Short-Term Rental
Program Update
GROVERBEACH.ORG
Megan Martin, Community
Development Director
A. Rafael Castillo, AICP, Senior
Planner
STR Update
GROVERBEACH.ORG
• City Council adopted a Short-term Rental (STR) Ordinance in June 2019 to regulate vacation rentals in the City
• Established a citywide cap for non-owner-occupied rentals • Established a maximum number of renters and guests based on bedrooms
• Created an inspection and self-certification program
• Established complaint hotline and portal
• Required neighborhood notification for non-owner-occupied permits • Required establishment of a local contact
STR Update
GROVERBEACH.ORG
• Ordinance was revised in 2021 with the following modifications:
• Limit multi-family developments to one (1) permit per property • Established a minimum-night stay requirement of 12-nights per year for non-owner-occupied permit holders
• Create and manage a waitlist for non-owner-occupied permits due to hitting cap limits
GROVERBEACH.ORG
Program Implementation
GROVERBEACH.ORG
• 119 STR permits total
• TOT / TDM taxes are collected:
• 12% TOT, 1.5% County TDM
• Tax payment is handled by Host
Compliance
• Host Compliance also used for
permitting and compliance
Fiscal Impact
GROVERBEACH.ORG
• Since 2019, city has collected
$2.9 million in TOT taxes
• City staff revamped efforts in
collection of taxes since the
beginning of the program
• Revamp of tax collection efforts
city staff ensures timely
payments
$103,540.00
$298,915.00
$508,362.00
$458,567.00
2019-2020
2020-2021
2021-2022
2022-2023
TOT Revenue
TOT Revenue
Enforcement of Regulations
GROVERBEACH.ORG
• 213 complaints received
• 6 complaints per month
• 64% of complaints generated by 13
STRs
• City staff works diligently with
permittees to reduce # of complaints
• Administrative Rules revamped to
reduce complaints
Potential Revisions - Waitlist
GROVERBEACH.ORG
• The decision to establish a waitlist was driven by an approach to manage demand for STR permits
• Currently 54 households are awaiting an STR permit on this list • When a permit becomes available, staff follows a protocol • Some waitlist participants have “passed”, and retain waitlist position • Staff recommends the following modification to the Admin Rules:
• 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” Potential Revisions – Local Contacts
GROVERBEACH.ORG
• Current administrative rules require a local contact to be within 30 minutes of a non-owner occupied permit location
• 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 • Admin rules define what is “30 minutes”
• Staff seeks on potential revisions to local contacts
• 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
STR & ADUs
GROVERBEACH.ORG
• Ordinance prohibits the use of ADUs as STRs
• City staff has received inquiries on whether an STR could be permitted within an ADU or move into the ADU and rent the primary unit
• ADUs are a way to increase the availability of long-term housing options
• Allowing ADUs to operate as STRs could reduce the overall housing stock • Intent of State law is to provide for more housing options through ADUs • Conversion of ADUs to STRs may drive up housing costs and negatively impact housing for local residents
STR & ADUs
GROVERBEACH.ORG
• Staff seeks direction on how to balance potential benefits and concerns:
• 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 originally licensed • At the time of building permit finalization, require the permittees to relinquish their permit following construction of the ADU.
Potential Revisions – Minimum Stays
GROVERBEACH.ORG
• Council directed staff in 2021 to add minimum-night stays for non- owner-occupied permits • 97% of existing permit holders meet this requirement
• Staff seeks direction on whether to increase the minimum-night stay requirement • Minimum night stay may increase to 24-nights per year, or another number between 13-24 • If so, based on 22-23 permit year, 12 existing permit holders would be ineligible for renewal • Allows for City to collect more TOT revenue without increasing the cap or total # of STR rentals
Increase the Existing Cap
GROVERBEACH.ORG
• Part of the STR ordinance adoption, the Council recognized the balance between providing additional visitor-serving amenities and maintaining a sufficient inventory of long-term rental housing
• 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. Staff seeks direction to:
• Increase the number of allowable STRs based on a percentage of the total housing stock - 2% which would allow for one new Coastal Zone permit would be allowed, and two non-coastal zone permits
• Increase this cap by a higher percentage based on the anticipated growth • Review this cap every 2-3 years for potential changes based on housing units produced
Requested Items for Council Direction
GROVERBEACH.ORG
• Waitlist procedures
• Local contacts
• STR & ADUs
• Minimum stays
• STR non-owner-occupied permit caps
• Questions and Comments
STR Update
GROVERBEACH.ORG