Agenda Item No. 13
CITY COUNCIL STAFF REPORT
TO: Honorable Mayor and City Council DATE: August 28, 2023 FROM: Matthew Bronson, City Manager
PREPARED BY: Megan Martin, Community Development Director Rafael Castillo, AICP, Senior Planner
SUBJECT: Short-Term Rental Program Update
RECOMMENDATION
Receive an update on the implementation of the City’s Short-Term Rental Program and provide policy direction to staff on potential revisions to the program.
BACKGROUND
On June 17, 2019, the City Council (Council) adopted a Short-term Rental (STR) ordinance (Attachment 1) that permits owner-occupied and non-owner occupied STRs with established regulatory requirements to minimize potential impacts on surrounding residents in the City. To ensure the ongoing success of the program, City staff committed to regular reviews to identify any deficiencies and areas for policy improvement or refinement. As such, on September 27, 2021, the Council provided policy direction to staff to include the following modifications:
• Modify the Administrative Rules limiting multi-family development to one (1) STR permit. • Establish a minimum stay requirement (12 stays per year) for non-owner occupied STRs. • Create and manage a waitlist for non-owner-occupied permits.
The City currently contracts with a third-party vendor, Host Compliance, who provides rental monitoring, compliance, and enforcement assistance through an online permit portal. The City currently expends $21,760 annually for these services.
Short Term Rental Program Implementation
As of August 7, 2023, the City has issued 119 STR permits. Of those permits, 19 are owneroccupied permits. The remining are “non-owner” occupied permittees. The current STR permit application fee is $326 for a “non-owner” occupied unit, and $273 for an owner-occupied unit. There is an annual renewal fee of $218 and a Business Tax Certificate (BTC) is required for all STR operators.
Of the permitted operators, 97% of permittees have listed their rentals on advertising websites such as VRBO, Airbnb, and Booking. The remaining three percent (3%) of those with permits use referrals to rent to a select number of guests throughout the year. At the end of each month, a permittee has 30 days to submit Transient Occupancy Taxes (TOT) based on the number of nightly stays. The City’s TOT tax is 12% and the San Luis Obispo County Tourism Management District fee is 1.5%. As of January 1, 2023, taxes can only be remitted via Host Compliance and the permit portal. City staff implemented this change to reduce submittal errors and capture data to confirm Staff Report: Short Term Rental Program Update Page 2
August 28, 2023
permittees met the minimum stay requirement. This process improvement has freed up staff resources by automating the TOT process and ensuring revenue collection.
TOT/TDM Collection Activity
City staff has revamped its efforts to ensure timely remittance of taxes with STR permittees. In July 2021, City staff noticed some permittees did not understand that taxes needed to be remitted or were frequently late with payments. Since that time, staff revamped the way it ensures taxes are collected in a timely manner by implementing the following:
• Sending out emails from the City’s STR email account when the TOT/TDM period ends (i.e.
January reporting period ends February 28, emails go out the next day or shortly thereafter) to individuals whom have not made payments.
• Working with Host Compliance to send auto-generated emails five days after the reporting period ends.
• Sending out formal “notice of permit revocation” to permittees that have not remitted TOT/TDM after 90 days.
• During the STR permit renewal period (Typically July 1 through July 31 of each year), staff reviews TOT/TDM payments against the number of reported stays, and flags permit holders to be audited if discrepancies are apparent.
With these changes implemented, certain permittees elected not to renew their permits, or had their permits revoked due to lack of TOT/TDM payments. Out of the 119 permits, on average 96% of permittees remit their required taxes on time. Typically, these overdue reminders prompt overdue taxes to be paid, with a penalty added. Since City staff developed a more robust TOT/TDM capture procedure, a significant reduction of past due TOT/TDM accounts has occurred, with most paying under the 30-day overdue window.
Fiscal impact
Since inception of the STR permits in October 2019 through April 2023, STRs have generated approximately half of the $2.9 million in Transient Occupancy Tax (TOT) revenue to the City, based on the chart below. The permitting, licensing, and operations of these short-term rentals have been a net positive for the City in terms of revenue and on average account for approximately 50% of the total TOT revenue collected by the City..
Fiscal Year TOT Revenue % Increase
2019-2020 $103,540.90 --
2020-2021 $298,915.02 +189%
2021-2022 $508,362.22 +70%
2022-2023 $458,567.07 -10%
Number of Permits Issued
As a part of the original ordinance, a cap was established that differentiated permits between two category types:
• Owner occupied (homestays) versus non-owner occupied (2nd homes, owner not present during stays)
• Location of permits between the coastal zone and non-coastal zone Staff Report: Short Term Rental Program Update Page 3
August 28, 2023
The Council decided the number of “owner occupied” permits could be unlimited. These are defined as rentals with homeowners who are present for a stay, and renting rooms within the home (i.e. a 3-bedroom home, with 2 rooms rented, and the owner remains in the primary bedroom). At this time there are 20 owner-occupied permits issued throughout the city.
The Council capped the number of non-owner-occupied permits based on the location of permits issued. A total of 40 permits in the coastal zone may be issued along with 60 permits in the noncoastal zone. In October 2021, the non-coastal area cap was reached and a waitlist for future applicants established with 46 households currently on this list. The City reached its coastal zone cap in January 2023 of 40 permits with seven households currently on the waiting list. Once a permit is not renewed, canceled, or revoked, staff goes to the waitlist, in order of which requests were received, for permit eligibility. Permits are not transferable if a house is sold with an existing permit.
Non-Owner Occupied Permit Map
Enforcement of Regulations
As a part of the City’s contract with Host Compliance, the vendor provides a 24-hour hotline to receive complaints, directing calls to the Police Department or other City departments. Since the launch of the STR program, the hotline or web form has received a total of 213 complaints which is an average, six complaints are received per month. In comparison, the City of Paso Robles averages approximately four complaints per month for a period between mid-2020 to early 2022 which is on par with the level of complaints in Grover Beach. Anecdotally, while complaints were not tracked in the same way before the STR ordinance was adopted, staff’s observation is that the frequency of complaints have decreased since the ordinance was adopted. Approximately 64% of all complaints associated with 13 permittees, of which 3 permittees, representing 20% of these Staff Report: Short Term Rental Program Update Page 4
August 28, 2023
complaints, are no longer participating in the STR program. City staff works diligently with the permittees to resolve all complaints and provides additional guidance on how to further reduce complaints such as a more robust vetting of potential guests, use of cameras at entrances to the residence to check in on number of guests and guest activities, and empowering property owners to understand their role in compliance and be more “hands on” in managing their properties. Below is a breakdown of the complaints received by type with noise/disturbance the top category.
Administrative Rules (shown in Attachment 2) were created to implement the STR ordinance and establish how to handle complaints. Because of the need for evidence to issue fines, especially those for noise and disturbances, the Administrative Rules provide clarity and expectations to ensure that permittees are responsive to complaints and held accountable for their renters. A few of those requirements include:
1. Requirements for a local contact person to ensure that the local contact understands their role, including staff outreach to the local contact during permit registration.
2. Local contact and/or property owner respond to complaints within 30 minutes of receiving and contact Host Compliance to indicate how the issue was resolved.
3. Local contact person or property owner email staff within 24 hours acknowledging the complaint received, and remedies they took to resolve the issue.
In implementing these Administrative Rules, staff issues one warning if Step #3 is not completed.
After that, a citation for $100 would be issued and a subsequent violation for the same issue within 90 days would result in a $500 citation. A third violation would result in revocation of the STR permit.
With these steps taken, permittees with frequent complaints have modified behaviors and are in quick communication with staff when a complaint is received to avoid fines. City staff has levied the $500 citation on only a few occasions.
Dogs Barking
3%
Follow-Up
8%
Noise
44%
Occupancy Limits
6%
Other
13%
Parking
10%
Trash
9%
Unpermitted STR
7%
COMPLAINT TYPES OCTOBER 2019-JULY 2023
Staff Report: Short Term Rental Program Update Page 5
August 28, 2023
In addition to staff’s oversight and implementation of the STR Ordinance, Host Compliance, provides a snapshot of properties listed on the various vacation rental websites that may be out of compliance with permit requirements. In this case, staff attempts to contact property owners about the rules and regulations pertaining to short-term rentals to correct the violation. There are times where City staff cannot identify unpermitted rentals. Staff reports these listings to the vacation rental platform as “operating outside of local compliance.” Code Compliance coordinates with the Host Compliance platform and attempts to discover these addresses and send out notices immediately.
Generally, City staff receives compliance quickly, however, there have been instances where compliance is not completed in a timely fashion, thereby generating administrative fines.
