Agenda Item No: 3.b
PLACENTIA CITY COUNCIL AGENDA REPORT
Meeting Date: September 2, 2025
Submitted by: Joe Lambert
From: Development Services
Subject:
Study Session di scuss Short-Term Residential Rentals Citywide; and Consideration of an Optional Interim Urgency Ordinance Placing a Moratorium on New Short Term Residential Rental Permits
Financial Impact:
Fiscal Impact:
Potential for approximately $236,000 in revenue annually from Transient Occupancy Tax based on FY24-25 actuals.
Summary:
On July 23, 2019, City Council adopted Ordinance No. O-2019-06 to establish Short Term Residential Rentals as a permitted use in Residential Zones citywide. Previous to adoption of the O-2019-06 establishing regulations related to Short-Term Rentals (STRs), the Placentia Municipal Code (PMC) was “silent” on the matter. Adoption of the Ordinance allowed the City to regulate these properties to ensure that all Short-Term rentals are accounted for in City records, and that no property operating as a Short-Term rental creates adverse impacts to surrounding residential neighborhoods. Since that time, the STR program has been utilized citywide, generating significant revenue. Conversely, STR’s have also brought up some concerns, which is the purpose of this Study Session.
Recommendation:
Recommended Actions: It is recommended that the City Council take the following actions:
1. Receive and file the Staff Report and presentation; and
2. Provide direction to Staff as appropriate regarding proposed changes to local regulations related to local regulations related to Short Term Residential Rentals, if any.
Optional Recommendation:
1. Adopt Interim Urgency Ordinance O-2025-07, An Interim Urgency Ordinance of the City of Placentia, California Establishing a Moratorium on Short-Term Rental Permits Pursuant to Government Code Section 65858.
Strategic Plan Statement:
This item is consistent with the City Council approved 5-Year Strategic Goal to:
1 Promote Community and Economic Development (Goal 3), as this item has directly resulted in generating approximately $236,000 in Transient Occupancy Tax (TOT) in FY24-25, additive to revenues collected for four additional Fiscal Years beginning in FY20-21. Also, Objective Number 3.3 of Goal 3 is to continue to recruit and attract retail, hotel and other commercial businesses that complement adjacent City assets and attractions. Although not necessarily commercial in nature, Short Term Rentals are similar to hotels.
Discussion:
BACKGROUND:
Prior to adoption of Ordinance O-2019-06 on July 23, 2019 establishing regulations related to Short-Term Rentals, the Placentia Municipal Code was “silent” on the matter. However, prior to adoption of local STR regulations, 56 STRs were operating citywide . The adoption of the STR regulations was partially in response to the fact that the Placentia Municipal Code was “silent” on the matter, as that made enforcement of STR prohibition difficult. Therefore, the adoption of local regulations allowed Placentia to establish a screening and permitting process, which also allows the City to cite unlicensed and/or non-compliant STRs. Today, there are 71 STRs operating citywide.
Prior to the adoption of the Ordinance in 2019, there was one STR in particular that was causing impacts to the surrounding neighborhood. Since adoption of local STR regulations, that particular STR left the City and no further violations occurred. At this time, there is one active nuisance-related STR Code Enforcement case in which the property owner was very recently cited for sidewalk obstruction, noise and parking violations. Prior to that, there have been eight properties that have received Code Enforcement violations related to Code violations. This does not include violations sent to STRs for operating without a license.
The City’s STR monitoring provider (Avenu) alerted Staff to a resident complaint, and the next working day, the property owner was cited and fined. The City has collaborated with Avenu since 2025 in identifying and managing STRs operating within the City, previous to that time, we utilized Host Compliance. Overall, Staff feels that the STR program is successful, in that minimal nuisance violations have occurred since adoption of the Ordinance in 2019. Also, our relatively new STR monitoring partner Avenu, has been providing enhanced service in ensuring code compliance citywide.
