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HomeMy WebLinkAboutOrdinance 1223 and Resolution 2011-24 ZOA 10-68 Short Term Vacation Rentals STRCITY OF PALM DESERT DEPARTMENT OF COMMUNITY DEVELOPMENT STAFF REPORT REQUEST: APPROVAL OF A ZONING ORDINANCE AMENDMENT REQUIRING A CONDITIONAL USE PERMIT FOR SHORT-TERM VACATION RENTALS IN NON -GATED RESIDENTIAL NEIGHBORHOODS OR COMMUNITIES, AND A MODIFICATION TO THE CONDITIONAL USE PERMIT CHAPTER ESTABLISHING A MINOR CONDITIONAL USE PERMIT REVIEW. SUBMITTED BY: Tony Bagato, Principal Planner APPLICANT: City of Palm Desert CASE NO: ZOA 10-68 DATE: March 24, 2011 CONTENTS: Draft Ordinance Exhibit A, Text Amendment Draft Resolution Exhibit A, Conditions of Approval for Short-term Rentals Legal Notice City Council Minutes, dated January 25, 2009 Planning Commission Minutes, dated January 19, 2010 Planning Commission Minutes, dated April 6, 2010 Planning Commission Minutes, dated February 15, 2011 Recommendation That the City Council, waiver further reading and: Pass Ordinance No. 1223 to second reading approving a Zoning Ordinance Amendment requiring a Conditional Use Permit for Short- term Vacation Rentals in non -gated communities. Adopt Resolution N02011-24approving a set of standard Conditions of Approval for Short-term Rentals and establish a new $1,500 Deposit Based Fee for a Minor CUP. Staff Report ZOA 10-68 March 24, 2011 Page 2 of 7 Short-term Subcommittee Action: After the April 6, 2010 Planning Commission meeting, staff was directed to form an ad -hoc subcommittee that would deal with Short-term Vacation Rentals. The subcommittee met three times to discuss the possibility of prohibiting or allowing short-term rentals in single- family neighborhoods. After researching and discussing the pros and cons of short-term rentals, the subcommittee recommended that the City continue to allow them with a Conditional Use Permit (CUP) and set standard of conditions for all non -gated residential communities. The subcommittee also recommended that a lesser fee be established through a Minor CUP process, and that we should reevaluate the process within 6 to 12 months. If this process does not work the way the subcommittee or City believes it should, then staff will request further direction from the City Council at a later date. Planning Commission Action: On February 15, 2011, the Planning Commission recommended approval of the Zoning Ordinance Amendment on a 3-2 vote. The motion was carried by Commissioners Campbell, Tanner, and Dash voting yes and Commissioners Schmidt and De Luna voting no. Executive Summary On April 6, 2010, the Planning Commission continued ZOA 10-68 and directed staff to form a subcommittee to study short-term rentals further. The subcommittee has met several times over the past 10 months and is recommending a zoning ordinance amendment that will require a Conditional Use Permit (CUP) for short-term rentals in all non -gated residential communities. In addition, the recommendation includes a zoning ordinance amendment creating a Minor CUP review for short-term rentals and other potential CUPs requiring lesser requirements. On February 15, 2011, the ZOA was presented to the Planning Commission and recommended for approval on 3-2 vote. The Commissioners discussed the pros and cons of short-term rentals. Commissioners Schmidt and De Luna were opposed to allowing short- term rentals in non -gated, single-family neighborhoods. Commissioner Tanner was part of the subcommittee and indicated how hard the subcommittee worked and that he was originally opposed to allowing short-term rentals, but is now in favor of them. Background On January 19`", 2010, staff requested direction from the Planning Commission on how to deal with short-term rentals in the R-1 zone since both the Planning Commission and City Council stated that short-term rentals are not compatible with single-family zones. After the discussion, Commissioner Tanner requested staff to do a study of the Planned Residential (PR) gated communities and the R-1 gated communities; in addition, Commissioner Schmidt asked for a possible ordinance. GAPlanning\Tony Bagalo\Prolect Staff Reports\ZOA\10-68 Short -Tenn Renlals=l` Hearing\SR CM Council 3-24-11. doc Staff Report ZOA 10-68 March 24, 2011 Page 3 of 7 After the Planning Commission meeting, staff researched and identified all gated communities zoned PR or R-1 (see Gated Communities Map). During the research of the gated communities, staff also found non -gated communities zoned R-1 with golf courses, and non -gated single-family neighborhoods zoned PR (see R-1 Gated, PR Non -Gated Study map). This study indicated that trying to link the prohibition of short-term rentals to one zone is difficult because there are gated communities in the R-1 zone and there are non -gated communities zoned PR, and two non -gated golf course communities zoned R-1. Given the difficulty of prohibiting short-term rentals in one particular zone, staff prepared a zoning ordinance amendment to prohibit short-term rentals in all residential zones, unless the property was located within a gated community. Staff prepared the zoning ordinance amendment prohibiting shot -term rentals in non -gated communities and proceeded with the notice requirements for the public hearing. Many comments were received in opposition to the prohibition, and staff agreed with some of the comments for allowing short-term rentals in our community. The comments against the prohibition that staff received were [in part): • Negative impact on their ability to afford the home, leading to more foreclosures. • Negative impact to local economy and businesses because of less rental options for many tourists that chose not to stay in hotels or motels. • If the current vacation rentals were enforced, the city would collect approximately $300,000 or more in Transient Occupancy Tax. • The property is a second home that is not lived in all the time and the short-term rentals supplement their income. At the April 6, 2010 Planning Commission meeting, staff presented the proposed prohibition and requested a continuance because public input against the prohibition led staff to research other possible regulations to control the potential problems with short-term. After staff's presentation and testimony from the public, the Planning Commission continued the zoning ordinance amendment and directed staff to form a subcommittee to study short-term rentals further. A subcommittee was formed and included members from the business community, homeowners with short-term rentals, homeowners against short-term rentals, two Planning Commissioners, two City Council members, and staff. Staff members included the City Manager and representatives from Police, Code Compliance, Finance, and Planning departments. On May 5, 2010, the Subcommittee met and discussed the pros and cons of short-term rentals as well as how to regulate them in the future. Staff determined that there could be approximately 750 short-term rentals within the City based on internet research of vacation rental websites. Given that there were approximately 750 short-term rentals and staff had only received eight (8) known complaints within ten (10) years; staff recommended a new ordinance that would allow short-term rentals in all zones with a business license and would be subject to stricter regulations. On July 28, 2010, the Subcommittee met to discuss the possibility of adopting a city-wide ordinance further. Staff also presented that further research had been done on the number of possible short-term rentals and indicated that there were approximately 1,363 short-term GAPlanning\Tony Bagato\Pmject Stag Repol-nAZOM10-68 Short -Tenn Rentals\CUP Hearing\SR City Council 3-24-1 LEoc Staff Report ZOA 10-68 March 24, 2011 Page 4 of 7 rentals in the City. Of the 1,363 identified, 1,212 were in gated communities and 151 were in non -gated communities. After staff's presentation, a member of the Subcommittee gave a presentation about the negative impacts related to short-term rentals. After the both presentations, the Subcommittee discussed the various regulations currently used for enforcing noise problems and indicated that a CUP for land -use restrictions would exert more control over Short-term rentals than would an ordinance permitting them a simple business license. Staff proposed that a list of standard conditions could be used for all short-term rentals regulating: the maximum number of guests, on -site parking, and requiring homeowner contact information. Some of the members were concerned about the $2,915 deposit based fee for a CUP and said that would encourage home owners to avoid the City approval process. After the discussion, the subcommittee directed staff to prepare the standard conditions and establish a lower fee for the application. On January 24, 2011, the subcommittee met to discuss the proposed standard conditions of approval that can be used to regulate: the maximum number of people, minimum number of days it can be rented, on -site parking, noise, property owner or property manager contact, licensing and TOT payment, and possible revocation for violations (Exhibit B). In addition, staff informed the subcommittee that an amendment could be processed for the CUP requirements creating a Minor CUP with a lower fee. Staff also informed the subcommittee that a complaint had been received about a home being used as a short-term rental in the Hillside Planned Residential zone, and that the requirement for the CUP should be in all residential zones with an exception for non -gated communities. The subcommittee agreed and recommended a zoning ordinance amendment be proposed with the standard list of conditions for short-term rentals in all zones. Protect Description: The proposed Zoning Ordinance Amendment will add new language to seven (7) sections of the Zoning Ordinance. The following wording will be added to the conditional uses section of each residential zone: "Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days." The Chapters that will be modified are: • 25.14 Residential Estates (RE) • 25.15 Hillside Planned Residential (HPR) • 25.16 Single -Family Residential (R-1) • 25.18 Single -Family Residential (R-2) • 25.20 Multi -Family Residential (R-3) • 25.22 Single -Family Mobile Home Residential (R-1-M) • 25.24 Planned Residential District (PR) To create the Minor CUP review the following wording will be added to Chapter 25.72.020 H: G:Wlanning\Tony Sagato\Project Staff Repons20A\10-68 Short -Teem Rentals\CUP Headng\SR City Council 3-2411.doc Staff Report ZOA 10-68 March 24, 2011 Page 5 of 7 "The Director of Community Development may determine that a certain request can be deemed a Minor Conditional Use Permit resulting is lesser requirements." The Minor CUP will establish a lesser fee in the amount of $1,500 instead of the $2,915 fee required by a CUP application. CUP Requirement: The CUP will be required for all new and short-term rentals in non -gated communities. Anyone operating a legal short-term rental with a city business license will have 90 days to register with the Planning Department. As part of the Conditional Use Permit, any new short-term rental will go through a public hearing, where the adjacent properties located within 300 feet will be notified. Any resident within 300 feet will be made aware of the request for the property to be used as a short-term rental. The standard conditions that will be applied are: • Minimum Number for Rent or Lease: The minimum number of days that a short- term rental can be occupied for is three (3) days. Less than three (3) days rentals or leases shall be prohibited. • Maximum Number of Occupants: The maximum number of overnight guests for a short-term vacation rental shall not exceed two (2) persons per bedroom. Additional daytime guests are allowed between the hours of 8:00 am and 8 pm, with the maximum daytime guests not to exceed one (1) person per bedroom. • Appearance. Visibility or Location: A short-term vacation rental shall not change the residential character of the outside appearance of the residence, either by the use of colors, materials, lighting, or any other advertising mechanism. • Signs: No signs, either on site or off site, shall be used to advertise the availability of the rental unit to the public. • On -site Parking Required: All parking associated with a short-term vacation rental shall be entirely on -site, in the garage, carport, driveway or otherwise off of the public street. • Noise: Occupants of the short-term vacation rental shall comply with the standards and regulations of the Palm Desert Municipal Code Section 9.24 Noise Control. • Contact Person: The owner, or his or her agent, shall be available 24 hours a day, seven days per week, to respond to any tenant or neighborhood questions or concerns. The following information shall be provided: G:\Planning\Tony Bagato\Prolect Staff Repoms ZOA\10-66 Short -Term Rentals\CUP Hearing\SR City Council 3-24-11.doc Staff Report ZOA 10-68 March 24, 2011 Page 6 of 7 o Name, address and telephone number(s) of the contact person responsible for the managing the short-term vacation rental. The name, address and telephone number(s) shall be provided to the City of Palm Desert Community Development/Planning Department and owners of property within 300 feet of the rental property, and shall be permanently posted in the rental unit in a prominent location. Any change in the contact person's address or telephone number shall be provided promptly to the parties described above. • Renter Notification: The owner, or operator, shall provide each occupant of the short-term vacation rental with the following information prior to occupancy of the unit and/or shall post such information in a prominent location within the unit: 1. Owner or his or her agent contact with 24 hour availability. 2. The maximum number of overnight occupants and the maximum number of daytime occupants as permitted by the CUP 3. Trash pick-up day and applicable rules and regulations pertaining to leaving or storing trash on the exterior of the property. 4. A copy of the Palm Desert Municipal Code Section 9.24 Noise Control 5. Notification that the occupant or owner maybe citied or fined by the City and/or in accordance with Palm Desert Municipal Code Section 9.24 Noise Control. • Transient Occupancy Tax: The operator of the short-term vacation rental shall comply with the regulations and standards set forth in the Palm Desert Municipal Code Section 3.28 Transient Occupancy Tax (9%), including making any required payment of transient occupancy tax for each short-term vacation rental. • Violations: Violations of these conditions shall result in the Conditional Use Permit being modified, discontinued, suspended or revoked by the Planning Commission. The purpose of these conditions is to establish a set of regulations applicable to short-term vacation rentals in non -gated residential neighborhoods. These conditions are intended to ensure that short-term vacation rentals will be compatible with surrounding residential uses and will not negatively impact the neighborhoods in which they are located. Any Conditional Use Permit issued for short-term vacation rentals may be modified, discontinued, suspended or revoked by the Planning Commission upon receiving satisfactory evidence that property has not been managed in accordance with these conditions. Discussion: The City of Palm Desert is unique in that it is both a resort community and permanent residential community for retired individuals and young families. As a resort community, many property owners have used single-family homes, condominiums and apartments as G.\Planning\Tony Bagato\Project Staff RepoftsZOA\10-66 Short -Term Rentals\CUP Hearing\SR City Council 3-24-11.doc Staff Report ZOA 10-68 March 24, 2011 Page 7 of 7 short-term rentals for vacation seekers. Historically, the majority of these properties have been in gated communities and country clubs where there is a great appeal to tourists. Staff believes that requiring a Conditional Use Permit for short-term rentals in non -gated residential communities meet both the needs for the resort community and permanent residents. Environmental Review For the purpose of CEOA, there are no environmental impacts related to rental or leasing options of residential properties. Fiscal Impact Allowing Short-term Rentals provides the City with Transient Occupancy Tax (TOT). Currently, the City is collecting approximately $234,900.27 in 2010. If approved, the Zoning Ordinance Amendment will continue to allow short-term rentals that provide TOT to the City. Submitted by: � Tony Bag' ato Principal Planner Department Head: 44- Lauri Aylaian Director of Community Development (4&--/ Paul Gibson, Director of Finance CCTV AYES: NO: ABSENT: ABSTAIN: e VERIFIED BY: ZWk Original on File wk6 City KftM7 GAPlanning\Tony Bagato\Project Staff Report \ZOA 10.68 Short -Tenn Rentals\CUP Hearing\SR City C"ncll3-2411.dw ORDINANCE NO. 1223 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, APPROVING A ZONING ORDINANCE AMENDMENT REQUIRING A CONDITIONAL USE PERMIT FOR SHORT- TERM VACATION RENTALS IN NON -GATED RESIDENTIAL NEIGHBORHOODS OR COMMUNITIES, CASE NO: ZOA 10-68 WHEREAS, the City Council adopted Ordinance No. on March 24, 2011 revising sections of the Palm Desert Municipal Code as described in Exhibit A, attached; and WHEREAS, the Planning Commission of the City of Palm Desert, California, did on the 15th day of February 2011, hold a duly noticed public hearing to consider the said request and by its Resolution No. 2545 recommended approval of ZOA 10-68; and WHEREAS, said application has complied with the requirements of the "City of Palm Desert Procedure for Implementation of the California Environmental Quality Act', Resolution No. 10-26, the Director of Community Development has determined that the project will not have a negative impact on the environment and is exempt from CEQA, and WHEREAS, at said public hearings, said City Council heard and considered all testimony and arguments of all interested persons; and NOW, THEREFORE, BE IT ORDINANDED by the City Council of the City of Palm Desert, California, that the following section of the Palm Desert Municipal Code is hereby amended, as follows: SECTION 1: That Palm Desert Municipal Code is herby amended and revised as described in Exhibit A, attached hereto. SECTION 2: That the City Clerk of the City of Palm Desert, California, is hereby directed to publish this ordinance in the Desert Sun, a newspaper of general circulation, published and circulated in the City of Palm Desert, California, and shall be in full force and effect thirty (30) days after its adoption. ORDINANCE NO. 1223 PASSED, APPROVED AND ADOPTED at a regular meeting of the Palm Desert Planning Commission, held on this 241" day of March 2011, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: JEAN M. BENSON, Mayor ATTEST: RACHELLE D. KLASSEN, City Clerk City of Palm Desert, California ORDINANCE NO. 1M EXHIBIT A Section 1. 