AGENDA CORRESPONDENCE
RECEIVED BY THE CITY COUNCIL FOR
PUBLIC REVIEW PRIOR TO THE MEETING
AGENDA NO: 7.d
MEETING DATE: January 9, 2024
Susan Pyburn
San Luis Obispo 93401
January 6, 2024
To Morro Bay City Council Members:
Re: Proposed ordinances regulating public camping and sleeping in vehicles I am writing to ask you to postpone a decision of proposed Ordinances 665 and 666 that would regulate camping on public property and sleeping in vehicles. These important issues deserve a thorough public discussion that considers both public safety concerns as well as the impacts on homeless individuals and families.
These ordinances would stipulate time, place and manner of the use of public and some private property , highly restricting the movement and location of campers and vehicle sleepers. Such restrictions could force daily movement and resettling for families already undergoing dire conditions in inclement weather, families in need of more immediate and substantial help than long‐term case management, helpful as that may be.
While the overarching goal of protecting the community from flooding and ensuring safety is important to the community at large, further discussion might avoid unnecessary disruption and turmoil for a population already under extreme duress.
Such community discussion should address developing a range of supportive services aimed at reducing the homelessness countywide by 50% by the year 2028 as per the Regional Compact on housing, to which Morro Bay is a signatory.
Please give this matter a wider forum before considering your vote.
Susan Pyburn
To: Morro Bay City Council
From: Glenn Silloway, MB resident
Re: Proposed ordinances regulating public camping and sleeping in vehicles
I am writing to urge the Morro Bay City Council to pull Ordinances 665 and 666 from the consent agenda and then to postpone a decision on them pending a thorough public discussion.
The ordinances up for adoption on January 9, 2024 mark a large shift in Morro Bay policy regarding people who are experiencing homelessness.
They create regulations for the time, place and manner of the use of public and some private property that highly restrict the location and movement of campers and vehicle sleepers. They may very well eliminate public space encampments, which is probably the point.
We understand that the ordinance on camping is crafted to comply with court cases Martin v. City of Boise and Johnson v. City of Grants Pass in order to allow camping on public spaces within regulatory guidelines. City officials have stated that their intent is to provide a set of services to people experiencing homelessness including, among others, case management.
However, the issue of homelessness is much more complex than recognized in the proposed ordinances. It is a community-wide issue that deserves discussion in public forums aimed at reaching a plan for the full array of services and supportive case management intended to eventually reduce the incidence of homelessness and the rigors of experiencing it.
Morro Bay needs a policy that has a prospect of sustainability within the Regional Compact on housing to which Morro Bay is a signatory and the regional plan to reduce homelessness countywide by 50% by 2028. The proposed ordinances do not provide that.
AGENDA CORRESPONDENCE
RECEIVED BY THE CITY COUNCIL FOR
PUBLIC REVIEW PRIOR TO THE MEETING
AGENDA NO: 7.e
MEETING DATE: January 9, 2024
1 Heather Goodwin
From: Ted Schiafone
Sent: Monday, January 8, 2024 11:15 AM
To: betty winholtz; Carla Wixom; Laurel Barton; Jennifer Ford; Zara Landrum; Cyndee Edwards; Council Cc: Dana Swanson
Subject: RE: agenda item 7e
Betty,
Thank for your comments. Please note this Agenda Item is not for the approval of this project. This is only to approve a Consent of Landowner (COL) form. That form allows the Developer the ability to present the proposed plan to the Planning Commission, Community Development Department, and Council. That process will allow for stakeholder engagement to address all the concerns and questions you mention in your email.
Thank you,
Salvatore (Ted) Schiafone
Harbor Director
City of Morro Bay
1275 Embarcadero / Morro Bay, CA 93442
Phone 805-772-6254
www.morrobayca.gov
From: betty winholtz
Sent: Sunday, January 7, 2024 11:22 PM
To: Carla Wixom <[email protected]>; Laurel Barton <[email protected]>; Jennifer Ford <[email protected]>; Zara Landrum <[email protected]>; Cyndee Edwards <[email protected]>; Council <[email protected]> Cc: Ted Schiafone <[email protected]>; Dana Swanson <[email protected]> Subject: agenda item 7e
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Dear City Council,
Please address my questions:
1. Policy: How is it that Council is assigning a leaseholder and approving his project at the same time? At the least, you are tying the hands of the planning commission if not eliminating its role in this project. Why?
2 2. Parking: Why is parking not required on the empty lot between the current buildings, rather than thrusting all parking onto the public street? Just because this is not a "commercial" area yet, it is well used by park users and walkers. In light of the number of units you are approving, you will be creating a public parking issue where one does not currently exist.
3. Setbacks: Have you check the height setbacks from the water?
4. Aesthetics: Who wants to see or walk under an elevated, overhead sidewalk?
5. Economics: The picture renderings are misleading by not showing the existing Inn across the street, and thus the negative impact the new project will have on the current business. While I understand that private views are not protected, in a business sense, how do you justify compromising one business's income for the benefit of another business? Are there changes that could be made to reduce the impact?
6. Endangered species: I do not see that the eelgrass is being protected.
If you would not approve the design, perhaps these are questions that could be addressed at the planning commission.
Sincerely,
Betty Winholtz
AGENDA CORRESPONDENCE
RECEIVED BY THE CITY COUNCIL FOR
PUBLIC REVIEW PRIOR TO THE MEETING
AGENDA NO: 7.g
MEETING DATE: January 9, 2024
1 Heather Goodwin
From: Brian Dedmon
Sent: Sunday, January 7, 2024 9:24 PM
To: Council
Subject: Three Stacks and a Rock
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To the Morro Bay Mayor and members of the City Council:
My name is ChrisƟne Dedmon. My husband and I are residents of the Central Coast. We oŌen stop in Morro Bay to visit one of our favorite places—Three Stacks and a Rock.
