HomeMy WebLinkAboutStaff Report 4.A 09/14/2015DATE: September 14, 2015
Agenda Item #4.A
TO: Honorable Mayor and Members of the City Council through City Manager
FROM: Ingrid Alverde, Redevelopment / Economic Development Manager
SUBJECT: Second Reading and Adoption of an Ordinance Amending the Text of the
Implementing Zoning Ordinance Sections 4.030, 7.110, AND 27.020, Ordinance
No. 2300 N.C.S., and the Smartcode, Ordinance NO. 2470 N.C.S, Sections 3.1
and 9.10.010 to Allow Short -Term Vacation Rentals in Residential and Mixed
Use Zones
RECOMMENDATION
It is recommended that the City Council adopt the attached Ordinance Amending the Text of the
Implementing Zoning Ordinance Sections 4.030, 7.110, AND 27.020, Ordinance No. 2300
N.C.S., and the Smartcode, Ordinance NO. 2470 N.C.S, Sections 3.1 and 9.10.010 to Allow
Short-Term Vacation Rentals in Residential and Mixed Use Zones.
BACKGROUND
On July 20, 2015, the City Council approved the first reading of an ordinance amending the text
of the Implementing Zoning Ordinance sections 4.030, 7.110, and 27.020, Ordinance no. 2300
N.C.S., and the Smartcode, Ordinance No. 2470 N.C.S., sections 3.1 and 9.10.010 to allow short-
term vacation rentals in residential and mixed use zones. The recommended action provides for
a second reading and adoption of the ordinance.
The approval was not unanimous but instead a 6 -1 vote. Section 45 of the City Charter dictates
the notice requirements that must occur before an ordinance is adopted. Generally, these require
advertising in the official newspaper of the City at least two days prior to adoption. When an
ordinance receives a unanimous vote at first reading, the advertising requirement may be met
instead by posting a copy of the ordinance on the bulletin board at the City Hall. If the vote upon
first reading is not unanimous, the advertising requirement may be met by publishing a synopsis
of the ordinance, in lieu of the ordinance in its entirety, at least two days before its adoption.
Section 45 requires that when a synopsis is published to meet advertising requirements, the entire
text of the ordinance shall be available to the public through the office of the City Clerk.
DISCUSSION
The recommended action provides for a second reading and adoption of the ordinance. A
synopsis of the Ordinance was published in the August 13, 2015 edition of the Petaluma Argus-
Courier and a copy of the entire text has been available in the Office of the City Clerk.
FINANCIAL IMPACTS
The cost to implement this program will be paid through the permit fees collected. Additional
revenue will be generated by both the business tax and transient occupancy taxes that will be
collected from each vacation rental unit. Assuming that 50 permits are issued, a total of $2,250
would be collected in business taxes. Approximately $15,000 would be collected by the permit
fees (if they are set at $300) which would pay for staff time to process the applications. If those
50 units were rented out 90 days a year at an average rate of $260 then approximately $117,000
of Transient Occupancy Taxes could also be collected. A more accurate estimate of revenues
will depend on the actual number of units rented, the actual number of rental nights, and the
actual rates charged for the property.
ATTACHMENTS
1. Ordinance
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ATTACHMENT 1
ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PETALUMA AMENDING THE TEXT OF THE
IMPLEMENTING ZONING ORDINANCE SECTIONS 4.030, 7.110, AND 27.020, ORDINANCE NO.