DISCUSSION:
Existing STR Regulations
As stated, there is one active nuisance-related STR Code Enforcement case. While for the most part STR operators are good neighbors, there have been some concerns about allowing STRs within residential neighborhoods. Upon thorough research and analysis of STRs, Staff discovered that those STRs that are problematic and cause nuisances to the surrounding neighborhood are properties that advertise via the STR websites as available for hosting events such as weddings, corporate events, and birthday parties. To protect residential properties from objectionable influences such as undue noise, traffic, and parking impacts, and ensure the continued residential character of the zone, the 2019 Ordinance addressed these issues by prohibiting short-term rentals for temporary activities. Temporary activities include, but are not limited to, weddings, corporate events, and birthday parties. In addition to compliance with PMC Chapter 10.32 (Noise) and PMC Chapter 23.76 (Noise Control), Staff 2 has prohibited the use of sound amplification, either inside or outside, of the STR. If an STR operator or renter operates outside of these limits, they will be subject to code enforcement action and administrative citations as outlined by 6.45.170 of the Ordinance, which allows for $500 and $1,000 fines for second and subsequent violations.
Section 6.45.120 of the PMC regulates overnight occupancy of STRs to two persons per bedroom with an exception for children under the age of six, who may additionally occupy the premises; and no additional occupants shall be permitted at the STR during the hours of 11:00 p.m. to 6:00 a.m. Any advertisement for an STR that is found to advertise an occupancy above that of two persons per bedroom will be in direct violation of the Municipal Code and will be subject to an administrative citation or possible revocation of their business license and operating permit.
Upon successful registration, the City may issue a Short-Term Residential Rental Operating Permit to the owner of the subject property on a first in time and first in right basis.
Notwithstanding any provisions of this Code to the contrary, the City reserves the right to deny a short-term residential rental permit to an applicant if it is determined that the geographic area within a 300-foot radius of the site being considered for registration has an overconcentration of short-term residential rental uses. The Short-Term Residential Rental Operating Permit must be renewed annually to achieve Code compliance.
Notice to Occupants
The owner or managing agency or agent shall provide the responsible person of a short-term residential rental with the following information prior to occupancy of the premises and shall post such information in a conspicuous place within the dwelling on the premises:
The name of the owner or managing agency or agent and a telephone number at which each may be reached on a seven (7) day per week, twenty-four (24) hour per day basis; and
Notification of the maximum number of overnight and daytime occupants permitted on the premises, pursuant to this Chapter; and
Notification of the City's noise standards, as provided in Chapter 23.76 of this Code, as may be amended from time to time; and
Notification of the parking standards of this Chapter; and A copy of this Chapter of the Placentia Municipal Code, as may be amended from time to time; and
Notification that an occupant may be cited or fined by the City, in addition to any other remedies available at law, for violating any provisions of this Chapter; and A copy of the "Good Neighbor Brochure"; and
The owner or managing agency or agent shall keep on file a signed agreement acknowledging that the responsible person and occupants agree to the general rules summarized in the “Good Neighbor Brochure” and rental contract, including without limitation the immediate termination provision in the rental contract for any violation of the Municipal Code by any occupant.
Survey of Surrounding Jurisdictions that allow Short Term Rentals
City
(Population)
Cap TOT (%)
Occupancy Limit Notable Regulations
3 Placentia
(53,395)No cap 10%
2 per bedroom
(children under 6
exempt)
300-ft separation, no
outstanding code
violations,
HOA/Grant Deed
authorization if
applicable
Buena Park
(82,611)No cap 12%
2 adults per bedroom
+ 2 extra; children
under 18 exempt
No whole-home
rentals, owner must
live on-site, 1 permit
per applicant, initial
inspection required
Fullerton
(140,054)
100 whole-house
(moratorium on new
permits)
10%Not specified
300-ft separation for
whole-house rentals,
no separation for
partial rentals
Orange
(137,941)
125
(cap reached)10%2 per bedroom + 2
extra
2-night minimum
stay, 300-ft
separation, 2
properties per owner
Anaheim
(344,561)
241 existing
(no new permits)15%Not specified Renter must be 21+
La Palma
(15,092)No cap 12%
2 per bedroom, max
10 renters (children
over 3 count)
General
requirements;
parking, occupancy,
tot, good neighbor,
noise, events, etc.
