONE: EFFECTIVE DATE.
This Ordinance shall take effect and be in force thirty (30) days after its passage and the City Clerk of the City of Encinitas is hereby authorized to use summary publication procedures pursuant to Government Code Section 36933 utilizing the Coast News, a newspaper of general circulation published in the City of Encinitas.
2026-09-23 Item #12D Page 20 of 26
This Ordinance was introduced at a regular meeting of the City Council held on September 23, 2026.
PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council held on the _____ day of __________________.
______________________________
Bruce Ehlers, Mayor
ATTEST:
______________________________________
Pete Weichers, City Clerk
APPROVED AS TO FORM
______________________________________
Ajit Thind, City Attorney
CERTIFICATION: I, Pete Weichers, City Clerk of the City of Encinitas, California, do hereby certify under penalty of perjury that the foregoing ordinance was duly and regularly introduced at a meeting of the City Council on the 23 day of September 2026 and that thereafter the said ordinance was duly and regularly adopted at a meeting of the City Council on the _____ of _________________, 2026 by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Encinitas, California, this _____ day of ______, 2026
_____________________________________
Pete Weichers, City Clerk
2026-09-23 Item #12D Page 21 of 26
Code: Select Code Section: 1 or 2 or 1001 Search
50990.
50991.
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GOVERNMENT CODE - GOV
TITLE 5. LOCAL AGENCIES [50001 - 57607] ( Title 5 added by Stats. 1949, Ch. 81. ) DIVISION 1. CITIES AND COUNTIES [50001 - 52203] ( Division 1 added by Stats. 1949, Ch. 81. ) PART 1. POWERS AND DUTIES COMMON TO CITIES AND COUNTIES [50001 - 51299.4] ( Part 1 added by Stats. 1949, Ch. 81. )
CHAPTER 4.6. The Short-Term Rental Facilitator Act of 2025 [50990 - 50996] ( Chapter 4.6 added by Stats. 2025, Ch. 751, Sec. 2. )
(a) This chapter shall be known, and may be cited, as the “Short-Term Rental Facilitator Act of 2025.” (b) This chapter shall only apply to a local agency that adopts an ordinance that makes the provisions of this chapter applicable within its jurisdictional boundaries. (Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) All of the following definitions shall apply for purposes of this chapter:
(a) “Hotel” means a commercially operated hotel, motel, bed and breakfast inn, or similar transient lodging establishment, when all or part of the transient occupancy is or would be subject to tax under Section 7280 of the Revenue and Taxation Code. For purposes of this chapter, a “hotel” shall not include a short-term rental facilitator as defined in subdivision (g).
(b) “Local agency” means a city, county, or city and county. (c) “Marketplace” means a physical or electronic place, including, but not limited to, a store, booth, internet website, catalog, television or radio broadcast, or a dedicated sales software application, where a marketplace seller facilitates the occupancy of a short-term rental for delivery in this state regardless of whether the shortterm rental, marketplace seller, or marketplace has a physical presence in this state. (d) “Ordinance” refers to an ordinance of a local agency imposing a transient occupancy tax. (e) “Purchaser” means a person who is required to pay the transient occupancy tax and who uses a short-term rental facilitator to facilitate the occupation of a short-term rental within the jurisdiction of the local agency imposing the transient occupancy tax.
(f) “Short-term rental” means the occupancy of a home, house, a room in a home or house, a campsite, or other lodging that is not a hotel in this state for a period of 30 consecutive days or less and under any other circumstances specified by the local agency in its ordinance that is facilitated by a short-term rental facilitator. (g) “Short-term rental facilitator” means a person or entity that facilitates for consideration, regardless of whether it is deducted as fees from the transaction, the occupancy of a short-term rental that is not owned by the person facilitating the rental, through a marketplace operated by the person or a related person or entity, and that does both of the following:
(1) Directly or indirectly, through one or more related persons, engages in any of the following:
(A) Transmits or otherwise communicates the offer or acceptance between the purchaser and the operator. (B) Owns or operates the infrastructure, electronic or physical, or technology that brings purchasers and operators together.
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https://leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=GOV&division=1.&title=5.&part=1.&chapter=4.6.&article= 1/3 ATTACHMENT 2 2026-09-23 Item #12D Page 22 of 26
50992.
50993.
50994.
50995.
(C) Provides a virtual currency that purchasers are allowed or required to use to facilitate the occupancy of a short-term rental from the operator.
(D) Software development or research and development activities related to any of the activities described in paragraph (2), if such activities are directly related to facilitating short-term rentals. (2) Directly or indirectly, through one or more related persons, engages in any of the following activities with respect to facilitating short-term rentals:
(A) Payment processing services.