25.14.030 — Conditional uses. K. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 2. 25.15.22 — Conditional uses. A. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 3. 25.16.030 — Conditional uses. K. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 4. 25.18.030 — Conditional uses. M. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 5. 25.20.030 — Conditional uses. O. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days.. Section 6 25.22.030 — Conditional uses. I. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 7. 25.24.025 — Conditional uses. 1. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 8. 25.72.020 H. The Director of Community Development may determine that a certain request can be deemed a Minor Conditional Use Permit resulting is lesser requirements and review time. RESOLUTION NO. 2011-24 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, APPROVING A STANDARD SET OF CONDITIONS FOR SHORT-TERM VACATION RENTALS AND ESTABLISHING A NEW FEE FOR PROCESSING A MINOR CONDITIONAL USE PERMIT. WHEREAS, the City Council of the City of Palm Desert, California, did on the 241h day of March 2011, hold a duly noticed public hearing to consider the request by the CITY OF PALM DESERT for approval of the above noted; and WHEREAS, said application has complied with the requirements of the "City of Palm Desert Procedure for Implementation of the California Environmental Quality Act", Resolution No. 10-26, the Director of Community Development has determined that the project is Class 5 Categorical Exemption under CEQA and no further environmental review is necessary, and WHEREAS, at said public hearing, upon hearing and considering all testimony and arguments, if any, of all interested persons desiring to be heard, said City Council did find the following facts and reasons to exist to justify approval of the said request: 1. That the standard set of conditions will provide the City of Palm Desert with regulations for short-term vacation rentals within non -gated single- family neighborhoods. 2. That the new Deposit Based Fee of $1,500 will provide the City with the ability to process a lesser fee for Minor Conditional Use Permits. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm Desert, California, as follows: 1. That the standard conditions of approval for short-term vacation rentals shall be as described in Exhibit A, attached. 2. That the City shall adopt a new Deposit Based Fee for Planning in the amount $1,500 for processing a Minor Conditional Use Permit. RESOLUTION NO. 2011-24 PASSED, APPROVED AND ADOPTED at a regular meeting of the Palm Desert Planning Commission, held on this 24`h day of March 2011, by the following vote, to wit: AYES: NOES: ABSENT: ABSTAIN: JEAN M. BENSON, Mayor ATTEST: RACHELLE KLASSEN, City Clerk City of Palm Desert, California 2 GAPlanning\Tony Bagato\Project Staff Reporla=Xl 0.68 Short -Tenn Rantals\CUP Hearing= Resolutlun.doc RESOLUTION NO. 2011-24 EXHIBIT "A" SHORT-TERM RENTAL CONDITIONS Minimum Number for Rent or Lease: The minimum number of days that a short-term rental can be occupied for is three (3) days. Rentals or leases for fewer than three (3) days shall be prohibited. Maximum Number of Occupants: The maximum number of overnight guests for a short-term vacation rental shall not exceed two (2) persons per bedroom. Additional daytime guests are allowed between the hours of 8:00 am and 8 pm, with the maximum daytime guests not to exceed one (1) additional person per bedroom. Appearance, Visibility or Location: A short-term vacation rental shall not change the residential character or the outside appearance of the residence, either by the use of colors, materials, lighting, or any other advertising mechanism. Signs: No signs, either on site or off site, shall be used to advertise the availability of the rental unit to the public. On -site Parking Required: All parking associated with a short-term vacation rental shall be entirely on -site, in the garage, carport, driveway or otherwise out of the public street. Noise: Occupants of the short-term vacation rental shall comply with the standards and regulations of the Palm Desert Municipal Code Section 9.24 Noise Control. Contact Person: The owner, or his or her agent, shall be available 24 hours a day, seven days per week, to respond to any tenant or neighborhood questions or concerns. The following information shall be provided: • Name, address and telephone number(s) of the contact person responsible for the managing the short-term vacation rental. The name, address and telephone number(s) shall be provided to the City of Palm Desert Community Development/Planning Department and owners of property within 300 feet of the rental property, and shall be permanently posted in the rental unit in a prominent location. Any change in the contact person's address or telephone number shall be provided promptly to the parties described above. Renter Notification: The owner, or operator, shall provide each occupant of the short- term vacation rental with the following information prior to occupancy of the unit and/or shall post such information in a prominent location within the unit: 1. Owner or his or her agent contact with 24 hour availability. 3 GAPlanning\Tony Bagalo\Project Staff Reports\Z0A\10-6B Short-Teon Rentals\CUP Hearing\CC Resolutlon.doc RESOLUTION NO. 2011-24 2. The maximum number of overnight occupants and the maximum number of daytime occupants as permitted by the CUP 3. Trash pick-up day and applicable rules and regulations pertaining to leaving or storing trash on the exterior of the property. 4. A copy of the Palm Desert Municipal Code Section 9.24 Noise Control 5. Notification that the occupant or owner may be citied or fined by the City and/or in accordance with Palm Desert Municipal Code Section 9.24 Noise Control. Transient Occupancy Tax: The operator of the short-term vacation rental shall comply with the regulations and standards set forth in the Palm Desert Municipal Code Section 3.28 Transient Occupancy Tax (9%), including making any required payment of transient occupancy tax for each short-term vacation rental. Violations: Violations of these conditions shall result in the Conditional Use Permit being modified, discontinued, suspended or revoked by the Planning Commission. 4 G:\Planning\Tony Bagato\Project Staff ReportsVOA\10-68 Short -Tenn Rentals\CUP Hearing\CC Resotution.00c CITY OF PALM DESERT LEGAL NOTICE CASE NO. ZOA 10-68 REVIEW. PROJECT DESCRIPTION: The City of Palm Desert is requesting the adoption of a Zoning Ordinance Amendment requiring a Conditional Use Permit for short-term vacation rentals in non -gated neighborhoods or communities, and establishing a Minor Conditional Use Permit Review. The following wording will be added to the Palm Desert Municipal Code: "RENTAL OR LEASING OF A RESIDENTIAL PROPERTY, OTHER THAN RESIDENTIAL PROPERTIES LOCATED WITHIN GATED COMMUNITIES, FOR PERIODS OF LESS THAN 30 DAYS." The requirement will be added to all residential zoning districts within the City of Palm Desert. • 25.14 RESIDENTIAL ESTATES (RE) 25.15 HILLSIDE PLANNED RESIDENTIAL (HPR) • 25.16 SINGLE-FAMILY RESIDENTIAL (R-1) 25.18 SINGLE-FAMILY RESIDENTIAL (R-2) 25.20 MULTI -FAMILY RESIDENTIAL (R-3) • 25.22 SINGLE-FAMILY MOBILE HOME RESIDENTIAL (R-1-M) • 25.24 PLANNED RESIDENTIAL DISTRICT (PR) To establish the Minor Conditional Use Permit Review, the following section will be added to the Palm Desert Municipal Code: 25.72.020 H. THE DIRECTOR OF COMMUNITY DEVELOPMENT MAY DETERMINE THAT A CERTAIN REQUEST CAN BE DEEMED A MINOR CONDITIONAL USE PERMIT RESULTING IS LESSER REQUIREMENTS AND REVIEW TIME. PROJECT LOCATION: City of Palm Desert, changing the Palm Desert Municipal Code PUBLIC HEARING: Said public hearing will be held before the City of Palm Desert City Council on Tuesday, March 24, 2011 at 4:00 p.m. in the Council Chamber at the Palm Desert Civic Center, 73-510 Fred Waring Drive, Palm Desert, California, at which time and place all interested persons are invited to attend and be heard. Written comments concerning all items covered by this public hearing notice shall be accepted up to the date of the hearing. Information concerning the Zoning Ordinance Amendment is available for review in the Department of Community Development at the above address between the hours of 8:00 a.m. and 5:00 p.m. Monday through Friday. If you challenge the proposed actions in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the Planning Commission at, or prior to, the public hearing. PUBLISH: Desert Sun Rachelle Klassen, City Clerk March 13, 2011 City Council, City of Palm Desert N 0 a r � rr•, — 0 rn April 9, 2010 N N m ry: r To: Palm Desert City Council Members/ Planning Commission Members n cn D -- From: Doug & Maureen Boren r RE: "Vote on Vacation Ban Delayed" We would like to give input to the discussion of banning short-term rentals in the city. We can assure you that the "party house image" may look "upgraded" in some neighborhoods but the nuisance is alive and well no matter who rents the property, whether or not they drive BMWs or eat at California Pizza Kitchen. We are strongly in favor of banning short-term rentals (1 week- 3 days, etc) in the city of Palm Desert. Kudos to Nancy DeLuna who said it so well, "It's not up to the city to change standards to help residents with second homes' (or mortgage payments on expensive homes). We have lived next to a short-term rental home and can attest to the problems that go with it. Noise factor is big. Even though there is a block wall between our properties, the noise from "guests" at the rental who, of course feel, entitled to party with loud music, D.J.'s, and lots of friends is irritating to the max. These people pay a lot to stay at this very nice home and want to use the outdoor pool and patio areas while they are here. We however, cannot use our outdoor patio and pool area for hours at a time due to this nuisance (unless we want to hear their music). After numerous complaints to the owner, he finally enforced the 10:00 cutoff on noise, however we would have already heard hours and hours of this already. Many, many times we have had to deal directly with the renters ourselves when the owner was not available. Weddings and other big celebrations are often held here with cars parked up and down our entire street. Valets are often present with cones along our curbs. We have to tell them not to park in front of our mailboxes so that we can receive deliveries. If anyone on the block had guests of their own, there would be no place to park. It's hard to control guests of the renter so often we have trash, beer bottles, cigarette butts left on our property where there were small congregations outside the party. We moved here many years ago because of the ambiance. We should not have to feel as though we are in a commercial area with this noise and traffic. It is difficult for neighbors to have to be the ones to enforce the city ordinances as it creates animosity in the neighborhood. We are aware that permits must be given to continue these practices however it is possible that if neighbors are not present for some reason to contest the permit or if someone happens to move into a neighborhood in which a permit has already been granted, the nuisance is there. We ask that you consider this ban very carefully. ` &r Maureen Bor n palm d, Vote on vacation rental ban delayed BY K KMMMM The Desert Sun Bowing to an outcry fiom home- owners and mom than $200,000 in hotel tax, die Palm Desert Planning Cormnission on Tuesday put off a vote on a proposed law to ban short-term vacation rentals in the The mtmvicsion voted 4-1 instead to setup astudygmup on the issue of short-tetmmntals to come up with a law that v& balance the financial in- fiffesti; of homeowners with the com- MWOnets' concerns about presety- mg the otYs fanny rrdgbborhoods, "We're not trying to discourage rentals," said Conmumon Chair- woman Connor Umont "Wire try- ing to preserve our neighborhoods. We're giving neighbors the opportu- nity to w 'We don't want a (party house) next door:' " Butdut*aspiritedpubiic hearing, homeowners argued that the "party ele short -tetll] rentals is largely unfounded foun " Mese are families going down to California Pizza Kitchen," said home- owner Jane Baron, desmbing the renters for her house on Grapevine Street Baron andother homeowners who bought horn es in Palm Desert hoping to retire these in the future said they rely on short term re talc to Dover their house payments. The oty's current law allows short-term rentals in gated conmru- nides, hot in other residential areas, specifically zoned for single-family houses, homeowners have to get a corrditimW use perm fiom the Homeowners renting out their homes for less than 3o days am sup- posed to pay occupancy, or "Most neghborhoods don't want to turninto short-tetm rental (auras),,' said Commidarer Nancy Mona, who provided the sole no vote on the issue it's not up to the city to change standards to help residents with sec- ond homes." MINUTES REGULAR PALM DE; ( CITY COUNCIL MEETING JUNE 25, 2009 XV. CONTINUED BUSINESS A. REQUEST FOR APPROVAL OF THE DEVELOPMENT OF AN "ARTIST SHOWCASE" CONCERT SERIES IN CIVIC CENTER PARK (Continued from the meetings of May 21 and June 11, 2009). Councilman Ferguson moved to, by Minute Motion, withdraw this request from the agenda. Motion was seconded by Finerty and carried by a 4-0 vote, with Kelly ABSENT. XVI. OLD BUSINESS None XVII. PUBLIC HEARINGS A. CONSIDERATION OF AN APPEAL OF A PLANNING COMMISSION DECISION, DENYING A CONDITIONAL USE PERMIT (CUP) TO OPERATE A SHORT-TERM RENTAL IN AN R-1 SINGLE-FAMILY ZONE LOCATED AT 77-040 UTAH CIRCLE Case No. CUP 09-180 (Lisa Theodoratus, Applicant/Appellant). Principal Planner Tony Bagato stated this request was before the Planning Commission where the Applicant requested a Conditional Use Permit (CUP) for a short-term rental, which is the ability to rent the home for less than 30-days periods. He displayed the vicinity map to show the home location in Palm Desert Country Club off Utah Circle. The homeowner had been operating as a short-term rental for the past two years, and it came to the City and Fire Department's attention when there was a noise complaint filed in July of 2008. The Police Department has verified there have been no further complaints since that time. He said staff added conditions to the proposal that no parties would be allowed. When the property owner was out of town, she had a local real estate person/rental agency to oversee her property. Staff felt that with the conditions proposed, which were compatible with the neighborhood, staff would recommend the City Council reverse the Planning Commission's decision. Responding to question, he confirmed the house was on a cul-de-sac and the Planning Commission voted to deny the request on a 4-1 vote. Further responding, he confirmed the City's policy is 30 days or more. Mayor Pro Tern Finerty asked if staff was recommending that the Council vote against it's own policy. Mr. Bagato explained that because the property was in the R-1 Zone, staff had no way to address short-term rentals in the past. The City required a CUP, in the R-1 Zone only, to be able to rent. In the past, the Planning IE MINUTES REGULAR PALM DE: i CITY COUNCIL MEETING JUNE 25, 2009 Commission approved the ones that were not problematic. However, the ones that had a proven history of party homes like the one in Ironwood and Joshua Tree were denied. He said short-term rentals are allowed under a CUP, as long as they can be compatible with the neighborhood. Mayor Spiegel declared the public hearing open and invited public testimony FAVORING or OPPOSING this matter. MS. LISA THEODORATUS, Applicant, stated that Palm Desert was a residential and vacation resort community, and as such, it had a tremendous amount of tourist coming from all over the world, which brought the City much needed tax dollars. She asked the Council to recognize the potential of the Transient Occupancy Tax (T.O.T.) revenues for the City by making it easier for homeowners to rent responsibly on a short-term basis and approve her request for a CUP. A home of her size would probably bring in an additional $2,000 to $3,000 a month in T.O.T. revenues. In the past she had been doing long-term rentals, but due to the economy, it was no longer feasible for her occupants. Her usual occupants are one couple and most often from Canada. This situation has put her in a severe bind, because