Potential Revisions with STR Implementation
Overall, staff believes the implementation of the STR ordinance has been a continued success with 119 permits issued, a significant increase in TOT revenue, and relatively low number of complaints.
As part of staff’s commitment to ensure the program continues to succeed and recognizing the importance of fostering responsible tourism while preserving the residential character of neighborhoods, staff has identified potential areas of improvement to address some specific items that have arisen over the last year. Specifically, staff is seeking Council direction on the following items:
• Waitlist Procedures
• Local Contacts
• STRs and ADUs For Existing Permit Holders
• Number of Required Annual Minimum Stays
• Number of Non-Owner-Occupied Permits
Waitlist Procedures
The decision to establish a waitlist was driven by a combination of factors that necessitated a strategic approach to managing the demand for STR permits. Over the past couple of years, there has been a surge in demand for STR permits due to the growth of tourism in the region. The waitlist system has ensured that STR permits are distributed fairly among interested parties. Currently, 54 households are awaiting an STR permit, with some households having been on the list for nearly two years. When one becomes available, City staff completes the following:
• Notify the waitlist applicant that a permit has become available. • Provide a two (2) week window to submit an application. • Send a follow-up notice 72-hours prior to the two-week deadline. • If an application has not been submitted, staff provides a notice the window has closed. • Staff contacts the next waitlist applicant, and the above steps are repeated until issuance of a new STR permit.
Staff has noticed, as permits become available, some waitlist participants elect to “pass” on the opportunity, sometimes as many as three times, yet remain in their current waitlist position. This has caused delays in issuance of STR permits where a permit would go months without being issued. To remedy this situation, staff is recommending the Administrative Rules be modified to establish a methodology to ensure the STR permits are issued in a timelier manner and that waitlist participants do not take advantage of the list effectively limiting the potential of other waitlist participants chances of receiving an STR permit:
Staff Report: Short Term Rental Program Update Page 6
August 28, 2023
• Phone call and message when a permit becomes available. • One (1) week to apply for the permit.
• Removal from the waitlist after a defined number of “passes” If the 3rd bullet point is implemented, this would initiate removal of a household from the waitlist.
There would be an opportunity to apply to be on the waitlist, but they would be placed at the end of the list and not return to their original place. The Council could choose to remove the household after a defined number of “passes.” Staff is recommending to only allow a single “pass” to reduce the administrative burden on staff and promotes a more equitable opportunity for potential applicants to participate in the program.
Local Contacts
City staff has received complaints from permittees regarding the local contact requirement. The existing ordinance and Administrative Rules require a “local contact” who is available 24-hours a day, seven days per week. The intent behind establishing a local contact was to have a person available to respond and be present at the unit within 30 minutes of the receipt of a complaint. The Administrative Rules further define who may qualify as a local contact and requires that contact to live within a 30-minute driving window, based on the local contact’s address, as inputted by an online mapping system. A local contact can be the property owner for both owner- and non-owneroccupied units, assuming they live within a 30-minute radius. Staff requests the Council provide input on modifying the local contact requirement. Options include the following:
• Eliminate or expand the 30-minute requirement.
• If expanded beyond 30-minute requirement, the STR permit holder shall install additional security measures to ensure compliance with all rules and regulations of the ordinance (i.e. security cameras, noise decibel level reader) This would require an inspection by city staff. • Allow for larger national or regional property managers to manage properties, however, these would still be required to respond to complaints consistent with the Administrative Rules.
STRs and ADUs For Existing Permit Holders
Currently the existing STR ordinance and Accessory Dwelling Unit (ADUs) ordinance prohibit the use of ADUs as STRs if constructed on or after September 11, 2020. This prohibition was established to ensure ADUs are constructed as long-term rental housing consistent with Government Code Section 65852.150 and address the severe housing crisis in California. City staff has received numerous inquiries from permit holders on whether an STR could be permitted within an ADU, or, if upon construction of an ADU, the household moves (temporarily or permanently) into the ADU and continues to rent the primary residence consistent with the STR permit.
Allowing someone to operate an STR within an ADU is a complex issue that involves a variety of considerations. Many cities are facing housing shortages, and ADUs are often seen as a way to increase the availability of long-term housing options. Allowing ADUs to operate as STRs could potentially reduce the overall housing stock, as these units might be more lucrative for owners as STRs rather than as long-term housing. Furthermore, the intent of State law and the City’s current prohibition, is to provide for more affordable housing options in single- and multi-family zones.
Conversion of ADUs to STRs may drive up housing costs and negatively impact housing affordability for local residents. Conversely, allowing homeowners to rent out their ADUs as STRs can provide them with a supplementary source of income, offsetting the costs of maintaining their properties. STRs provide flexible accommodation options for travelers, especially those seeking Staff Report: Short Term Rental Program Update Page 7
August 28, 2023
alternatives to traditional hotels, ultimately contributing to a more diverse and vibrant tourist environment.
With these points in mind, staff is seeking direction on how to balance these potential benefits with the concerns and potential negative impacts associated with allowing ADUs as STRs, especially as it relates to the intent of State law and legislation regarding ADUs fulfilling long-term housing needs.
Some options for the Council to consider includes the following:
• Take no action and allow permittees to maintain their non-owner-occupied permit, thereby allowing occupancy of an ADU by the property owner, and the permittee maintains their permit, provided they abide by all regulations.
• Require permittees that have non-owner-occupied permits that construct ADUs to switch to owner-occupied permits if they intend to occupy the ADUs and continue to rent out the primary unit that was originally licensed, therefore requiring them to be present during stays.
This allows households on the waitlist to access a non-owner occupied STR permit. This option is highly recommended by city staff because it meets the intent of state law relaxing regulations to construct affordable by design units such as ADUs. • At the time of building permit finalization, require the permittees to relinquish their permits following construction of the ADU.
Number of Required Annual Minimum Stays
In 2021, the Council directed staff to adopt a 12-night per year minimum stay requirement to eliminate inactive permits preventing new STR permits from being issued. Owner-occupied permit holders are exempt from this requirement. Currently, 97% of the existing permit holders met the minimum overnight threshold for the previous permit year (August 1st – July 31st).
Staff is seeking direction from Council on whether the minimum number of stays should be increased during the permit year to further eliminate permit holders who complete only the minimum night stay requirement effectively preventing new STR permits from being issued. For example, instead of one stay per month (12 annually), the requirement could be increased to 24 nights per permit year which is the equivalent of a weekend stay a month. Based on permit year 2022-2023, 12 non-owner-occupied permit holders would be ineligible for renewal if the minimum night stay were increased to 24 nights per permit year.
Number of Non-Owner-Occupied Permits
The existing ordinance established a cap of 100 non-owner-occupied permits, 40 in the Coastal Zone and 60 in the non-Coastal Zone. As part of the STR ordinance adoption, the Council discussed the appropriate maximum number of STRs within the City recognizing the balance between providing additional visitor-serving amenities and maintaining a sufficient inventory of long-term rental housing.
Since the program’s inception in 2019, the City has added approximately 60 new residential units in either the form of single-unit residences, multi-unit residences, or ADUs. This equates to an increase of two percent in the city’s total housing stock. However, based on current development applications under review by City staff, the City will likely see as many as 250 new residential units under construction over the next two to three years. The Council could direct staff to increase the number of allowable STRs based on a percentage of the total housing stock; based on the 2% increase in housing produced over the last two years, which would allow for one new Coastal Zone permit would be allowed, and two non-coastal zone permits. The Council could also increase this Staff Report: Short Term Rental Program Update Page 8
August 28, 2023
cap by a higher percentage based on the anticipated growth in new housing units in upcoming years or review this cap every 2-3 years for potential changes based on housing units produced.
Based upon Council direction on the above policy items, an amendment to the STR ordinance may be required and staff would subsequently schedule the item for Planning Commission and Council consideration in early 2024.
Conclusion
The STR program has demonstrated resounding success since its implementation. The efforts of staff, combined with the proactive engagement from the community, have resulted in a wellregulated program. The remarkably low number of complaints is a testament to the effectiveness of the adopted standards and Administrative Rules. The STR program has also proven to be a significant revenue generator for the City whose funds are able to be allocated towards different projects and public services.
The City continues to stress recognizing the importance of fostering responsible tourism and preserving the residential character of neighborhoods. While minor changes have been discussed in this report, it is important to note that these adjustments are not imperative to the continued success of the program and staff is dedicated to reinforcing its success through a balanced and sustainable approach that benefits the local economy and the quality of life for its residents.
FISCAL IMPACT
There is no fiscal impact associated with this report. Modification to the number of non-owneroccupied permits and minimum number of stays may result in some level of additional TOT revenues to the City.