(B) Listing homes, houses, or rooms in homes or houses, campsites, or other lodgings that are not a hotel or motel, and that are not owned by that person or a related person, for rental on a short-term basis. (C) Setting prices.
(D) Branding short-term rentals as those of the short-term rental facilitator. (E) Taking orders or reservations.
(h) “Transient Occupancy Tax” means a tax imposed by a local agency on the privilege of occupying a short-term rental as specified and defined by the local agency in its ordinance. (Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) For purposes of this chapter, a person is related to another person if both persons are related to each other pursuant to Section 267(b) of Title 26 of the United States Code, as that section was amended by Public Law 114-113, and the regulations thereunder.
(Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) (a) Upon request by the local agency, each short-term rental facilitator shall report, in the form and manner prescribed by the local agency, the physical address, including nine-digit ZIP Code, of each short-term rental during the reporting period.
(b) If the information provided by the short-term rental facilitator pursuant to subdivision (a) is not sufficient for the local agency to identify a specific short-term rental at the provided address, the local agency may request the following:
(1) The assessor parcel number of each short-term rental. (2) The URL associated with the specific short-term rental listing. (3) Information exclusively related to the identification of an accessory dwelling unit, guest house, or single unit of a timeshare or multifamily housing project located at a single address, which is located at the address or assessor parcel number requested.
(c) Except as provided in subdivision (d), the reporting period in subdivision (a) may be no more frequently than in intervals of every 3 months within a 12-month period. (d) The reporting period in subdivision (a) may be monthly if a local agency requires remittance of transient occupancy tax monthly.
(e) A local agency may make the failure of a short-term rental facilitator to report the information required by this section subject to an administrative fine or penalty pursuant to Section 53069.4. (Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) A short-term rental facilitator shall include in the listing of a short-term rental any applicable local license number associated with the short-term rental and any transient occupancy tax certification issued by a local agency.
(Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) (a) A local agency may conduct an audit or otherwise examine the records of the short-term rental facilitator documenting the receipt of the transient occupancy tax due and payable to the local agency if the 8/3/26, 8:59 AM Codes Display Text
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50996.
short-term rental facilitator is responsible for collecting and remitting the transient occupancy tax to the local agency pursuant to a local ordinance or collection agreement. (b) Any costs associated with an audit or examination shall be paid for by the local agency. (Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) Nothing in this chapter shall be construed to preempt a local agency from adopting an ordinance that regulates short-term rentals, short-term rental facilitators, or the payment and collection of transient occupancy taxes in a manner different from the procedures prescribed in this chapter. (Added by Stats. 2025, Ch. 751, Sec. 2. (SB 346) Effective January 1, 2026.) 8/3/26, 8:59 AM Codes Display Text
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(“the property”) is being Term Rental (“STR”) without a valid STR Permit and remittance of appropriate Transient Occupancy Tax. This constitutes a violation of the Encinitas Municipal Code (“EMC”) Short
. The report must include the following information: occupant’s
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SIMMONS LIVING TRUST 11-15-07
437 WASHINGTONIA DR
SAN MARCOS, CA 92078-5049
DEVELOPMENT SERVICES DEPARTMENT
CODE ENFORCEMENT DIVISION
505 S. VULCAN AVENUE
ENCINITAS, CA 92024-3633
ATTACHMENT 3
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Short-Term Rental Cessation Affirmation
Date: _______________
Property Address: ________________________________________ Property Owner’s name: _____________________________________ Property Owner’s address: __________________________________ Assessor’s Parcel Number: __________________________________ I, _________________________ (print name), as the property owner affirm that the above address is not currently being advertised and/or operated as a Short-Term Rental. Please initial each statement below to indicate that you have read and understand this information. ____ I understand that if and when a decision is made to use property in such a manner, that a permit from the City of Encinitas must first be obtained prior to advertising and/or operating as a short-term rental.
____ I understand that it is a violation of the Encinitas Municipal Code to advertise and/or operate a Short-Term Rental without a valid permit first being obtained and displayed. ____ I understand that short-term rentals are only permitted in single-family and duplex dwelling units.
As such, it is prohibited to advertise and/or operate a short-term rental in an accessory dwelling unit (ADU), guest house, pool house, apartment, condo, townhome, tri-plex, or four-plex. ____ I understand that all advertising for Short-Term Rentals at this location is not permitted. This includes, but is not limited to, newspaper, magazine, flyers and/or internet advertising. ____ I understand that fines and penalties may be issued if it is discovered that a Short-Term Rental is being advertised and/or operated without first obtaining a permit or in violation of any other City requirement.
________________________________________________________________________________ Print Owner’s name Property Owner’s signature
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