City will take another look at short-term rentals

The Laguna Beach City Council on Tuesday will again discuss the increasingly controversial practice by residents of bringing in short-term renters, possibly with an eye toward further regulating these side businesses, even limiting their locations.

Since 1999, a city ordinance has allowed property owners to rent out space in their homes or apartments for no more than 30 days at a time if they have obtained approval and paid $275 for a permit.

But as the short-term rental industry has exploded with websites such as Airbnb and Vacation Rentals By Owner, cities have had to respond to neighbors’ complaints of parking problems and loud music being played late at night.

Laguna Beach has been no exception. In response to concerns, the Laguna council in May enacted a 45-day moratorium on the approval of new short-term rental applications. The moratorium was extended for 90 days from July 4 to allow city staff more time to research long-term options and code enforcement practices.

Since May 19, staff discovered that 175 property owners who were renting to visitors had not received city approval, Assistant Community Development Director Ann Larson said.

Larson said owners are not being cited unless the city receives a complaint. She also said the transitory nature of short-term rentals makes enforcement difficult.

“Occupants don’t stay long,” Larson said. “By the time code enforcement goes out there’s another renter.”

Laguna Beach, unlike other cities, issues permits that are tied to the property, so if an owner moves, the rules pertaining to the short-term rental transfer to the new owner, Larson said.

Upon receiving a permit request, the city notifies neighbors about the proposed short-term rental activity.

Within 30 days of receiving notice, concerned residents can request a public hearing.

Larson said she encourages the applicant and concerned parties to try to work out a solution before the public hearing.

The law mandates that the city deny an application if concerns of surrounding neighbors can not be resolved.

The road to winning a permit can be tricky, but as property owner Ronnie Rogers proved, not impossible.

Rogers faced complaints earlier this year when he applied to rent out a 1,462-square-foot, two-bedroom, two-bathroom house on Reed Street.

Two neighbors complained that Rogers’ prospective renting arrangement could hurt property values and create even more traffic congestion and parking problems in the area.

Larson agreed with opponents and denied Rogers’ request at a hearing in March. Rogers appealed Larson’s decision to the City Council.

On May 19, council members, who later during that meeting voted for the moratorium, reversed Larson’s decision and granted Rogers’ appeal in a 4-1 vote.

Rogers’ apparent clean record in having guests and the fact that he lives on the site swayed several council members.

Rogers and his wife, Holly, reside in another house on the property.

The current moratorium does not apply to Rogers.

Rogers charges $375 per night, plus a cleaning fee, and guests have a dining room, living room, private backyard and parking. Rogers encourages visitors to walk to the beach and enjoy Laguna.

He limits guests to one-week stays, including weekends.

“I think the thing that is most attractive to guests is off-street parking and having on-site maintenance and care,” Rogers wrote in an email. “They love the cottage but these two amenities add to the experience for guests. It’s a great way of allowing, especially young families who cannot afford to live in Laguna, to enjoy Laguna for a great price.”

There is no limit on the number guests allowed to stay in a short-term rental. Usually there are two people to a room, Larson said.

If there are more than three people staying in a house or apartment, the property owner must pay the city a business improvement assessment fee similar to a 2% charge on hotel room receipts that helps fund activities promoting tourism throughout Laguna.

The council’s meeting begins at 6 p.m. at City Hall, 505 Forest Ave.