HomeMy WebLinkAbout03 - Amending the Newport Beach Municipal Code Restrictions for Short Term LodgingQ �EwPpRT
CITY OF
O �
z NEWPORT BEACH
<,FORN'P City Council Staff Report
July 14, 2020
Agenda Item No. 3
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Seimone Jurjis, Community Development Director - 949-644-3232,
sjurjis@newportbeachca.gov
PREPARED BY: Evelyn Tseng, Revenue Manager, etseng@newportbeachca.gov
PHONE: 949-644-3153
TITLE: Ordinance No. 2020-15: Amending the Newport Beach Municipal
Code Restrictions for Short Term Lodging
ABSTRACT:
For the City Council's consideration is the second reading and adoption of
Ordinance No. 2020-15, amending Newport Beach Municipal Code Section 3.16.060 and
Chapter 5.95, relating to short term lodging. If adopted, the ordinance will be effective
August 13, 2020.
RECOMMENDATION:
a) Find this action is exempt from the California Environmental Quality Act (CEQA)
pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because
this action will not result in a physical change to the environment, directly or indirectly;
and
b) Conduct second reading and adopt Ordinance No. 2020-15, An Ordinance of the City
Council of the City of Newport Beach, California, Amending Section 3.16.060 and
Chapter 5.95 of the Newport Beach Municipal Code Relating to Short Term Lodging.
FUNDING REQUIREMENTS:
If the proposed ordinance is adopted, the additional restrictions may require increased
staff resources for administering and enforcing the program. Also, an outsourced
answering service is anticipated to cost $27,000 per year (not including first year
implementation costs). To offset the increase in any additional costs, staff will complete
a fee study and return to City Council with a revised short term lodging permit fee from
the current amount of $103 per year.
DISCUSSION:
On July 9, 2019, the City Council formed an ad hoc committee to review the short term
lodging regulations set forth in the Newport Beach Municipal Code (NBMC) Chapter 5.95.
3-1
Ordinance No. 2020-15: Amending the Newport Beach Municipal Code for Short Term
Lodging
June 23, 2020
Page 2
After receiving public input at several community events and meetings, the committee
recommended the City Council modify the short term lodging regulations at the
February 11, 2020, City Council meeting. Based on input received at the City Council
meeting, the committee was tasked with conducting additional public outreach and
refining its recommendations.
On June 23, 2020, the City Council introduced and passed to second reading
Ordinance No. 2020-15, which amends Municipal Code Sections 3.16.060 and
Chapter 5.95, relating to short term lodging.
Some of the noteworthy changes in the ordinance are: short term lodging permit numbers
are required to be posted on all advertisements including platforms; property owners are
required to post street sweeping and trash pickup schedules, 24-hour contact information,
and the good neighbor policy; subletting of units will be prohibited; short term lodging
permits will be closed if no transient occupancy tax is reported for two years; tenants must
be 21 years of age to rent a unit; a permit may be suspended for six months if the unit
receives two violations in a 12 month period; and platforms may not complete bookings
for non-compliant properties.
If adopted by the City Council, the ordinance will be effective August 13, 2020.
ENVIRONMENTAL REVIEW
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not
result in a direct or reasonably foreseeable indirect physical change in the environment)
and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA
Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no
potential for resulting in physical change to the environment, directly or indirectly.
NOTICING:
This agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
ATTACHMENTS:
Attachment A — Ordinance No. 2020-15
3-2
ATTACHMENT A
ORDINANCE NO. 2020-15
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY
OF NEWPORT BEACH, CALIFORNIA, AMENDING
SECTION 3.16.060 AND CHAPTER 5.95 OF THE
NEWPORT BEACH MUNICIPAL CODE RELATING TO
SHORT TERM LODGING
WHEREAS, Section 200 of the Charter of the City of Newport Beach ("City")
vests the City Council with the authority to make and enforce all laws, rules and
regulations with respect to municipal affairs subject only to the restrictions and
limitations contained in the Charter and the State Constitution, and the power to
exercise, or act pursuant to any and all rights, powers, and privileges, or procedures
granted or prescribed by any law of the State of California;
WHEREAS, the City is a popular beach resort community that serves a large
number of tourists during the summer months;
WHEREAS, this influx of tourists' burdens City streets and services with heavy
volume of vehicle traffic and heavy demand on parking, sewage, and refuse facilities,
paramedics and police services;
WHEREAS, the Police and Fire Departments frequently respond to complaints of
noise disturbances, disorderly conduct and other illegal activity at short term lodging
units;
WHEREAS, a large number of short term lodging units are located in residential
areas where dwelling units are occupied by the property owner or long term tenants and
these permanent residents are adversely impacted by the noise, traffic, refuse and
demand for parking resulting from occupancy of short term lodging units;
WHEREAS, the presence of such visitors within the City's residential
neighborhoods can sometimes disrupt the quietude and residential character of the
neighborhoods and adversely affect the community;
WHEREAS, the City has an interest in preserving its housing stock and the
quality and character of its existing single and multi -family residential neighborhoods;
WHEREAS, occupants of short term lodging units are generally not residents of
the City and the City has limited ability to enforce provisions of the Newport Beach
Municipal Code and the Penal Code related to disorderly conduct when violated by
occupants of short term lodging units;
3-3
Ordinance No. 2020-15
Page 2 of 18
WHEREAS, on May 11, 1992, the City Council adopted Ordinance 92-13,
establishing regulations for the operation of short term lodging units within residential
zones to mitigate the impact of this use on the residents of the City; and
WHEREAS, the City Council has reviewed and considered evidence and
documentation attesting to the need to further regulate and control short term lodging
units in residential zones to ensure that short term lodging units are regulated in a way
to maintain harmony with surrounding uses and all transient occupancy taxes and visitor
service fees are properly collected and remitted to the City.