We understand that you are proposing to change their lease in ways that will make it hard for them to stay in business.
I’m not sure why you would want to damage a thriving business that is such an asset to the Embarcadero and to the City.
The owners have created a great place, enjoyed by tourists and locals alike. There are plenty of shops and restaurants that cater mainly to the tourist trade. Three Stacks is a place that local residents can frequent on a regular basis.
We hope you will reconsider this proposed change and honor the original agreement so that Three Stacks and a Rock can conƟnue to be a valued Embarcadero business.
Sincerely,
ChrisƟne & Brian Dedmon
Cambria CA
2 lucky to make a 10—15% profit. All other businesses on the Embarcadero may deduct their base rent (monthly rent) from their percentage of rent, but now the City is revoking that critical component from Three Stacks. Why? If the City has its way, not only will Three Stacks be paying the highest percentage of rent, but they will also be the only business on the Embarcadero that cannot deduct their base rent from their percentage of rent. This will cause this business’ slow death and potential to go out of business. That would be a significant loss to the community! In any agreement, particularly with a city that depends so heavily on tourism business, a spirit of partnership and good faith is critical for the success of both the business and the city. However, that apparently is not the case here, and the attitude is a “take it or leave it” situation without allowing for any negotiations.
As a frequent visitor and future resident who has consistently supported, and invested in, the businesses and organizations that make Morro Bay so special, I respectfully request that the City negotiate in good faith with Three Stacks as promised to them when they invested in your building. If the council concludes that there will be no negotiation and only the reliance on the Harbor lease policy, then the Harbor Lease Policy states that a percentage of rent be deducted from base rent regardless if you are a building lease or a master lease holder. Please, at least let Three Stacks deduct base rent from that percentage.
TO REITERATE ONE MORE TIME: Three Stacks’ lease states the City will negotiate a fair and equitable percentage of rent, and yet the City is refusing to do that. So, Three Stacks is now referring to the Harbor Lease Policy, which states lease holders get to deduct base rent from a percentage of the rent and pay whichever is greater. While this was originally offered, now that policy has also been rescinded, therefore going against their own policy.
Three Stacks, who have negotiated in good faith from the beginning of this process, were promised so much while investing in the City’s building, and by extension, investing in this community and its economic growth/health. They have hosted fundraisers for other Morro Bay organizations and are, yes, putting their time and money where their mouths are to be contributing members of the community.
Now, you have decided to not honor a written, signed, and fully executed agreement? You don’t want to support one of the best new businesses in town? Not everyone is interested in the new overpriced boutique hotels (especially when parking is at a premium and, in one case, requires guests to park blocks away) or (in my opinion) mediocre new restaurants (yes, we’ve tried them all). If we wanted pretentiousness, we’d head to Santa Barbara or Cambria. Three Stacks offers a truly “Morro Bay” experience for everyone. They love their customers and their community. All they are asking is for the opportunity to remain in business, provide jobs for their exceptional employees, and continue to provide a delightful experience for locals and visitors alike.
Sincerely,
Laurie Miller
Santa Clarita, CA
2 The City will make TTL lease sites available on fair and reasonable terms without discrimination. The City may consider more than just the maximum revenue that can be generated by a new lease. The City will also consider what is in the best interests to ensure the public’s enjoyment of the TTL, as well as to serve the City of Morro Bay, including the essential role all parties and businesses play in maintaining growth and job creation, as well as the need to maintain a diversified mix of water dependent uses.
The City will establish and maintain a level and structure of rents, fees, and charges that are fair and equitable for all tenants, and which are based on current appraised lease site values. An improvement project involving remodeling or replacement of 50% or more of the existing improvements, or of a lease site requiring significant private investment costing 50% or more of the appraised value of the property, the City may allow both temporary reductions in the outlined minimum rent to offset the Master Tenant’s period of reduced revenues during construction, as well as a reduction in the standard percentage of gross sales requirements.
Three Stacks has spent many hours preparing presentations, reports etc.… for meetings with the Harbor Director in order to negotiate in good faith to reach an equitable percent of rent according to our Lease. At our first meeting with the Harbor Director, he stated he had no intention of negotiating with us & in fact was not able to. From that point forward, it has been our position that the City has negotiated in bad faith. Even though the Harbor Director has refused to participate in any good faith negotiations, Three Stacks has continued to provide additional documentation to the Harbor Director, including a proposal for making additional improvements to the building that would include paying for repairs to the outside siding of the building. Three Stacks has explained to the Harbor Director that we are entitled to be considered a Master Tennant instead of a Building Lease Tenant since we had to provide our own plumbing, heating, electrical, fire suppression, new concrete, sewer lateral & ADA compliance. The Harbor Lease Management Policy states that there is a potential conflict of interest if the City is both landlord to Master Tenants and a building lease landlord and the City will only enter into building leases when it becomes absolutely necessary, to maintain the improvements, for business continuity or to take advantage of an unusual opportunity. The Policy also states that building leases will be only on a short-term basis (generally three years or less), provide for fair market value terms and conditions and be in compliance with the Tidelands Trust.