Note: (1) City
provides notice of
permit issuance and
local contact info to
property owners
within 300-feet of the
STR. (2) Specific on
advertising/listing
requirements
Newport Beach
(82,970)
1,550 10%
Maximum permitted
by building code and
fire code.
Renter must be 25+,
City is allowed to
inspect, 2-night
minimum stay,
Laguna Beach
(22,564)
20% of units in
commercial and
mixed-use districts,
300 city-wide
12%2 per bedroom
Not allowed in
residential districts
(R-1,R-2,R-3),
exception: Properties
with ≤ 5 units are
allowed one STR
Seal Beach
(24,421)
47, representing
about 1% of housing
units
12%
2 per bedroom + 2
additional guests
(including children)
Permitted only in the
Coastal Zone (1% of
housing units
allowed) , Renter
must be 25+, 1
permit per owner
Surrounding Jurisdictions that prohibit Short-Term Rentals 4 Brea (47,844), Yorba Linda (66,489), Stanton (41,188), Tustin (78,863), Villa Park (5,698), Santa Ana (316,184), and Garden Grove (172,361) are surrounding cities that prohibit Short- Term Rentals.
Potential Enhancements to Existing STR Regulations
500-foot radius in lieu of 300-foot radius locational requirement for new STRs (note:
current 300-foot radius requirement is not currently an automatic disqualifier) Cap on total STRs for instance, 0.5% of 16,979 Placentia housing units = 85 total STRs (Seal Beach uses 1% of total housing units for example) Require site plan, floor plan, and inspection, either initially or annually Limit 2 STR permits per applicant
Notice of permit issuance to surrounding properties
Additional controls regarding parking, parties, and number of occupants (current regulations already address these topics)
Annual renewal of STR permits (currently in practice for several months)
Optional Moratorium
Staff worked with the City Attorney’s office to draft an Urgency Ordinance which if adopted would place a moratorium on new Short Term Residential Rental permits for up to 45 days.
Short Term Rentals are addressed in the Zoning Code (Title 23 of the PMC) only in Chapter
23.71.010, which establishes the zones in which STRs are permitted. As discussed, S taff is evaluating potential additional regulations regarding STRs for City Council consideration via Ordinance at a future meeting. Therefore, a Moratorium could be placed on new STRs if City Council finds it necessary.
Regardless of whether a Moratorium is adopted or not, Staff will take City Council direction on the topic of STRs. This may result in Staff returning with a regulatory Ordinance to amend certain STR specific operational and locational regulations in Title 6 (Business Licenses and Regulations) and/or Title 23 (Zoning).
CONCLUSION:
In an effort to properly regulate STRs for the benefit of the residents of Placentia, the Housing, Planning and Economic Development Ad Hoc Committee directed Staff to prepare an ordinance to regulate STRs in 2019. This ensured that all STRs are accounted for in City records, and that no property operating as an STR causes an ongoing nuisance to the surrounding residential community.
If Council desires, Staff recommends adding additional locational and operational regulations regarding STRs to preserve the character of residential neighborhoods citywide. As mentioned in the staff report, there are several options to consider regarding enhanced regulations.
Fiscal Impact Summary:
Anticipated Transient Occupancy Tax (TOT) from 2019 Staff Report In 2019 Staff anticipated annual net revenue of only $36,000. However, our actual experience has been much more successful as illustrated in table below.
Transient Occupancy Tax (TOT) Actuals
5 Fiscal Year STR Totals Hotel Totals
FY20-21 $19,882.33 $654,971.65
FY21-22 $82,294.79 $1,302,975.88
FY22-23 $105,704.56 $1,561,971.47
FY23-24 $186,842.60 $1,569,834.45
FY24-25 $236,429.20 $1,552,994.65
GRAND TOTAL $631,153.48 $6,642,748.10
As demonstrated in the above table, this item has directly resulted in generating approximately $236,000 in Transient Occupancy Tax (TOT) in FY24-25. The City spends approximately $10,000 annually for the monitoring services of Avenu, resulting in a FY24-25 net revenue of approximately $225,000. Based on the above table, STR revenue accounts for approximately 15% of the City’s total TOT revenue. Therefore, the $225,000 of actual annual net revenue far exceeds the originally anticipated annual net revenue of $31,600.