she has not been able to rent her home. She was running into a huge dilemma by having to refer people to other homeowners who are renting their house anyway without being required to pay the tax for the CUP. She said there was one complaint filed last year, but no one but her was at the house for a two -month period. The complaint was done by a reporting party with very little information on it. She always tries to be extremely responsible as noted in a letter by one of her neighbors who lived two doors down. She even has provisions in her contract that if there was any noise or party, that the renter would be evicted immediately. Mayor Pro Tern Finerty asked the Applicant why she didn't rent out the unit full-time since she lived in San Rafael, California. MS. THEODORATUS replied she lived in San Rafael and started renting out several years ago when the economy was turning. She is a small business owner who was able to afford her home on Utah Circle as a vacation residence without having to rent it. However, she was now in a position where she needed extra revenue from that house during the time she was not utilizing it. MS. CAROLE BENFORD stated she lived on Tennessee Avenue, which was not far from the subject home. She personally didn't know of any problems there, but there are a number of houses that are available for rent in the area and a number of absentee owners that might want to rent. She would be concerned that a CUP was granted every time someone had a financial difficulty, because she could lose the residential bedroom community. iG MINUTES REGULAR PALM DE (CITY COUNCIL MEETING JUNE 25, 2009 MS. MARIE SCHMIDT stated she was a member of the Palm Desert Planning Commission and noted the Commission deliberated on this extensively and arrived to the conclusion that it was establishing a somewhat dangerous precedent in a residential area knowing full well that there are short-term rentals in and about the area that are not permitted. It seemed dangerous to the Commission to extend a CUP that ran with the property and not with the present owner. It was somewhat surprising to her that staff would recommend reversing the Planning Commission's decision, which she thought was not a good idea. She hoped the Council would uphold the Planning Commission's decision. With no further testimony offered, Mayor Spiegel declared the public hearing closed. Mayor Pro Tem Finerty said she felt the integrity of the residential neighborhoods needed to be preserved, and short-term leases were not compatible with keeping them that way. Residential neighborhoods are not meant to be hotels or timeshare, and in a sense, that's exactly what Council would be allowing, which was a slippery slope. She too was surprised that staff recommended overturning the Planning Commission decision when it was a 4-1 vote. Mayor Pro Tem Finerty moved to, by Minute Motion, direct staff to prepare a Resolution of Denial for presentation at the next City Council Meeting. Councilmember Benson agreed with Mayor Pro Tem Finerty, stating she sympathized with those affected by the economic downturn but everyone was affected. The City couldn't solve everyone's woes because they couldn't make their house payment that they shouldn't have owned in the first place, which was not the City's problem. She said if the Council allowed it in this neighborhood, Palm Desert County Club, pretty soon it will spring up in other places. The City had a bunch of rentals and second homes that the City will eventually catch up to. Many modified their homes, and they are probably sitting on pins and needles wondering when the City will get to them. She said there was a lot the Council didn't know, and to go ahead and approve this request would only encourage more to rent out their homes on a short-term basis. She said short/term rentals destroyed neighborhoods. She said the City had plenty of hotels and not all were expensive anymore. Councilmember Benson seconded the motion. Mayor Pro Tem Finerty stated that in these issues, it would be a good idea for staff, especially in a 4-1 vote, to provide the Council with an option for denial, instead of assuming the Council will go along with staffs recommendation. 17 MINUTES REGULAR PALM DEI ( CITY COUNCIL MEETING JUNE 25, 2009 Mayor Pro Tern Spiegel had the same concern as Councilmember Benson that a lot of homes were being rented on a two-, three-day, two-, three-week basis without permission, and he didn't know how to put a stop to it. Mayor Spiegel called for the vote, and the motion carried on a 3-0 vote, with Ferguson and Kelly ABSENT. B. REQUEST FOR APPROVAL OF A ZONING ORDINANCE AMENDMENT UPDATING AND REVISING PALM DESERT MUNICIPAL CODE SECTION 25.68 - SIGNS Case No. ZOA 09-104 (City of Palm Desert, Applicant). Principal Planner Tony Bagato stated the request was for approval to update the Sign Ordinance, Chapter 25.68. Some of the reasons for the update were that the Ordinance was originally adopted in 1975, and there have been piecemeal updates since then, which led to an inconsistent document of the Palm Desert Municipal Code. In 2007, a Signage Subcommittee comprised of staff and business community members was formed to address the outdated standards. The Committee addressed some of the wording that was lengthy and unclear. Real estate signs were the first issue that came up in 2007 from the business community, because the standards were outdated and too restrictive. Staff also had problems with signs facing the freeway. He said from a real estate standpoint, the issue was that many of the commercial Realtors were held to twelve -square feet if the building had more than 200 lineal feet of frontage. However, the smaller buildings on Fred Waring were held to a three -square foot sign. Mr. Dick Baxley spoke on behalf of many commercial Realtors in front of City Council, and he stated that the current standards were outdated and too restrictive. The subcommittee went out and looked at some of the signs that were causing staff concern, like the ones that were showing up much larger, and also the ones with "riders," which are the add -on pop outs outside of the sign area. He said this type of sign intends to draw attention to the site. He displayed a few samples with up to three "riders" for Council to view, stating that due to the downturn in the economy many more signs were appearing, which was creating clutter. The Subcommittee came up with a standard of a one two-sided sign per frontage, which was the same today. However, the Subcommittee was looking at increasing the size from a three -square foot to a maximum of a six -square foot sign, no matter how much of a frontage there was in front of the building. He said the maximum was six -square feet, which was the same standard today. He said no riders would be allowed outside the 16-square foot radius, and a "rider" could still be used, but it had to be within the main square and not be sticking out. He said signs could not be illuminated, which was the same standard today. Freeway signs came up when the City reviewed an Architectural Review case where a multi tenant business owner asked for his sign to be located higher in the building for advertising. The ARC denied that request and instead recommended that U CITY OF PALM DESERT DEPARTMENT OF COMMUNITY DEVELOPMENT PLANNING COMMISSION STAFF REPORT REQUEST: DIRECTION REGARDING SHORT-TERM RENTALS IN THE R-1 ZONE. , SUBMITTED BY: Tony Bagato, Principal Planner DATE: January 19, 2010 Recommendation Direct staff to either prepare a Zoning Ordinance Amendment prohibiting short- term rentals in the R-1 zone, or to continue to allow them as a Conditional Use and approve them on a case -by -case basis. Executive Summary Currently the R-1 zone allows a single-family home to be rented or leased for periods less than 30 days with a Conditional Use Permit (CUP). On May 19, 2009, the Planning Commission, on a 4-1 vote, denied a CUP application by a homeowner on Utah Circle to operate her second home as a short-term rental in an R-1 zone. The majority of the Commissioners believed short-term rentals are not compatible with single-family neighborhoods. The applicant appealed the decision, and the City Council denied the appeal, upholding the denial by the Planning Commission. Staff is currently aware of at least nine homeowners within the R-1 zone who are renting or leasing homes for less than 30 days without CUPS. Before staff contacts any of the homeowners operating short-term rentals, staff is requesting direction from the Planning Commission to either prohibit them in the R-1 zone or to continue to review each one on a case -by -case basis, potentially approving them with conditions and restrictions. Background 1. Conditional Use Permits (In General): A Conditional Use Permit (CUP) allows a local government the ability to permit a range of land uses required for a community to function and to provide flexibility to land use owners, while maintaining control over individual properties. Since each individual property has certain characteristics, conditional uses require l Staff Report ) Short-term Rental Disc --- ion January 19, 2010 Page 2 of 4 special consideration to make sure that they are properly located while meeting the objectives of the Zoning Ordinance. In order to achieve this purpose, the Planning Commission has the authority to approve or deny applications for CUPS for any conditional use prescribed in each zoning district. A Conditional Use Permit is approved with conditions to make a certain use more compatible with the surrounding land uses within the zone it is located. As an example, the following uses may be permitted win the R-1 zone with a CUP: A. Boardinghouses and rooming houses; B. Churches, convents, monasteries and other religious institutions; C. Day nurseries and nursery schools; D. Fire stations; E. Private recreational facilities such as country clubs, tennis and swim clubs, golf courses, with incidental, limited commercial uses which are commonly associated and directly related to the primary use; F. Private schools and colleges, not including art, business, or trade schools or colleges; G. Public educational institutions; H. Public utility and public service facilities; I. Commercial parking lots when directly adjacent to the C-1 general commercial zone and consistent with recommendations of an adopted specific plan; J. Professional office parking lots when directly adjacent to the O.P. office professional zone and consistent with the recommendations of an adopted specific plan. K. Rental or leasing of a single-family dwelling for periods of less than thirty days. 2. Short-term Rentals (less than 30 days): As a resort community, there are many second homes within Palm Desert and some are rented out on a short term basis to vacationers for periods ranging from a single weekend to several months. The vast majority of these rental homes are located in Planned Residential (PR) zoned gated communities and country clubs. These communities are regulated through private CC&Rs that typically control and manage these vacation rentals. Vacation rentals in these communities have not generated any complaints. In 2000, planning staff began to receive complaints about a few homes located in the R-1 zone being rented as vacation rentals. At that time, the Zoning G•\PlanningtTony BagataMoro F1IeMFormalslSlaH ReponsWISMShort Term Re111195hon Term Rentals Stall Report Planning Commission aoc Staff Report Short-term Rental Disc ozlon January 19, 2010 Page 3 of 4 Ordinance did not specifically restrict the permitted occupancy length of a rental in the R-1 zone. Since homes located in the R-1 zone are not located within gated communities or country clubs, staff was concerned about the land use compatibility of a short-term rental in an R-1 zone. On September 14, 2000, the City Council approved a zoning ordinance amendment allowing short-term rentals upon approval of a Conditional Use Permit following a noticed public hearing by the Planning Commission. Since the ordinance was enacted, staff has processed five applications for short-term rentals in the R-1 zone. Two of the five have been approved, while three have been denied. Staff typically becomes aware of a home being operated as a short-term rental by a complaint from an adjacent resident. Similar to hotels or motels, single-family homes rented for less than 30 day periods located in any residential zone are required to pay the City a Transient Occupancy Tax (TOT). This tax is nine percent (9%) of the rent charged by the operator, paid to the City and used in the general fund. According to the City's Finance Department, the current amount of money being provided to the General Fund from short-term rentals is about $2,800 annually.. Discussion: On May 19, 2009, the Planning Commission, on a 4-1 vote, denied a CUP application by a homeowner on Utah Circle to operate her second home as a short-term rental in an R-1 zone. The majority of the Commissioners expressed the opinion that short-term rentals are not compatible with single-family neighborhoods. The applicant appealed the decision, and the City Council denied the appeal, upholding the denial by the Planning Commission. Since 2000, only two out of five CUP applications for short-term rentals have been approved by the Planning Commission. Staff has become aware of at least nine properties within the R-1 zone that are being operated as short-term rentals without a CUP. Based on the most recent denial on Utah Circle, staff is requesting direction from the Planning Commission on whether or not to continue to allow short term rentals as a conditional use or to process a zoning ordinance amendment prohibiting them from the R-1 zone. Prohibiting short-term rentals within the R-1 zone will not significantly impact the City's General Fund since the amount of revenue currently provided annually is about $2800. Since many homes within gated communities or country clubs are regulated through private CC&Rs, staff is not proposing the prohibition within the Planned Residential zone. G.%Plann i ngJony 9agalolWora Flles'Formals''Sta" ReportsVISCShart Term Renlals'Shorl Term Rentals Slall Report Planning Commission dw Staff Report Short-term Rental Disc ---ion January 19, 2010 Page 4 of 4 Environmental Review This staff report is currently for discussion purposes and therefore requires no further environmental analysis at this time. Submitted by: Tony Bag6to Principal Planner Department Head: Lauri Aylaian Director of Community Development G:Wlanninq\Tony SapatoMord Flle.\Fo,malm&an ReponslMISCIShon Tenn R,t jsl Shoq Term Rental. Staff Report Planning C"'is.ion, doe MINUTES PALM DESERT PLAN JCOMMISSION J4► li �1 suite located at 72-855 Fred Waring Drive. Business Owner: Lawrence M. Andrews; Property Owner: Haven Management. Mr. Swartz reviewed the staff report and recommended approval of the findings and adoption of the resolution to revoke Conditional Use Permit 08-433. Commissioner Schmidt asked if the business was closed at this point. Mr. Swartz said yes. Chairperson Tanner opened the public hearing and asked if anyone wished to speak in FAVOR of or in OPPOSITION to the proposed revocation. There was no response. Chairperson Tanner closed the public hearing and asked Commission for their comments. Action: It was moved by Commissioner Campbell, seconded by Commissioner DeLuna, approving the findings and recommendation as presented by staff. Motion carried 5-0. It was moved by Commissioner Campbell, seconded by Commissioner DeLuna, adopting Planning Commission Resolution No. 2517, revoking Case No. CUP 08-433. Motion carried 5-0. IX. MISCELLANEOUS A. Request for direction regarding short-term rentals In the R-1 zone. Principal Planner Tony Bagato explained that was a discussion on short- term rentals. Recently there was an application for one on Utah Circle that was denied. That denial was then appealed to the City Council. The City Council upheld the decision of the Planning Commission denying the conditional use permit application. The discussion was being brought forth because there are some short-term rental properties currently operating without conditional use permits and staff was going to go and require them to file for a conditional use permit. As he listed in the staff report, he said he gave a brief explanation of what a conditional use permit is; it allows for a flexibility of uses in different zones. Currently in the R-1 zone, Section K allows an applicant to do a short-term rental. This ordinance was enacted in 2000 because we found that a lot of times they are done in country clubs and those hadn't been a problem because they are regulated through CC&R's and a lot of homeowner associations have management companies that actually manage them, so they weren't having any `I MINUTES PALM DESERT PLA QOMMISSIQN problems with those homes. Around 2000, we started getting complaints in R-1 zones being operated on a short-term basis and even sometimes as party homes for spring break and things like that. This ordinance was done at the time to just require a conditional use permit because they thought that there could be some cases where it was compatible with conditions and certain restrictions. He went back through since the ordinance has been in place and found they've only processed about five applications and two out of the five were approved. That showed that two-thirds of the time it's been acceptable and the other times it has been more problematic homes. The decision by the Planning Commission was based on the majority because it was believed that this wasn't compatible in the single family zone and City Council agreed. Staff was therefore requesting direction before bringing forth any new applications whether or not