NOW THEREFORE, the City Council of the City of Newport Beach ordains as
follows:
Section 1: Section 3.16.060 of Chapter 3.16 of Title 3 of the Newport Beach
Municipal Code is hereby amended to read as follows:
3.16.060 Registration of Hotel.
Within thirty (30) days after commencing business each operator of any hotel
renting occupancy to transients shall register the hotel with the Finance Director and
obtain a "transient occupancy registration certificate" to be at all times posted in a
conspicuous place on the premises. The certificate shall, among other things, state the
following:
A. The name of the operator;
B. The address of the hotel;
C. The date upon which the certificate was issued; and
D. The following statement: This transient occupancy registration certificate
signifies that the person named on the certificate has fulfilled the requirements of the
Uniform Transient Occupancy Tax Ordinance (Chapter 3.16 of the Newport Beach
Municipal Code) by registering with the Finance Director for the purpose of collecting
the tax from transients and remitting the tax to the Finance Director. This certificate
does not authorize any person to conduct any unlawful business, to conduct any lawful
business in an unlawful manner or to operate a hotel without strictly complying with all
local laws, including those requiring a permit from any board, commission, department
or office of the City. This certificate does not constitute a permit.
The requirements of this section shall not apply to the operator of a hotel
required to obtain a short term lodging permit pursuant to Section 5.95.020.
3-4
Ordinance No. 2020-15
Page 3 of 18
Section 2: Chapter 5.95 of Title 5 of the Newport Beach Municipal Code is
hereby amended to read as follows:
Chapter 5.95
SHORT TERM LODGING PERMIT
Sections:
5.95.005 Purpose and Findings.
5.95.010 Definitions.
5.95.015 Residential Properties Eligible for Short Term Lodging Permits.
5.95.020 Permit Required.
5.95.025 Agency.
5.95.030 Application for Permit.
5.95.035 Denial of Permit.
5.95.040 Filing Fee.
5.95.045 Conditions.
5.95.047 Violations of Permit Conditions by Transient User, Occupant or Guest.
5.95.050 Agent and Hosting Platform Responsibilities.
5.95.055 Issuance of Administrative Subpoenas.
5.95.060 Violations, Penalties and Enforcement.
5.95.065 Suspensions and Revocations.
5.95.070 Permits and Fees Not Exclusive.
5.95.080 License and Permit Closure.
5.95.005 Purpose and Findings.
The City Council of the City of Newport Beach finds and declares as follows:
A. An ever-increasing number of tourists renting short term lodging units is
increasing the demand for City services and creating adverse impacts in residential
zones.
B. Over a thousand dwelling units within residential zones near the City's beaches
and harbor are rented for less than thirty (30) consecutive calendar days with the vast
majority of those rentals occurring during the summer when the demand for parking and
City services is the greatest.
3-5
Ordinance No. 2020-15
Page 4 of 18
C. Many of the occupants of short term lodging units are permanent residents of
areas distant from Newport Beach and the City has no effective way to prevent
occupants from continuing to violate provisions of this Code and the Penal Code
relating to noise, disturbances and disorderly conduct. The only effective way to
minimize the problems associated with occupancy of short term lodging units is to
impose responsibility on the owner of the property, either personally or through an
agent, to control the conduct of guests and occupants.