2300 N.C.S., AND THE SMARTCODE, ORDINANCE NO. 2470 N.C.S, SECTIONS 3.1 AND 9.10.010
TO ALLOW SHORT -TERM VACATION RENTALS IN RESIDENTIAL AND MIXED USE ZONES
WHEREAS, Section 25.010 of the City of Petaluma Implementing Zoning Ordinance
(IZO) provides in pertinent part that no amendment that regulates matters listed in
Government Code Section 65850 shall be made to the IZO or Smart Code unless the Planning
Commission and City Council find the amendment to be in conformity with the General Plan;
and
WHEREAS, on November 15, 2010 the Petaluma City Council accepted the Petaluma
Economic Development Strategy which identifies expanding tourism as a long term strategy for
developing Petaluma's economy; and
WHEREAS, on March 4, 2013, the City Council adopted its two -year goals which
directed staff to look at and make recommendations about the possibility of allowing and
regulating short -term vacation rentals; and
WHEREAS, on September 23, 2013, the City Council directed staff to develop a
program to regulate short -term vacation rentals and to charge transient occupancy taxes for
such uses; and
WHEREAS, staff has proposed a series of provisions amending the IZO and Petaluma
Smart Code (collectively, "the Amendments "), in order to allow short -term vacation rentals in
Petaluma, and expand tourism locally; and
WHEREAS, on October 9, 2014, public notice of the October 14, 2014 Planning
Commission meeting to consider the Amendments was published in the Argus- Courier and sent
to all members of the public on the interested parties list for this item; and
WHEREAS, on October 14, 2014, the Planning Commission held a duly noticed public
hearing in accordance with the IZO, Section 25.0 to consider the Amendments; and
WHEREAS, on October 14, 2014, the Planning Commission continued the hearing to
November 18, 2014 and directed staff to amend the proposed resolution; and
WHEREAS, on November 18, 2014 the Planning Commission held a duly noticed public
hearing in accordance with IZO Section 25.0, to consider the revisions to the Amendments; and
WHEREAS, after the conclusion of said public hearing, the Planning Commission
adopted Resolution No. 2014 -40, finding the amendments consistent with the General Plan and
unanimously recommending that the City Council adopt the amendments; and
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WHEREAS, on January 15, 2015, a public notice of the January 26, 2015 public hearing
before the City Council to consider the amendments was published in the Argus- Courier; and
WHEREAS, on January 26, 2015, the City Council of the City of Petaluma held a duly
noticed public hearing to consider the Amendments; and
WHEREAS, on June 1, 2015, the City Council of the City of Petaluma held a duly
noticed public hearing to consider the Amendments and continued that public hearing to the
July 20, 2015 hearing; and
WHEREAS, on July 20, 2015, the City Council voted to approve the Ordinance; and
WHEREAS, the amendments are categorically exempt pursuant to Section 15305
(Minor Alterations in Land Use Limitations) in that the amendments involve minor
modifications to the IZO and Smart Code that do not result in significant changes in allowable
land use or density.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF
PETALUMA AS FOLLOWS:
Section 1. Findings. Based upon the Planning Commission's recommendations, the
staff report and presentation, and evidence presented during the public hearing, the
City Council of the City of Petaluma hereby finds:
a. The Amendments to allow short -term vacation rentals in Petaluma are
consistent with General Plan Policies 9.1,2,3 and 9 -P -18 because vacation
rentals are expected to expand tourism opportunities throughout the City,
support the vibrancy of the downtown by attracting new clientele, and by
expanding opportunities to collect transient occupancy tax revenues, thereby
contributing to the City of Petaluma's economic base, yielding net fiscal
benefits and strengthening the vitality and diversity of the community.
b. The Amendments would allow vacation rentals based on an established
permit process, limit non - hosted vacation rentals, provide adequate
enforcement provisions to ensure minimal impacts to surrounding residential
neighborhoods, and uphold the general welfare of Petaluma residents, which
furthers General Plan Guiding Principle 1 and Goal 11 -G -5.
c. The Amendments to the City's Implementing Zoning Code Sections 4.030,
7.110, and 27.020 and SmartCode Sections 3.1 and 9.10.010 contained in this
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ordinance are in general conformity with the Petaluma General Plan 2025
and Central Petaluma Specific Plan.
Section 2. The Table of Contents of the Implementing Zoning Ordinance, Ordinance
No. 2300 N.CS., is hereby amended to add a new section 7.110 to Chapter 7, Standards for
Specific Land Uses to read as follows:
Chapter 7 Standards for Specific Land Uses 51
7.010 - Purpose
7.020 - Applicability
7.030 - Accessory Dwellings
7.040 - Dwelling Group
7.050 - Home Occupation Permit
7.060 - Large Family Child Day Care
7.070 - Short -Term Activities
7.080 - Swimming Pools, Hot Tubs, and Spas
7.090 -Telecommunication Facilities
7.100 - Bed and Breakfast Inns
7.110 — Short -Term Vacation Rentals
Section 3. Chapter 4, Zone Districts, Section 4.030, Allowable Land Uses, Table 4.1,
Implementing Zoning Ordinance, Ordinance No. 2300 N.C.S., is hereby amended to add short -
term vacation rentals as a Permitted Use as follows:
Natural and Rural Zones
•
Lodging— Short -Term Vacation Rentals P I P 17 - 7 I Section 7.110
Section 4. Chapter 4, Zone Districts, Section 4.030, Allowable Land Uses, Table 4.2,
Implementing Zoning Ordinance, Ordinance No. 2300 N.C.S., is hereby amended to add short -
term vacation rentals as a Permitted Use as follows:
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Residential Zones
LODGING
Lodging — Short -Term Vacation Rentals P 17 E 17 11 P1171 P(17) Section 7.110
Section 5. Chapter 4, Zone Districts, Section 4.030, Allowable Land Uses, Table 4.3,
Implementing Zoning Ordinance, Ordinance No. 2300 N.C.S., is hereby amended to add short -
term vacation rentals as a Permitted Use as follows:
Mixed Use Zones
LODGING
Lodging — Short -Term Vacation Rentals PLI-71 I P 1-71 I P 17 P 17 P 17 I Section 7.110
Section 6. Chapter 4, Zone Districts, Section 4.030, Allowable Land Uses, Table 4.3,
Footnote 17 to Tables 4.1 to 4.5, Implementing Zoning Ordinance, Ordinance No. 2300 N.C.S, is
hereby added as follows:
Short -term vacation rental permit, business license and transit occupancy tax certificate
required (see section 7.110 of Implementing Zoning Ordinance)
Section 7. Chapter 7, Standards for Specific Land Uses, Section 7.110 of the
Implementing Zoning Ordinance, Ordinance No. 2300 N.C.S., Short -Term Vacation Rentals, is
hereby added to read as follows:
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7.110 — Short -Term Vacation Rentals
This Section establishes requirements and conditions for the establishment and operation of
short -term vacation rentals within residential, planned unit development, and mixed -use
zoning districts.