ALTERNATIVES
The City Council has the following alternatives to consider:
1. Receive a report on the implementation of the City’s STR program and provide direction to staff on potential changes to the City’s STR regulations.
2. Provide alternative direction to staff.
PUBLIC NOTIFICATION
The agenda was posted in accordance with the Brown Act. All STR permit holders and those currently on the waitlist, were notified and emailed the agenda for this item.
Attachments
1. Short Term Rental Ordinance
2. Administrative Rules
3. Short Term Rental Permit Locations
4.10.170
4-26 City of Grover Beach Development Code
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022
4.10.185 Short-Term Rentals
A. Purpose.
1. This Section provides standards to regulate short-term rentals where allowed by Chapter 2 (Zones and Allowable Uses). The intent of these requirements is to ensure short-term rentals are operated in a way that minimizes impacts on surrounding residential uses, provides basic life safety measures, and operate consistent with applicable sections of the Municipal Code.
2. This Section is not intended to provide any owner of a single-unit dwelling, multiunit dwelling, or mobile home with the right or privilege to violate any private Attachment 1
0 City of Grover Beach Development Code 4-27
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022 conditions, covenants and restrictions applicable to the owner’s residence that may prohibit the use of an owner’s residence for short-term rental purposes as defined in this Section.
B. Applicability.
1. The provisions of this Section shall apply to all short-term rental units, including owner occupied and non-owner occupied short-term rentals. All standards of the underlying zone shall continue to apply to a permitted short-term rental. This Section does not apply to legally established lodging uses, which are regulated separately.
2. Short-term rental units shall only be allowed within a legally constructed singleunit dwelling, multi-unit dwelling, multi-unit dwellings within a mixed-use project, or mobile home as defined in Section 9.10.020, except short-term rentals shall be prohibited in the following types of dwellings: live-work units, caretaker residences, and accessory dwelling units unless exempt as specified in Subsection Q. Short-term rental permits shall be limited to the issuance of one permit per building when units share common walls within multi-unit dwellings or within a mixed-use project for all new permits issued after October 1, 2021.
3. Short-term rentals shall be prohibited in any residence subject to an affordable housing covenant or deed restriction imposed or required by the city.
4. Short-term rentals shall be prohibited in recreational vehicles, motor homes, travel trailers, truck campers, tent trailers, boats and other similar vehicles.
C. Permit Required.
1. No person shall rent, offer to rent, or advertise for rent a residential dwelling to another person or group for a short-term rental without a short-term rental permit approved and issued in a manner provided for by this Section, except as specified in Subsection P.
2. A short-term rental permit must be renewed on an annual basis in order to remain valid. If a short-term rental permit is not renewed prior to its expiration date, it shall expire automatically. Under such conditions, the owner shall be required to apply for and obtain a new short-term rental permit, subject to the regulations and administrative rules in effect at the time an application is submitted.
3. Any proposed change to the permit conditions or material facts relating to the information contained in the permit application shall require the owner to submit a new short-term rental permit application.
4. A short-term rental permit is only valid for the address and owner on the shortterm rental permit. The short-term rental permit is non-transferable to another residential unit and any change in property ownership shall require a new shortterm rental permit application be submitted within 60 days. 0 4-28 City of Grover Beach Development Code
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022
5. A short-term rental permit shall be valid only for the number of bedrooms in existence at the time the short-term rental permit is issued. A short-term rental permit shall not authorize the use of any bedrooms in excess of those identified in the short-term rental permit. If additional bedrooms are added to the subject dwelling, a new short-term rental permit shall be required.
D. Application Requirements. The owner shall submit a short-term rental permit application, application submittal requirements, and fee approved in the City’s Master Fee Schedule.
E. Application Approval. The Community Development Director shall approve the short-term rental permit if the owner demonstrates compliance with this Section, agrees to abide by the short-term rental permit conditions, and a site inspection has verified compliance.
F. Permit Approval Notification. The City shall notify all property owners and occupants in writing within a 150-foot radius upon issuance of a short-term rental permit for a non-owner occupied short-term rental indicating the rental address, owner’s name, hotline contact information, and the maximum number of occupants allowed. No notification is required for owner-occupied short-term rentals.
G. Maximum Number. The maximum number of non-owner occupied STRs shall be 40 within the Coastal Zone area and 60 within the non-Coastal Zone area. There is no limit on the number of owner-occupied STRs in the city. STR permit applications shall be reviewed on a first-come, first-serve basis with a waiting list for new STR permits once all authorized STR permits are issued.
H. Permit and Operating Requirements. The owner shall be responsible to ensure that renters comply with all the requirements of this Section. The short-term rental shall comply with the following standards:
1. Maximum Occupancy of a Non-Owner Occupied Rental. The maximum occupancy permitted for a non-owner occupied short-term rental unit shall be limited to the following:
Number of
Bedrooms
Maximum
Number of
Renters
Additional Daytime Guests
Allowed from 7:00 a.m. to 10:00
p.m.
0 (studio) 2 0
1 4 2
2 6 3
3 8 4
4 or more 10 5
2. Maximum Occupancy of an Owner-Occupied Rental. The maximum occupancy permitted for an owner-occupied short-term rental unit shall be limited to the following:
0 City of Grover Beach Development Code 4-29
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022 Number of
Bedrooms
Maximum
Number of
Renters
Additional Daytime Guests
Allowed from 7:00 a.m. to 10:00
p.m.
0 (studio) 2 No Limit
1 4 No Limit
2 6 No Limit
3 8 No Limit
4 or more 10 No Limit
3. Parking. The number of on-site parking spaces shall be provided as required by Development Code Section 3.50 Parking Regulations based on the type of residential unit, except that the required parking spaces may be in either a garage, carport or designated driveway with approved hardscape material.
Parking spaces shall meet the minimum dimensions required by Section 3.50.
Short-term rental parking shall also comply with the following:
a. If a garage is utilized as required parking, access shall be provided at all times the short-term rental is operational.
b. The property owner shall require the renters to utilize the designated on-site parking to the maximum extent feasible.
c. A site plan shall be provided to the guests indicating the location of the required on-site parking spaces and, if applicable, where parking is prohibited, such as within a common driveway. The site plan shall be posted in a conspicuous place on the inside of the premises near the front door at all times the unit is being rented.
4. Local Contact Person. Short-term rental units shall have a local contact person who is available 24-hours per day, seven days per week. The local contact person must be able to be present at the short-term rental within 30 minutes of receiving a complaint at all times the short-term rental is operational. The contact information shall be submitted to the City when an application for permit is submitted and the owner shall immediately provide the city in writing of any change to the local contact person.
5. Property Maintenance. The property shall be maintained in a neat and clean appearance at all times. The owner shall provide appropriate trash and recycling containers which must be stored in a location not visible from the street.
Containers shall be placed at the appropriate pick-up location weekly, no more than 24-hours prior to pick-up, and returned to storage no more than 12-hours after pickup.
6. Good Neighbor Brochure. The property owner shall require any renter to sign an agreement acknowledging they have been provided a copy of the City’s “Good Neighbor Brochure” and agree to comply with the regulations and the consequences for violating the regulations. If the rental is through a third party hosted by an on-line platform, the owner shall require the third party to provide 0 4-30 City of Grover Beach Development Code
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022 an on-line link to the Good Neighbor Brochure and a mechanism by which a renter shall acknowledgement receipt of the Good Neighbor Brochure and agree to comply with the regulations and the consequences for violating the regulations.
7. Life Safety Measures. The following life safety measures shall be provided:
a. Smoke detectors in each bedroom and the hall leading to the bedrooms. b. Carbon monoxide detector.
c. Fire extinguisher in or near kitchen.
d. A site plan indicating the location of the electrical, gas and water shut-off locations.
e. If the residence has a fire sprinkler system, an annual inspection shall be made to ensure proper operation.
8. Posting Permit. The short-term rental permit shall be posted in a conspicuous place on the inside of the premises near the front door at all times the unit is being rented.
9. Noise and Conduct. The owner or the local contact person shall ensure that the renters and/or guests of the short-term rental do not create unreasonable noise or disturbances, engage in disorderly conduct, or violate any applicable law, rule or regulation pertaining to the use and occupancy of the short-term rental. No radio receiver, musical instrument, phonograph, compact disk player, loudspeaker, karaoke machine, sound amplifier, or any machine, device or equipment that produces or reproduces any sound shall be used outside or be audible from the outside of any short-term rental between the hours of 10:00 p.m. and 7:00 a.m. The renters and/or guests shall comply with the City’s Noise Ordinance at all times.
