South County’s recent wave of vacation rental deliberations finally touched Arroyo Grande after coursing through its two neighboring cities.
At the Sept. 13 City Council meeting, Arroyo Grande initiated a lengthy makeover of its vacation rental ordinance, which received unanimous approval from the three council members in attendance.
Mayor Pro Tem Lan George and Councilmember Kristen Barneich recused themselves from the discussion. Brian Pedrotti, the director of community development, told New Times that several council members hold rental permits, which are potential conflicts for ordinance approval on their part.
“Staff originally reached out to the California Fair Political Practices Commission (FPPC) for guidance on how to proceed with the ordinance,” he said via email. “The FPPC determined that the council members could draw straws to determine which three members would participate in the vacation rental ordinance hearing.”
By the end of the two-hour discussion, City Council eked out 10 amendments to the ordinance, which will come back before the council at the next meeting.
At the meeting, Arroyo Grande officials agreed on the definition of “short term rentals (STRs),” which they said comprise vacation rentals and homestays. They perceived the former as a structure rented out for less than 30 days without being occupied by the owner or operator in tandem. A homestay, on the other hand, is owner-occupied with a maximum of two short-term lodging rooms.
The City Council addressed the perennial conflict of parking spaces between rental owners and their neighbors by allowing vacation rentals to have only two parking spaces each.
The trio recommended capping the total number of vacation rental permits at 90, which includes the existing 86 and four applications that are pending in the city’s system. The city plans to review this cap after six months.
Then, they increased the buffer radius between vacation rentals and homestays from 300 feet to 500 feet, along with a 500-foot buffer from schools. City staff will also include information in outreach letters about voluntary relinquishment of permits for existing holders.
The City Council decided to increase the frequency of transient occupancy tax (TOT) collection from once a year to twice. Currently, Arroyo Grande’s temporary rentals pay 13.5 percent of the rent as TOT. In fiscal year 2021-22, the city received roughly $150,000 in TOT from them.
Permit revocations will be triggered if the emergency contact is unresponsive three times within a rolling 12-month period, and if the rental receives two citations from the Arroyo Grande Police Department during the same time period. Both violations will result in a revocation hearing.
Pedrotti told New Times that Arroyo Grande has performance standards in place for rentals, including a requirement for an emergency contact person.
“If it is found that STRs do not meet these standards, the municipal code provides for the initiation of a revocation hearing for the STR permit,” he said. “Complaints or incidents logged for STRs are quite rare, and no past incidents have warranted fines. The Community Development staff have worked with the Police Department to coordinate efforts so that incidents that occur at STRs are appropriately tagged.” Δ
This article appears in Sep 15-25, 2022.