A. Purpose. The purpose of this section and the standards outlined below is to serve visitors
of Petaluma, to ensure that short -term vacation rentals are compatible with residential and
mixed use, and planned unit districts, and to preserve the character of the neighborhoods in
which they are located.
B. Permit Required.
1. Short -term vacation rentals. Short -term vacation rentals are a permitted use only
in residential, planned unit development, and mixed use zoning districts and only
pursuant to a valid Short Term Vacation Rental Permit issued in accordance with this
section by the Planning Director or designee of the Planning Director.
2. Notice to Neighbors. Upon approval of a Short -Term Vacation Rental Permit, all
property owners within 100 feet of the permitted Short -Term Vacation Rental shall
be noticed in writing. Such notice shall include the location of the short term
vacation rental, number of rooms available for short term vacation rental, and
contact information for the locally - available manager.
C. Requirements Applicable to All Short Term Vacation Rentals.
1. Guest Manual. The Host shall provide a written manual to guests providing the local
manager's contact information, the Performance Standards set forth in Chapter 21
of the Implementing Zoning Ordinance, parking limitations, and other helpful
information to minimize conflict within the neighborhood.
2. Signs. On -site signage is prohibited.
3. Business License. All short -term vacation rentals require a valid Business License
issued in accordance with Chapter 6.01 of the Petaluma Municipal Code.
4. Transit Occupancy Tax. Short -term vacation rentals are subject to and must satisfy
all applicable requirements of the City's transit occupancy tax.
S. Permit Number. In every advertisement for the Short Term Vacation Rental, the
Permitee shall include the City issued Permit Number.
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D. Requirements Applicable To Hosted Short Term Vacation Rentals. A Short Term Vacation
Rental in which the permittee occupies the property with the guests and is subject to the
following requirements:
1. Limit on Maximum Number of Occupants. No more than 2 overnight occupants per
bedroom plus 2 additional occupants are permitted.
a. No more than two bedrooms in the dwelling may be furnished for
compensation. (See section 7.100 for Bed and Breakfast requirements.)
b. If the entire dwelling is an accessory /secondary unit, it may be furnished for
compensation as a Hosted Short Term Vacation Rental, provided that the
guests constitute one party, which may be evidenced through a single rental
agreement for the entire dwelling.
2. Manager. The permittee must be available at all times and be able to respond to
complaints within 1 hour.
E. Permit Requirements Applicable To Non - Hosted Short Term Vacation Rentals. A Short
Term Vacation Rental in which the permittee does not occupy the property with the guests
and is subject to the following requirements
1. Limits on Occupants.
a. The entire dwelling maybe furnished for compensation, provided that the
guests constitute one party, which may be evidenced through a single rental
agreement for the entire dwelling.
b. No more than 2 overnight occupants per bedroom plus 2 additional
occupants are permitted.
2. Limitation on Days. The dwelling as a non - hosted vacation rental may be furnished
for compensation for no more than 90 days during any calendar year.
3. Manager. A manager located within 45 miles of the City must be available at all
times and be able to respond to complaints within 1 hour.
F. Short -Term Vacation Rentals in Planned Unit Developments. A permit issued for a Short
Term Vacation Rental in a Planned Unit Development must comply with Section 19.050 of
the Implement Zoning Ordinance.