10. Signage. No on-site signage shall be allowed to advertise short-term rentals.
11. Advertising Requirements. All advertisements for short-term rentals shall include the city’s short-term rental permit number and the maximum permitted overnight occupancy as stated on the approved short-term rental permit.
12. Payment of Transient Occupancy Tax. The owner shall pay the transient occupancy tax in compliance with Municipal Code Article X Chapter 6 and the Administrative Rules. Payment of transient occupancy tax shall be required upon the effective date of the ordinance. The owner may submit payment of the transient occupancy tax directly to the City or make payment through a shortterm rental platform that has a current agreement with the City.
13. Business Tax Certificate. The owner of a short-term rental that has an active short-term rental permit shall have a valid Business Tax Certificate at all times.
14. Minimum Stay Requirement. All non-owner occupied permits shall have a minimum of 12 overnight stays during the permit year, as defined by the 0 City of Grover Beach Development Code 4-31
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022 Administrative rules. Any permittees not meeting this requirement shall not be eligible for permit renewal.
15. Compliance with laws. The owner shall ensure that the short-term rental is operated in a manner that complies with all applicable federal, state and local laws, rules and regulations and private governing documents, including, without limitation, conditions, covenants and restrictions (“CC&Rs”) that are valid and enforceable pursuant to the Davis-Stirling Common Interest Development Act, as set forth in California Civil Code Section 4000 et seq., pertaining to the use and occupancy of the short-term rental.
16. Additional conditions or requirements may be required as determined by the Community Development Director to achieve the purpose and intent of this Section.
I. Rental Agreements. The owner shall enter into a written rental agreement with the renter of any short-term rental property, or shall enter into an agreement provided by a third-party rental agency, or hosted on-line platform, which agreement shall, at a minimum, include the following:
1. The name, address, mobile phone, and email address of the renter.
2. The terms and conditions of the rental agreement, including occupancy limits.
3. Acknowledgment by the renter that he or she is legally responsible for compliance by all renters and any guests of the short-term rental with the requirements of this Section and the terms of the rental agreement.
4. Acknowledgment by the renter they have reviewed the Good Neighbor Brochure as specified in Subsection H.6.
5. Acknowledgment and agreement that the City may inspect the short-term rental property for cause upon 24-hour notice.
J. Owner Responsibilities. An owner may authorize an agent to comply with the requirements of this Section on behalf of the owner. However, the owner shall not be relieved from any personal responsibility and personal liability for noncompliance with any applicable law, rule or regulation pertaining to the use and rental of the shortterm rental, regardless of whether such noncompliance was committed by the owner’s authorized agent, local contact person, renter or guest of the short-term rental.
K. Violations.
1. Notice of Violation. The City may issue a notice of violation to the owner, local contact person, renters, or guests pursuant to Municipal Code Article I, Chapter 4, if a violation of this Section is committed, caused or maintained by any of the above parties.
2. Responding to Hotline. The City may issue a notice of violation to the owner if the local contact person fails to respond when contacted by the hotline. 0 4-32 City of Grover Beach Development Code
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022
3. Administrative Citation. The City may issue administrative citations to the owner, local contact person, renters, or guests pursuant to Municipal Code Article I, Chapter 4, if a violation of this Section is committed, caused or maintained by any of the above parties. Unless otherwise provided herein, any person issued an administrative citation pursuant to this Section shall for each separate violation be subject to those fines consistent with the Grover Beach Master Fee Schedule.
4. Penalties. It is unlawful to violate any provision of this Section 4.10.185 of Chapter 4 of Article IX. Violations of this Section are punishable as misdemeanors. Violations of this Section may alternatively be punished as administrative violations as provided in Chapters 1 and 4 of Article I. Any administrative or criminal penalties imposed in accordance with this Section shall be consistent with those penalties and fines enumerated in the Grover Beach Master Fee Schedule. Each separate day or rental night in which a violation exist may be considered a separate violation whether for administrative citations or as a misdemeanor.
5. Additional Conditions. A violation of any provision of this Section by the owner, local contact person, renters, or guests shall authorize the Community Development Director, to impose additional conditions on the use of any given short-term rental to ensure that any potential additional violations are avoided.
6. Permit Modification, Suspension and Revocation. Unless otherwise provided in this Section, a violation of any provision of this Section by the owner, local contact person, renters, or guests shall constitute grounds for modification, suspension and/or revocation of the short-term rental permit and/or any affiliated licenses or permits.
7. Public Nuisance. It shall be a public nuisance for any person to commit, cause or maintain a violation of this Section.
L. Permit Revocation. A short-term rental permit may be revoked under any of the following conditions:
1. The City issues three or more violations related to the operation of the short-term rental within any two-year period.
2. The short-term rental is found to be noncompliant with any portion of this Section, the Administrative Rules, or the short-term rental permit conditions.
3. Abandonment of the use for a period of 12 months or more (demonstrated by a lack of payment of transient occupancy taxes).
4. Failure to pay a citation related to operation of a short-term rental within 15 days of issuance.
5. The owner provided materially false or misleading information in any submittal required by this Section.
0 City of Grover Beach Development Code 4-33
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022
6. Any instance of transient occupancy tax fraud or transient occupancy tax delinquency of more than three months.
7. Credible evidence is presented to the City, after issuance of a short-term rental permit, that there are private governing documents, including, without limitation, conditions, covenants and restrictions (“CC&Rs”) that are valid and enforceable pursuant to the Davis-Stirling Common Interest Development Act, as set forth in California Civil Code Section 4000 et seq., which prohibit the use of the dwelling for short-term rental purposes, as defined in this Section, the owner shall have thirty days after being notified of receipt of such evidence by the city to provide written authorization from the owner’s homeowner association that allows the owner to continue to use the owner’s property for short-term rental purposes until expiration of the current short-term rental permit. If no such written authorization is provided as set forth herein, the owner’s short-term rental permit shall be summarily revoked.
8. A permanent ban on the rental of the subject short-term rental pursuant to an order issued by a court of competent jurisdiction.
9. If the subject property lacks adequate onsite parking, or impedes ingress and/or egress access to the subject property or adjacent properties.
M. Permit Revocation Process. If a short-term rental permit is revoked, the following applies:
1. The Community Development Director shall notify the property owner in writing that the short-term rental permit has been revoked and specify the reasons for the revocation.
2. A property that has a short-term rental permit revoked cannot reapply for a period of two years.
3. Notification shall be sent to all owners and occupants within 150 feet of the subject short-term rental of any revocation.
4. A decision by the Community Development Director to revoke a short-term rental permit is appealable to the Planning Commission as specified in Section 7.20 Appeals.
N. Denial of Permit. A short-term rental permit may be denied for the following reasons:
1. At the time the short-term rental permit application or annual permit renewal is submitted, the short-term rental property has an active code violation related to structures, land use or life safety issues.
2. The owner has had a prior short-term rental permit suspended or revoked, or has been cited for violating any provision of this Section or the Municipal Code related to the use or maintenance of the property of the short-term rental in the prior two years.
4.10.190
4-34 City of Grover Beach Development Code
Adopted October 15, 2012
Amended July 21, 2014, May 15, 2017, January 8, 2018, May 21, 2018, March 18, 2019, June 17, 2019, July 15, 2019, July 6, 2020, November 22, 2021, and June 13, 2022
3. Failure to make transient occupancy tax payments in accordance with Municipal Code Article X, Chapter 6 or the Administrative Rules.
4. There is credible evidence that there are any private governing documents, including, without limitation, conditions, covenants and restrictions (“CC&Rs”) that are valid and enforceable pursuant to the Davis-Stirling Common Interest Development Act, as set forth in California Civil Code Section 4000 et seq., which prohibit the use of such owner’s single-unit dwelling, multi-unit dwelling, or mobile home for short-term rental purposes as defined in this Section.
5. If the subject property lacks adequate onsite parking, or impedes ingress and/or egress access to the subject property or adjacent properties.
6. The owner fails to provide any of the required application information, renewal requirements, or demonstrate compliance with the requirements of this Section or the Administrative Rules.
O. Administrative Rules. The City Manager, or designee, shall have the authority to establish administrative rules and regulations consistent with the provisions of this Section for the purpose of interpreting, clarifying, carrying out, furthering, and enforcing the requirements and the provisions of this Section, and establishing procedures for complaints. A copy of such administrative rules and regulations shall be on file in the office of the city clerk and posted on the city's website.
P. Effect of Ordinance on Existing Short-Term Rentals. All owners advertising or operating a short-term rental property on the effective date of the ordinance enacting this Section shall have 60 days from the effective date to submit a shortterm rental permit application in compliance with this Section. Failure to submit a short-term rental permit application in compliance with this Section shall result in the owner not being eligible to apply for a short-term rental permit or be authorized to operate a short-term rental for a six-month period after the expiration of the 60 day application period.