It should be noted that if STRs are not permitted at all, there will be no revenue captured, and there will be no funds available to hire Host Compliance (or similar vendor) to monitor the City and locate those STRs operating in the City illegally. If STRs are permitted in some fashion, Staff can properly monitor STRs and mitigate any potential negative effects of STRs.
Attachments
2.O-2025-07 Optional Moratorium STR.docx
1.Short_Term_Rental_ppt1.pptx
6 1
Urgency Ordinance 2025-07
URGENCY ORDINANCE NO. O-2025-07
AN INTERIM URGENCY ORDINANCE OF THE CITY OF
PLACENTIA, CALIFORNIA ESTABLISHING A
MORATORIUM ON SHORT-TERM RENTAL PERMITS
PURSUANT TO GOVERNMENT CODE SECTION 65858
City Attorney’s Summary
This Interim Urgency Ordinance is adopted pursuant to California Government Code section 65858(a) and places a temporary forty-five (45) day moratorium on the issuance of new permits for short-term residential rentals within the City of Placentia while the City considers zoning and other amendments regarding the regulation and placement of short- term rentals. The City Council finds that a moratorium is necessary to protect the public health, safety, and welfare.
WHEREAS, the City of Placentia desires to impose a moratorium upon owners and/or operators of new short-term rentals of residential properties located in the City, such as , Airbnb’s, Vrbo’s and other such short-term rental platforms; and WHEREAS, the Placentia Municipal Code (PMC) Title 6 defines a short-term residential rental as the rental of a residential dwelling unit by the owner thereof to another party for a continuous period of 29 days or less, in exchange for any form of monetary or non-monetary compensation; and
WHEREAS, Chapter 23.71 of the PMC sets forth the zones in which short-term rentals are permitted; and
WHEREAS, short-term rentals have caused problems and nuisances, including undue noise, traffic, parking impacts, and concerns for the City maintaining its continued residential character; and
WHEREAS, the City’s primary objective is the protection of public health, safety, and welfare; and
WHEREAS, California Government Code section 65868 provides cities with the broad power to adopt as an urgency measure an interim ordinance prohibiting any uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission or the planning department is considering or studying or intends to study within a reasonable time ; and WHEREAS, on September 2, 2025, City Council held a duly noticed study session regarding short-term residential rentals, and the City is currently considering and intends to study amendments to the City’s zoning regulations relating to short-term residential rentals.
7 2
Urgency Ordinance 2025-07
WHEREAS, this urgency ordinance is adopted pursuant to California Government Code section 65858 and shall take effect following a four-fifth vote and public hearing and shall be of no further force and effect forty-five (45) days from its date of adoption, subject to extensions for up to twenty-two (22) months and fifteen (15) days;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PLACENTIA DOES HEREBY ORDAIN AS FOLLOWS:
SECTION 1. The Recitals set forth above are hereby adopted as the findings of the City Council in connection with the adoption of this ordinance and that based on the above recitals, there is an immediate threat to the public health, safety and welfare. The adoption of this ordinance is necessary for the immediate protection of the public health, safety and welfare.
SECTION 2. The purpose of this interim ordinance is to establish a moratorium on the approval or issuance of any new short-term rental permit for the immediate preservation of the public health, safety and welfare.
SECTION 3. Based on the findings set forth in the Recitals and incorporated herein in Section 1, the addition of additional short-term residential rental properties pose a current and immediate threat to the public health, safety and welfare on the residential character and uses within the City regarding traffic, noise and parking, and the termporary moratorium on short-term rental permits will ensure a balanced, and as such the City Council hereby enacts this interim ordinance by not less than a four -fifths vote, under the authority granted to it by Article XI, Section 7 of the California Constitution and section 65858 of the California Government Code, which allows the City to adopt an interim ordinance prohibiting land uses which may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the City Council, planning commission or the planning department is considering or studying or intends to study within a reasonable time. The City Council hereby directs the Development Department to complete its review of short-term rentals, including but not limited to residential impacts, additional regulations that may be recommended, appropriate zones and other related issues. .