Three Stacks has also explained to the Harbor Director that we should be considered a manufacturing facility. Three Stacks does not simply “tap a keg” like a bar, Three Stacks manufacture a product at a greatly increased cost than that of a “bar”. We use high utilities in sanitization of cleaning each keg & processing water to manufacture the product. Federal TTB (tax trade bureau) taxes paid per keg per month based on manufacturing. *Taxed on production. Therefore, Three Stacks acts as a manufacturing plant/eating place/tasting room that cannot be compared to a “bar”.
Based upon the above, the City has failed to follow its own Lease Management Policy Principles as set forth above and most specifically the policy that allows for Tenants to earn a fair return on their investment.
Our goal has always been to be a good partner with the City, provide jobs for local community members and be a major draw to the south end of the Embarcadero. The old Aquarium never paid percent rent and in its waning days became a deterrent. Three Stacks came in when many hospitality businesses were shuttering. Despite the previous promises made to Three Stacks, we will 3 acquiesce to the higher percentage rent, with the exception of Beer/Wine vs. Liquor. Three Stacks requests that the City use the same percentage rent as set forth in other Leases and comply with its own Policy guidelines related to fairness and anti-discrimination. Please understand that in regard to Beer/Wine vs. Liquor, the profitability on a liquor drink is 75-80%, while profitability on beer manufacturing/restaurant is closer to 10-15%. In addition, the profitability of a bar that does not provide food service and manufacture its own beer is extremely more profitability. Simply put, it would be impossible for Three Stacks to pay 10% gross percentage rent on the beer we manufacture.
Based upon the forgoing we propose the following fair and equitable amendment to our lease.
Percentage Rent. In partial consideration of completing the improvements stipulated in Section 3.4 of this Lease, Tenant shall have no percentage rent payment obligations for the first twelve full-calendar months of tenancy after the Effective Date. As of May 1, 2023, Tenant will be responsible for Percentage Rent from Tenant’s Gross Sales at the following rates.
Restaurant Sales 5%
Beer/Wine Sales 5%
Liquor Sales 10%
Merchandise 5%
The First Paragraph of section 3.4.2 under Performance Standards of the Amended Lease is replaced in its entirety and reads as follows;
Section 3.4.2. In addition to the minimum rent, tenant agrees to pay to City Percentage rent, as calculated pursuant to Section 3.3, to the extent that Percentage rent in each years exceeds the amount of minimum rent due that year pursuant to this lease.
Three Stacks believes this proposal to be fair and equitable and ask for your support in this matter. Although we do not know what the Harbor Director will be proposing at closed session on 12/12/23, the Harbor Director stated to us that because we would not agree to his proposed percentage rent that he would be removing his recommendation for us to deduct base rent from percentage rent. Clearly, this is completely contrary to the Lease Management Policy, would be in violation of the Tidelands Trust, and would demonstrate further bad faith negotiations by the City, as we would be the only tenant that is not allowed to deduct percentage rent and also be paying the highest percentage rent on the Embarcadero.
We look forward to resolving these lease issues and reaching fair and equitable lease terms.
Sincerely,
Ananda Nettnin / Owner
Three Stacks Brewing Co., LLC
A proud minority owned business
Morro Bay City Council
My wife and I are writing to you in regards to item 7.g of the January 9, 2024 city council meeting. We were made aware that the owners of Three Stacks and a Rock Brewing Company, Chuck and Ananda Nettnin, have been in so-called negotiations to add an amendment to their lease to include an equitable percentage of their profits as additional lease costs. From our understanding negotiations as to a percentage was to happen between the Harbor department and Chuck and Ananda, and it has been a one-sided conversation. The Harbor department has not been willing to negotiate the added lease charge terms at all. We would understand an effort by the Harbor Department to add an equitable percentage of profit to the lease term IF the equitable percentage total exceeds the base lease total.
What we have been told and see in the amendment proposal, because an agreement has not been reached, the Harbor department wants to charge an additional amount to the base rent from the first dollar of revenue – that is neither fair nor equitable. Additionally, we understand that the Harbor’s lease policy, which they are falling back on because an agreement has not been reached, is written with this additional clause that states a deduction to base rent will be made to offset the equitable percentage until the equitable percentage exceeds base rent - this clause should be included in the proposed amendment.
Chuck and Ananda have been long time Morro Bay residents and Three Stacks and a Rock LOCAL business owners since 2016. As such they have and will continue to support the local community in many ways - they are a small local business trying to serve the best interests of our town, Morro Bay.
My wife and I have been going to their brewery since it opened and will continue to support their LOCAL business. We are long time visitors of Morro Bay, and in the past year and a half we became residents.
When we were searching for a home in Morro Bay, one of the main criteria was to be close enough to walk to the Embarcadero to visit the local shops, and especially Three Stacks and a Rock. Whenever we are in town we are frequent visitors, and we bring any guests that we have down to visit the Embarcadero to shop at the local stores and have a beer or two and a bite to eat at Three Stacks and a Rock. Practically every time we go there, we end up talking with someone that is visiting from another state or even outside of the US. The staff is local and amazing - it is a great place to enjoy the harbor and have wonderful conversation.
I am asking you, as the city council, do not allow the Harbor to invoke this amendment without further negotiation, as you will likely lose another LOCAL business that is vital to our community.