Q. Effect of Ordinance on Existing or Proposed Accessory Dwelling Units.
Accessory dwelling units and second residential dwellings that are existing, under construction, or in building plan review prior to September 11, 2020 may be used as a short-term rental.
R. Definitions. Definitions for this Section are in Development Code Section 9.10.050.
Attachment 2
City of Grover Beach │ Short-Term Rental Administrative Rules City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page i
Table of Contents
1. Glossary ...............................................................................................................................1
2. Introduction..........................................................................................................................4
3. Key Dates and Deadlines ....................................................................................................4
4. Number of Short-Term Rentals Allowed............................................................................5
5. Short-Term Rental Permits .................................................................................................5
6. Business Tax Certificate .....................................................................................................9
7. Payment of TOT/TMD Taxes ...............................................................................................9
8. Short-Term Rental Operator Regulations........................................................................10
9. Violations............................................................................................................................15
10. Revocation of Permit.........................................................................................................17 Appendix
Appendix A TOT / TMD Submittal Form
Appendix B TOT / TMD Exception Form
Appendix C Owner-Occupied Self Certification Form
Appendix D Non-Owner-Occupied Inspection Checklist
City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 1
1. Glossary
This glossary provides definitions for terms used in the City of Grover Beach Short-Term Rental Administrative Rules and Regulations.
Accessory Dwelling Unit A legally permitted residential unit, either separated or detached, located on the same residential parcel/lot as the primary residential unit.
Administrative Rules The City Manager, or designee, shall have the authority to establish administrative rules and regulations consistent with the provisions of this Section for the purpose of interpreting, clarifying, carrying out, furthering, and enforcing the requirements and the provisions of this Section, and establishing procedures for complaints. A copy of such administrative rules and regulations shall be on file in the office of the city clerk and posted on the city's website.
Advertise The publication of any statements, phrases, words, photographs, drawings or other images for the purpose of informing any member of the public of the ability or availability to use a specific dwelling unit for short-term rental purposes including but not be limited to verbal, written, printed, electronic, televised or broadcast set forth or contained in any newspaper, magazine, newsletter, website, solicitation, handbill, business card, flyer, outdoor advertising display, billboard, cable, satellite or digital radio or television broadcast, social networking site or any other electronic and digital media.
Application A public document completed and filed to the City of Grover Beach that requests permission to operate a short-term rental business for a property located within the City of Grover Beach.
Bedroom Any habitable room normally occupied with no less than 70 square feet of floor area and no horizontal dimension less than seven feet with at least one wall located along an exterior wall with a window and equipped with a heating source as required by the California Building Code.
Brochure A document prepared by the City that summarizes the general rules of conduct and applicable short-term rental regulations to be adhered to by renters.
BTC Business Tax Certificate is a tax payable when the City issues a Business Tax Certificate by every person conducting, carrying on, or managing any business within the City of Grover Beach.
Development Code The City of Grover Beach zoning and development regulations known as Article IX in the Grover Beach Municipal Code.
City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 2
City The City of Grover Beach comprising of all lots within its incorporated City Limit line.
City Council The City Council of the City of Grover Beach.
GBMC The Grover Beach Municipal Code.
Guest An invitee of a renter or other person visiting a renter of a shortterm rental unit who does not rent the unit. Guests shall only be allowed at the short-term rental between the hours of 7:00 a.m. and 10:00 p.m. unless they intend to occupy the unit for the evening consistent with Section 8.(F).
Hotline The telephonic service or electronic messaging service operated by or for the City for the purpose of receiving complaints regarding the operation of any Short-Term Rental and forwarding the complaints to the local contact person.
Hosting Platform An internet based service, or property management company that provides advertisement for a short-term rental property.
Legally Permitted A residential dwelling unit, remodel, or addition that has been issued a building permit by the City, or the County prior to incorporation.
Local Contact Person A person designated on the short-term rental permit, whom shall be available 24-hours a day, seven days a week for the purpose of responding in-person to the short-term rental site within 30 minutes of receiving a complaint regarding the condition, operation, or conduct of guests and is authorized by the owner to take remedial action and who responds to violations.
Non-Owner-Occupied A short-term rental in which the owner does not reside on the property during the time a renter is occupying the residence.
Operator A person that is operating an STR either as an authorized agent for an owner (property manager), or as a legal occupant of the long-term rental with landlord permission.
Owner-Occupied A short-term rental in which the owner resides on the property during the time a renter is occupying the residence.
Owner A person or entity holding legal title and/or equitable title to the real property that is the subject of a short-term rental permit.
Permittee The applicant (property owner) that has been issued a ShortTerm Rental Permit.
Residential Unit A building or portion thereof designed for or occupied in its entirety or in part, as a home, residency, or sleeping place, either City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 3
permanently or temporarily, and containing not more than one kitchen per residential unit.
Renter A person renting or occupying a short-term rental property in accordance with the GBMC. For purposes of these regulations, “renter” shall have the same meaning as “transient,” as defined in Municipal Code Article X Chapter 6.
Short-Term Rental The rental of a private residence, or any portion of the private residence, for thirty or less consecutive days for which a rental contract for occupancy has been made which the short-term rental use is permitted to operate, pursuant to a current and valid short-term rental permit on file with the city. A short-term rental may be either an owner-occupied or non-owner-occupied shortterm rental.
STR Permit An issued document that allows a rental of a residential unit for a period of less than 30 consecutive calendar days or less, subject to all applicable City development code regulations, permit/licensing requirements, and payment of fees and/or taxes, including transient occupancy tax, and tourism marketing district taxes as defined in the GBMC.
STR Permit Renewal A Short-Term Rental Permit Renewal Application to continue operation of an existing Short-Term Rental that the owner of a Residential Unit must fill out and submit to the City’s Community Development Department by July 31st of each year to renew their permit.
Stay A stay is considered the rental period in which a residential unit is occupied by a renter.
TOT Transient Occupancy Tax (TOT) is charged for the privilege of occupancy in a residential unit. Each transient is subject to and shall pay a tax in the amount of twelve (12%) percent of the rent charged by the operator. Said tax constitutes a debt owed by the transient to the City which is extinguished only by payment to the operator.
TMD Tourism Marking District (TMD), requires that all operators who collect Transient Occupancy Tax (TOT) within the County also begin remitting an additional 1.5% of taxable rents beginning with rents collected on July 1, 2020. The District is designed to provide funding for County-wide marketing, advertising, promotions and sales efforts on behalf of the assessed
businesses.
City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 4
2. Introduction
The City Council adopted a short-term rental (STR) ordinance on June 17, 2019 that established a permitting process for all STRs and regulations for all STRs operating in the City. The Ordinance number 19-04 is codified in the Grover Beach Municipal Code (GBMC) Article IX Development Code Chapter 4 Section 4.10.185. The Ordinance authorizes the City Manager to establish administrative rules and regulation consistent with the Ordinance for the purpose of interpreting, clarifying, carrying out, furthering, and enforcing the requirements of the Ordinance.
3. Key Dates and Deadlines
The following table sets forth key dates and deadlines for the City’s STR regulations.
Key Dates and Deadlines
September 11, 2019 California Coastal Commission approved local ordinance regulating Short-Term Rentals.
October 1, 2019 STR application and BTC application available on city’s website https://str.groverbeach.org . Applications accepted online only.
November 12, 2019 Enforcement of STRs that have not applied for permits begins.
December 31 of each year Business Tax Certificate renewals are due (sent via us mail by Administrative Services Department)
July 1- July 31 STR Permit Renewal Applications period. Renewals completed online only at https://str.groverbeach.org .
July 31 of each year Final day to apply for a renewal. If a renewal application is not received by July 31, the permit may be revoked
August 1 to July 31 Permits are valid from August 1 to July 31 of the next year (i.e. August 1, 2021 to July 31, 2022).
City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 5
4. Number of Short-Term Rentals Allowed
The Development Code establishes a maximum number of STRs for non-owner-occupied units (Development Code Section 4.10.185.G). A maximum of 40 non-owner-occupied STRs will be allowed on properties within the coastal zone. A maximum of 60 non-owner-occupied STRs will be allowed on properties outside of the coastal zone. There is no limit for the number of STR permits issued for owner-occupied units. Permits will be issued on a first come, first serve basis.
City Map – Maximum Number of Non-Owner-Occupied STRs
5. Short-Term Rental Permits
A. Application. An application must be completed on-line at https://str.groverbeach.org with all the required information and submitted with a fee approved in the City’s Master Fee Schedule. The City will review all information submitted, including a review of City building permits to ensure floor plans and site plans are in compliance with City records. If as part of the application review process it is determined that construction occurred at the residence without a valid building permit issued by the City, a code enforcement investigation will be opened and your STR application will be denied until building permits have been issued and the work is completed. Applications will be rejected if an open building permit is on file for the property. The following items are required to be submitted for an STR application.