they should consider a zoning ordinance amendment that would basically prohibit short-term rentals. From the TOT side (transient occupancy tax) they receive on short-term rentals, it is only a little over $2,000, so if they did prohibit it, it wasn't an impact on the City budget. Staff believed that if they wanted to process a zoning ordinance amendment, it would be acceptable, or they could continue operating them with a conditional use permit and then bring them in on a case -by -case basis. Staff was asking for direction. Commissioner Limont asked if the folks renting without CUPs were notified or cited, or if they've had this issue in the past. Mr. Bagato said they haven't been notified. This came to staff's attention when the last applicant came through, she said there were some people in her neighborhood doing this without a CUP, so staff did some research and were able to identify a few. Typically these were found in associations, and not often in R-1 zones because they lead to complaints and they know right away. Commissioner Limont asked if he had run into this in the past where they had someone in violation and they cited them or send Code out, or how we handled it. Mr. Bagato said every one they've had has come from a complaint. Commissioner Limont asked how they handled it, did they say starting February 1 please make sure you're not doing short-term rentals any longer because it is in violation. Mr. Bagato said it becomes a Code Enforcement action and they come in to apply for a permit. That's how it had been done in the past. Commissioner Limont agreed that this wasn't an issue of money, but what they were talking about was what they discussed months ago when they denied that CUP and that was to really make certain that we maintain the integrity of our neighborhoods as neighborhoods. Other cities in the valley have had unfortunate problems when renters got out of hand in their neighbors. It completely changes the whole character. Mr. Bagato agreed that conditional use permits give them some restrictions, but whether it was worth having them was the bigger question. E MINUTES PALM DESERT PLA iCOMMISSION Chairperson Tanner said that one of the issues they were also looking at is that people can do this without a conditional use permit. You can rent a home for long term, but people can rent them for two weeks or a month during holidays and they don't need a conditional use permit. He asked if that was correct. Mr. Bagato said that if someone is in an R-1 zone, they are supposed to have a conditional use permit. There is always going to be an enforcement side, but some of these people they actively know have websites advertising their homes and if they see that they can go after them. The ones that don't advertise or somehow do it under the radar will be a little more difficult to track. But there is always the enforcement side, whether or not they require a CUP. Chairperson Tanner reiterated that typically the way staff finds out about it is through a complaint. Mr. Bagato said that was correct; typically when someone has used a home during spring break or for a party weekend or wedding and a bunch of neighborhood complaints to the police department on the weekend and they also follow-up outside of the police with staff on Monday morning and then they are contacted. Chairperson Tanner noted that staff was asking for direction from the Planning Commission. Mr. Bagato said yes, because staff doesn't typically initiate a zoning ordinance amendment, but they also don't want to send in nine applicants who may be denied if it isn't considered compatible any more. So they were asking for direction on whether or not they should be allowed to continue on a case -by -case basis or eliminated. Chairperson Tanner asked if there were any applicants since the May 19 meeting. Mr. Bagato said no, but they are aware of some they need to contact. Commissioner Limont explained that these nine will apply when they are told they are in violation. Chairperson Tanner said they would probably be denied. Commissioner Limont noted that is our process. Mr. Bagato clarified that if the zoning ordinance amendment prohibits it, they would then just contact them afterward to say it isn't allowed. Commissioner Limont Mr. Erwin if they did something along those lines to limit whether or not a person can do a short-term rental under the R-1 zone, if that was any sort of denial. Mr. Erwin said basically, if it was the Planning Commission's feeling, they ought to be thinking in terms of initiating an ordinance eliminating the current conditional use permit process in our ordinance and just indicate it is prohibited. Commissioner Limont: and just say no short-term rentals period. Chairperson Tanner said they could direct staff to do a CUP on no short-term rentals in an R-1. Mr. Erwin clarified it would be an ordinance amendment. Commissioner Campbell asked for the definition of a short-term rental. Less than 30 days? Mr. Erwin concurred that it was 30 days or less. Commissioner Campbell indicated that otherwise it would just be a regular rental. That was in the R- 0 Im-owlspiw-1:4.10-11 11 ► ► • 1 1 1. She was happy to see that it wouldn't hold true to the gated communities. Commissioner Schmidt said that was a question that she had. How do they do that? The assumption is that all gated communities have CC&R's or bylaws and regulations that preclude short-term rentals. Mr. Erwin wasn't sure that all of them do. Mr. Bagato clarified that they manage them. They actually allow them and some actually have management companies, like Desert Resort Management, will manage it for people. They were zoned differently, so they've always been treated differently in the past because they have different standards they follow within their own community and they haven't been a problem. And typically they were going to find more often than not in a gated or country club communities they are second homes and do choose to rent them out on a month -to -month basis or a weekend home in the season. Commissioner Schmidt asked if the ordinance would be drafted to specifically exclude any gated community. Mr. Erin said that was going to be difficult. Commissioner Schmidt said that was her point. Mr. Bagato said that is how it is treated now with a conditional use permit. It applies only to the R-1, not the PR. Commissioner Schmidt asked if the gated communities apply for CUPs. Mr. Bagato said no, it wasn't required. Chairperson Tanner said they have their own set of rules and regulations. Commissioner Limont said yes, they don't fall under a CUP. Mr. Erin said so long as they are not R-1. He assumed all of the gated communities are Planned Residential (PR). Mr. Bagato said that was correct. Mr. Erin asked if they all are. Mr. Bagato said typically they are. Commissioner Limont asked if Mr. Bagato could think of one that isn't. Mr. Bagato replied Regency where Van lives and Whitehawk. They are R-1. Commissioner Schmidt felt they should direct staff and counsel and everyone involved to explore this and make certain that the gated communities all comply and can be accepted because they have their own. She doubted seriously that was really totally true, but she thought they had to know. Chairperson Tanner asked how they would direct a private residential community to change their CC&R's to not allow or to allow. Commissioner Schmidt indicated there had been a blanket comment made tonight that most all gated communities have their own rules, regulations and CC&R's which would exclude them from whatever they would be doing. That was her understanding. Mr. Erin said no, not necessarily. That does not occur. The ordinance, if they apply it to R-1, it is applied regardless of the CC&R's. Commissioner Schmidt said that was her point. If someone lives in a gated community and you do not like the next door rental that is weekend rental, you would still have an opportunity to complain and have some sort of enforcement. Mr. Erin replied as far as R-1, yes. It falls under the R-1 at the present time. Commissioner Schmidt indicated that it did not necessarily have to be gated. 10 MINUTES PALM DESERT PLAI Commissioner Limont thought it might be helpful if staff came back with a list of the ones that fall under R-1 and with suggestions. It sounded simple, but if they have a couple of communities that are going to be affected adversely, they need to look at that. Mr. Erwin said they could look at it and see what they could come up with as a way of alternatives and see what the problems might be and bring it back to them in 30 or 45 days. Commissioner Schmidt stated that she would be very much in favor of eliminating weekend rentals in the R-1 zone. She just wanted to make certain they weren't stepping on toes they need not be. Mr. Erwin said they would explore it and see what they could come back with. In the meantime, Commissioner Limont noted there are nine rentals that are not in compliance and in fairness to the person whose CUP they turned down, they have a process of letting them know that they cannot do this and they need to apply and they need to do stop running the short-term rental until they put through their conditional use permit. Mr. Bagato explained that they haven't been contacted yet because they would want to know the process of how to get approval and he didn't want to give them an application, say they need to apply, and have them pay a fee for something that may be denied if we're changing it. Commissioner Limont noted that is the ordinance right now. Mr. Ervin said it did create somewhat of a problem, because they know the feeling, at least what he was hearing is that Planning Commission is interested in prohibiting them in an R-1, and if these are R-1's, they are going to waste not only staff time, Planning Commission's time, their money, in coming through the process until the Planning Commission has put something in black and white and recommended it to Council for approval, either prohibiting it in the R-1 and PR is okay within gated communities, until we get something definite, he suggested that they not go out and chase people at the moment, because if we start, there might be a whole lot more than these nine. Commissioner Limont asked how we should handle the complaints. If someone lives in an R-1 neighborhood and it's in our ordinance that you need to have a CUP and the person doesn't have a CUP, in the meantime they are renting their house out on a short-term basis. Mr. Erwin's inclination would be to tell them that we are in the process of looking at it and until we conclude the study, we're just going to be aware of the complaints and tell the people there that we are studying it so they have at least some long-term notice that it may be prohibited. Not give them a violation. Commissioner Limont asked if they could stop them from doing short -terms rentals in the interim. Mr. Erwin explained that if they do, we have to tell them they are entitled to apply for a conditional use permit and they have to pay the appropriate fee and start through the process. They would then come before them. Chairperson Tanner said they would be MINUTES s p PALM DESERT PLAT 0MMISSION JANUARY 19. 2010 denied. Ms. Aylaian added that these nine that they are aware of out there appear to be operating in good faith. They probably just don't know. They have registered with the Finance Department and are paying bed tax when they rent the place out, so it would seem a little unnecessarily harsh to ask them to come in. Commissioner Limont asked about them paying tax. Ms. Aylaian noted that the staff report indicated that the City received approximately $2,000 in bed tax from them, so it wasn't a great deal of revenue, but they are at least recording their rentals and turning in tax. She said they became aware of these locations by going through Finance to find the ones that are paying bed tax and they tried to determine if they had a CUP in place for it. Chairperson Tanner thought the consensus of the Planning Commission was they asked for staff to do a study and come back by our next meeting with those restrictions of R-1 versus PR. Commissioner Campbell noted that they recommended 30-45 days to come back. Chairperson Tanner asked if staff knew when the next scheduled meet would be. Mr. Bagato said he couldn't draft this in two weeks. Ms. Aylaian said it would probably be the second meeting in February. Mr. Bagato said could identify which country clubs are in R-1 and gated, but probably couldn't have an ordinance ready. He could have some other information by the second meeting in February. Chairperson Tanner said that if that was the consensus of the Planning Commission, they would instruct staff to do a study of those PR gated and R-1 gated communities and come back. Commissioner Schmidt said with maybe a draft ordinance. Chairperson Tanner concurred. Chairperson Tanner asked if they needed a motion. Mr. Erwin said he thought staff had their instructions. Action: None, X. COMMITTEE MEETING UPDATES A. ART IN PUBLIC PLACES Commissioner Campbell reported that the meeting would be next Wednesday. B. LANDSCAPE COMMITTEE Commissioner Limont stated that the next meeting was January 20, 2010. 12 III 1w.111VA101mmmia There was no one and the public hearing was closed. Chairperson Limont asked for Commission comments. Action: It was moved by Commissioner Campbell, seconded by Commissioner Tanner, approving the findings and recommendation as presented by staff. For clarification purposes, Commissioner Schmidt reiterated that this is presently a rental property that is owned by one owner or a partnership and the proposal is to change it so they can condominiumize the project and sell each unit individually. Mr. Swartz said that was correct. Chairperson Limont asked if we as a City have concerns with regard to an owners' association. From time to time associations come to the City because they are short on funds and can't keep up the grounds. This is a small project, but she asked if staff anticipated any difficulties along those lines. Ms. Aylaian said no, they were pretty typical throughout the city. Chairperson Limont called for the vote. The motion carried 5-0. It was moved by Commissioner Campbell, seconded by Commissioner Tanner, adopting Planning Commission Resolution No. 2527, approving Tentative Parcel Map 36210, subject to conditions. Motion carried 5-0. mom, C. Case No. ZOA 10-68 — CITY OF PALM DESERT, Applicant Request for consideration of a Zoning Ordinance Amendment to Chapter 25.56 General Provisions, adding Section 25.56.530 Prohibition on Short -Term Rentals in Residential Zones, except for hotels, motels, and/or a bed and breakfast as allowed per the Zoning Ordinance, short- term rentals for less than 30-day periods shall be prohibited in all residential zones, unless the property is located in a gated community. Principal Planner Tony Bagato reviewed the staff report. He went through the map exhibits of gated and non -gated communities in different residential zones. Mr. Bagato indicated that letters, emails and phone calls had been received in opposition to the proposed revision and outlined their concerns. Staff thought there were some valid concerns raised. He looked at other local cities to see how the situation was handled. No one had an active ordinance and others were looking for ways to enforce it. He said he didn't check Palm Springs the first time. When he did, he found they had a pretty good ordinance that allows short-term rentals. They are all required to get permits through the business department, and they have restrictions in the ordinance that limit the number of people there at night, during the day, noise, and issues like that. With that ordinance, Palm Springs thought it was beneficial to the community from the resort side, and the restrictions benefit the community by keeping them more controlled in a manner compatible with single-family neighborhoods. A copy of that ordinance was included with the staff report. Mr. Bagato thought that short-term rentals could be appropriate for Palm Desert. Palm Desert is a resort destination and he believed that short-term rentals were vital to part of Palm Desert's success, along with the hotels and timeshares. In the first staff report he had indicated that approximately $2,800 was received in TOT (transient occupancy taxes). After further discussions with the Finance Department, it was determined that the City is currently collecting approximately $235,000 in TOT, both in gated and non -gated communities. Further research he distributed at the meeting included information from one website he found out about from public input. It was a vacation rental website. He counted 588 listings, noting this was for individual homeowners listing their homes, not rental agencies. Out of this scenario, from what he could identify, only 15% were outside of gated communities. They didn't give physical addresses and that was why it was difficult to enforce, but some indicated if they were in places like Desert Falls or The Lakes. The ones that said they were close to El Paseo, or a private home, he assumed were non -gated. Some said Sandpiper and Shadow Mountain Country Club, which he knew were not gated, as well as those in Palm Desert Country Club. In talking with resort management companies, Mr. Bagato said there are hundreds more listings with them that are not on this website. So they were looking at potentially 750 or more units used for vacation rentals. If they look at that scenario, 15% would be outside gated communities; 85% to 90% would be within gated communities. Since the year 2000, there had been six properties that generated complaints within the last ten years. Out of 800, that was less than 1 %. Palm Desert