Thank you,
Derrick and Michele Rebensdorf
1 Heather Goodwin
From: Sheri Schmidt
Sent: Monday, January 8, 2024 12:17 PM
To: Council
Subject: Three Stacks
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Shame on you Morro Bay - before Three Stacks this building was disgusting. It is the best place to visit in our town for locals and visitors. Have some integrity and uphold your original agreement. 2 1
Heather Goodwin
From: Tracy Stratton
Sent: Monday, January 8, 2024 6:33 PM
To: Council
Subject: City Council meeting on 1/9/2024- Agenda item 7G [Some people who received this message don't oŌen get email from . Learn why this is important at hƩps://aka.ms/LearnAboutSenderIdenƟficaƟon ]
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Dear Councilpersons,
It has been brought to my aƩenƟon that the city council is not honoring their original agreement with Three Stacks and a Rock brewing Company, in negoƟaƟng a fair and equitable rent upon their lease renewal. But instead, imposing the highest rent of anyone on the Embarcadero and imposing addiƟonal taxes, and not allowing the base rent to be deducted before the taxes are imposed (as is done for other businesses). This will be the slow death of a beloved business on our Embarcadero. They spent a lot of money and turned a crumbling building into a wonderful community restaurant and gathering place.
Please reconsider, imposing such impossible rents and taxes, and creaƟng a hardship for a wonderful local business. I would hate to see a beloved business fail because the city is being greedy and not keeping their word.
Thank you for your Ɵme and consideraƟon,
Tracy StraƩon
resident of Morro Bay
AGENDA CORRESPONDENCE
RECEIVED BY THE CITY COUNCIL FOR
PUBLIC REVIEW PRIOR TO THE MEETING
AGENDA NO: 9.a and 9.b
MEETING DATE: January 9, 2024
1 Heather Goodwin
From: patticake801 <
Sent: Tuesday, January 9, 2024 8:59 AM
To: Council
Subject: Meeting tonite
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Dear mayor and council, in regards to the STR s, this seems to be such a messy subject. We definitely need a list available, to the public, of all existing STRs … at the least. The number of them needs to be reduced, as well; or possibly only owner occupied allowed. I personally, would hate to have one next door to me, or many on my street. I would guess that you might feel the same way. As a retired person, I value my well earned peace and quiet. Please do your best to figure out this complicated issue. Many a town, snd neighborhood, have been ruined by too many STRs !!! In regards to holding town hall meetings, I believe that MORE meetings are better!!! MORE understanding of the issues, by the public, will be the result. I have always felt that the communication in this city is sorely lacking and these meeting are important to the citizens. Most of the meetings have been a full house which proves there success. Please don’t deprive the public by limiting them. Limiting them, would only result in more resentment and distrust. Thank you for all you do and the many hours you devote to our city. Patti Anderson Sent from the all new AOL app for iOS
AGENDA CORRESPONDENCE
RECEIVED BY THE CITY COUNCIL FOR
PUBLIC REVIEW PRIOR TO THE MEETING
AGENDA NO: 9.a
MEETING DATE: January 9, 2024
January 8, 2023
RE: Short Term Vacation Rental policy
Dear Mayor Wixom and Morro Bay City Council members:
I am a resident of North Morro Bay, and own a “home-share” hosted Airbnb that is set up downstairs in my home. I have a business license in Morro Bay and I report and pay all of my TOT every month. I attended the town hall regarding STVRs, made public comments at your meetings, and have written letters to you before. As the issue is coming up on the agenda Tuesday, January 9, I write this to summarize my comments and requests for action on the issues we discussed. There appeared to be a consensus from the town hall that lack of enforcement of the ordinance was a major problem. There are three categories at least; (1) issues around unlicensed STVRs and (2) problems related to noise, nuisance, etc, (3) the number of unhosted, whole house STVRs. Here are my thoughts:
● Shut down unlicensed STVRs. Contact Airbnb and VRBO and ask for a list of all STVRs in Morro Bay for each. Compare this to city/HDL records of who is licensed and pays TOTs; seek out the unlicensed STVRs and fine them, shut them down. If it has been less than one year, maybe give them a month to comply, pay back TOT, etc. Enforcement may involve amending the contract with HDL to add these duties, and/or hiring an assistant city attorney to locate the unlicensed units. ● File collection actions for back TOTs on unlicensed STVRs. This should pay for itself and more. It will also have a deterrent effect on further failure to pay taxes, and it should shut down some of the STVRs that are the source of nuisance and noise issues. I believe it will have the effect of “cleaning up”the industry as well as reducing the number of unhosted STVRs.
● Enforce accurate reporting and payment of TOTs by hosts in the monthly TOT collection. Currently reporting and paying TOTs is done on an “honor system” only, with no consequences for under reporting or failure to report and pay the full TOT.
During the town hall I learned that in a 12 month period, only $9,000 was collected from home-share hosted Airbnbs. This is disturbing and unfair, as my own TOT payments for the year 2023 are over $4,800 which is over half of the total. I believe there are 11 home-share Airbnbs in Morro Bay alone, so this means that many of them are not paying anything, or are under-reporting by a large amount. The STVR system in Morro Bay will never be cleaned up if payment of TOTs is optional.
I contacted HDL and they indicated that the online TOT payment page has a place where hosts have the option to upload documentation showing the number of nights booked and gross receipts. The HDL representative I spoke to indicated they could require this documentation if their contract allowed for that, instead of making it optional. As an Airbnb host I can say that it would be very easy for us to take a screenshot from the Airbnb app at the end of each month showing nights booked and gross receipts, and upload it to the HDL site. Please make documentation of #nights booked and total monthly receipts mandatory, with this information reported to code enforcement or the city attorney. The city attorney assigned can then pursue penalties and back taxes for those that fail to report or underreport. ● Give warnings and shut down VRs that are repeat offenders regarding neighborhood noise, nuisance, parking violations etc. The current small fine system is not enough. No one has a right to disturb their neighbors. ● Lower the number of whole house, unhosted Airbnbs, after considering other small coastal towns and their numbers.
