Council fails to pass short-term vacation rental rules: Opponents regroup to continue fight

Despite two proposals and high expectations, the San Diego City Council failed to pass an ordinance regulating short-term vacation rentals (STVRs) during its Dec. 12 meeting, leaving the issue in legal limbo for proponents and opponents alike. Local advocates fighting for tighter regulations, if not an outright ban, on STVRs are regrouping to consider options in the new year for forcing a reckoning on the issue.

However, the stalemate leaves Pacific Beach residents plagued by a housing affordability crisis and nuisance issues from the “mini hotels” as well as those hoping to cash in on the STVR craze, with one question: Now what?

“It’s frustrating as heck,” said Ryan Purdy, policy advisor to City Council member Lorie Zapf (District 2), a co-sponsor of the more stringent STVR proposal. “The issue has been dragging on for three years — or 11 years, depending on how you’re counting.”

At the 10-hour marathon meeting at Golden Hall on Dec. 12, neither the stricter proposal co-sponsored by Zapf and Barbara Bry (District 1), prohibiting investors outside of San Diego from opening STVRs, nor the more lax alternative could muster the five votes necessary for passage.

For Tom Coat, head of Neighborhoods for Residents lobbying for Bry and Zapf’s proposal, the deadlock was a godsend considering the proposal that would have opened the doors to a proliferation of STVRs had four sponsors.

“The No. 1 goal was that the investor-friendly proposal did not pass,” he said. “We saw that as the end of San Diego neighborhoods as we know them. It was that dire. That it did not pass was a huge victory for young families, African-Americans and Hispanics, and businesses trying to find housing for their workers.”

While Council member David Alvarez (District 8) ultimately vacillated (even though he was initially one of the four co-sponsors of the more permissive proposal), John Thickstun, president of Save San Diego Neighborhoods, argues neither <FZ,1,0,15>proposal could have passed because compulsory studies on environmental impacts and housing impacts were not completed.

“This was basically the City Council shooting from the hip,” Thickstun said. “And they missed fundamentally. They had not done the work necessary for a policy change, not only in residential zoning, but in the interpretation of commercial use. At the end of the day, STVRs are the same as any other visitor accommodation, including hotels and motels. They were trying to mix oil and water.”

In March 2017, City Attorney Mara Elliott opined that STVRs are illegal since they aren’t listed in the Municipal Code as permitted uses for residential homes. Save San Diego Neighborhoods supports enforcement of the ban on STVRs in residential zones.

“The City Council needs to school themselves on the policy and purpose for residential zones,” said Thickstun. “Residential zones are specifically designed to provide housing for the community. It’s one thing if they want to change it in one specific area. But it’s completely different if they want to change it for every single neighborhood in the city. That’s a recipe for disaster.”

Although the Council’s inaction leaves the status quo in place, Coat claims the lack of a definitive resolution is temporarily slowing down the conversion of homes into STVRs by big investors. “Corporations don’t like uncertainty,” he said. “So that’s stopping some of the investment.”

Three ways to turn

Despite the current morass, numerous ways out exist, according to Thickstun. They include increasing political pressure, getting a referendum on the ballot, and potential lawsuits to have the courts decide.

Yet Coat maintains the STVR issue has come too far to lapse now. With agreement on all sides to allow unlimited home-sharing (in which homeowners rent a room or section and remain on premise) and the creation of an enforcement arm for noise and nuisance problems, the only remaining contention is how to regulate whole home rentals, which some inland communities welcome as an investment upgrade to their neighborhoods.

“A one-size-fits-all solution might not be right for a city the size of San Diego,” he said. “Pacific Beach is far different from Barrio Logan, so it doesn’t make sense that you can impose one solution that will work for both. But I don’t think the climate is such that we’re going to be talking about this for years this time. We’re closer than we’ve ever been.”

With four Council seats up for election in November, all sides agree that the STVR issue has reached the point where it can swing votes for candidates.

“For every STVR, there are four neighbors around that house and if they are upset that the City is doing nothing about it, they will vote this issue,” said Coat.

While future strategies on STVRs make for an interesting topic at a coffee klatch, what’s a poor resident to do at 1 a.m. when there’s a wild party at the STVR next door? Purdy said that residents will, unfortunately, have to double down on their efforts to demand change and get satisfaction.

Citizens engaged

He recommends that people keep writing letters to Mayor Kevin Faulconer and City Council members, particularly inland representatives; calling the police and code enforcement when needed; checking if your neighborhood has a Homeowners’ Association (HOA) or Covenants, Conditions and Restrictions (CC&Rs) agreement; and taking photos and videos of problem STVRs and uploading it onto the City’s “Get It Done!” app for City services. (See directions for downloading the app below.)

Some residents have come up with innovative tactics to crackdown, especially on STVRs that are not registered, noted Purdy

“The City Treasurer collects the Transient Occupancy Tax (on visitor accommodations),” he said. “Some clever people have called there and said, here’s the address, it’s a STVR, do you collect taxes? If the answer is ‘yes,’ there’s nothing else to do. But if the answer is ‘no,’ you can report it. We’re going to keep fighting the fight to get the strictest enforcement possible. We’re not shrugging our shoulders and saying, an ordinance didn’t pass.”

Noting that the problems with STVRs are becoming more apparent as the phenomenon grows, Thickstun argues that elected officials can’t ignore grievances when they come from voters.

“The squeaky wheel gets the grease,” he said. “People need to continue to complain and they need to complain loudly and repeatedly. At some point, someone is going to say, ‘We need to build some dikes and stop the flood from coming in.’ ”

GET THE CITY APP: Downloading instructions can be found online at sandiego.gov/get-it-done

REACH CITY COUNCIL MEMBERS: Names, districts and contact information is at sandiego.gov/citycouncil