had ordinances in the past that were difficult to regulate because we didn't have good control, but a new ordinance was adopted about two years ago for noise and standards related to when Augusta's on El Paseo was having issues. The new noise ordinance deals with disturbing, excessive and offensive noises. The City has a lot more control over short-term rentals just from a noise aspect if they did allow them. And there was never a guarantee that a regular neighbor wouldn't be a problem. So staff believed that there's a 7 u9 12, 1 :1 potential to look at another solution than the ones proposed tonight and he would lay out several options. Mr. Bagato said the first was to do nothing and continue to allow short- term rentals in residential zones and stick with a conditional use permit that is discretionary approval reviewed on a case -by -case basis. One of staff's concerns with that initially is that the fee is $2,915, and if they are incompatible, he wasn't comfortable bringing property owners here to apply for that, pay that fee, and then potentially be denied, so staff was more in favor of a city-wide code that deals with them outright with restrictions. That would be to revise the ordinance and restrict them and permit short-term rentals pretty much everywhere. Or they could look at doing them only in the R-1 zone like they do with a CUP, or they could specify restrictions that apply to non -gated communities and the gated communities could continue on the way they have been. Or they could do something similar to Palm Springs. That ordinance was before them. They could just do a citywide approach and make everyone come into compliance, but try to put more enforcement in there through just penalties if people are doing them without proper permits. Or they could adopt the proposed zoning ordinance amendment tonight. The last request for a conditional use permit was denied by the Planning Commission 4-1. The Planning Commission said that these weren't compatible in R-1 single family zones. That denial decision was upheld by the City Council with a 3-0 vote and the City Council agreed that these weren't compatible. Mr. Bagato stated that the ordinance was before them tonight, but staff's recommendation was to continue it and ask staff to look into a new ordinance that would deal with either citywide or the non -gated communities and apply restrictions similar to Palm Springs. There were other cities like Solana Beach that have also dealt with short-term rentals. He stated that San Luis Obispo prohibits them. So there were different options before the Commission, although staff was requesting a continuance and direction. He asked for any questions. Commissioner DeLuna noted that Mr. Bagato referred to a particular website that deals with vacation rentals in Palm Desert. It overwhelmingly referred to private, gated communities. As they talked about vacation rentals, she asked if a vacation rental meant short-term rentals, or over 30-days, and how that was defined. Mr. Bagato said looking through most of them, they advertised for a week or a month, but some of them did have up to 30 days. Palm Desert defines short-term, which was the same as vacation in the Palm Springs ordinance, as 30 days or less. For anything over 31 days they couldn't charge TOT under state law. It became a permanent residence. r via Commissioner Tanner said they talked about short-term rentals as they apply, but not for hotels, not for motels and/or bed and breakfasts. He asked how a bed and breakfast was defined. That was a pretty generic term, unless Mr. Bagato was saying that they were providing a bed and breakfast. Anyone could probably put their house on the rental market as a bed and breakfast in the city of Palm Desert, unless there was a clear definition for it. Mr. Bagato confirmed that in the R-3 zone a bed and breakfast was allowed with a CUP, but they didn't have a definition for it. They could make .a definition as part of it, but typically it is usually accommodated with a kitchen and they were providing a service like a hotel, but that isn't a home. Commissioner Tanner asked if they adopted the draft ordinance amendment before them, what was to prohibit someone from advertising vacation rentals as a bed and breakfast. Mr. Bagato said currently bed and breakfasts are only allowed in the R-3 zone. There is a bed and breakfast at Tumbleweed and Shadow Mountain. No matter what, it would require a hearing. In the other zones it is not allowed. Because this would cover R-3 zones, staff wanted to make sure they aren't prohibited where they are currently allowed. That is why it excluded hotels/motels/bed and breakfasts per the ordinance, and they had to stay within their zone. If they are already allowed, they wouldn't be affected. Chairperson Limont asked if a bed and breakfast requires a business license. Mr. Bagato said yes. Commissioner Campbell asked if short-term rentals were allowed for just one or two nights. Mr. Bagato said anything less than 30 days, so it could be days as well. Commissioner Schmidt noted that Mr. Bagato was proposing that they look at the Palm Springs ordinance. She wanted to know if staff investigated how Palm Springs enforces their ordinance and asked about their track record. Mr. Bagato stated that he has a call into them, but hasn't received a return call. Our Finance Department has talked to them and they do have a two to three person staff that actively tries to enforce it. One of the responses from the public was from a gentleman who helped draft the ordinance. He heard it has been very positive for the people using it; he wasn't sure from the City side. Mr. Bagato said he was expecting a call back and was hoping to get into it more when they come back with another ordinance and review the pros and cons and maybe change it or modify it if they thought things weren't working. But he hasn't received comment. Commissioner Schmidt said it becomes a code enforcement problem if there is one, based on complaints. Mr. Bagato said it was already a code E I III RJ u _► enforcement problem. That's how the City deals with them today. Staff just tells them whether or not they need a CUP. Under the Palm Springs ordinance, they have active stings to try to enforce the TOT. If we were to try to do something like that, that was something that was more internal management and they would have to discuss that and it was a lot more staff time than we dedicate toward enforcing the TOT. But staff would anticipate the enforcement as being the same as today. If a complaint was received by Code Enforcement, they would be sent out to see if there was an active business license and permit to do the vacation rental. If they didn't have a permit, they could apply and restrictions would be put on it. If they violate the restrictions, the permit would be revoked. It would be the same as what we have to do today. Commissioner Schmidt reiterated that enforcement would be complaint driven, regardless if we go on the way we are or have a new ordinance. Mr. Bagato said it depends. He would have to talk to Finance, the City Manager, and Executive Management on how to deal with it, because there are cost benefits in spending more staff time to try to get the TOT, and then whether it becomes cost revenue neutral, positive or negative. But staff would have that addressed when coming back with a new ordinance. Commissioner Campbell asked if Mr. Bagato's recommendation was to continue this and see what the Palm Springs ordinance is or other cities. Mr. Bagato clarified that the direction request was to continue it to allow staff to either adopt one citywide similar to Palm Springs and staff would come back with a custom fitted one for Palm Desert. Or they could apply it just to non -gated communities and leave the gated communities like they are today. Or they could apply it just to R-1 like the CUP is because that is where the six instances have been, in R-1 communities, not the other zones. There were three different ways to handle it: whether they want a citywide approach, a little broader, or a little narrower. One of those three options and then continue it to address one of those. Commissioner Schmidt asked what the prognosis was for doing nothing and leaving it the way it is. Mr. Bagato said he would be for that with the conditional use permit; his concern was that if they make the finding that there are no complaints and they have been compatible with the neighborhood and they apply proper restrictions, staff would still support it. His concern was that a CUP is a discretionary approval and when they notify people, even if they haven't had complaints, sometimes people come out just as a matter of fact and it's a hearing and they get scared and they could deny someone over one complaint and they spent a good amount of money to go through the process. 10 MINUTES PALMDESEBT PLA iC1CQMMI551QN APRIL 6, 2010 Commissioner Schmidt asked if adjacent property owners were notified for a CUP application. Mr. Bagato said yes, 300 feet. Commissioner Tanner asked if that was the original application. Mr. Bagato said that was correct. Commissioner Schmidt asked if it ceased with a change of title. Mr. Bagato said it doesn't cease with a change of ownership. It would cease if a use hadn't been done for more than a year, so if a new owner came in, they could continue on under the same conditions. If they decided to live there permanently and a year lapses, the CUP would become invalid. Commissioner DeLuna pointed out that the ordinance says 30 days or less was considered one way, more than 30 days another. By inference that meant a month at a time. What did they do with the month of February that is only 28 days? Anyone who wants to rent for the month of February, did that become a short-term rental? Mr. Bagato said technically by law, yes, it would be a short-term rental. Commissioner Schmidt thought it depended on how the ordinance was worded. Monthly would include February. On that particular issue, in the past, Commissioner Schmidt said she has had a number of rentals, not locally, and they might start on the 101h of the month, or the 151h, or the 201h and go that way. She assumed if it was January 15, the month would be to February 14 or such to make the accommodation for the 28 days. Commissioner Tanner noted that it was 30 days, so if they rent the month of February, they get a couple of days in March. It is 30 days. Mr. Bagato indicated that it's based on TOT law whether or not we can charge the tax. We could always apply restrictions on our own terms, but they would still want the TOT if it is less than a 30- day rental. Chairperson Limont opened the public hearing for testimony in FAVOR of or in OPPOSITION to the proposed Zoning Ordinance Amendment. MS. BARBARA deBOOM, President of the Palm Desert Chamber of Commerce, stated that she has received a few calls at the office the past eight to ten days on this issue. From a business perspective, what it would mean to their members, be it the restaurants and/or the retails. She said what was nice about the one -week type turnover, it's new money coming into town; new sales tax dollars to these businesses. She found it a little confusing that we as a City are building timeshares at Desert Willow with week at a time rentals, and yet potentially may not allow this to happen. She requested a continuance and a study group be put together to look at it further. 11 MINUTES PALM DESERT PLAN 11 11 ► ' ' i 1 1 MR. KIRK ELLIOTT, 30-600 Desert Moon Drive in Thousand Palms, California, said he has been a resident here for about 28 years as a builder. He has done quite a few of these rental properties for a lot of people out here and if they are bringing in $235,000, maybe put someone on staff to go through all the websites and find out who is running these places and lock down on them a little bit and bring in a little revenue and work it a little bit instead of cutting everyone out of the limelight. They are bringing in and generating a lot of revenue in here and he didn't think it was fair for some of these people who are not full-time residents, they can make a few extra dollars and bring money into the city and everybody is happy. It seemed like a win -win situation to him. MS. DEBBIE HOUSTON, 21 Umachan, in Scotland. She said she flew over specifically for this meeting tonight. She said they bought property which they remodeled and they have been using it as a vacation rental. They advertise and pay the TOT and thought that was all they had to do. They weren't aware they had to have this conditional use permit. Even after having the TOT license, nobody notified them they had to do that. They felt they built a nice property. They brought something to the area. There are neighbors on either side and their properties are quite run down. They have made a feature of theirs. The people that are coming into their properties, these consumers, would suffer if they didn't have the option to come for a week. Not everyone has 30 days of vacation. She has been coming here for 15 years and she rented homes for the 15 years she has come here. She can't come for 30 days; she can come for a week at a time or two weeks. She certainly wouldn't go to a hotel because she would rather be in a home, not a hotel. If they adopt this, she felt that the City was really going to cut themselves out of the $235,000 in revenue. The cleaners, the pool people, and gardeners, they won't be employed to upkeep the property they have, so then they are forcing people out of work. They would probably put their house on the market, not that they want to do that in this kind of climate, but they would force people into doing that. So the market suffers; everybody suffers. She asked that they give it a serious think before adopting this ordinance. MS. JANE BARON, 73-500 Grapevine Street, stated that her husband Alan couldn't be here, they are from Sonoma County. They bought their home on Grapevine, very excited to retire here in 2007. They all knew what had happened since then. Their house isn't as valuable monetarily right now, but they still love this home and plan to retire there. However, their retirement plans have 12 u I :i .) changed and they are still working. Based on that, they had a home they love and didn't want to sell and buy again so many years down the road. They want to keep this home and retire there. One of the ways they can do that, and the City encouraged them when they purchased, was to get this license for the TOT through VRBO, which is a great website. They put up a very beautiful advertisement and have had wonderful response from people from Minnesota, Canada, and people who have cold winters. They have had no problems with the short-term. These are families and less than a month is a vacation, truly, for families. They come in at Christmas time, Thanksgiving. The longer snowbird type months, February and March, could be long term, but earlier on, and even now, they had a family from England staying for two weeks. She had been writing to her for six months and they were so excited and were doing fine. The importance here is that these are families and these families are going down to California Pizza Kitchen on El Paseo. She sends packets to everyone and it's all about Palm Desert. She doesn't send any information about La Quinta for these families. They go the park, they are golfing at Desert Willow; all of her energy for people when they are going to stay at her place and ask what to do now. She leaves tickets for the families to The Living Desert. This is really important, the less than one -month group. They can't be there a month. They have jobs, vacations, and this is what she wanted to emphasize. The one month they had those, they had a couple come for two months. They are Minnesota retired couples. That's what would put them in this market. It's a different market. It wasn't quite as much fun; it wasn't as lively as the woman who spoke first talked about. These families come and spend money. They also pay their 9% and she thought it was good for everybody. She also wanted to say that if they leave it vacant because they don't get those one -month locks, they had last summer, when it was 110 degrees, someone broke into their home —went through the French doors and broke the glass. That was really tragic. The alarms went off and the neighbors probably didn't like that. The police were all over, there were police dogs, and she was upset. Her brother and sister-in-law are managers and were right there. The point being that a vacant house isn't good for the neighborhood. In fact, it was frightening for the property owners as well because they have a lot invested in this. They also tried in the beginning a long-term rental two-year lease. The person stopped making the payments, brought three cats in, and the house was not left in good condition. They had found with short-term that they can get in, take care of their home, clean it, and it was a perfect 13 MINUTES PALM DESERT PLAN G COMMISSION _ APRIL 6 2010 situation for them. So they were of course very upset that the City was considering this other idea. She did fly down here; this was very important to them. MS. KAREN MACAULAY, 45-800 Deep Canyon Road, said that she agreed with Ms. Baron wholeheartedly that they are business people. They've made an investment in the city of Palm Desert. They make long-term business decisions based on the fact that they have a license with the City and they pay the tax. They purchase furniture, buy linens, they can't let something go unrepaired, they employ plumbers, electricians, gardeners and tree trimmers, and it would be a definite financial hardship if they were deprived of this income. MS. SHERRILL WILLIAMS, 72-610 Pitahaya, Palm Desert, said she was in the throws of finishing her home, applying for the correct licenses for a rental and this was dropped on her. She gave the Planning Commission photos (on file in the Department of Community Development). She stated that they are all long-term rentals in her neighborhood. She was so disappointed in Palm Desert again. Here she promotes this city, it is a resort, and has spent all these hours and money getting this home prepared and getting great response from the site. She hasn't rented yet because she isn't totally ready with everything. Why would Palm Desert turn down money from individuals such as herself in this environment and time when they have houses looking like this (referring to the pictures she submitted)? She needed to know what started this thinking and taking this privilege as a homeowner away. What was the cause? When you own a home, and to show her that she is permanent and it's due tomorrow, and she pays $5,000 a year in property taxes to support all these wonderful things in this great city, and now they have provisions that a gated community can have rentals. When something happens there, they still depend on the Palm Desert Police Department. Their security legally is not allowed to physically touch anyone or remove anyone. So it was still the same tax dollars if there was some issue. And she had done a lot of research on this when she was notified that there were questions. Why is Palm Desert so concerned? She also owns properties in Lincoln City, Oregon, and this would be a great opportunity for them to research and see what happened when they did this. She thanked them. MS. JUDY NAGLER, the property owner of 73-425 Buckboard Trail, said her permanent residence is in Los Angeles. She bought this house specifically with the intent of doing short-term rentals; 14 MINUTES PALM DESERT A.