● Finally, TOTs totalling 14.5% are too high for hosted home-share VRs, have a disproportionate impact and should be lowered or scaled down, along with the business license fee for STRs.
Thank you for your consideration of these matters.
Respectfully yours, Jeanne Marie Colby
Business license
2 Thank you for reading my lengthy message. I am happy to meet and support if desired, Helene
1 Heather Goodwin
From: Cythnia Hawley < >
Sent: Monday, January 8, 2024 8:46 AM
To: Council
Subject: vacation rentals
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Dear City Council Members,
I support Council Member Landrum in her efforts to get an effective vacation rental ordinance.
Commercial use of houses should not be allowed in residential zones. Keeping neighborhoods a place where people can enjoy some peace and quiet is important.
Separating homes from noise and polluting businesses and industries is one of the primary reasons zoning.
No matter where vacation rentals are cited, an ordinance with clear, unambiguous, and understandable laws should be legislated and made known to the public.
And, of course, an ordinance is nothing unless it is enforced by dedicated staff time.
Sincerely,
Cynthia Hawley
Begin forwarded message:
From: betty winholtz <
Subject: vacation rentals tuesday at city council
Date: January 8, 2024 at 2:53:44 AM PST
To: Betty Winholtz >
Dear Morro Bay Friends and Residents,
Council Member Zara Landrum has boldly taken on the ineffective vacation rental ordinance to make it better. She held a town hall meeting to hear residents' complaints and suggestions. She got it on the city council agenda.
In order to make corrections, other members of the council need to here from the public what is wrong, and what we want done differently. Please send an email to the city council no later than noon on this Tuesday, January
9. [email protected]
2 You know what would help your neighborhood. Would it include enforcement of rules for those who are legal, as well as enforcement against illegals? What about a dedicated enforcer, not part time, whose hours are partly days and partly nights? The report says TOT from STRs is $750,000, enough for a person. Amend the ordinance to make leaving barking dogs alone illegal? Lower the maximum number of full home rentals? Should they be allowed in residential zones only, or only in commercial zones, or it doesn't matter? Do you know if your street is considered commercial? The link to the staff report on page 149 of 185 is: https://pubmorrobay.escribemeetings.com/FileStream.ashx?DocumentId=317 Your short or long email would look like this:
Dear City Council,
This is my comment on STRs.......
Respectfully,
[name]
January 8, 2024
To Morro Bay City Council members:
Re: Agenda Item 9a for January 9,2024 City Council MeeƟng Please Note: This leƩer was submiƩed to the Council in for the Oct 24, 2023 meeƟng and is very relevant to the agenda item on STR RegulaƟons that you will be discussing on Tuesday. In addiƟon to the leƩer below, I want to point out the following aŌer reading the Staff Report for this topic, which includes notes from the input received at the Town Hall:
There are mulƟple comments about ILLEGAL vacaƟon rentals so please address this as an issue not with legal STRs, but an issue that needs to be addressed by Host Compliance, the company the city pays to idenƟfy and stop illegal STRs in our city. Some of the problems called out are about 2nd homes where owners send over their friends and family who someƟmes misbehave. The community needs to be informed that they can also report noise disturbances on those homes and I would encourage the Council to consider some type of fine structure associated with those violaƟons just as they have for STRs. There seemed to be a lot of confusion about the role that Hdl plays. Please ask the Community Director to clarify their role versus that of Host Compliance and that of the Code Enforcement Officer in enforcing STR regulaƟons. As a side note, Hdl, who is responsible for collecƟng TOT and renew business licenses, has been TERRIBLE to work with. Our company has wasted endless hours trying to get things straight with them and we conƟnue to have some issues.
Below is the leƩer originally submiƩed in October, 2023 but I respecƞully request that all Council members re-read it in preparaƟon for the Tuesday discussion:
We are the owners of Beach-N-Bay Getaways and Urelax VacaƟon Rentals, operaƟng as affiliated companies from our office here in Morro Bay. We currently manage 38 un-hosted vacaƟon rentals in Morro Bay and for FY 2022-23, paid approximately $374,000 in TOT to the city of Morro Bay for this period. This figure does not include $111,364 to the MB TBID and $57,040 to Visit SLOCal to promote visits to the area. We acƟvely parƟcipated in the review and revisions of the STR regulaƟons that took place from 2019 to 2021 which were subsequently approved by the Coastal Commission early in 2022.
We donated hundreds of hours of our Ɵme to this process. Needless to say, we were shocked and disappointed to find out that aŌer all the effort put forth to arrive at the current regulaƟons, a current City Council member has chosen to re-open this topic via a Town Hall meeƟng held on October 15th, 2023. The original revamping of the old regulaƟons included mulƟple community forums designed to seek input, a year-long series of commiƩee meeƟngs (members included community members, hoteliers and STR owners and managers) and mulƟple City Council meeƟngs where the proposed new regulaƟons were read and approved followed by review and finally, acceptance by the California Coastal Commission. During this process, the Chamber of Commerce with their Governmental Affairs CommiƩee and the local Realtor’s AssociaƟon conducted independent surveys and meeƟngs on this subject and both came forth strongly supporƟng the fact that STRs are an important part of the total package that is needed to conƟnue to support the tourism industry in Morro Bay. Tourism is Morro Bay’s largest industry by far as you all know. Our guests are able to enjoy family-friendly accommodaƟons that offer direct beach access in the city, which is an important consideraƟon for the Coastal commission. If our operaƟons were disrupted, these guests would find other locaƟons to enjoy the beach experience.
Other lodging choices would usually not be considered by these groups as staying in a vacaƟon rental is the only desirable choice for some travelers. Morro Bay in general mostly lacks lodging choices that offer this outside of vacaƟon rentals.
