The Three Possible Paths to Vacation Rental Rules - Voice of San Diego

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The Three Possible Paths to Vacation Rental Rules

San Diego’s headed into yet another summer tourism season without regulations to police vacation rentals. Policies to regulate the industry could come from the City Council, state Legislature or a ballot measure – but each of those paths is fraught with challenges.

Opponents and supporters of vacation rentals voice their concerns at a San Diego City Council meeting. / Photo by Adriana Heldiz

San Diego’s headed into yet another summer tourism season without regulations to police vacation rentals.

Instead, city-level regulatory proposals appear unlikely to materialize until at least this fall, and vacation rental companies that bankrolled a campaign that forced the City Council to rescind rules approved last year are weighing their options – including a 2020 ballot measure.

Meanwhile, city leaders and advocates on both sides are closely watching a state bill that could sharply curtail rentals in coastal areas of San Diego County.

Each of the three potential paths to vacation-rental regulations is fraught with challenges. The City Council process could fall apart, as it has many times already. The legislative approach would only apply to a portion of rentals and doesn’t come with an enforcement mechanism in the areas it does cover – nor is it clear whether it can win the support of legislators in the state Senate or Gov. Gavin Newsom. And a potential ballot measure could leave the contentious issue unresolved for nearly two years.

Activists and vacation-rental companies have quietly continued to lobby city officials since the City Council voted to rescind strict vacation rental rules after rental platforms and supporters qualified a referendum to overturn them.

City Council President Pro Tem Barbara Bry, who pledged to lead the way on new regulations, hasn’t offered specifics on her next steps other than to say she wants to enact “reasonable” rules.

Bry said last fall that she might float a new regulatory proposal as soon as January. She had championed rules that would have limited vacation rentals to a homeowner’s primary residence.

City attorneys have said any new regulations proposed within the next year would need to be “substantially different” to avoid legal challenges.

Bry has apparently opted to run down the clock to sidestep that issue.

City Councilwoman Jennifer Campbell, who also represents beach communities, said Bry has decided to wait until at least October to pitch new rules, hinting at the possibility of restrictive policies like those Bry championed last year. Campbell said she agrees with the decision to hold off.

“There’s no concrete definition of substantial,” Campbell told Voice of San Diego. “Rather than get into battles over words, I think it’s better that we just wait the 12 months.”

Campbell said it’s not clear that the new regulations will match last year’s but that maintaining housing stock for San Diegans rather than tourists remains her focus. She has supported Bry’s approach to addressing that concern.

“The more housing we have for our own San Diegans, the better off we are,” Campbell said.

A spokeswoman for Bry, who is running for mayor, declined to comment but said the councilwoman would have more to share after additional meetings with community members early this summer.

Brigette Browning of Unite Here Local 30, a hotel workers union that was a key backer of Bry’s regulations last year, said she has had multiple discussions with Bry and Campbell on the issue but hasn’t received recent updates on their plans.

Browning said she’s hopeful Bry will make adjustments to address concerns about shuttering rentals in  Mission Beach and other issues raised by the state Coastal Commission that have long complicated the city’s regulatory attempts. She’s not certain whether City Council members will agree.

“I think we need to reboot. I am open to having some amendments so that the Coastal Commission will be more happy with the ordinance,” Browning said. “I’m not sure my opinion is necessarily the prevailing opinion on the 10th floor [of City Hall] right now.”

While those conversations have continued, Mayor Kevin Faulconer and his team have largely stepped aside. Last year, the mayor proposed letting vacation rental hosts rent out their entire primary residences up to six months a year and giving them and others the right to rent out one other home each year-round. He also pitched a city registration process for rentals. Bry’s more restrictive rules ultimately won out before being rescinded last fall.

Faulconer spokeswoman Christina Chadwick said the mayor’s office still considers the mayor’s proposal a fair compromise and remains open to working with stakeholders on a local solution.

For now, all eyes are on Assemblywoman Tasha Boerner Horvath’s AB 1731, which aims to bar vacation rental platforms like Airbnb and VRBO from listing San Diego County vacation rentals that fall into both residential and state coastal zones on their sites for more than 30 days a year absent a full-time resident on site. The measure passed the state Assembly last week and is now headed to the state Senate.

Vacation-rental companies have opposed the bill and the prospect of strict city regulations, while neighborhood activists who say the booming vacation rental industry has negatively affected their neighborhoods have cheered Boerner Horvath’s legislation.

“I have spent countless hours in City Council meetings hoping for the city to take some action to limit short-term rentals in Mission Beach, but with no tangible results,” former Mission Beach Town Council president Gary Wonacott told the San Diego Union-Tribune after AB 1731 passed the Assembly. “This is one of the reasons why I support AB 1731.”

The city hasn’t taken a formal position on the bill, which would go into effect next January if it is signed by the governor.

Spokespeople for rental platforms Airbnb and Expedia and Share San Diego, a coalition of vacation-rental operators, said they are hoping that the City Council can hash out a compromise of its own. They said they are eager to meet with Bry and others to discuss possibilities.

“Expedia Group maintains the belief that a fair and effective short-term rental policy can — and should — be passed by City Council,” Expedia spokesman Philip Minardi wrote in a statement.

Minardi acknowledged Expedia, which owns platforms HomeAway and VRBO, is also exploring other tacks after years of legislative paralysis.

City Councilman Chris Cate, who has advocated more permissive vacation rental rules, said he has told vacation rental platforms they should pursue a 2020 ballot initiative to set regulations rather than rely on the City Council.

Cate told VOSD he believes a ballot measure is the only way for companies to get regulations on the books that don’t hammer the industry.

“They need to control their own destiny on this,” Cate said. “The public will support their efforts.”

Indeed, as vacation-rental supporters have often noted, a September 2018 Survey USA poll conducted for the Union-Tribune showed two-thirds of 500 San Diegans surveyed supported allowing rentals at a second home, a practice the City Council sought to ban last year.

Minardi and Airbnb spokeswoman Molly Weedn, whose companies funded last year’s referendum and signature-gathering effort, would not elaborate on any initiative plans.

For now, both said they hope to work with city officials and stakeholders on a solution.

“While there is not a decided timeline, we look forward to working together with city officials,” Weedn said.

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