Item 250/2025
Final
City of Garden Grove
INTER-DEPARTMENT MEMORANDUM
To:
Lisa L. Kim From: Matthew West
Dept:
City Manager Dept: City Manager
Date: 7/8/2025
Subject: Approval to submit a response to the Grand Jury Report, Long-Term Solutions to Short-Term Rentals. (Action Item)
OBJECTIVE
The purpose of this report is for the City Council to approve the attached response to the 2024-25 Grand Jury Report, Long-Term Solutions to Short -Term Rentals and authorize submittal to the Orange County Grand Jury.
BACKGROUND
On May 22, 2025 the Orange County Grand Jury released its 2024 -25 Grand Jury Report, Long-Term Solutions to Short -Term Rentals. The purpose of the report was to investigate how effectively Orange County cities are managing short -term rentals (STRs) and identify best practices for city councils and planning departments to more efficiently and effectively manage STRs. The Grand Jury studied STR permits and the effectiveness of STR bans across the thirty-four cities in Orange County. More specifically, the Grand Jury examined permitting, enforcement, and collections strategies in order to provide city planning departments with a compilation of tools that would assist in effectively balancing the expectations of residents and business owners operating STRs.
DISCUSSION
The Grand Jury report found that of the thirty four (34) incorporated cities in Orange County, nineteen (19) cities had a ban on all STRs while fifteen (15) cities allowed STRs. Through a survey of cities’ STR policies and practices, the report determined that the overall impacts of STRs on their respective communities varied by city based on established ordinances, policies, and enforcement practices, or lack thereof. However, the report also found that in nearly every city, STRs were generally regulated by ordinances defining operational rules, establishing fees for licensing and violations, and outlining the appeals p rocess. Ultimately, the report determined that STRs can be good neighbors when cities have clearly established ordinances, concise permitting guidance, diligent code enforcement, an easy -to-use complaint system, and monthly electronic collection of TOT.
Item 250/2025
The Grand Jury report outlined twelve findings, four of which applied to Garden Grove. The City agrees with each of the following findings.
1) F1 – Despite the increasing media coverage on Online Booking Agencies (OBAs), STRs are not a new phenomenon in Orange County. 2) F2 – The steady growth of STR usage in the last decade raises concerns of potential public nuisance.
3) F3 - Even with robust Code Enforcement, a city’s statutory ban on STRs is not enough to keep STRs from operating.
4) F12 – City leaders have no regular communication with each other concerning STR issues, limiting opportunities to develop strategies and expertise to improve service.
The Grand Jury report also outlined nine recommendations, three of which applied to Garden Grove. Cities were advised to:
1) R1 – Review and begin to update ordinances to keep up with the rapidly changing nature of court findings and legislation related to STRs, by December 31, 2025, and no less frequently than every three years thereafter. 2) R2 – Consider developing a plan for upcoming major events that are expected to create a surge in demand for STRs and its associated Transient Occupancy Tax, by December 31, 2025, and no less frequently than every two years thereafter.
3) R9 – Have regular discussions with each other to shar e STR management strategies on a biannual basis commencing no later than January 1, 2026.
FINANCIAL IMPACT
None.
RECOMMENDATION
It is recommended that the City Council:
Approve the attached response to the 2024-25 Grand Jury Report, Long-Term Solutions to Short-Term Rentals, and authorize submittal to the Orange County Grand Jury.
By: Shawn Park
Assistant to the City Manager
ATTACHMENT(S)
1. OC Grand Jury Report - Long-Term Solutions to Short-Term Rentals
2. Grand Jury Report - Long-Term Solutions to Short-Term Rentals Response