60 STRs
40 STRs
City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 6
1. Applicant Name – This is the name of the property owner. If you are a renter, the landlord’s name must appear on this line and match property records. A permit will be issued to the property owner.
2. Property Address – This is the address of the property. This must match property records maintained by the City.
3. Mailing Address – This is a mailing address where forms and other communications are to be sent. If this is the same as the property address type “same as property.”
4. Applicant Contact Number – This is a phone number to contact either the property owner or the authorized agent such as a property manager or renter. It is recommended this number be a mobile phone number.
5. Applicant Email Address – This is an email to contact either the property owner or the authorized agent such as a property manager or renter.
Assessor’s Parcel Number – The is a property identification number issued by San Luis Obispo County Assessor’s Office. This number may be obtained by visiting either the County Assessor’s website https://www.slocounty.ca.gov/Departments/Assessor/Services/Propert y-Information-Search.aspx or the City’s Zoning information website = https://www.google.com/maps/d/viewer?mid=1oxe-GE-bg8RPy7- FmIGbYTaoAjpyawT3&ll=35.12985372392944%2C120.62230030638129&z=18
6. Fee. An application fee is due at the time of permit registration. This fee covers the cost of City staff time and the City’s third party vendor that accepts the application, monitors the hotline, and performs other assigned contractual tasks. The application fee can change annually and is in the City’s Master Fee Schedule. The fee is not pro-rated at the time of permit registration. The third party vendor may charge a separate fee for credit card and Automated Clearing House (ACH) payments directly from a checking account.
7. Owner-Occupied - The owner resides on the property during the time a renter occupies the residence, between the hours of 10:00 p.m. to 7:00 a.m. To be considered an owner-occupied STR, you must submit a property tax bill that shows the “homeowner” exemption. If a renter, through permission from a landlord, is operating the STR, a copy of the lease shall be submitted in lieu of a property tax bill. A maximum of four (4) entire home stays up to a maximum of 30 days total, is permitted, per permit year (July 1-June 30), to maintain owner-occupied status. In no instance can an owner-occupied permit holder utilize an on-site camper, RV, or stay in a tent, on the property to qualify for an owneroccupied permit.
8. Non-Owner-Occupied – The owner or entity does not reside permanently at the property and rents their entire home and is not present during the duration of the stay.
City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 7
9. Local Contact – All STRs must provide a local contact person who is available 24-hours a day seven (7) days per week and must be located within 30 minute drive of the short-term rental property. The local contact must be able to be present at the non-owner occupied dwelling within 30 minutes. Typically for owner-occupied units, this is the owner, but may also include a secondary contact that is located within 30 minutes of the short-term rental property. City staff will contact the local contact person prior to permit issuance and renewal to verify their role.
10. Site Plan – A site plan showing the location of the residence, all buildings, and setbacks from property lines. An example of this is available at http://www.grover.org/DocumentCenter/View/8811/SitePlan-Example-GB?bidId= . Site Plan must indicate the location of parking, electrical meter, gas meter shutoff, and water shutoff valve.
This site plan needs to be to scale (i.e. 1 inch = 10 feet).
11. Floor Plan – A plan showing the entire floor plan (include all stories) of your residence must be included. Please indicate the location of the following: proposed room(s) to be used for short-term rentals, if using the entire house, indicate entire house, location of all smoke detectors, carbon monoxide detector(s), fire extinguisher within kitchen. Plans are to be completed to scale (i.e. 1 inch = 10 feet). An example is available at:
http://www.grover.org/DocumentCenter/View/8812/Floor-PlanExample-GB?bidId=.
12. Grant Deed – A grant deed is required for any short-term rental permit owned by a property for less than a year, and/or does not match City property records.
13. CC&Rs/HOA – These are required if your property was developed as a planned unit development (PUD), or your property is part of a Homeowners Association or has recorded Covenants, Conditions, and Restrictions. A copy of these restrictions are typically included with your deed or escrow papers. If you need to obtain additional copies, you will need to visit the San Luis Obispo County Recorder’s Office.
14. Authorized Agent Form – This form is required if an application is being submitted by a property manager or renter with authorization from a landlord. The form can be accessed at
http://grover.org/DocumentCenter/View/6732. This form is not required if you will be managing your own property.
A. Business Tax Certificate. Concurrent with an application for a STR permit, the applicant must submit an application for a business tax certificate (BTC). The applicant shall pay the minimum BTC amount, as established in the Master Fee Schedule. All short-term rental permittees shall renew their BTC when it is required by the Grover Beach Municipal Code.
City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 8
B. Inspections. After a review of the initial application submittal, an inspection is required for all non-owner-occupied units prior to approval of an STR permit. An inspection checklist can be accessed at
http://www.grover.org/DocumentCenter/View/8893/Non-Owner-OccupiedInspection-Checklist?bidId=. Owner-occupied STRs must complete a selfcertification checklist and submit this with their application. This checklist is included in the appendix for both owner and non-owner-occupied units and can be accessed here: http://www.grover.org/DocumentCenter/View/8894.
C. Approval. After review of an STR application and inspection completed for nonowner-occupied STRs, the Community Development Director, or their designee shall approve a short-term rental permit if the owner/operator demonstrates compliance with the STR ordinance. In no instance shall an STR operator advertise or complete stays without a valid STR permit after November 12, 2019.
D. Notification. City staff shall notify all property owners and occupants in writing within a 150-foot radius for a non-owner-occupied STR following approval of the STR permit. The information provided will include the rental address, the owner’s name, 24-hour phone number for complaints, and the maximum number of occupants. No notification is required for owner-occupied STRs.
E. Issuance of Certificate. A certificate will be issued via email to the applicant’s email, as provided in the application. This certificate will include the owner’s name, permit number, and date of approval. Permits shall be issued to the owner only. If a permittee does not receive their certificate, they should email city staff at [email protected] and request a copy. It is the responsibility of the permittee to transmit this certificate to their property manager.
F. Renewals. All STR permits shall expire on July 31 of each calendar year. Renewal notices will be sent via the applicant’s email provided on or before July 1st of each year. The permit holder shall submit the STR renewal fee as shown on the City’s Master Fee Schedule, along with required application submittal materials. Any STR permit not renewed on or before August 1 of each calendar year shall be considered expired and will need to re-submitted as a new STR permit. If there is a wait list, the permittee will be placed on this list.
G. Wait List. Upon reaching the maximum number of non-owner-occupied STR permits issued, the City will establish a wait list. If a permit is not renewed, or a permit is revoked, staff will notify the waitlist applicant of availability and the waitlist applicant will have fifteen (15) calendar days to submit an application. The wait list form can be found here: https://forms.office.com/g/WAy6Y0pwrR . Applicants on the wait list should provide contact information including email address and phone number.
H. Permit Denials. An STR permit or renewal may be denied for the following reasons:
1. Code Violations or Life Safety Issues – At the time the short-term rental permit application or annual permit renewal is submitted, the short-term rental property has an active code violation related to structures, land use or life safety issues, including but not limited to illegal structures, City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 9
conversion of space without a building permit, illegal room additions, etc.
2. Suspension or Revocation – The operator has had a prior short-term rental permit suspended or revoked or has been cited for violating any provision of this Section or the Municipal Code related to the use or maintenance of the property of the short-term rental in the prior two years.
3. CC&R Prohibition –If there is credible evidence that any private governing documents, including but not limited to, conditions, covenants and restrictions (“CC&Rs”) that are valid and enforceable pursuant to the Davis-Stirling Common Interest Development Act, as set forth in California Civil Code Section 4000 et seq., which prohibit the use of such owner’s single-family dwelling, multi-family dwelling, or mobile home for use as an STR.
4. Lack of On-site Parking – The subject property lacks adequate on-site parking or impedes ingress and/or egress access to the subject property or adjacent properties.
5. Failure to Provide Information – The applicant/operator fails to provide any of the required application information or demonstrate compliance with the requirements of Development Code Section 4.10.185 or the Administrative Rules, which includes any additional information requested of City staff during the initial review period of a permit.
6. Business Tax Certificate
A Business Tax Certificate (BTC) is required along with an STR permit. An STR operator shall pay the minimum BTC amount. BTC’s are not pro-rated for operations associated with an STR.
BTC’s must be renewed on or before December 31 of each calendar year. BTC fees are separate from STR fees and TOT/TMD taxes. Renewals shall be remitted to the Administrative Services Department.