& sometimes it is six weeks, sometimes two months, sometimes it was two weeks, to help her to pay for the mortgage which she took out a 15-year mortgage with a plan that when she could afford and pay for it, she and her husband could retire here. Her property has decreased in value over 30% since she purchased it. She maintains it beautifully. She pays her taxes, she has a permit, and she uses a rental agency that requires if there is a slight scratch on anything that she repaints immediately. She has only had wonderful tenants. The other homes on her street, some are abandoned; some which have long-term rentals have hoards of teenagers throwing parties all night. They don't keep up the property at all. She had to put in a fence between her neighbor's house and hers completely at her expense because they tore it down. She believed that if they enact this, they would be bringing Palm Desert down so fast it would break many of their hearts. If she knew this, she would have purchased elsewhere. Or if she knew she needed to purchase in a gated community, she would have purchased in a gated community. She has a very expensive home. She thought it was very discriminatory, it's taking away her property rights, and it was really hurting the city. She certainly would fight it as best she could. She has already retained counsel to that effect. MR. PETER BROOKS, with Palm Springs Rental Agency in Palm Springs, California, said that his company started renting vacation rentals in Palm Desert in 1972. Various cities around the country have sought to regulate vacation rentals with great success in partnership with industry, as well as property owners. The City of Palm Springs recently enacted a city ordinance in partnership with industry. They worked with them for over two years to get that ordinance done. It has been successful and protects the property rights of all citizens, and dramatically increased TOT revenues in Palm Springs. In 2008 their company paid approximately $25,000 in TOT to the City of Palm Desert. And they also estimate getting a formula from the CDA that their short-term Palm Desert customers spend approximately $370,000 in the local economy. So, they thought that was quite a bit. He respectfully requested that they continue this to allow them an opportunity to speak with City staff. He thanked them. MR. JIM PEARCE, 75-715 Altamira in Indian Wells, California, stated that he also owns property in Palm Desert. They have the vacation rental management building Fairway Vacation Rentals and Desert Sage Real Estate just outside the entrance to Palm Valley Country Club on Country Club Drive. He has been a desert resident for over 30 years. He has been in vacation management, in and out 15 of the business for 25 years. Their company manages over 200 units valley wide; 120 of those units are in Palm Desert in such communities as Palm Valley Country Club, The Lakes, Desert Falls, Palm Desert Resort Country Club, Monterey, etc. All the units they manage are in gated golf communities, so the legislations as proposed didn't really effect him directly and frankly, if it was passed it wouldn't bother him in the least. However, he did feel this could be the first step in a slippery slope of additional regulation. And frankly, he had an opportunity to look quickly at the Palm Springs ordinance and he thought it was a terrible idea. He thought really when they step back from this whole thing that this is government trying to legislate where a problem doesn't exist or where their energies would be better focused elsewhere. Just a few problems Mr. Pearce saw with a quick look at the Palm Springs ordinance, is it requires $1 million of general liability insurance for any owner who wants to participate. It requires that the owner of that property insure that the vacation rental unit complies with all applicable codes. The daytime occupancy is limited to the maximum number of residents plus 50%, so if they have a condominium that accommodates four people, they could have two other people over during the day, not more. And who is going to enforce that? The managers have to sign a formal acknowledgement that they are responsible for the compliance for all provisions within the ordinance. Again, this is exactly the wrong approach. What they are doing is making it more and more difficult to rent their home on a vacation basis. What are they going to do? They are going to go to VRBO. VRBO has a place in the overall scheme of this industry and a lot of people use it successfully. More power to them. That's just fine. However, they have 588 properties on VRBO in Palm Desert right now; he has been on the site many times and most of those properties advertise and offer rentals for less than 30 days. Mr. Pearce said that based on personal experience and observation, not more than 5% of those people who are renting for less than 30 days are paying transient occupancy tax. He made that point to the Finance Department of this City on several occasions before trying to get them to focus on that, and enforcement there, and making more money for Palm Desert. There has never been any follow through. Well, it's difficult, how can we prove it, how can we catch them. He had a hundred ideas in that respect and there are a lot of rental agencies with motivation to help them out in that process. He respectfully requested that the current proposal be abandoned, or adopted; it wouldn't hurt him, IL u 1 but would be unfortunate for these other people. However, he encouraged the Planning Commission to look where problems exist and that is noncompliance and put the City's energies and resources in that direction. MR. JOE CHURCHILL, 130 Pueblo Lane in Los Angeles, California, stated that he and his wife have been vacationing in the Coachella Valley since 2000 and they actually started vacationing through the PSBR program as well. That's what kind of got them into this market. In 2005 they had their first child, and they are from Toronto, Canada, and their house in L.A. isn't big enough. Having been out to the desert many times to vacation here, they decided to purchase a home because they had the means to do so, that was bigger than their place in Los Angeles that could accommodate their parents and grandparents. So they had been operating a vacation rental home for three and a half years; they have contributed $10,000 in TOT over that timeframe and probably double that in property taxes. Mr. Churchill said he was specifically of the opinion that a properly mandated and monitored rental program is the best way to address both the concerns of the City and the owners. They agree that the existing ordinance for the past three and a half years demonstrates that the conditional use permit process provides adequate safeguards for the City and its residents and felt strongly that it is possible to allow short-term rentals that serve both the needs of the City and the resort vacationer while preserving the high -quality of life found in a livable, sustainable and balanced community. He thought some of the ideas brought up by the rest of the people speaking tonight deserved to be looked at; perhaps the current process was not quite sound enough to meet everyone's needs and needed to be looked at. They respectfully hoped the City would decide to stick with leaving homeowners the option to do short-term rentals. He thanked them. MR. JUSTIN STEUBS, 78-140 Calla Tampico in La Ouinta, California, said he is the owner of a small vacation rental leasing and management company. If this new rule is adopted, he said it will basically fly in opposition for the direction of the hospitality industry. Consumer demand for homes to rent as an alternative to hotels is growing rapidly. The company that owns VRBO Home Away just spent $3 million to do an ad during Super Bowl with Chevy Chase to promote the vacation rental industry. Large families have told them that renting hotels becomes a safety issue as much as an economic one. Most hotels are not geared for large 17 families. If a mom and dad have four children or more, they have to rent two or three rooms and get them all adjoining, which isn't always possible. They potentially have young children sleeping down the hall from parents which isn't good, but it happens all the time. For the same money as three hotel rooms, a family can rent a nice home with a private pool and adequate bedrooms for all to sleep safely in one home. More and more people see this as a better alternative. If this new rule is adopted by Palm Desert, it will cause guests looking for a home to go to other cities and outside of Palm Desert. This rule would not change consumer demand; consumers will still rent vacation homes, they will just rent outside Palm Desert. He thanked them. Chairperson Limont asked if there was any other testimony in FAVOR of or in OPPOSITION to the proposed Zoning Ordinance Amendment. There was no response. Chairperson Limont closed the public hearing and asked for Commission comments. Commissioner Tanner thought when they originally reviewed this and asked staff to come back with their recommendations to give Planning Commission a little insight into what we have out there in the city of Palm Desert that could potentially bring us taxes, he didn't have any idea about the kind of money that is produced by this transient occupancy tax. He said he is a proponent of the small business person without a doubt and he thought it would be in Palm Desert's best interest to continue this and ask staff to come back with recommendations, working with a couple of the agencies that do the vacation rentals in Palm Desert, to come up with a solution on how to best handle them. He said they had to understand that the Planning Commission was also looking to protect the next door neighbor of the homes that have the weekend rentals that rent to people maybe they shouldn't be renting to. He thought originally that was their intent —to make sure a family neighborhood was kept as a family neighborhood and again, he is a proponent of that business person and he would be in favor of a continuance to come up with a solution that would help not just the owners of property in Palm Desert, but also neighbors that do own their homes next door. Commissioner DeLuna said she listened to everything that had been said. It is a highly complex issue and she had several things to address based on what she heard said. Addressing the $235,000 in TOT that comes in, she thought previously it was established that most of that comes in through the short-term rentals from PUD's and from gated country clubs. The people that live in those country clubs pay large homeowner's dues. The associations have hired attorneys and they have formulated CC&R's and bylaws and that's not the case for R-1. R-1 zoning doesn't require f7 I these restrictions. When they start trying to compare 8-1 short-term rentals with short-term rentals in the gated country clubs, they are talking about apples and oranges. She didn't think they could be lumped together and as a blanket amount and say the specific amount they would be threatened to lose if they do not approve vacation short-term rentals. Secondly, this issue is not new. Requests for short-term rentals have come before the City several times, and in each case have been turned down. In the past when the item was noticed, the preponderance of sentiment was against having short-term rentals. The short-term rentals were considered to be a detriment to the wellbeing of the family neighborhood because there were noise issues and parking issues. If a residence can sleep 6-8 people, they are liable to have any number of cars parked there. People who come for weekends, particularly now the demographics of the short-term renters are changing, they have rock concerts, Stagecoach, Coachella Fest, and a lot of people come to town and want weekend rentals. A lot of those people have parties, they make noise late at night, there are lots of people in the houses, and they get reports on an ongoing basis on that type of rental situation. It disrupts the family neighborhood in which these individual short-term rentals exist. We can't turn residential neighborhoods into party houses. There are hotels, motels, timeshares, and bed and breakfasts available for short-term rentals. They also produce the TOT. Arguably it could be said that many residents who would not stay in a short-term rental could avail themselves of a bed and breakfast if they wanted a more residential feel, or there were hotels and motels that generate the same TOT that the neighborhood R-1 residential short-term rentals do. A lot of these places were zoned as residential neighborhoods just for that purpose. She said they don't modify an entire ordinance that has been carefully thought out, carefully planned, carefully considered. A lot of these options, which come up time and time again, have been addressed. Most neighborhoods don't want to turn into places that have short-term rentals with party fests, and she wasn't speaking individually to any of the people here, nor did she question their motives, or intent, or the customers that they have that rent from them, but in addressing the city as a whole, that wasn't the reason Palm Desert was formed, regardless of the fact that it is a destination resort. These neighborhoods are for families and they are intended to be so. Chairperson Limont was highly sensitive to the times and the economy. They were all affected by it, but it wasn't up to the City to change its standards to help citizens who have second residences they are trying to keep and they are in a financial bind about it. The City must consider what is in the best interest of the city and what the founding fathers intended the city to become, and modifying the ordinance that has been so carefully adopted might not be in the city's best interest. 19 u Commissioner Schmidt stated that she preferred to look at this entire issue on a non -emotional basis. That was difficult to do when so many here have such a vested interest. She understood it, because she had been there. The reality is that everyone who is represented here, as well as those who are in the same category represent an extreme minority in the city if they look at the overall residency. And she didn't really want this to get legs. She thought they have been limping along trying to monitor and police the abuses of short-term rentals. She said she wasn't at all sure they needed an ordinance, and if they do, it should be better than what Palm Springs is doing and those which she has looked at, because they are ineffective unless they are going to really devote the police presence and code enforcement required to collect, which is the only reason they would have to encourage what's going on. Perhaps most of them who have spoken have no issues and they really police their short- term renters, but it does not address the people who live next door and around within that 300 feet who bought their property to enjoy it peacefully. Commissioner Schmidt stated that she has lived in areas that had short- term rentals. She didn't like it. As well-meaning as the owners of the short- term rental properties were, they weren't present to know what was going on. Not everything is reported; not everything is investigated. To her it was mindboggling to think of the enforcement that they would have to increase to police an ordinance such as the Palm Springs ordinance. If Mr. Bagato really did get to them, she thought he would find it was a barrel of worms for them as well. She didn't know that for a fact, but did know of many short-term rentals in Palm Springs. All of them have their problems. She liked the idea that Barbara DaBoom had in looking at a study group. Commissioner Schmidt suggested putting together the Chamber of Commerce, some of the rental agencies if they are willing, a member or two of the Planning Commission, some staff and a few of the short-term rental owners, and try to drum up something that works. Her feeling at the moment is that there are many many residents in this city who do not abide by the ordinance of the City and register their homes and pay the taxes. That's one issue. That was not the most important issue to her. The most important issue is that person or persons living around these properties live in peace and quiet and enjoyment; period. She thought they should study it and look at it; they didn't have to move quickly on an ordinance unless someone gave her a really good reason. She thought that was a prudent way to move forward. And she would make that motion. Commissioner Tanner seconded. 