Two views on short-term rentals

SHORT-TERM rentals are legal in Huntington Beach, but not in Garden Grove (Shutterstock).

Short-term rentals – often referred to as “Air BnB” – have been a controversial issue in Orange County for years, indeed all over the U.S. where ever there is a lively tourism trade.

Such operations, typically involve a person renting out rooms in a house, or all the rooms, for fewer than 30 days. It has been a way for folks with some spare space to monetize their property.

However, it’s brought problems as well as conveniences. As the internet has made booking such arrangements quick and easy, the STR has moved from a minor sideline into a thriving business. Some streets in desirable tourist areas now have houses formerly occupied by property owners that are now owned by businesses whose trade is to operate what has amounted to unregulated hotels.

Complaints about noise, traffic, crowding, etc. have led some cities to ban them. On the other hand, the difficulties in policing such a thriving business model – along with the prospect of collecting some tax revenue – has led some cities to accept the STR.

Garden Grove, being adjacent to Disneyland and other attractions, prohibits short-term rentals and has a $1000 a day fine on the books as a deterrent. Typically, an STR operates in a grey area and does not charge or pay the city’s transient occupancy tax. For Garden Grove that TOT (also known as “bed tax”) represents a huge chunk of the city budget, and to the extent that a short-term rental operation siphons off money that could be going to a hotel means tax revenue not going to pay for police, fire and other city services.

However, some cities have taken a different tack. On Monday, the Huntington Beach City Council approved granting an extension on regulations governing the STR. Short-term rentals are legal in “Surf City” as long as the operator stays on the premises during guest stays, and follows all other city codes and requirements, including collecting and paying taxes.

Huntington Beach’s approach is motivated by two impulses. First is that while HB wants to attract tourists, it’s not as dependent on “bed tax” as Garden Grove is, with its row of high-rise hotels on Harbor Boulevard. Secondly, some cities have found the process of regulating STRs as sort of a game of “whack-a-mole.” You knock one down, and three others spring up.

Combined with state law allowing – almost demanding – accessory dwelling units in single-family home neighborhoods, this trend represents the idea of the quiet suburban cul-de-sac as a shining artifact of the past.

Shifting sands on city councils

In Huntington Beach and Westminster, what appear to be new majorities are forming which could have a big impact on the future of those cities.

Councilwoman Kimberly Ho had been aligned at voting time on the Westminster council with Mayor Tri Ta and Vice Mayor Chi Charlie Nguyen. Critics called them the  “The Gang of Three” and they were the target of an unsuccessful recall effort in 2020.

KIMBERLY HO has broken with what was once a majority on the Westminster City Council.

But in recent weeks and months, Ho has broken ranks. Most spectacularly, she led the effort to cancel the proposed Civic Center project pushed by developer Steve Sheldon. At the April 14 meeting, she leaned heavily on the idea that the city was facing a huge deficit when Measure SS  – the 1-cent sales tax passed (for six years) by voters in 2016 – expires.

How could the city go back to voters asking for a renewal of the tax while it had the money to build a new city hall, as called for in Sheldon’s proposal?

The upshot of all of this is that the way appears to be cleared for the sales tax hike to go on the ballot in 2022.

Huntington Beach may have acquired a reputation as a haven for extreme right-wing folks, but the reality is that the city council is looking more and more liberal.

Mayor Kim Carr is a Democrat, as are new members Natalie Moser and Dan Kalmick. Chosen in the 2020 election also was Tito Ortiz, the controversial “Huntington Beach Bad Boy,” now famous for not just his mixed martial arts background but also his espousal of conspiracy theories about the coronavirus pandemic: he called it a “plandemic.”

Ortiz and Councilmember Erik Peterson are now finding themselves on the short end of 5-2 votes on some council actions. At the “CommUNITY PopUp Picnic” at the Central Park emphasizing unity and inclusiveness, Ortiz and Peterson were absent, at least as far as we could see.

“Usually Reliable Sources” is posted every other week, alternating with Jim Tortolano’s “Retorts” column.


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