The City Council originally passed the ordinance 6-3 in July. Short-term rental operators would have been limited to renting primary residences a maximum of 180 days per year and would have had to pay transient occupancy taxes to fund the construction of affordable housing projects.
The ordinance also mandated that vacationers stay in short-term rentals for a minimum of three days in coastal areas of the county and downtown San Diego. The regulations would have gone into effect in July 2019.
City Council members have said they plan to craft a new ordinance for short-term rental owners and companies, but no timetable for that has been agreed upon.
District 7 City Councilman Scott Sherman spearheaded an effort to qualify a referendum on the ordinance shortly after the council passed it. In late August, Sherman and a group of short-term rental advocates announced they had collected roughly 62,000 signatures, enough to trigger the referendum. The council then had the option to repeal the regulations or put them to a public vote, likely in 2020 unless the city called for a special election.
“That’s what the referendum process is for,” Sherman said. “If a majority of citizens who sign a petition believe that their government passed something that went too far, they have a right to come up and say `we want to vote on this or you guys need to rescind it.”‘
Homeowners who list their houses for rent using short-term rental platforms considered the regulations a de facto ban despite the ability to rent for up to 180 days per year, a feeling reflected by most public comments at the City Council meeting. Short-term renters also argued that they properly vet each person or group of people staying in their rental properties.
But supporters argue that the regulations were intended more to restrict investors, both local and out-of-town, from renting multiple properties and listing them year-round on short-term rental platforms, theoretically withholding housing in a county with the fourth largest population of homeless people in the country according to a 2017 report by the U.S. Department of Housing and Urban Development.
District 1 City Councilwoman Barbara Bry called it “a sad day for our city,” supporting the repeal only because not doing so would tie the city up in two years of litigation until the next election, she said.
Bry also chastised Airbnb, which faced accusations of funding signature gatherers who allegedly used manipulative tactics to fill out petitions.
“I’m disappointed that a corporation reportedly valued at $31 billion descended upon our city with its unlimited millions of dollars and used deceptive tactics to force us to where we are today,” Bry said. “If this goes to the ballot, this large corporation would largely spend millions of dollars.”
District 2 City Councilwoman Lorie Zapf was the lone council member to vote against repealing the ordinance, suggesting there’s no guarantee that a compromise on a new set of regulations will ever be reached again.
In a joint statement, Share San Diego, HomeAway and Airbnb said: “Today’s City Council decision is an important step towards fair and effective short-term rental regulations in San Diego. Over the last few months, tens of thousands of local residents stood up in support of the long standing vacation rental community through signing petitions, testifying at hearings, and speaking with their neighbors.
“This rescission passed because voters want regulations that protect private property rights, encourage tourism, weed out bad actors and create an enforceable regulatory structure. We believe there is a better way to regulate short-term rentals in San Diego and look forward to working with the City and all stakeholders to find a solution that works.”
— City News Service contributed to this report.
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