Item 10 - Receive and File - Orange County Grand Jury’s Investigative Report, Findings, and Recommendations Regarding Long-Term Solutions to Short-Term Rentals

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Long-Term Solutions to Short-Term Rentals Regardless of the model, neighbors have the expectation that STR businesses will be operated in a responsible and respectful manner. Owner-occupied models make it easier for a neighbor with a complaint to get resolution. In cities that use this model, formal complaints are fewer because neighbors can quickly resolve issues between themselves. Code Enforcement's Role Code Enforcement(CE)responsibilities include initial and ongoing inspections of STRs to assure adherence to building codes, noise and parking requirements, along with monitoring city complaint portals and searching for nonpermitted STRs. Code Enforcement officers also investigate citizen complaints to substantiate claims and issue citations. Revenue staff work in tandem with CE to process permits and licenses and to collect TOT and other fees. In at least one city that has a waiting list for STR permits, revenue staff rather than CE staff manage the list, which may delay or limit CE's ability to find unpennitted STRs. Several cities employ third-party platforms offering an array of services, including STR registration portals, a complaints hotline and/or online portal, and tax payment portals. These platforms offer efficient and potentially cost-effective options to aid staff monitoring STRs. Cities may also select a third-party platform option that identifies both permitted and unpermitted STRs advertising on OBAs. STR Policies Vary in Orange County Each of the thirty-four cities in Orange County has its own policies. As of this writing, nineteen of the cities had a ban on all STRs and fifteen allowed STRs (see Table 1). Unincorporated areas of the county (e.g., Rossmoor,North Tustin) are covered by County of Orange policy through the OC Public Works department, which issues permits; however, the Grand Jury did not observe STR volumes in unincorporated areas warranting analysis. Cities With an STR Ban The Grand Jury learned that it is difficult for cities to enforce a ban. Cities report that after they enacted a ban, the volume of STRs saw a notable decline; however, some unpermitted STRs still continued to operate. Cities may use a rental identification database and a complaint portal to improve compliance, often through third-party software. These databases can often identify the address of an unpermitted STR and allow follow-up with the property owner. At least one city with technologically savvy CE staff has performed this task without help from a third-party platform. All cities in the coastal zone have permits for STRs, and this is linked to mandates from the California Coastal Commission (CCC) which issued a 2016 memo with guidance that coastal cities provide "lower cost visitor...facilities" and beach access via STRs. 2024-2025 Orange County Grand Jury Page 8