SECTION 4. The issuance of any new permit for short-term rentals is hereby prohibited.
SECTION 5. The City Council has reviewed the matter and, based upon the facts and information contained in the staff reports, administrative record, and written and oral testimony, hereby finds that this ordinance is not subject to CEQA pursuant to Sections 15060(c)(2), 15060(c)(3) and/or 15061(b)(3) of the State CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, in that it will not result in a direct or reasonably foreseeable indirect physical change in the environment nor have a significant impact on the environment.
SECTION 6. This Ordinance shall become effective immediately upon adoption if adopted by at least four-fifths vote of the City Council, and shall remain in full force and 8 3
Urgency Ordinance 2025-07
effect for a period of forty-five (45) days from the date of its adoption unless extended by the City Council in accordance with the provisions of California Government Code section 65858..
SECTION 7. If any provision of this ordinance or the application thereof to any person or circumstance is held to be to be unconstitutional or otherwise invalid by a court of competent jurisdiction, such invalidity shall not affect other provisions or applications of this ordinance which can be implemented without the invalid provision or application and to this end the provisions of this ordinance are declared to be severable.
SECTION 8. For the term of this ordinance, or any extension thereof, the provisions of this ordinance shall govern over any conflicting provisions of any other City code, ordinance resolution or policy.
Passed, approved, and adopted this 2ND day of September, 2025
Kevin Kirwin, Mayor
ATTEST:
Robert S. McKinnell, City Clerk
I, Robert S. McKinnell, City Clerk of the City of Placentia, do hereby certify that the foregoing Urgency Ordinance was introduced and adopted at a regular meeting of the City Council of the City of Placentia, held on the 2nd day of September, 2025 by the following vote:
AYES: Councilmembers:
NOES: Councilmembers:
ABSENT: Councilmembers:
ABSTAIN: Councilmembers:
ATTEST:
___________________________________
Robert S. McKinnell, City Clerk
APPROVED AS TO FORM:
Christian Bettenhausen, City Attorney
9 Short-term Rentals
City Council
September 2, 2025
City of PlacentiaCity of Placentia
10 Outline
1.Background – STR Ordinance
2.Current Regulations
3.Fees, Revenue, and Applications
4.Other O.C. Cities – Regulatory Standards
5.Restricted O.C. Cities
6.Potential Issues
11 Background
•Ordinance No. 2019-06 was approved and adopted by the City Council on June 11, 2019
•Purpose: Promote travel, tourism, and generate revenue for the City’s economy
•Ordinance identifies the need to balance short-term rental opportunities by minimizing any adverse impacts onto surrounding properties
•STR regulations should prevent:
Excessive noise and nuisance violations
Parking shortages
Trash accumulation
Loss of long-term housing stock
Neighborhood incompatibility
12 Current Regulations
Application Requirements
•Registration and local contact information
•Commercial liability insurance
•HOA authorization (If applicable)
•Grant deed (If applicable)
Eligibility
•300-foot separation (currently at staff’s discretion)
•No outstanding code violations
•Permitted Zone (PMC §23.71)
13 Fees, Revenue, & Applications
•Application:
- $450 fee
•Annual Renewal:
- $89 fee
•Transit Oriented Tax
(TOT) %:
- 10% TOT rate
Revenue
(By Fiscal Year)
No. Applications
(By Calendar Year)
FY 20-21 $19,882.33 15 (2020)
FY 21-22 $82,294.79 4 (2021)
FY 22-23 $105,704.56 22 (2022)
FY 23-24 $186,842.60 16 (2023)
FY 24-25 $236,429.20 26 (2024)
FY 25-26 $1,915,000 (Budgeted for
Hotel and STR TOT)
16 (2025)
Grand Total:$631,153.48
(Not including FY 25-26)
99 Total (71
active/licensed)
14 Other O.C. Cities
City
(Population)Cap TOT (%)Application Requirements Permit Validity Insurance Requirement Occupancy Limit Parking Rules Notable Regulations Placentia
