By Geoff Page
The Ocean Beach Planning Board wants to see some serious changes to the very flawed Short Term Residential Occupancy, or STVRO, ordinance. To that end, the OBPB, in conjunction with other beach areas suffering under this hastily crafted and poorly thought-out law, will send a letter with recommendations for changes to the City.
The OBPB discussed and approved the letter at the OBPB’s regularly monthly meeting, Tuesday, March 5 at the OB Rec Center. The OBPB recently changed its meeting day from the first Wednesday of each month to the first Tuesday instead. The board changed the night to avoid parking problems on Wednesday’s the Farmer’s Market crowd.
Kevin Hastings, OBPB vice-chair is leading the effort. Hastings probably knows more about the subject than anyone else. Hastings gave a presentation that contained history, information, and recommendations.
Hastings provided a quote from District 2 councilperson Jennifer Campbell from February, 2021:
“Allowing STR owners a maximum of one license, per person.”
“San Diegans will have more homes to buy or rent, neighborhoods will see a massive reduction in STRs in their communities with real enforcement to weed out bad actors.”
This truly represents what San Diegans want to see: an end to the ‘wild west’ STR environment that has negatively impacted so many.” Even Campbell would have a hard time saying any of that has come to be.
Hastings then showed how many of the licenses are available citywide and how many have been issued. There is an unlimited number of available Tier 2 licenses, where a host has to live on the property. To date, 2,605 licenses have been issued.
The ordinance allows for 5,419 Tier 3 licenses, or one percent of the city’s housing outside of Mission Beach. At the moment, there are about 4,530 of these licenses with 900 licenses still available.
Tier 3 and Tier 4 licenses are for whole home rental where the owner does not have to be on site. Tier 4 licenses are strictly for Mission Beach, which the ordinance walloped with an amazing limit of 30 percent of it’s total housing, or 1,082 licenses. There is a waiting list for licenses in Mission Beach.
Hastings provided a chart showing now many STVRs are in the various planning group areas. What the chart shows is that the ordinance’s requirement to cap STVRs at one percent was a citywide figure, not by area. Six percent of the housing in OB, for example, is STVRs, not one percent. Hastings group recommends capping each planning area at two percent, which would free up a lot of housing for long-term renters.
The presentation explained why the short-term vacation rental business is so lucrative by contrasting the yearly revenues from a long-term rental compared to a vacation rental. There is a significant difference.
One of the areas the presentation focused on was “apartment-hotels” defined as “a multi-family building with 4 or more units, where at least half the units are whole-home STROs.” In OB alone, there are 42 apartment hotels with 189 units. These are small units that were previously affordable housing. Hastings provided a list of all the ones in OB.
The recommendation to address this problem is to restrict Tier 3 and 4 licenses to 25 percent of the units in one building, or two units, whichever is greater.
The presentation moved on to the biggest loophole in the ordinance that allowed for some property owners to obtain over a hundred licenses. The ordinance issues licenses to “hosts,” not property owners. As a result, owners sign up people with no connection to the properties to be hosts. The host may even live out of state and have nothing to do with the listing.
The recommendation to rectify this problem is to restrict the Tier 3 and 4 licenses to an actual person with ownership in the property. One license per individual only.
Hastings then talked about enforcement. Under the current ordinance, if the city revokes a license, that particular host cannot get another one for 12 months, but a new host can get a license for the same unit immediately.
The recommendation to remedy this problem is to change the ordinance to say that, upon revocation, no new license may be issued to that particular property for one year. Makes sense. Since the hosts have no actual tie to the property, putting the penalty on them accomplishes nothing at all.
A discussion of housing platforms, like AirBnB, followed. Apparently, the platforms pay no attention to whether or not a San Diego vacation rental has a license or conforms with any city legal requirements. Whatever anyone wants to rent out, the platforms will advertise, no questions asked. There are no penalties for this either.
The recommendation to remedy this problem involved three bullets:
• Provide the platforms a list of valid STR licenses and exempted properties (hotels) against which the platforms must validate listings.
• Enforce the ordinance and penalize the platforms with specific fines for non-compliance.
• Require Tier-2 hosts to report booking activity to the City.
Hastings’ last slide contained the main reason for this effort.
The short-term vacation businesses and the ordinance, in the midst of a housing crisis, have caused the loss of hundreds of lower-cost apartments, displacing hundreds of tenants. “This has disproportionately impacted some communities for the financial gain of a small number of owners who are taking advantage of the system.”
The presentation may be viewed here: https://drive.google.com/file/d/13ADYlC99n5AQ0C77-P3XbGUYVPe6BfCt/view.
The OBPB incorporated all of this in a letter that the board will send to the city. There is no doubt that this will be a hard sell. The city is making a lot of money from the Transient Occupancy Tax that hotels and vacation rentals pay. The city will be very reluctant to limit that income, which was over $50 million last year just from STVROs.
The letter may be viewed here: https://oceanbeachplanning.org/files/2024/03/STRO-Letter-3-5-24.pdf
Target
The Target store on Newport Avenue has applied for a license to sell liquor. There was a bit of a discussion but the board was clearly not in favor, evidenced by the unanimous motion to deny.
Target had originally said it would not be selling alcohol but apparently did not mean never. The two major criticisms, beyond Target’s broken promise, was the proximity to OB Elementary and that OB already has considerably more such licenses than there should be now. Figures of 200 or 300 percent over standards were mentioned.
Target did not send a representative to the meeting to argue their case. Unlike when Target first came to OB and had to come before the board, because of development requirements, today, there is no such requirement. The city has cut the planning boards out of the development process. The OBPB is providing its opinion, but the lack of a Target representative was illustrative of this change. Target was not required to appear, so they did not.
{ 2 comments… read them below or add one }
Thank you, OB Planning Board.
Your recommendations set the bar where it should be.
Now let’s see what our elected officials do with it.
Despite lots of promises, they should have made sure that the short term rental situation was fixed, and they have not.
Many OB long term renters are now long term gone…priced out, kicked out, etc.
And liquor at Target? For heavens’ sake, no!
I recommend you see the “slide show.”