Council Moves Ahead with Regs on Short-Term Rentals

After nearly a year of research and community input, the Long Beach City Council has agreed to move forward with an ordinance to regulate short-term rentals (STRs), where residential property owners use online platforms, most notably Airbnb, to rent out units and homes to tourists and other visitors.

At its Dec. 4 meeting, the City Council voted unanimously to draft a citywide ordinance that would impose restrictions on STRs and their operators as a way to address rising concerns over quality of life, noise, safety, affordable housing, parking and enforcement issues related to the unregulated rentals.

Though a clear ordinance has yet to be fully established, the council agreed to move forward with city staff’s recommendation, known as Option 2, considered a middle-of-the-road alternative that attempts to strike a balance between the needs of STR owners and the community.

While adding several amendments after hearing public comment from about 60 speakers, the council ultimately voted in favor of moving forward with the option, also known as “Limited STRs,” which would limit STR owners or hosts to those who live within city boundaries while also requiring hosts to register with the city and follow other specific rules or face fines for violations.

“We think that [Option 2] appropriately balances all of the market that we have here in the city, but, in particular, it also addresses issues of community character,” said Linda Tatum, director of Long Beach Development Services. “Our recommendation was guided by the fact that we clearly want to be able to benefit local residents with the proposal, but we also want to be sure that we’re addressing community concerns and mitigating those concerns through appropriate regulation.”

During public comment, speakers brought forward differing points of view on the issue.

STR hosts called for less regulations and expressed the benefit of having supplemental income during retirement while affected homeowners stressed the need for more regulations, expressing concerns about noise and parking issues related to STRs operated by out-of-town owners.

Other speakers raised concerns about the impact STRs may have on the city’s affordable housing stock given the city’s current housing crisis as well as impacts to the hotel industry.  

Staff’s recommendation comes after the city hired Lisa Wise Consulting (LWC) and Host Compliance earlier this year to research the STR market in Long Beach and analyze related state policies and similar ordinances in other cities while gathering input from the community at public workshops.

Research conducted by LWC revealed that there are approximately 1,328 active STRs in Long Beach operating illegally. This represents less than one percent (0.75 percent) of the city’s total housing stock of 177,245 units, according to city staff.

The staff recommendation, which would give STR hosts a way to legally list their properties, is one of three options city staff and LWC presented for public review in October during a community workshop.

Under the proposed option, which the council ultimately approved with certain amendments, STR hosts would be required to register with the city and obtain an annual renewal, similar to a business license.

STR hosts would also be required to provide guests with city rules and requirements in addition to a 24-hour contact to report any issues. Hosts would be required to clearly post escape routes and fire extinguisher locations in the unit and maintain liability insurance of at least $1 million or conduct transactions through a platform that provides equal or greater coverage.

Under the proposed ordinance, “quiet hours” would be set from 10 p.m. to 7 a.m. during which outdoor pools and hot tubs could not be used. The proposal would also limit STR occupants to two people per bedroom plus two with a maximum of 10 people per STR while large events would be prohibited as well as exterior signage. STRs would be prohibited in deed restricted affordable housing units and dormitories.

The proposed ordinance would also require that STR guests pay a transient occupancy tax (TOT), the same tax guests currently pay at regular hotels, to the city at an established 12 percent rate.

In addition, several amendments were proposed by councilmembers who directed city staff to research and bring back for further consideration.

Second District Councilmember Jeannine Pearce requested that the ordinance include an overall cap on the total number of “un-hosted STRs,” in which the host is not present onsite during the short-term rental activity, allowed to operate in the city at no more than 1 percent of the city’s total housing stock.

Amendments also directed city staff to further research a cap on the number of STRs allowed in multi-family units either through a sliding scale depending on building size or a single percentage cap to address building-size disparity.

Third District Councilmember Suzie Price, meanwhile, proposed adding a provision that would give neighborhoods the ability to petition for a ban on un-hosted STRs with a two-thirds vote of property owners. The council ultimately directed staff to review best practices on such a provision.

Fifth District Councilmember Stacy Mungo requested that, once an ordinance is approved by the council, city staff return by October 2019 with the number of registrations, complaints, resolutions to complaints, TOT collected and other information to assess implementation for possible improvements.

City staff is also expected to return with additional information on: enforcement options; whether a business license tax could be legally required; and how funding for affordable housing could be provided as part of the STR ordinance or an inclusionary housing ordinance.

Additionally, 9th District Councilmember Rex Richardson requested that city staff report back on how the city can partner with Airbnb and other platforms to support local businesses, such as Kiva businesses, to deploy resources or leverage technology to support small businesses.

During public comment, Airbnb spokesperson Connie Llanos expressed the need for STR regulations in Long Beach and indicated the online platform’s willingness to partner with the city. She also assured that hosts are dedicated to maintaining their homes and the fabric of the community.   

“I think vacation rentals have existed historically in Long Beach,” Llanos said. “There should be a way to legitimize them through this process but create the rules that actually solve the noise and concerns that frankly can happen in long-term stays as well as short-term stays.”

sean@beachcomber.news