(53,395)No cap 10%Contact info, proof of insurance, HOA Authorization (If applicable)1 year Required
(no amount specified)
2 per bedroom (children under
6 exempt)Off-street parking 300-ft separation, no outstanding code violations Buena Park
(82,611)No cap 12%
Floor plan, driver's license, voter registration, vehicle registration, utility bills, property tax records, HOA letter, proof of insurance, inspection required
3 years $1,000,000
2 adults per bedroom + 2
extra; children under 18
exempt
Off-street parking No whole-home rentals, owner must live on-site, 1 permit per applicant, initial inspection required
Fullerton
(140,054)
100 whole-house
(moratorium on new), no
restriction to partial
rentals
10%Contact Info, Site Plan, Floor plan, proof of B.L. registration, HOA Authorization (If applicable)3 years Not specified Not specified Off-street parking 300-ft separation for whole-house rentals, no separation for partial rentals
Orange
(137,941)
125
(cap reached)10%
Diagram of property and parking, executed indemnification document, proof of liability insurance, trust certification (if applicable), inspection required
1-year $1,000,000 2 per bedroom + 2 extra Off-street parking 2-night minimum stay, 300-ft separation, 2 properties per owner Anaheim
(344,561)
241 existing
(no new permits)15%owner affidavit, contact info, site plan, floor plan, proof of liability insurance 1-year Not specified
3 persons per bedroom, + two
additional people allowed in
the living room on a sleeper
sofa or roll-away bed
2 off-street parking spaces
required, on-street parking
allowed if necessary
Renter must be 21+, 3-night minimum
La Palma
(15,092)No cap 12%TOT registration form 1-year Not specified 2 per bedroom, max 10
renters (children over 3
count)
1 off-street per bedroom, 1 on-
street allowed if legal
General requirements; parking, occupancy, tot, good neighbor, noise, events, etc.
Note: (1) City provides notice of permit issuance and local contact info to property owners within 300-feet of the STR. (2) Specific on advertising/listing requirements
Newport Beach
(82,970)1,550 10%
Contact info, evidence of valid BL, # of bedrooms, gross floor area, #/location/size of parking spaces available, nuisance response plan
Indefidently until
abandoned Not specified Maximum permitted by
building code and fire code.
All on site parking shall be
available to occupants, on-
street parking allowed
Renter must be 25+, City is allowed to inspect, 2-night minimum stay, Laguna Beach
(22,564)
20% of units in
commercial and mixed-
use districts, 300 city-
wide
12%
site plan, floor plan, fire inspection, nuisance response plan, written declaration informing all residents and businesses within 200' of the proposed STR, estimate of daily rental fee 1 year $500,000 2 per bedroom on-street parking allowed where legal
Not allowed in residential districts (R-1,R-2,R-3), Properties with ≤ 5 units are allowed one STR,
Seal Beach
(24,421)47 12%
proof of liability insurance, HOA authorization, signed Indemnification & Hold Harmless agreement, initial and
annual inspection
1-year Required
(no amount specified)
2 per bedroom + 2 additional
guests (including children)
on-street allowed
where legal
Permitted only in the Coastal Zone (1% of housing units allowed) , Renter must be 25+, 1 permit per owner
15 Restricted O.C. Cities
Fully-restricted Cities (STR Prohibition)
•Brea (47,844)
•Yorba Linda (66,489)
•Garden Grove (172,361)
•Fountain Valley (56,036)
•Stanton (41,188)
•Tustin (78,863)
•Santa Ana (316,184)
•Irvine (318,683)
•Westminster (89,537)
•Costa Mesa (109,131)
•Lake Forest (87,159)
•Lakewood (78,494)
•Villa Park (5,698)
Partially Restricted Cities:
•Orange – Cap reached (125)
•Fullerton –No new permits
(Cap: 100-whole-house)
•Anaheim –No new permits
(241 permitted)
16 Potential Issues
•Eight Overconcentrated Areas
Louise Dr, Heather Ave, La Jolla,
Voigt Wy,
Bradford, Encinitas Wy, Chapman
Ave, Kevin Wy
One active code enforcement case
•Average one STR complaint every
2-3 months
•Two permit holders with more than
two permits
17 Questions & Comments
18