20 Chairperson Limont asked if they could hear from Commissioner Campbell first. Commissioner Campbell stated when the original ordinance was adopted on a 4-1 vote; she was the one in favor of short-term rentals. As a business owner, she feels for everyone and thought they needed to go ahead and facilitate everything for the people because of our economic times and said we need all the business we can get in the desert. She wasn't ready to vote on this ordinance. If it came to a vote today, she would vote against it. So she was also in favor of the study session for the time being. Chairperson Limont asked if Commissioner Schmidt would restate her motion. Action: It was moved by Commissioner Schmidt that staff would be instructed to set about the formation of a committee of interested parties, businesses, two Planning Commission members be appointed, Council, and a broad enough base that would allow the committee to really study the pros and cons. She added one thing that she thought was very pertinent, and that was when they hear about the short-term rentals, which obviously bring in more revenue than a long-term rental, because they are turning and turning and she did it for years. The assumption is that it is 100% occupancy and that is simply not true. If they have a year or six months lease on a property, they don't make as much money, but they know that it is leased and there's a commitment. She doubted seriously that vacation rentals are as sought after during July, August and September here. So they needed to keep proper focus and perspective when they are dealing with this. Commissioner Tanner asked if the motion was to continue with staff's study session. Commissioner Schmidt concurred. The motion was seconded by Commissioner Tanner. Before voting, Chairperson Limont said she had a few comments. One, she is a homeowner and lives full time here. She also realized, and she thanked the person who brought in the pictures, that they obviously have an ordinance problem and they need to talk to Code and have some yards cleaned up. That was completely unacceptable. Palm Desert does take a great deal of pride in keeping up their neighborhoods. She also thought it was very important that they do keep up our neighborhoods. She thought they have a really well -written ordinance and it says, "The R-1 District is to encourage the preservation of residential neighborhoods characterized by single-family buildings on medium-sized lots." Palm Desert is middle 21 MINUTES PALM DESERT PLANICOMMISSION A': • 1 1 America. We are homes and neighborhoods and kids; rentals are important, but our residents, at least in her mind, are first and foremost. They were not trying to discourage rentals; they were trying to discourage losing our neighborhoods. What they were discussing this evening were short-term rentals, under 30 days. And with a CUP, they give their neighbors the opportunity to say, you know what? We don't want an animal house next door. She had a pretty good reminder over Easter. Her neighbor has a big family and everybody left Monday morning at 4:00 a.m. and just the slamming of the car doors got her up. That's what they were trying to protect here. As they move forward, she appreciated all the comments, because they were concerned for our town, but she also didn't want to move quickly. Her understanding was that they had a motion to continue and move forward with a study group made up of Council, Commission, some of the homeowners, but in the meantime, they would stick with the current ordinance because that was what was on the books. Chairperson Limont called for a vote. The motion carried 4-1 (Commissioner DeLuna voted no). Chairperson Limont thanked everyone for attending. D. Case No. PP 10-74 — PALM DESERT REDEVELOPMENT AGENCY, Applicant Request for approval of a Precise Plan of Design to allow construction of a Desert Willow Golf Resort terrace, canopy, kitchen/building, and overflow parking lot expansion located at 38-995 Desert Willow Drive. Assistant Planning Missy Grisa reviewed the staff report, provided a power point presentation, and recommended adopting the findings and resolution approving Precise Plan 10-74, subject to conditions. Commissioner Tanner asked how much this would cost. Ms. Grisa referred the question to Redevelopment Agency staff (RDA). MR. MARTIN ALVAREZ, Redevelopment Manager, stated that they allocated approximately $5.5 million for the entire project, which includes the building expansion, the terrace, and the overflow parking lot. Commissioner Tanner asked if that was Redevelopment funds. 22 On the perforated canopies, painted metal to match existing, Commissioner Schmidt asked if anything was ever investigated about adding some solar capabilities to this addition. Mr. Alvarez indicated that the perforated metal is for the outdoor canopies. In terms of solar in the future, they are required and would provide conduits and opportunities for future solar on the rooftop of the new addition. That was something they wanted to plan for; however, it was not included as a direct solar installation as part of this project. Commissioner Schmidt asked if that rough -in was in the budget. Mr. Alvarez said yes. Chairperson Limont opened the public hearing and asked if anyone wished to speak in FAVOR of or in OPPOSITION to the proposed development. There was no response and the public hearing was closed. Chairperson Limont asked for Commission comments. Action: It was moved by Commissioner Campbell, seconded by Commissioner Tanner, approving the findings and recommendation as presented by staff. Motion carried 5-0. It was moved by Commissioner Campbell, seconded by Commissioner Tanner, adopting Planning Commission Resolution No. 2528, approving Precise Plan 10-74, subject to conditions. Motion carried 5-0. Commissioner DeLuna commended staff for the outstanding job they've done. She thought Desert Willow was a gem in our city and what they proposed in terms of the remodeling could only enhance that and staff had done a wonderful job and ought to be commended. The Commission concurred. IX. MISCELLANEOUS City Attorney Dave Erwin asked that two members of the Planning Commission be designated to act with the study group on the short-term rentals. He suggested one in favor and one opposed. Vice Chair Schmidt and Commissioner Tanner were appointed. 25 MINUTES PALM DESERT PLANNING• •► VI. APPROVAL OF MINUTES Request for approval of the February 1, 2011 meeting minutes. Action: Commissioner De Luna moved and Commissioner Tanner seconded the approval of the February 1, 2011 meeting minutes. Motion carried 3-0-0-2. (Commissioners Campbell and Dash ABSTAINING). VII. CONSENT CALENDAR NONE Vill. PUBLIC HEARINGS Chair Limont stated that anyone who challenges any hearing matter in court may be limited to raising only those issues he, she or someone else raised at the public hearing described herein, or in written correspondence delivered to the Planning Commission at, or prior to, the public hearing. A. Case No. ZOA 10-68, City of Palm Desert, Applicant. Recommendation to City Council for approval of a Zoning Ordinance Amendment requiring a Conditional Use Permit for Short -Term Vacation Rentals in Non -Gated Residential Neighborhoods or Communities, and a modification to the Conditional Use Permit chapter establishing a minor Conditional Use Permit (CUP) review. Principal Planner Tony Bagato orally presented his staff report and PowerPoint presentation to the Planning Commission. This matter was brought before the Planning Commission in April, 2010. At the direction of the City Council, staff was instructed to form a sub -committee and strike a compromise that would better regulate short-term rentals. Mr. Bagato reported that from 1973-2000, the City of Palm Desert Municipal Code was silent regarding short-term rentals, neither prohibiting nor allowing them. Since 2000, a CUP was required to operate a short-term rental, and compliance was monitored on a complaint -driven basis. In January 2010, the Planning Commission directed staff to conduct a study of gated vs. non -gated communities to show where the short-term rentals were in fact operating. Staff discovered that no zone is solely gated or non -gated, as both can be found in nearly every zone. The sub -committee consisted of staff members, planning commissioners, city council members and citizens who were both for and 2 pf-allkylem. ► 19 11 _9WIL41OV, I & Lei ► 1 against short-term rentals. The sub -committee found that the cities of Mammoth and Palm Springs have actively dealt with this issue and those cities regulate short-term rentals under strict control using a business license. However, it would not give as much control as using a CUP along with a business license. After talking with the Police Department, Code compliance and other departments; the use of a CUP with a Business License would give the most control over land use issues and noise. Conditional Use Permits are already in use across all zones for such things as churches, day -schools and other such uses. They provide land use control with regulations and can be revoked for violations leading to fines or jail time for repeat violators. Staff proposed the following conditions to the short-term rentals: having a minimum of 3 days/2 nights' stay; maximum of 2 people per bedroom for overnight guests and additional guests of up to 2 more people for day time; a home will still need to look like a home and not like a hotel with signage and all on -site parking must be provided for use. A contact person with an available 24 hour phone number must be provided to the City and the neighbors in case of noise complaints. A minor CUP would have a one-time deposit of $1500 for this permit, rather than the $2915 for a normal CUP. The reasoning for this is that these cases take less staff work to process and a homeowner would be more likely to afford the smaller fee, whereas the full CUP fee might discourage a homeowner from registering with the City and getting a legal permit. The amount of TOT paid to the city last year was nearly $234,000. Of the number of short-term rentals, 1,212 were in gated communities and nearly 151 were located in non -gated communities. These numbers are approximate based on business license and internet research. Certain assumptions were made about where listings were located based on the verbiage in the advertisement. Over the past ten years, there have been only seven problems with short-term rentals that resulted in violations. Mr. Bagato entertained questions from the Planning Commission. Commissioner Tanner didn't have any questions. He stated that he was part of the sub -committee that reviewed the conditions. Commissioner De Luna began by commending staff on their outstanding work on this difficult task. Her question was about the CUP fee and would that $1,500 fee be an annual fee or a one-time fee? Mr. Bagato indicated that it is a one- time fee. She then asked if the CUP would run with the land and if someone sold their home, would that CUP stay with the house? Mr. Bagato stated that yes, a CUP runs with the property and in the case of someone selling their house, the City could require the seller to notify the City of a change in ownership. Commissioner De Luna commented about letters of opposition that M MINUTES 11 i \ ► 11 11 \ - • 1 the Commissioners received stating that some of the reasons that were listed in these letters didn't add up to her and while she considered them carefully, she didn't feel it was the City's responsibility to certify that citizens with second homes be successful at renting their properties out. Commissioner De Luna isn't convinced that the $234,000 in TOT would completely be lost by approval or denial of this ordinance. She stated that she is concerned with preserving the neighborhoods for those citizens who live here full time. Mr. Bagato stated that the sub -committee and City staff have been tasked with finding a compromise not only for those who live here full time and want the tranquility but also for those who live here and want to rent out their house. The conditions set forth are the conglomeration of ideas and suggestions from those individuals who worked on this project to strictly regulate these homes, but still allow them to make money and have their business. These suggestions take into account that 99% of the rentals are compliant and only 1% were problematic. Commissioner De Luna ended by asking who would one call with a complaint. Mr. Bagato said that a complainant could call the City, or the 24 hour phone number that will be provided to the City -per condition, or City Code compliance and a response to that complaint will follow. With the new sets of proposed conditions, the City would have more avenues of enforcement including, but not limited to: fines, revocation of CUPs, and even jail time if there are repeat violations. Commissioner Tanner wanted to point out that there have been a couple of homes that HAVE had their CUP'S revoked for repeated violations and are no longer in operation, illustrating that the process, albeit long, does work. Commissioner Dash began by thanking staff for their assistance as this was his first meeting. He asked about staff's level of confidence in the accuracy of the numbers presented here tonight. He clarified by indicating that he meant the numbers of gated vs. non -gated short-term rentals specifically. Mr. Bagato stated that there was some small margin for error, especially when he did his internet search to see where some of the rentals were located. If, on the website a rental was listed in a country club, he assumed that it was a gated community due to the nature of country clubs, but the website might never actually have said "gated". He cross-referenced the locations with business licensesladdresses listed with the City. Commissioner Dash wanted to clarify about enforcement and the level of priority to enforce and didn't feel that it was a top priority since there were very few complaints. Mr. Bagato stated that enforcement in times past was complaint driven. The City of Palm Springs hired new staff to regulate and enforce their rentals. The City of Palm Desert has officially determined that there is not 4 MINUTES PALM DESERT PLANNING11 l •►-EebruarvA5-2011 enough time nor staff to devote to full-time enforcement such as Palm Springs has. Commissioner Campbell thanked staff and the sub -committee for their efforts and had no questions. Commissioner Limont wanted to get some clarification on a few matters: she asked N we currently had an ordinance on short-term rentals. Mr. Bagato stated that, yes, but it currently only covers the R-1 zone. She then asked about the 151 short-term rentals, not in gated communities and how many had CUP's? Mr. Bagato stated that only five had CUP's. Commissioner Limont asked why the other 146 rentals haven't been approached to come into compliance with the City. Mr. Bagato stated that enforcement has been 'complaint driven', so if no complaints were lodged, then the City wouldn't necessarily have contacted these owners. There are many short-term rentals that are operating with business licenses but do not have a CUP and those would be grandfathered in this new ordinance as compliant. Commissioner Limont asked for a rough estimate of how many of the 151 short-term rentals do not have either a CUP or a Business license. Mr. Bagato hazarded a guess of 80. Commissioner Limont continued by asking about the number of people allowed in a house. She wanted to know what people would do for situations like Thanksgiving, where she herself had nearly 20 people in her house, and under this new ordinance, she would have been in violation. She wanted to know how the City enforces this. Mr. Bagato stated that it will still be 'complaint based' and citizens can still call the police and code compliance. The land use control [that the CUP offers] is still the better option since it now specifically indicates what rentals can and cannot do. Commissioner Limont asked if the police are called, could that response be 'back -charged' to the homeowner. Mr. Bagato said that it could. And that is part of the new ordinance to noise responses that was recently changed. Commissioner Limont questioned why staff went against Planning Commission directives in the past on this issue and brought the matter before the City Council, despite a 4-1 vote in opposition to an ordinance similar to this. Ms. Aylaian addressed the issue regarding staff recommendations saying that staff reviews the technical data on each application based on the codified zoning ordinance. She noted that there will be times when the City Council or Planning Commission might disagree with staff, but staff would maintain their recommendation all the way to City Council to see the project 'through'. For staff to change their recommendation mid -stream because of a 4-1 or 3-2 vote by the Planning commission diminishes the value and independence of the recommendation. It is not indeed to be disrespectful, nor