HomeMy WebLinkAboutInfo Rprt - Short-term Rental Properties in PDCITY OF PALM DESERT
DEPARTMENT OF COMMUNITY DEVELOPMENT
STAFF REPORT
REQUEST: INFORMATIONAL REPORT REGARDING SHORT-TERM RENTAL
PROPERTIES IN PALM DESERT
SUBMITTED BY: Tony Bagato, Principal Planner
DATE: March 11, 2010
Recommendation
By Minute Motion, that the City Council receive and file the informational
report regarding short-term rentals.
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 on June 25, 2009, the City Council denied the appeal, with several
Council members also expressing the opinion that short-term rentals are incompatible
with single-family neighborhoods.
On January 19, 2010, staff requested direction from the Planning Commission on how
to deal with short-term rentals in an R-1 zone, because short-term rentals are allowed in
R-1 zones with a Conditional Use Permit (CUP), but members of both the Planning
Commission and City Council stated that short-term rentals are not compatible with
single-family neighborhoods. After the discussion, Commissioner Tanner asked staff to
study the Planned Residential (PR) gated communities and the R-1 gated communities
to determine the number of gated R-1 properties that require CUPs; in addition,
Commissioner Schmidt asked for a possible ordinance.
Staff researched the different gated and non -gated R-1 communities and prepared a
Zoning Ordinance Amendment (ZOA 10-68) that would prohibit short-term rentals in
non -gated communities. On April 6, 2010, a public hearing was held and there were
many property owners with short-term rentals at the hearing who expressed opposition
to a prohibition. After the discussion, staff was directed to form a subcommittee
comprised of two City Council members, Planning Commission members and
Staff Report
Short -Term Rentals
December 9, 2010
Page 2 of 3
interested parties that included the Chamber of Commerce, rental agencies, concerned
residents, and short-term rental home investors to study the issue.
On May 5, 2010, the Subcommittee met and discussed some of the issues with short-
term rentals as well as the best way to handle them in the future. Staff had determined
that there could be approximately 750 short-term rentals within the City based on
research of internet vacation rental websites. Given that there were approximately 750
short-term rentals and only eight known complaints within ten (10) years, staff
recommended researching other cities' ordinances to develop a new city-wide
ordinance allowing short-term rentals in all zones with a permit and regulations.
On July 28, 2010, the Subcommittee met to discuss the possibility of a city-wide
ordinance further. A member of the Subcommittee gave a presentation about the
negative impacts related to short-term rentals. After the presentation, the Subcommittee
discussed the pros and cons of short-term rentals and staff indicated that the City's
existing requirements for a CUP and new noise ordinance were the best way to handle
any negative impacts. The consensus of the Subcommittee was to require a
Conditional Use Permit (CUP) for short-term rentals. Staff agreed to create a list of
conditions that would be applied to any short-term rental CUP, and verified that any
neighbors within 300 feet of a proposed rental property would be notified of the public
hearing during which such a CUP would be considered. Staff is preparing the list of
conditions of approval, and will provide those to the Subcommittee members in
December.
Since the last meeting of the Subcommittee, City representatives have received a
complaint about a property in the Hillside Planned Residential Zone being used as a
short-term rental. Currently, a CUP for short-term rental is only required in the R-1
Zone; short-term rentals are technically allowed in other residential zones. Based on the
concerns and potential impacts from short-term rentals, staff believes that a CUP
should be required for all short-term rentals that are not within gated communities,
rather than just for those in R-1 zones as was discussed by the Subcommittee. A
Zoning Ordinance Amendment will be required to apply this restriction to the other
residential properties outside of gated communities. A Zoning Ordinance Amendment
will be presented to the Planning Commission in January, after the conditions of
approval for short-term rentals have been reviewed by the Subcommittee. After the
Planning Commission's decision, the item can be discussed by the City Council.
G:\Planning\Tony Bagato\Word Files\Formats\Staff Reports\ZOA\10-68 Short -Term Rentals\Hearing\Informational CCSR (2).doc
Staff Report
Short -Term Rentals
December 9, 2010
Page 3 of 3
Environmental Review
This staff report is currently for informational purposes and therefore requires no further
environmental analysis at this time.
Fiscal Analysis
There is no financial impact from this informational staff report. A change in the
ordinance regulating short-term rentals will effect a change in the amount of transient
occupancy tax collected from the short-term rental of vacation properties and second
homes. For reference purposes, it is noted that during the fiscal year 2009/10, the City
received approximately $245,000 in transient occupancy tax from short-term rental
properties.
Submitted by:
-7 Tony Bagato
I' Principal Planner
Approval:
M. Wohlmuth, City Manager
Department Head:
Lauri Aylaian
Director of Community Development
CITY COUNCIL ACTION
APPROVED • DENTED
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Original on File with City'elerk's Office
MEETING DATE
AYES:
NOES:
ABSENT:
A 13STAIN:
VERIFIED BY:
G.\Planning\Tony Bagato\Word Files\Formats\Staff Reports\ZOA\10-68 Short -Term Rentals\Hearing\Informational CCSR (2).doc