7. Payment of TOT/TMD Taxes
All STR operators must comply with the requirements, procedures, and schedule set forth in Article X, Chapter 6 of the GBMC regarding remittance of the Transient Occupancy Tax (TOT) and Tourism Marketing District (TMD) taxes to the City.
A. TOT / TMD Tax Rates. As of July 1, 2020, the Transient Occupancy Tax (TOT) is 12%. The tax rate for Tourism Marketing District (TMD) is 1.5%.
B. Payment Due. Payment of TOT/TMD taxes are due on or before the last day of the month following the reporting period (i.e., June reporting period, due on July 31).
Postmarks are not accepted
C. Payment. Payment of TOT/TMD may be made either online only at https://str.groverbeach.org, through electronic check or credit card / debit card, by clicking on the link “Make TOT Payments” or clicking this direct link:
https://secure.hostcompliance.com/grover-beach-ca/remit/registration_number or City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 10 by completing this form and remitted to the city with either cash or check. You may access this document at the following link: Payments are responsibility of the permittee. Platforms such as Airbnb, VRBO, etc. do no remit these taxes to the City; therefore, it is the permittee’s responsibility to ensure payments are made.
D. Penalties. Penalties are due consistent with Article X, Chapter 6 of the GBMC.
E. Exception. Exceptions to payments of TOT/TMD shall be consistent with Article X, Chapter 6 of the GBMC and shall include proper documentation.
8. Short-Term Rental Operator Regulations
The following are regulations and clarifications for short-term rental operators. These regulations will be updated periodically for clarification of situations that may develop based on the implementation of the STR regulations within the City.
A. Owner-Occupied STR Requirements. The following are requirements that shall be adhered to qualify for an owner-occupied STR permit. If you do not meet these regulations, an STR permit shall be submitted as a non-owner-occupied STR.
1. During Stays. An owner must be in the residence or in another residence on the property during the time of a stay during the hours of 10:00 p.m. to 7:00 a.m.
2. Property Verification. At the time of application, an owner must submit their property tax bill issued by the San Luis Obispo County Assessor’s office. This tax bill must contain the “homeowners exemption” line.
3. Multiple Units on a Property. An owner-occupied STR permit may be issued for a maximum of one unit when there are multiple units on the property, legally permitted and if it is ADU constructed prior to June 17, 2019. In no instance can an owner-occupied permit be issued when an ADU is constructed, and the owner occupies the ADU.
4. Use of Accessory Dwelling Units. Accessory dwelling units or the primary residence may be rented as an entire home stay if the following qualifications are met: the accessory dwelling unit was legally permitted prior to June 17, 2019, or the owner had applied for a building permit for an accessory dwelling unit on or before June 17, 2019; and the owner will reside in either the primary residence or accessory unit during the duration of a stay.
5. Use of Tiny Homes. Tiny homes shall be prohibited from use as a shortterm rental.
6. Entire Home Rental Exception. A maximum of 30 nights total, is permitted per permit year and still allow the owner-occupied status during a permit year (August 1 to July 31). In no instance may an accessory dwelling unit and the primary residence be rented simultaneously.
City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 11 B. Non-Owner Occupied Requirements. The following are requirements that shall be adhered to in order to qualify for a non-owner-occupied STR permit.
1. Multiple Units on a Property. A non-owner-occupied STR permit shall be limited to the following:
a. Single-family residences. Lots with a single family residence and a secondary unit (e.g., guesthouse, accessory dwelling unit (ADU) ), legally permitted or constructed prior to June 17, 2019, shall be limited to the issuance of one (1) STR permit. b. Multifamily residential development on a single lot (e.g., apartments) . STR permit issuance after August 1, 2021 shall be limited to one (1) unit per building when units share common walls.
2. Use of Accessory Dwelling Units. An accessory dwelling unit shall not be used as a STR for non-owner-occupied units.
3. Use of a Tiny Home. Tiny homes shall be prohibited from use as a short-term rental.
C. Local Contact Person. A non-owner-occupied STR permit must include a local contact person. The local contact shall respond to a complaint and be present at the STR within 30-minutes of receiving a complaint at all times. An owner-occupied unit must include a secondary local contact person at the time of application, if the owner will utilize the entire home rental exception in Section 8.A.5.
1. Verification. City staff will verify the address provided for the local contact person(s) meets the 30-minute response time by calculating the travel time from the local contact person’s address to the address of the STR using Google Maps, or similar mapping program, for a Saturday at 8:00 p.m. to determine travel time.
2. Phone Number. Local contact shall provide a phone number to be contacted by City Staff, or contracted third party. A toll-free number or answering service is acceptable, provided that the local contact responds to complaints as outline in this section.
3. Travel Time outside of 30 minutes. If city staff determines that the local contact person is outside the 30-minute response travel time, the applicant must choose a new local contact person that meets the minimum criteria. No permit will be issued without a local contact person that meets these criteria.
4. Response to Complaints. The local contact person shall have 30 minutes to respond to a complaint that is logged by the City’s contracted third party vendor, or the City Police Department. If a telephonic message, text, or email is left or sent by either the third party vendor, or the City Police Department, the local contact shall respond by either calling the renters or going to the rental within 30 minutes of receiving this message.
5. Follow-up. The local contact shall reply to the City’s third party vendor, and email city staff at [email protected] within 24 hours of the complaint and include the following:
City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 12 a. Acknowledgement of the complaint received
b. Resolution of complaint
6. Change in local contact. Permittee shall notify city staff within 24 hours of a change to the designated local contact and provide the following:
name, address, email, and telephone number.
Hotline/Complaints. The City shall establish and maintain a non-emergency 24- hour hotline telephone number and electronic messaging system for the express purpose of receiving complaints regarding the operation of any short-term rental property and will forward those complaints to the local contact person for immediate resolution of the complaint, and/or, if necessary, to the Grover Beach Police Department if the complaint has not been resolved within 30 minutes of the initial call to the hotline, consistent with GBMC Article I, Chapter 4.
1. Information Collected. The hotline shall maintain a record of complaints received that include the following information:
a. Date and time of complaint;
b. Nature of complaint;
c. Address of the short-term rental property that is the subject of the complaint;
d. Complainant’s name, address and contact information; e. Actions taken by the hotline attendant in response to the complaint including, but not limited to: persons contacted, including law enforcement, if applicable, and date and time of actions taken in response to complaint; and
f. Corrective action taken by the local contact person in response to complaint.
2. Duration of Registered Complaint. All complaints shall be kept for a maximum of three (3) years from the date the complaint was received.
3. Notification. The owner/operator shall receive a copy of the complaint received through electronic communications (i.e., email).
D. Advertising. The following are requirements to be placed on listing for all platforms and advertisements for STRs.
1. Permit Number. All STR advertisements shall include “Grover Beach STR Permit _____”. This information shall be located in the platform rental summary near the top of the advertisement printed in the same size font as the largest font used in the summary.
2. Maximum Number of Occupants. All STR advertisements shall also include the maximum number of permitted overnight occupants which shall be equal to or less than the maximum number of occupants on the approved STR Permit.
3. Temporary/Permanent Signage. All owners/operators shall not place any signage on the property indicating the use of the property as a short-term rental for safety of guests and owner/operators.
City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 13 E. Responsible Party. As a part of an STR stay or rental, a responsible party must be designated. The responsible party is the person that signs the STR contract, either through a physical form or through a hosting platform. The responsible person is responsible for ensuring all guests and occupants comply with the STR regulations at all times.
F. Rental Unit Requirements. The following are requirements for all rental units or rooms that are to be occupied by guests.
1. Property maintenance. The property is well maintained and clean appearance and is consistent with the submitted site plan.
2. Legible Street Address. The property’s street address numbers are clearly visible from the street using 4-inch numbers and contrast to the color of the mounting surface.
3. Trash / Recycling. Appropriate trash and recycling containers are not visible from the street and accessible to the renter.
4. Exterior Gates. Exterior gates leading to and from the front, side, and/or back yards are not padlocked and can be used in case of an emergency.
5. Required Parking Location and Surfaces. All residences must meet the minimum parking requirements in Development Code Section 3.50.
Surface parking spaces must be a minimum of 9 feet by 18 feet located on an approved hardscape material (Section 4.10.185.H.3). Hardscape materials shall include concrete, asphalt, pavers, gravel base and other acceptable materials as determined by the City Manager. Hardscape materials do not include lawn, landscape areas, dirt, or mulch. Parking spaces shall not block existing sidewalks or if no sidewalk exists, the parking spaces shall not be within the future location of the public sidewalk. If you have questions about the location of future sidewalks, please contact the City’s Public Works Department at (805) 473-4530.