There were several of the new regulaƟons that negaƟvely impacted those homeowners holding STR licenses and significantly constrained any possible growth of our business in Morro Bay but were necessary compromises in order to protect and serve the residents here. Some of those items were:
ReducƟon in the # of un-hosted STR licenses from 250 to 175. As of this wriƟng the current number of licensed un-hosted STRS has reached 175, a 30% reducƟon in the last 2 years. ImplementaƟon of proximity restricƟons for any new license applicants by requiring a minimum of 175 feet separaƟon between un-hosted vacaƟon rentals. This provision will reduce the density over Ɵme in areas of concentraƟon without the chaos and possible lawsuits that might result from a forced reducƟon in the number of compliant, operaƟng and currently licensed un-hosted rentals.
The business license fee for STRs has increased 600% from a few years ago due to addiƟonal permit fees to cover outsourcing to Host Compliance for idenƟficaƟon of illegal VRs and outsourcing to Hdl for the collecƟon of TOT and other fees as well as funding for a compliance officer to ensure compliance with new STR regulaƟons.
ProhibiƟng the STR license to be passed to a new owner upon sale of the property. Over Ɵme this will reduce the concentraƟon of rentals in the most desirable and commercially viable areas. Increased fines for violaƟons of STR regulaƟons.
Requirement to have a sign posted at all VRs that is visible from the public right-of-way and provides the public with a business license number and a contact number. (standards have not been published by the city for specificaƟons for the sign).
We feel strongly that the current regulaƟons adequately provide for sufficient monitoring and control of short-term vacaƟon rentals but unfortunately the City has not put personnel and processes in place to enforce these regulaƟons. The significant increase in our permit fees were in large part designed to fund a compliance officer to ensure and enforce compliance but there is no reporƟng from the city on the acƟvity and acƟons of that person. The regulaƟons also call for the public to have access to a current list of addresses of all licensed STRs and that is currently only available if one makes a Public Records request of the city. This should be free, easy-to-access informaƟon! We have made this informaƟon available on our advocacy site in the past and have recently updated it to the current list of licensed rentals - WWW.ShareMorroBay.com .
In talking with Council Member Landrum about the Town Hall meeƟng, we heard that many of the complaints were about unlicensed homes where it is a second home and the owners send over friends and relaƟves who are noisy and disrespecƞul of the surrounding neighbors. These homes should sƟll be subject to the city noise ordinance and the health and safety regulaƟons that govern how many people are allowed to “live” in a home.
We ask that the current Council members please review in detail the informaƟon and findings that came out of these proceedings that led up to the establishment of the current regulaƟons before opening “Pandora’s Box” on this issue again. We suggest that the City Council move forward with the implementaƟon of the new VR regulaƟons and its provisions to adequately regulate the operaƟons that fall outside professional management. Currently and in all past reviews professional management operaƟons have never been idenƟfied as a part of the problem.
We would suggest the following immediate acƟons that could be implemented that may help alleviate some of the community concerns:
1. Send a copy of the current STR regulaƟons to all license holders and remind them that they are responsible for complying with all items.
2. Provide a “Good Neighbor” brochure to every operator of un-hosted rentals and require the item to be provided to every VR guest.
3. Verify that all licensees have a means of ensuring their guests’ understanding of the rules and requirements of being a good neighbor via posted house rules or a signed agreement.
4. Establish standards for the signage that is to be visible to the public and send this to all licensees with a “due by” date to have these in place. The Compliance Officer should then be responsible for ensuring that all licensed STRs have these in place by that due date.
5. Make a current list of licensed vacaƟon rentals available to the public on the city website with the contact number for each STR so residents know who to call if there are issues at a rental.
6. Audit all un-hosted vacaƟon rentals to verify that a local responsible contact is available.
7. Ensure that the Morro Bay Police Department has a current list of all licensed STRs so if they get a noise or disturbance complaint on one of these homes, they can then report the complaint to the Compliance Officer if the situaƟon is not addressed. The police should also have the local contact number for each STR so that they can contact the responsible party first to deal with the complaint and if they are unable to talk with the contact within the hour limit specified in the regulaƟons, this too should be reported to the Compliance Officer.
8. The city should send an email to all second home owners informing them that they must ensure that any people they allow to stay in their vacaƟon home must comply with the city noise ordinance and must be respecƞul of their neighbors by not parking too many cars on the street and adequately managing their garbage and recycle. We would suggest that in the leƩer, it is stated that unruly guests in some of the second homes have become a major issue and that if they are collecƟng money from these guests, they are required to get an STR license and pay the TOT and other fees levied for STRs.
9. Provide reporƟng to STR licensees from the police and the Compliance Officer showing all acƟons and violaƟons that have been handled.
10. Lastly, remind the community that ALL homes in the city are subject to noise and disturbance regulaƟons and strongly encourage the community to report issues on all neighboring homes whether they are STRs or not and if there are repeat offenders, the city should take acƟon against the homeowner.
As the largest operator in the city, we are currently remiƫng over 50% of the total STR TOT that was paid for the FY 2022-23 and we have worked diligently to set the example for other operaƟons by being compliant with the regulaƟons and insisƟng that our guests are “Good Neighbors” during their visit.
Please don’t punish those of us who are working hard to be good and compliant operators for the acƟons by the bad actors and the second home owners. Let’s just focus on fixing the gaps in enforcement and idenƟfying and eliminaƟng the violators. As a professional Real Estate company in the city, we generate very significant economic benefit for the local merchants in the area with our esƟmated 5000 guests in the city each year, providing an even greater economic benefit to the city beyond the funds remiƩed directly to the city in TOT.
