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Pismo Imposes New Rules on Vacation Rentals

By Mark A. Diaz

With the rise of popularity and ease of operating short-term vacation rentals (STR), cities have sought to find a balance that allows the industry to grow without alienating its residents. The City of Pismo Beach took another step in its attempt to perfect the balance between STR commerce and its citizen’s quality of life.

STRs, also known as homestays, come with a host of potential problems that include noise, trash and lack of parking. The City recognized that its limited housing stock was being absorbed by investors who purchased property for the sole purpose of converting it into basically an unmanned bed and breakfast. However, to make new rules governing homestays, the City had to first approach the California Coastal Commission (CCC) which is the state’s regulatory oversight committee. The CCC’s mission is to protect land use and coastal access for all Californian and not just those that live on the coast.

“The ordinance strikes a perfect balance between protecting neighborhood quality of life and housing stock,” said City Manager Jim Lewis, “and allowing residents to receive some income from their home while offering this type of accommodation.”

Through a series of public meetings, the City drew a plan to specify additional restrictions to STRs in specific city zones that the California Coastal Commission (CCC) had not addressed in its Land Use Programs (LUP). The LUP is comprised of basic planning tools that guide cities on the development of coastal zones in their jurisdiction. They are not set in stone as demonstrated by the approval of the City’s latest amendment by the CCC.

“We had a great deal of public involvement,” said Lewis, “and that is something we’re proud of. We actually appointed a committee of 16 people made up of all sides of this issue.”

The ordinance approved by the CCC last week dictated that in order for a homeowner to operate a STR the property must be their primary residence in specific zones such as Single-Family Residential (R-1), Planned Residential (P-R), and Open Space Natural Resources Protection (O-S-1) zoning districts. However, “the proposed ordinance places no limits on the number, location, or rental frequency of STRs in the single-family residential districts as long as the primary residence requirements met,” according to the recommendation prepared by Susan Craig, Central Coast District Planner. Primary residence, as defined by the City, means owners living on the property for more than half the year.

“We are pleased to have unanimous approval by the California Coastal Commission on an ordinance they hailed as a model for coastal California,” said Lewis

The ordinance states that non-hosted rentals, where the property is not the primary residence of the homeowner, in specified zones may only be rented for a total of 182 days per year. These new rules, do not apply to other zones such as Pismo Beach’s downtown areas.

The City estimates that there are approximately 125 STRs that operate under the addressed zones outside of the downtown area and with the umbrella of the new ordinances allows them to join the fold as well as for the City to begin collecting taxes from them. Lewis said that the new rules will go into effect no later than December 1, 2018.

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