G. Dispute Resolution. Upon receipt of three or more complaints in a calendar year about a
Short Term Vacation Rental, with the consent of the parties involved, the City may refer the
parties to a third party mediator. The cost shall be shared equally by the parties involved,
unless the parties agree otherwise in writing.
H. Application Process. The application process for a Short Term Vacation Rental Permit shall
be as follows:
1. Application for Permit. Application for a Short -Term Vacation Rental Permit shall be
made to the Director on a form provided by the City.
2. Fee. The fee that applies to process applications for Short -Term Vacation Rental
Permits shall be set by City Council resolution.
3. Parking. The application must show that the applicant can provide:
a. Parking. On -site parking for the existing residential use shall be provided as
required in Table 11.1 for Dwelling Single Family or Multiple Household, as
applicable. The Planning Manager, in his or her sole discretion, may give
credit for up to two uncovered spaces on the abutting public street if there is
legal non - conforming parking on the site; or
b. Parking Exception. Applicants that are unable to meet the parking
requirements in Section H.3.a. due to existing legal non - conforming parking
and /or site constraints, may obtain a Parking Exception upon approval of a
Minor Conditional Use Permit as prescribed by Section 24.030. Applications
for a Parking Exception must provide documentation demonstrating that
adequate on- street parking is available to accommodate the proposed short
term vacation rental and the other existing uses on the site.
4. Safety. All short term vacation rentals must provide smoke detectors, CO2
detectors, be adequately heated, and otherwise satisfy all applicable requirements
of the California Building Standards Code as in effect in the City
5. Duration. Short -Term Vacation Rental Permits shall be valid through the end of the
calendar in which they are issued. All Short -Term Vacation Rental Permits shall
expire on December 31, unless a renewal application is approved.
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6. Permit Approval. A Short -Term Vacation Rental Permit application shall be
approved if all applicable requirements are satisfied; otherwise, the application shall
be denied.
Renewal of Permit.
1. Permittees may apply to renew Short -Term Vacation Rental Permits on forms
provided by the City.
2. Permit renewal applications do not require notice in accordance with Section B. 2.
3. The Director shall issue a renewal of a Short Term Vacation Rental Permit if the
permittee satisfies all applicable requirements pursuant to this Chapter; otherwise
such renewal applications shall be denied. The Director may deny a renewal
application if he or she determines that any of the following have occurred during
the 12 months prior to the renewal application:
a. Failure to timely remit Transient Occupancy Taxes; or
b. More than three verified violations of this section; or
c. The Director determines that permittee has provided false information in the
application or previous renewal application; or
d. An authorized official has given notification of health or safety violations or
non - compliance on the property.
J. Revocation of Permit. Upon confirmation of three or more verified violations of this
section or other information alleging that a short -term vacation rental has violated or is
in violation of any applicable laws, regulations, or other requirements, including, but not
limited to, the requirements of this section, the Planning Director or a designee of the
Planning Director may commence permit revocation proceedings in accordance with
section 24.030(J). Once a Short -Term Vacation Rental Permit has been revoked,
continued use of the Short -Term Vacation Rental at that location is prohibited and
subsequent applications may not be filed within one (1) year from the date of
revocation.
K. Appeal. Appeal of decisions of the Planning Director pursuant to this section may be
brought pursuant to Section 24.070.
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L. Enforcement. The City may seek remedies for any violations of this section pursuant to
any applicable authorities, including, but not limited to, those contained in Chapter 26
and those contained in Title 1 of the Petaluma Municipal Code.
M. Sunset. Unless otherwise extended, or modified and extended by action of the City
Council, this Ordinance shall expire and its terms shall no longer remain in effect as of
midnight, December 31, 2018.
Section 8. Chapter 28, Glossary of the Implementing Zoning Ordinance, Ordinance
No. 2300 N.C.S., definition of "Bed and Breakfast Inn" is amended to read as follows:
Bed and Breakfast Inn (B &B). A residential structure with one household in permanent
residence, with three or more bedrooms furnished for compensation for overnight lodging,
where meals may be provided subject to applicable Health Department regulations. Does not
include room rental, which is separately defined (see "Rooming, Lodging, Boarding House, or
Short Term Vacation Rental ").
Section 9. Chapter 28, Glossary of the Implementing Zoning Ordinance, Ordinance
No. 2300 N.C.S., definition of "Rooming or Boarding, Accessory" is amended to read as follows:
Rooming or Boarding, Accessory. A portion of a dwelling where lodging and boarding are
provided for no more than 3 persons for a_period of 30 days or longer.