Maggie Juren, Nick Juren, Robert Elzer
Owners, Beach-N-Bay Getaways and URelax VacaƟon Rentals 1 Heather Goodwin
From: Marlys McPherson
Sent: Tuesday, January 9, 2024 10:37 AM
To: Council
Subject: January 9, 2024 Meeting, Item 9.a (STRs)
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Dear Mayor and Councilmembers,
As a Council representative to the ad hoc committee that held 14 meetings to hammer out the details of the short-term vacation rental ordinance that was adopted in 2020 and put into effect in 2021, I feel compelled to comment on this item. The ad hoc committee included representatives from all interested parties: owners of both full-home and hosted STRs, property managers of STRs, hoteliers, neighbors who live near STRs, and representatives from the planning commission, the City Council, and the City Manager. The committee was formed after numerous public forums where the problems associated with STRs were discussed. I also attended the forum organized by Councilmember Landrum.
Based on my experience with this issue, I make the following observations.
1. People are generally unaware of the specifics of the ordinance, and that apparently includes some of the folks responsible for enforcement (e.g., HDL), as well as STR operators with permits.
2. The ordinance has not been properly implemented. For example, a key provision in the ordinance is a mandatory sign clearly "visible from the street" that the home is a STR and includes information on whom to contact with issues. There are also many other provisions in the ordinance that I doubt have been implemented.
3. Although the ordinance includes several vehicles of enforcement for identifying illegal STRs (e.g, an outside firm contracted to monitor websites advertising STRs, a contract with HDL, and a City Code Enforcement Officer), it is not at all clear whether these mechanisms have been effective. For example, how many illegal STRs have been identified? What actions were taken against them? Who is monitoring this? I should also clarify that I was not in favor of grandfathering in all existing STRs, but rather was on the losing end of the Council's vote. I supported the proposal that there should be a three-to-five- year time period to bring all STRs into compliance. I still believe that this is the only way that those residents most impacted by STRs (e.g., those in the Beach Tract neighborhood) will get any relief.
I have read the letters submitted by the public and there are many good suggestions for making this ordinance more effective that the Council could consider.
Finally, I believe the Council should discuss the issue of whether to address STRs in commercial and mixed-use zones. At the time, there were only one or two of these so they were not included in the ordinance. Either there should be a cap on these or they should be included in an overall cap for all STRs.
I appreciate the opportunity to comment.
Marlys McPherson
Morro Bay
2 At the time of our letter in 2021, the city had determined that one of the goals for the city would be to: identify the opportunities for additional housing options and/or explore partnerships to support these efforts.
We shared the following in our 2021 letter that could be helpful for this Council’s discussion:
We also believe the City would benefit by being creative with some of their existing policies, and possibly implementing some new policies to help meet housing needs. We include below some of our concerns that were not addressed in the staff’s report, and some of our ideas for possibly meeting those needs. (One thing - please include within your goal the word “affordable” housing needs. Because, it isn’t just about finding or creating housing – it is about housing being affordable within our community – which, for the most part, it is not.
Most of us, have already read about how some local employers are having difficulty staying open normal or extended hours because they cannot find employees. We also hear about the many people leaving the area because they cannot afford to live in our community – not just our gardener and his fiancé.
Please understand that we do not fault the landlords for finding creative ways to make additional income. However, we need to think seriously about the impacts of how this affects our community and what the city can do to alleviate the pressures those decisions create for its residents and our local businesses.
One possibility…the City can and should do everything to find ways to ensure that no vacation rental is ever grandfathered or no new vacation rental applications are approved within our residential neighborhoods while these affordable housing challenges exist. So perhaps, one way to address housing needs would be for the city to create an emergency ordinance moratorium on grandfathering vacation rentals and/or issuing any new vacation rental applications.
We have plenty of motels and hotels within our city limits that can provide housing for tourists.
Three hotels have been built in Morro Bay since the writing of our letter in 2021. It would seem that we are providing enough locations within our community for tourists to stay.
Why should our city be encouraging mass neighbor/potential neighbor exoduses from our communities when it is obvious there are few if any affordable rental spaces? Or giving landlords vacation rental options? Including allowing for vacation rental grandfathering options.
We appreciate that the city is investing in finding low-income housing opportunities – but what about mid-range housing opportunities, as well? Not everyone is capable of affording the rates that Morro Bay landlords are demanding, recently – to purchase or to rent.
And because the city has opted to allow for a vacation rental policy which has removed 175 homes from being available to rent citywide, would the city be open to considering implementing a rent control ordinance similar to what has been provided typically in mobile home parks in other cities?
3 Consider how many families in our community are barely getting by on one or more incomes– especially as they are attempting to recover from the height of the pandemic. A stable population of renewing, responsible renters is a good thing for landlords, who then save on the costs of reletting their properties and avoid the risks that come with adding new, unknown tenants. Also, keeping rental rates predictable and in check, makes it easier for tenants to budget successfully and pay on schedule. Without rent control, landlords continue to increase rents by a more substantial margin than general inflation, pricing stable tenants out of a home, and forcing good people to leave the area. Which as we continue to see is exactly what is happening now on an ongoing basis. Which goes back to our local businesses ability to retain employees. This in turn can and will and has had an effect on our local economy.
Is affordable housing still a city goal? It certainly is a mandate for the State of California for counties to provide affordable housing. How can our city achieve affordable housing when vacation rentals are contributing to a loss of community and driving up rents? We realize that the subject of affordable housing can be a difficult, sensitive and at times, emotional issue. We are hopeful that it will be an ongoing one that will be addressed often to meet the changing needs of our community. We also hope the Council will adopt a policy that will work for our community. Thank you for your time and consideration.