is it staff's function to recommend against something because of the opinion of an individual or 5 MINUTES PALM DESERT PLANNING COMMISSION February 15, 2M commission.. Staff is tasked with making professional recommendations based on the code. Ms Aylaian invited the members of the Planning Commission to comment on any project that they feel IS NOT in accordance with City Policy or and direct staff to look into the issue and report back, a request to change the code so that it reflects current policy or that a Commissioner may comment to the City Council suggesting a change in the code. Chair Limont declared the public hearing open and asked for anyone who wanted to speak IN FAVOR OF the recommendation. Sarah Pallett of 42669 Brighton Street, Palm Desert, CA, spoke in favor of this ordinance. She stated that her family sometimes lists their home for a short term rental. She served on the sub -committee that crafted these guidelines. Ms. Pallett stated that most people who rent her house want to stay in a luxurious place with family and pets in a quiet location and many hotels don't necessarily allow pets and some places aren't quiet. Offering her home affords her renters all of these amenities. She stated that neighboring cities offer short-term rentals and the rental group that sends clientele to Palm Desert will just as easily send their patrons to neighboring cities if they feel Palm Desert is no longer welcoming. With that, she stated that she supports the conditions and wants to keep the groups coming to Palm Desert where they stay and spend their money and time in the city. Hal Reynolds, 73308 Tamarisk Street, Palm Desert spoke in favor of this proposal. He said he didn't think there was a problem until he and his family got back to their house and there was a football game going on in the street and over 20 guys swimming in the pool next door. He would like to keep the neighborhood quiet. Another house down the street was rented to a rock band for a few days. His neighbors are from Canada and decided not to rent their house any longer after hearing about the 20 guys swimming in their pool. Mr. Reynolds wanted to impress upon the Commission that he is for this proposal since it will enforce something that he feels should already be enforced. Hearing no other testimony in favor of, Chair Limont asked for any testimony IN OPPOSITION TO the recommendation. Ms. Elena Baumann, of HK Lane Real Estate stated that she opposes a '$1000 tax' [sic] on real estate that would cause a chain reaction to rent prices and real estate prices. She knows that many people come to the desert to spend money and by adding this tax it will drive business away. Hearing no other testimony, Chair Limont declared the public hearing closed and asked for any Commissioner comments. Commissioner De Luna just wanted to say that it is most important to protect the neighborhoods for those that choose to live here in a family community, not in a business community. Commissioner Dash stated that although he was new, he felt that staff's attempt to address the problem as it was and not just deny it outright was a good way to manage the problem and with these recommendations for enforcement, he could support this. Commissioner Campbell is in favor of staffs recommendation as presented and moved for approval. Commissioner Limont commented that she still had a problem with the 3day / 2 night condition. She commended staff on their research but still didn't think she could support this issue as it was presented. Mr. Bagato stated that the '312 day' was a compromise because some felt that one day was too short and one week was too long, since many visitors come out from Orange County or LA to shop but they wouldn't be able to do that for an entire week and take off extra time from work in most cases. Therefore, the '3/2 day' was reached as the best possible compromise for this condition. Commissioner Tanner wanted to commend the sub -committee for how hard they worked on this. He stated that he originally voted against allowing short- term rentals, but after hearing from home owners, retail and other interested parties he sees that this still can promote secure neighborhoods, but also keep people coming to Palm Desert and staying and spending their time and money here. He mentioned the fee is a one-time fee to cover added staff time for enforcement and is a reasonable request considering that the actual price of a CUP like this was higher at $2915. He has decided to vote in favor of this recommendation. Action: Commissioner Campbell moved and Commissioner Tanner seconded the motion to approve case ZOA 10-68. The motion carried for approval 3-2 (Commissioners Limont and De Luna voting NO). Commissioner Campbell moved and Commissioner Tanner seconded adopting Planning Commission Resolution No. 2545 recommending approval of ZOA 10-68. Motion carried 3-2 (Commissioners Limont and De Luna voting NO). IX. MISCELLANEOUS 7 PLANNING COMMISSION RESOLUTION NO. 2545 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF PALM DESERT, CALIFORNIA, RECOMMENDING TO CITY COUNCIL APPROVAL OF A ZONING ORDINANCE AMENDMENT REQUIRING A CONDITIONAL USE PERMIT FOR SHORT-TERM VACATION RENTALS IN NON -GATED RESIDENTIAL NEIGHBORHOODS OR COMMUNITIES, AND A MODIFICATION TO THE CONDITIONAL USE PERMIT CHAPTER ESTABLISHING A MINOR CONDITIONAL USE PERMIT REVIEW. CASE NO. ZOA 10-68 WHEREAS, the Planning Commission of the City of Palm Desert, California, did on the 151h day of February 2011, hold a duly noticed public hearing which was continued from April 6, 2010 to consider the request by the CITY OF PALM DESERT for approval of the above noted; and WHEREAS, said application has complied with the requirements of the "City of Palm Desert Procedure for Implementation of the California Environmental Quality Act', Resolution No. 10-26, the Director of Community Development has determined that the project is Class 5 Categorical Exemption under CEQA and no further environmental review is necessary, and WHEREAS, at said public hearing, upon hearing and considering all testimony and arguments, if any, of all interested persons desiring to be heard, said Planning Commission did find the following facts and reasons to exist to justify approval to the City Council of said request: 1. That the Zoning Ordinance Amendment is consistent with the Zoning Ordinance requirements for Conditional Uses. 2. That the Zoning Ordinance Amendment will provide the regulations for short-term rentals in non -gated communities, which will improve the public welfare by regulating short-term rentals to be compatible with residential neighborhoods. NOW, THEREFORE, BE IT RESOLVED by the Planning Commission of the City of Palm Desert, California, as follows: 1. That the above recitations are true and correct and constitute the findings of the Planning Commission in this case. 2. That the Planning Commission does hereby recommend approval of ZOA 10-68 and the standard conditions of approval for Short-term Rentals, Exhibit A and B attached. PLANNING COMMISSIOI ESOLUTION NO. 2545 ' PASSED, APPROVED AND ADOPTED at a regular meeting of the Palm Desert Planning Commission, held on this 15`h day of February 2011, by the following vote, to wit: AYES: TANNER, CAMPBELL AND DASH NOES: De LUNA, LIMONT ABSENT: NONE ABSTAIN: NONE M. CONNOR LIMONT, Chairperson ATTEST: LAURI AYLAIAN, Secretary Palm Desert Planning Commission 1 2 G. Planning\Tony BagatoMgW Slag ReP00520AU U88 Shod -Term RenlalslCUP Heading PC ResaMlmdm PLANNING COMMISSIC ESOLUTION NO. 2545 EXHIBIT "A" ISection 1. 25.14.030 — Conditional uses. K. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 2. 25.15.22 — Conditional uses. A. Rental or leasing pf a residential property, other than residential properties' located within gated communities, for periods of less than 30 days. Section 3. 25.16.030 — Conditional uses. K. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 4. 25.18.030 — Conditional uses. M. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 5. 25.20.030 — Conditional uses. O. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days.. Section 6 25.22.030 — Conditional uses. I. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. Section 7. 25.24.025 — Conditional uses. Rental or leasing of a residential property, other than residential properties located within gated communities, for periods of less than 30 days. 3 G`Plammrg,Tony 8agai Stall Repods,ZOA\10-a ShcTTerm Renlals%CUP Hearing PC Resoimion doc PLANNING COMMISSIC ESOLUTION NO. 2545 Section 7. 25.72.020 H. The Director of Community Development may determine that a certain request can be deemed a Minor Conditional Use Permit resulting is lesser requirements and review time. 4 G; Plannmg%Tony BagatorProled Staff Repor s9 ZOA\1066 Shw-Term Rentala`CUP Hearing`PC Resddbn.d% PLANNING COMMISSIC :SOLUTION NO. 2545 EXHIBIT "B" SHORT-TERM RENTAL CONDITIONS Minimum Number for Rent or Lease: The minimum number of days that a short-term rental can be occupied for is three (3) days. Rentals or leases for fewer than three (3) days shall be prohibited. Maximum Number of Occupants: The maximum number of overnight guests for a short-term vacation rental shall not exceed two (2) persons per bedroom. Additional daytime guests are allowed between the hours of 8:00 am and 8 pm, with the maximum daytime guests not to exceed one (1) additional person per bedroom. Appearance Visibility or Location: A short-term vacation rental shall not change the residential character or the outside appearance of the residence, either by the use of colors, materials, lighting, or any other advertising mechanism. Signs: No signs, either on site or off site, shall be used to advertise the availability of the rental unit to the public. On -site Parking Required: All parking associated with a short-term vacation rental shall be entirely on -site, in the garage, carport, driveway or otherwise out of the public street. Noise: Occupants of the short-term vacation rental shall comply with the standards and regulations of the Palm Desert Municipal Code Section 9.24 Noise Control. Contact Person: The owner, or his or her agent, shall be available 24 hours a day, seven days per week, to respond to any tenant or neighborhood questions or concerns. The following information shall be provided: Name, address and telephone number(s) of the contact person responsible for the managing the short-term vacation rental. The name, address and telephone number(s) shall be provided to the City of Palm Desert Community Development/Planning Department and owners of property within 300 feet of the rental property, and shall be permanently posted in the rental unit in a prominent location. Any change in the contact person's address or telephone number shall be provided promptly to the parties described above. Renter Notification: The owner, or operator, shall provide each occupant of the short- term vacation rental with the following information prior to occupancy of the unit and/or shall post such information in a prominent location within the unit: 1. Owner or his or her agent contact with 24 hour availability. 5 G.' PlarningVony Bagalo,Proleol Slalf ReporlVZOMIC 68 Snarb Term RerlaWCUP Heanng�PC Resoluti. d. PLANNING COMMISSI( ;ESOLUTION NO. 2545 2. The maximum number of overnight occupants and the maximum number of daytime occupants as permitted by the CUP 3. Trash pick-up day and applicable rules and regulations pertaining to leaving or storing trash on the exterior of the property. 4. A copy of the Palm Desert Municipal Code Section 9.24 Noise Control 5. Notification that the occupant or owner may be citied or fined by the City and/or in accordance with Palm Desert Municipal Code Section 9.24 Noise Control. Transient Occupancy Tax: The operator of the short-term vacation rental shall comply with the regulations and standards set forth in the Palm Desert Municipal Code Section 3.28 Transient Occupancy Tax (9%), including making any required payment of transient occupancy tax for each short-term vacation rental. Violations: Violations of these conditions shall result in the Conditional Use Permit being modified, discontinued, suspended or revoked by the Planning Commission. 6 O.' Planningtiony Bagato'Pralect Staff Reports%2OM10-66 Short -Term Rentals CUP Reanng'PC Resduli w.doc FROM :PMC FAX NO. :4154546201 `tar. 21 2011 10:08AM P2 C ;VED CtT CLERK'S OFFICE PALH DESERT, CA 2011 MAR 21 AM 10: 30 To: The City Council of Palm Desert C/o Rachelle Klassen, City Clerk Box 998 Ross, CA 94957 March 19, 2011 I am responding to your legal notice regarding case number ZOA 10-68 "requiring a conditional use permit for short-term vacation rentals in non -gated residential neighborhoods or communities, and establishing a minor conditional use permit review," with public hearing to be held 3/24/11. We are submitting this statement as we are in northern California and unable to attend the meeting. We have owned property in Palm Desert for many years and pay transient occupation taxes on rentals. Restricting residential rentals will have a significant financial impact on us and many other property owners who purchased property knowing they could subsidize their expenses with rental income, This proposed change would also have a significant impact also on the local economy. • It would harm local small businesses by decreasing merchant's revenues as visitors leave a lot of cash within Palm Desert. • It would create a higher residential vacancy rate, furthering lowering property values. • It would harm local government by decreasing property and sales tax revenues. • It would harm the local real estate market as many of today's homeowners are yesterday' lessees. Many of the people leasing homes are families who would not vacation in Palm Desert if they had to stay in multiple hotel rooms. We know this personally as we vacationed in Palm Desert with our five children at least once a year over some 15-20 years. A compromise solution would be to prohibit short-term rentals of less than a week in residential areas. Sincerely, Diana D. Parnell �ancis W. Parnell FROM :PMC FAX NO. :4154546201 `gar. 21 2011 10:013AM P1 Fax number: 760-340-0574 Please distribute the following to all Palm Desert City Council members before tomorrow's Council meeting. Thank you. Diana D. Parnell March 24, 2011 To: Palm Desert City Mayor, Palm Desert Council Members and Palm Desert City Manager Jean Benson Jan Hamik Robert Spiegel William Kroonen Cindy Finerty John Wohlmuth k �jo Re: ZOA 10-68 Short Term Vacation Rental — City of Palm Desert As realtors, we are opposed to the passage of ZOA 10-68 and feel that also the current non -enforced ordinance should be done away with. Additionally, you are impacting our ability to earn income, as selling a home in this economy can be challenging enough, but now you are pushing .; clients away, and in fact they are looking at homes instead in Rancho Mirage or Palm Springs, so they do not have to deal with the rental restrictions Palm Desert is trying to impose. We feel that City of Palm Desert is infringing on our property rights and therefore violating our civil rights by effectively banning the right to short term rentals. The ordinance currently in place is unconstitutional as it applies to us as . property owners. We would implore the City to re -consider their stance on this ordinance and: 1. Remove the requirement for a Conditional Use Permit for short term rentals. 2. Drop the requirement for neighbor approval to allow short term rentals. 3. Conditionally allow short term vacation rentals where properties are properly registered, signage is posted and the Transient Occupancy Tax is collected. Respectfully submitted, Viimt.+'e R§14t1 FSJor, - t e+-\+`$' — i0.Iw\ begr_2< FROM :PMC FAX NO. :4154546201 Mar. 21 2011 10:08AM P2 €i rD 'IT r C4.EP .S OFFICE PAI' i DEr, CA 2911 MAR 21 AM 10: 30 To: The City Council of Palm Desert c/o Rachelle Klassen, City Clerk Box 998 Ross, CA 94957 March 19, 2011 I am responding to your legal notice regarding case number ZOA 10-68 "requiring a conditional use permit for short-term vacation rentals in non -gated residential neighborhoods or communities, and establishing a minor conditional use permit review," with public hearing to be held 3/24/11. We are submitting this statement as we are in northern California and unable to attend the meeting. We have owned property in Palm Desert for many years and pay transient occupation taxes on rentals. Restricting residential rentals will have a significant financial impact on us and many other property owners who purchased property knowing they could subsidize their expenses with rental income. This proposed change would also have a significant impact also on the local economy. • It would harm local small businesses by decreasing merchant's revenues as visitors leave a lot of cash within Palm Desert. • It would create a higher residential vacancy rate, furthering lowering property values. • It would harm local government by decreasing property and sales tax revenues. • It would harm the local real estate market as many of today's homeowners are yesterday' lessees. Many of the people leasing homes are families who would not vacation in Palm Desert if they had to stay in multiple hotel rooms. We know this personally as we vacationed in Palm Desert with our five children at least once a year over some 15-20 years. A compromise solution would be to prohibit short-term rentals of less than a week in residential areas. Sincerely, Diana D. Parnell rands W. Parnell FROM :PMC FAX NO. :4154546201 Mar. 21 2011 10:08AM P1 Fax number: 760-340-0574 Please distribute the following to all Palm Desert City Council members before tomorrow's Council meeting. Thank you. Vc��A-01 *601�j—bc- Diana D. Parnell