After months of discussions, Orange’s short-term rentals will be regulated and licensed with the city allowing a maximum of 125 permits in town.
Editors’ Note: This dispatch is part of the Voice of OC Collegiate News Service, working with student journalists to cover public policy issues across Orange County. If you would like to submit your own student media project related to Orange County civics or if you have any response to this work, contact Collegiate News Service Editor Vik Jolly at vjolly@voiceofoc.org.
The City Council is expected to take a final vote on a short-term rentals ordinance Tuesday night. The council voted 4-2 in April to give initial approval with Council members Chip Monaco and Jon Dumitru dissenting, expressing concerns about preservation of neighborhoods. The majority of the council opted for stricter regulations of the lodgings and enforcement. Members of the public who commented at the meeting were also divided; some voiced concerns, while others viewed these lodgings as money makers for the city.
While city staff proposed an annual permit fee of $150 for short-term rentals, the council modified the fee to $250. The council also approved an amendment to an agreement with Granicus, a hosting compliance service, that will aid the city in addressing short-term rental challenges, such as enforcement.
The ongoing discussion regarding the rentals in Orange has highlighted the city’s growing need to regulate and tighten restrictions on the businesses. As these lodgings have become more prevalent in recent years, their impact on residential neighborhoods has resulted in numerous complaints such as noise, trash, possible illegal activity, and parking issues, according to a city staff report.
Currently, the rentals are “not specifically allowed” in Orange, but the city has been looking to tighten regulations. Staff estimates that currently 200 to 300 properties in the city are rented as short-term rentals at least part of the year.
During the April council meeting, City Manager Rick Otto discussed how hiring a compliance service to help identify which homeowners have the proper permits and which don’t will help the city pinpoint illegal short-term rental owners in the city.
“At that point, we would go through the code enforcement process with those who have not been issued a permit ultimately through city attorney prosecution,” said Otto.
At previous council meetings, Orange property owners, who operate short-term rentals, have expressed the importance of recognizing the lodgings in the Orange municipal code and agreed to the need to protect the city’s neighborhoods.
“This group has provided feedback to staff about the proposed ordinance and has expressed their willingness to obtain business licenses, pay TOT (transient occupancy tax or bed tax), and comply with the proposed restrictions,” according to the staff report.
The debate surrounding short-term rentals in April lasted more than an hour. Council member Monaco voiced strong opposition against the lodgings.
“We as a council have an obligation to protect residents. Allowing short-term rentals does nothing to protect residents. It weakens neighborhoods. I’ve made that argument; I’ve lost that argument,” he said.
Mayor Pro Tem Kim Nichols reassured residents that the city’s neighborhoods would be protected.
“I have a strong belief we can create an environment with regulations that protect our neighbors. I think this kind of application will do just that because it’s effective in other cities that actually have them,” said Nichols.
Jonah Breslau, who works with the Los Angeles Alliance for a New Economy, an advocacy group focused on supporting communities and good jobs, urged the council to ban short-term rentals in Orange.
“They turn homes into de-facto hotels; they exacerbate the housing crisis which is having a devastating impact on working people all over Southern California, and they harm neighborhood character,” he said. “I think ultimately it’s strongest to have a bright-line rule that’s easy for neighbors and other individuals to understand to simply ban short-term rentals.”
Longtime Orange resident Laura Espinoza said her neighbor operates an Airbnb and she has experienced numerous issues with parking, trash, and loud noise.
“I want my home back,” she said, adding that she wants her grandchildren to be in a safe environment when they visit.
Huntington Beach resident Kathryn Levassiur, who spoke on behalf of the Huntington Beach Short-Term Rental Alliance, a group that supports regulations, advocated allowing such lodgings because of the financial benefits they provide.
“People who visit Orange and stay in short-term rentals support local neighborhood businesses, generate sales tax that goes directly into the city’s general fund.” Levassiur said. “These visitors that come to your city for the university, the hospitals, nearby cities amusement parks, to visit family and for many other reasons, they will generate many thousands of dollars of hotel tax revenue that will greatly benefit the residents of Orange.”
A final vote on the ordinance is set for Tuesday. The City Council meeting starts at 6 p.m. and can be viewed through Orange’s website.