Regards,
Karen S. Robert and Rick Gilligan
Residents
Morro Bay
1 Heather Goodwin
From: betty winholtz
Sent: Monday, January 8, 2024 2:02 AM
To: Carla Wixom; Laurel Barton; Jennifer Ford; Zara Landrum; Cyndee Edwards; Council Cc: Yvonne Kimball; Dana Swanson
Subject: agenda item 9a
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Dear City Council,
1. Since all of the current city council members and relevant city staff were not here in 2020, it is worth pointing out that the sub-committee's draft ordinance to the city council was changed by the city council. That is, what was adopted by the city council does not reflect the document submitted by the sub-committee.
2. A significant question that needs clarifying is: Are ADUs and JADUs eligible for STR status? All italics are mine.
The definition of Short Term Vacation Rental, on page 152 of 185 of the staff report states,
17.41.030N "Notwithstanding any other provision herein, short-term vacation rentals shall not be operated out of accessory dwelling units or junior accessory dwelling units, as provided in state law, except as provided for in Section 17.41.050(A)." Then read the referenced section:
17.41.050A "Short-term vacation rentals lawfully permitted by the city prior to the effective date of the ordinance codified in this chapter, and in good standing with the city on the effective date of the ordinance codified in this chapter, shall be considered legal nonconforming uses not subject to the limitations of Section 17.41.040, provided they obtain a new short-term vacation rental permit pursuant to this chapter within one year of its effective date."
So when Mr. Graham's Attachment states under Key Definitions #3: "Short-term vacation rental: means a single family dwelling, multi-family unit, bedroom of a primary residence, accessory dwelling unit, or junior accessory dwelling unit," is he referring to legal non-conforming units only or all units?
However, in his very next section, General Regulations, "STR’s are prohibited in affordable housing projects, Accessory Dwelling Units."
3. How many Full Home Rentals are in the City? The ordinance gives the impression that the maximum is 175 units. However, that number is only for Residential use. The Attachment states there are currently 173 in use in Residential areas. So that is a match. However, the number of Full Home Rentals in Commercial areas is unlimited. The 2 City has 5 kinds of Commercial areas. The Attachment states there are 9 Full Home Rentals in the Commercial areas. The other area that can have unlimited numbers is Mixed Use. The report does not mention Mixed Use. Is this because there are none, or they haven't been counted. In the following link to the City's Land Use Map, note the pink (Neighborhood Commercial) and blue (Mixed Use) in south Morro Bay. These are predominantly residential neighborhoods not being counted as residential; and where, therefore, STRs are unlimited.
https://www.morrobayca.gov/DocumentCenter/View/18200/2023-Land-Use-MapAmendment?bidId= There are 5 STRs in a 1-block radius of my house. Only 1 identifies itself as such.
Home share units are of no concern to anyone because the host is present in the house.
These units are and should remain unlimited.
4. Suggested Recommended Action: To continue to "monitor" an ineffective system is a waste of time and money, is an offense to the public, and harms neighborhood safety and welfare. Weaknesses have been identified over and over and it's time to "direct improvements."
Sincerely,
Betty Winholtz
AGENDA CORRESPONDENCE
RECEIVED BY THE CITY COUNCIL FOR
PUBLIC REVIEW PRIOR TO THE MEETING
AGENDA NO: 9.b
MEETING DATE: January 9, 2024
2 filing deadline for election candidacy to insure no political favoritism issues.
I for one learned a tremendous amount of information about the proposed wind farm thanks to Zara Landrum.
Thank you City Council for doing the right thing and carry on to more pressing items and issues facing the City of Morro Bay. --
Litter means "I don't care" in any language.
1 Heather Goodwin
From: Derek Dahlgren
Sent: Tuesday, January 9, 2024 9:19 AM
To: Council
Subject: Endorsement of Item 9.B Establishing a Policy regarding the use of Public Resources by Elected Officials
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Dear Mayor, City Manager, and Council Members,
I trust this email finds you well. I am writing to express my support for item 9.B in the upcoming council session, which advocates for the responsible use of public resources within specified parameters. This proposal is particularly commendable as it directly aligns with the council's overarching goal of enhancing community engagement.
By the utilization of public resources, we can empower our community members to actively participate in initiatives aimed at improving our shared environment. This approach not only instills a sense of ownership and responsibility among residents but also cultivates a collaborative spirit crucial for the success of the council's mission.
I believe that item 9.B exemplifies our commitment to inclusivity and cooperation, reinforcing the council's dedication to creating a vibrant and involved community. I encourage each council member to consider the positive impact this proposal can have on our community and to support its implementation during the upcoming session.
Thank you for your attention to this matter, and I look forward to witnessing the positive outcomes that will undoubtedly result from our collective commitment to fostering a stronger, more engaged community.
Sincerely,
Derek Dahlgren
1 Heather Goodwin
From: Jeffrey Heller
Sent: Friday, January 5, 2024 7:57 PM
To: Council
Subject: Agenda Correspondence - Item 9-b - Use of Public Resources CAUTION: This is an external email. Please take care when clicking links or opening attachments.
Mayor, City Manager, and council members.
I fully support item 9.b which allows the use of public resources within certain parameters. The intent fully supports the council's goal of increasing community engagement.
Thank you for bringing this item forward.
And---I really like the new Council Meeting Agenda formatting. Very friendly.
Jeff and Kerry Heller