Section 10. Chapter 28, Glossary of the Implementing Zoning Ordinance, Ordinance
No. 2300 N.C.S., definition of "Rooming, Lodging or Boarding Housing" is amended to read as
follows:
Rooming, Lodging or Boarding House. A dwelling or part of a dwelling where lodging is
furnished for compensation to three or more persons living independently from each other for
a period of 30 days or longer. Meals may also be included.
Section 11. Chapter 28, Glossary of the Implementing Zoning Ordinance, Ordinance
No. 2300 N.C.S., definition of "Short -Term Vacation Rental" is added to read as follows:
Short -Term Vacation Rental - A dwelling, part of a dwelling, or dwelling as an accessory or
secondary unit furnished for compensation for a period of less than 30 days. Meals may also be
included. Does not include room rental for 30 days or more, which is separately defined (see
"Rooming, Lodging, or Boarding House ").
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Section 12. Section 3, Building Function Standards, Section 3.10.030, Permit
Requirements for Allowable Uses, Table 3.1, Allowed Building Functions and Permit
Requirements, Smart Code, Ordinance No. 2470 N.C.S., is hereby amended to add short -term
vacation rental as a Permitted Use as follows:
Lodging
Short-term vacation rental P5 ps P2, s P ,s
Section 13. Section 3, Building Function Standards, Section 3.10.030, Permit
Requirements for Allowable Uses, Footnote 5 to Table 3.1, Allowed Building Functions and
Permit Requirements, Smart Code, Ordinance No. 2470 N.C.S., is hereby added as follows:
Short -term vacation rental permit, business license and transit occupancy tax certificate
required (see section 7.110 of Implementing Zoning Ordinance)
Section 14. Section 9, Glossary, Section 9.10.020, Definitions of Specialized Terms and
Phrases, Bed and Breakfast Inn (B &B), Smart Code, Ordinance No. 2470 N.C.S is hereby
amended to read as follows:
Bed and Breakfast Inn (B &B). A residential structure with one household in permanent
residence, with three or more bedrooms rented for overnight lodging, where meals may be
provided subject to applicable Health Department regulations. Does not include room rental,
which is separately defined (see "Rooming, Lodging, Boarding House, or Short Term Vacation
Rental ").
Section 15. Section 9, Glossary, Section 9.10.020, Definitions of Specialized Terms and
Phrases, Short -Term Vacation Rental, Smart Code, Ordinance No. 2470 N.C.S is hereby added
to read as follows:
Short -Term Vacation Rental - A dwelling, part of a dwelling, or dwelling as an accessory or
secondary unit furnished for compensation for a period of less than 30 days; Meals may also be
included. Does not include room rental for 30 days or more, which is separately defined (see
"Rooming, Lodging, or Boarding House "),
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Section 16. Except as amended herein, the City of Petaluma SmartCode, Ordinance
No. 2470 N.C.S. and the City of Petaluma Implementing Zoning Ordinance, Ordinance No. 2300
N.C.S., remains unchanged and in full force and effect.
Section 17. Program Evaluation. No later than April 2, 2018, the City Manager shall
cause to be initiated a study to determine the effectiveness of this ordinance in regulating the
operation of short term vacation rentals in the City of Petaluma, the administrative
effectiveness of the short -term vacation rental program, and whether a need to regulate short
term vacation rentals continues to exist. Specific areas of inquiry shall be determined by the
City Manager, but shall be sufficient to address these broad areas of concern. The study, shall
be presented to the Planning Commission not later than August 14, 2018, and shall include
recommendations to terminate, extend, or modify and extend the program. The study shall be
accompanied by proposed legislation, if the recommendation to the Planning Commission is to
extend, or modify and extend, the effective date of the program. Not later than October 15,
2018, the study, together with the recommendations of the Planning Commission, and any
accompanying legislation, shall be presented to the City Council for its consideration.
Section 18. Severability. If any section, subsection, sentence, clause, phrase or word
of this ordinance is for any reason held to be unconstitutional, unlawful or otherwise invalid by
a court of competent jurisdiction or preempted by state legislation, such decision or legislation
shall not affect the validity of the remaining portions of this ordinance. The City Council of the
City of Petaluma hereby declares that it would have passed and adopted this ordinance and
each and all provisions thereof irrespective of the fact that any one or more of said provisions
be declared unconstitutional, unlawful or otherwise invalid.
Section 19. Effective Date. This ordinance shall become effective thirty (30) days after
the date of its adoption by the Petaluma City Council.
Section 20. Posting /Publishing of Notice. The City Clerk is hereby directed to publish
or post this ordinance or a synopsis for the period and in the manner provided by the City
Charter and other applicable law.
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