6. Emergency Map. An emergency exit map is posted in an area visible to the renter that illustrates how to exit the property in the event of an emergency.
7. Hallway / Exit Doors. Hallway and exit doors are operational and not obstructed.
8. Double Keys Dead Bolt. Doubled-keyed dead bolt locks are prohibited on all exit doors and must not be present.
9. Minimum Sleeping Room Size. Bedrooms or sleeping rooms occupied by renters shall be a minimum of 7 feet in all directions and not less than 70 square feet in area and have an egress window and door.
City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 14
10. Carbon Monoxide Detector. All STRs shall have a minimum of one carbon monoxide detector with AC power and a battery back-up. This is to be located either in the common room for a residential unit.
11. Smoke Detector. Smoke detectors shall be operational at all times.
Smoke detectors shall be either DC (direct current) with a 10-year battery life or AC (alternating current) with a battery back-up. There shall be a smoke detector located in each bedroom rented as a STR and the hall leading to the bedroom(s). If a living room or sleeping couch is utilized, a smoke detector must also be in place in that area.
12. Fire Extinguisher. All STRs shall one fire extinguisher located in or near the kitchen.
13. Fire Sprinklers. Residences with existing fire sprinkler systems shall have an annual fire sprinkler system inspection indicating the system has “passed”. An STR Permit cannot be issued until an inspection has been performed and passed. Any required repairs shall be performed by a licensed C-16 fire sprinkler contractor prior to issuance of an STR permit.
14. Placement of Permit. The owner/operator shall post the City issued STR permit in a location visible to guests.
15. Good Neighbor Brochure. The owner/operator shall provide the responsible party with the City’s good neighbor brochure either by hardcopy or a link to the City’s website. This link should be included in any “rules” established by the owner/operator.
G. Inspections. For non-owner-occupied units, an inspection shall be completed by city staff prior to issuance of an STR permit to verify the application materials and ensure the STR requirements have been met. A copy of the Non-Owner-Occupied Inspection Checklist is available as a part of the appendix. For owner-occupied STR units, a self-certification inspection is required and needs to be submitted concurrently with an STR application. A copy of the Owner-Occupied Self Certification Checklist is included as a part of the appendix.
City staff may inspect any STR if there is “good cause” for potential violations including but not limited to hotline complaints, code enforcement complaints, notifications from hosting platforms of potential violations, etc. City staff shall notify the owner/operator of an inspection and the owner/operator shall allow an inspection within 72-hours of the notification. A notice of violation may be issued if violations are found.
H. Transfer/Change in Ownership. If the title changes from a person a living trust, where the owners are named as the trustees, notification to the City is required but a new application is not required.
If a STR permit was revoked or suspended and a new STR application is submitted indicating a change of ownership, all previous owners shall be prohibited from City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 15 being part of the new ownership and the new STR application cannot include a spouse or other immediate family member (e.g., siblings, children, parents, grandparents), a change to ownership percentage, name change, or transfer to spouse or other family member (e.g., siblings, children, parents, grandparents).
The City Manager may request additional ownership documents and information to ascertain if the change in ownership is an attempt to allow the STR to be operated by another family member. The City Manager in his independent judgement may deny the new STR permit based on the determination that the new ownership is not a complete change in ownership.
In no event may a permit be transferred when a property is purchased. New owners must apply for a separate permit, and submit all required documents, and fees, etc. If there are no permits available, the new property owner may submit a form to be placed on the waitlist.
I. Minimum Number of Overnight Stays to Maintain Valid Permit. All permits shall have a minimum of 12 overnight stays during the permit year, July 1 through June
30. If an owner does not comply with the minimum number of 12 stays, the permit will be revoked.
9. Violations
Notice of Violations shall be issued to operators of Short-Term Rentals based on the following rules.
1. Advertising without a STR Permit number listed. All permitted shortterm rentals must include their STR number in all advertisements or may result in a violation as follows:
a. A Notice of Violation letter or email will be sent to operators / permittees, providing 14-days to update listings with required information.
b. If the violation remains after 14 days, a follow-up letter / email will be provided to come into compliance, within 7 days. c. If the violation remains, or another violation is found within 90 days, a citation may be issued.
2. Disturbance of the peace violation. A police report is taken for disturbing the peace with a renter / guest staying at an STR shall result in a violation as follows:
a. 1
st Violation within 90 days. A citation may be issued.
b. 2
nd Violation within 90 days. A citation may be issued.
c. 3
rd Violation within 90 day is cause for permit revocation consistent with Development Code Section 4.10.185.L.
3. Failure to Remit Required Taxes. Taxes are required to be remitted, or reported each month, even if no stays are completed. Failure to pay taxes in a timely manner shall result in the following:
a. Fines shall be levied consistent with GBMC Article X, Chapter
6. b. Failure to Make Payments – If TOT or TDM taxes are not remitted in accordance with GBMC Article X, Chapter 6 after 90 City of Grover Beach │ Short-Term Rental Administrative Rules December 2021 Update http://str.groverbeach.org Page 16 days this shall be cause for permit revocation consistent with Development Code Section 4.10.185.L
4. Failure of Local Contact to Respond. A local contact shall respond to a call from the City’s third party vendor within 30 minutes as required by Section 8.C.3. If a local contact does not respond to this phone call as required by Section 8.C.3, this shall result in a violation as follows:
a. First violation, a letter / email will be issued by City staff warning the permittee and the local contact to respond to all calls within 30 minutes.
b. 2
nd Violation within 90 days, a citation may be issued
c. 3
rd Violation within 90 days, a 2nd citation may be issued d. 4
th Violation within 90 days is cause for permit revocation consistent with Development Code Section 4.10.185.L.
e. One violation is considered a call between a 48-hour period (i.e. multiple calls on a weekend is considered one violation).
5. Occupancy Limit Violation. Hosting renters beyond the allowed limit of your permit occupancy shall result in a violation as follows:
a. a. First Violation. A letter shall be sent to the property owner informing them of the violation. Property owner must ensure total number of guests match their allowed occupancy. If there is a police report taken this may be waived to an citation. b. b. 2nd Violation. A citation may be issued. A violation is considered a documented stay identified by the City’s 3rd party vendor within 90 days.
c. c. 3rd Violation. A citation may be issued. A violation is considered a 2nd documented stay identified by the City’s 3rd party vendor within 90 days.
6. Operation of a Short-Term Rental without a Permit. It is illegal to operate a short-term rental without a valid permit. Operations without a STR Permit shall result in the issuance of a Notice of Violation as follows:
a. First Violation. A letter shall be sent to the property owner informing them of the violation and 14 days to comply with either submittal for a permit or removal of the advertisement. b. 2
nd Violation. A citation may be issued. A violation is considered a documented stay identified by the City’s third party vendor within one year.
c. 3
rd Violation. A citation may be issued. A violation is considered a second documented stay identified by the City’s third party vendor within one year.
d. Code enforcement case to be referred to the City Attorney.
7. Noise Violations. No music, musical instrument, phonograph, compact disk player, loudspeaker, karaoke machine, sound amplifier, or any machine, device or equipment that produces or reproduces any sound shall be used outside or be audible from the outside of any short-term rental between the hours of 10:00 p.m. and 7:00 a.m. and the operation of a Short-Term Rental shall be in compliance with the City’s Noise City of Grover Beach │ Short-Term Rentals Administrative Rules December 2021 Update http://str.groverbeach.org Page 17 Ordinance at all times. Failure to comply with the above shall result in a violation as follows:
a. First Violation. A copy of a signed sworn statement by the responding officer along with a warning letter shall be provided to the permittee and local contact.
b. 2
nd Violation within 90 days, a citation may be issued.
c. 3
rdViolation within 90 days, a citation may be issued.
d. 4
th Violation within 90 days is cause for permit revocation consistent with Development Code Section 4.10.185.L.
e. One violation is considered a call between a 48-hour period (i.e. multiple calls on a weekend is considered one violation).
8. Trash Violations.
a. 1
st Violation. A warning letter / email will be sent to the permittee and or local contact. Trash cans shall be removed from the rightof-way within 48 hours of receipt of the letter / email. b. 2
nd Violation within 90 days. A 2nd warning letter / email will be sent to the permittee / local contact. Trash cans shall be removed from the right-of-way within 48 hours of receipt of the letter / email.
c. 3
rd Violation and subsequent violations within 90 days. A citation may be issued.
9. Other Violations. Other violations shall be reviewed by the Community Development Director to determine severity of violations.
10. Revocation of Permit
Revocation of a STR permit shall be consistent with Development Code Section 4.10.185.L and M.
Attachment 3 – STR Locations
Density of STR Permit Holders