By Neil Farrell ~
Morro Bay has capped the number of vacation rentals they will allow, for at least the next couple of years, when the general plan update now underway will presumably offer up a complete new ordinance.
The City Council voted 4-0 with Councilman John Headding stepping down, to set a limit of 250 vacation rentals scattered throughout the city, extending a 45-day temporary moratorium approved at the end of June (Ordinance No. 604).
Six-oh-four stopped the issuing of any new permit, license, approval or entitlement “pertaining to a vacation rental within the City of Morro Bay,” the ordinance was titled. It took effect immediately.
The ordinance said continued operations of vacation rentals minus specific regulations on number, location, and similar issues, “can change the character of a neighborhood, cause blight and impact the quality of life and potentially property values. It also says the rentals could compromise the public trust in its local government, “to ensure the public health, welfare and safety are protected.”
The 22-month 15-day extension of the emergency ordinance is the maximum allowed by State law, but can be further extended by the Council. The point is to make a new, final ordinance part of the general plan update, which is expected to take another 18 months or so.
Community Development Director, Scot Graham, said they have 180 legal registered vacation rentals in the City but, “this number gets a little blurred as we have some hotels that pay TOT [transient occupancy taxes] and list their rooms as vacation rentals without registering as vacation rentals This process confuses things a little bit and is something we likely need to clarify during the drafting of the updated ordinance.”
The higher cap gives a little wiggle room for people to get legal before a permanent ordinance is approved, though there is no guarantee that a final ordinance will mean all existing ones automatically become legal. They could come in conflict with a provision that separates vacation rentals by distance, for example. That would likely bring up a conflict over which ones get to remain in business and which ones don’t.
“The cap was placed at 250 because we have some idea that there are somewhere in the neighborhood of 50-60 unregistered vacation rentals out there,” Graham said.
RV parks and vacation rentals are required to collect and remit the City’s 10-percent TOT. But neither is part of the Tourism Business Improvement District or TBID along with moteliers, so they don’t pay the extra 3% charge on a night’s stay, nor do they pay the 1% County Tourism Marketing District or CTMD fee.
Another blurring of the definition comes from people who have secondary homes here and live elsewhere. Those folks could be loaning/renting out the home to family members, friends or anyone else for that matter, and the City would have no knowledge that a transaction had taken place in another city.
Graham told the City Council that sometimes they get complaints about a vacation rental and investigate only to find that the home is a family’s vacation home and the people staying there are relatives.
There are a few other issues, too, like the rise of so-called “home shares,” or renting out a single room in a home for a short-term stay, listed and booked over websites like Airbnb.com.
Also, the Council passed a ban to use secondary dwelling units or “granny houses” for short-term vacation rentals.
Such granny units are specifically allowed by State law in residential zones to add to the affordable housing stock, but are now prohibited from being used for short-term vacation rentals in Morro Bay.