D. Numerous incidents involving excessive noise, disorderly conduct, vandalism,
overcrowding, traffic congestion, illegal vehicle parking and accumulation of refuse are
directly related to short term lodging units, which increasingly require response from
police, fire, paramedic and other City services.
E. The increase in demand for City services resulting from short term lodging units
overburdens and threatens the City's ability to provide necessary services.
F. Many short term lodging units are operated by agents and/or absentee owners
who exercise little or no supervision or control of occupants.
G. There has been an increase in the number of lodging units booked on a short
term basis where the owner of the unit does not have a short term lodging permit,
affecting the ability of the City to properly regulate the impacts caused by the illegal
operation.
H. There has been an increase in the number of lodging units booked on a short
term basis where the owner of the property has not taken steps to ensure the transient
occupancy tax and visitor service fee is collected and/or remitted to the City, resulting in
an unfair business advantage to these illegal operations and loss of revenue necessary
to provide City services.
I. Problems with short term lodgings is particularly acute in residential districts
where the peace, safety and general welfare of the long term residents are threatened.
J. To ensure the effective enforcement of this Code, it is necessary to have the
owner include the short term lodging permit number issued by the City on all
advertisements for a short term lodging unit so the transient user knows the owner is
authorized to rent the lodging unit on a short term basis.
K. To ensure the transient user knows the total cost associated with renting the
lodging unit and to prevent fraud, it is necessary for the owner to make sure the
transient user is informed of the amount of the transient occupancy tax and visitor
service fee prior to completing a booking transaction.
3-6
Ordinance No. 2020-15
Page 5 of 18
L. The restrictions of this chapter are necessary to preserve the City's housing
stock, the quality and character of the City's residential neighborhoods as well as to
prevent the continued burden on City services and adverse impacts on residential
neighborhoods posed by short term lodgings.
5.95.010 Definitions.
For the purpose of this chapter, the following definitions shall apply:
A. "Accessory dwelling unit" shall have the same definition as set forth in Chapter
20.70 of Title 20 of this Code.
B. "Agent" shall mean any person who is authorized in writing by the owner to
represent and act for an owner.
C. "Booking transaction" shall mean any reservation or payment service provided by
a person who facilitates a short term lodging rental transaction between a transient user
and owner for the use of a unit for a period of less than thirty (30) consecutive calendar
days.
D. "City Manager" shall mean the City Manager of the City or his or her designee.
E. "Finance Director" shall mean the Finance Director of the City or his or her
designee.
F. "Gross floor area," shall mean the area of the lodging unit that includes the
surrounding exterior walls and any interior finished portion of a structure that is
accessible and that measures more than six feet from finished floor to ceiling.
Stairwells and elevator shafts above the first level shall be excluded from the calculation
of gross floor area.
G. "Home -sharing" shall mean an activity whereby the owner hosts a transient user
in the owner's lodging unit, for compensation, for periods of less than thirty (30)
consecutive calendar days, during which time the owner of the unit lives onsite, in the
unit, throughout the transient user's stay and the owner, the transient user and any
other occupants live together in the same unit as a single housekeeping unit.
H. "Hosting platform" shall mean a person, other than an owner or agent, who
participates in the short term lodging business by facilitating a booking transaction using
any medium of facilitation.
I. "Lodging unit" or "unit" shall mean a "dwelling unit" as that term is defined in
Chapter 20.70, of Title 20 of this Code. An accessory dwelling unit shall not be
considered a lodging unit or unit for purposes of this chapter.
3-7
Ordinance No. 2020-15
Page 6 of 18
J. "Owner" shall mean the person(s) that hold(s) legal and/or equitable title to the
lodging unit.
K. "Person" shall mean any individual and any form of business entity including, but
not limited to, all domestic and foreign corporations, associations, syndicates, joint stock
corporations, partnerships of every kind, clubs, business or common law trusts,
societies, or limited liability companies.
L. "Residential district" shall mean those areas of the City so designated by Title 20
of this Code as well as any other area in the City designated for a residential use as part
of a Planned Community Development Plan, Specific Area Plan or Planned Residential
District.
M. "Short term" shall mean a lodging unit that is rented or leased as a single
housekeeping unit for a period of less than thirty (30) consecutive calendar days. This
also includes home -sharing.
N. "Short term lodging unit registry" shall mean the published registry maintained by
the City that sets forth a list of all owners and the address of all units that have a valid
short term lodging permit and business license with the City, a copy of which is
available, without charge, to any person who requests a copy and which shall be
accessible on the City's website.
O. "Single housekeeping unit" shall have the same definition as set forth in Chapter
20.70 of Title 20 of this Code.
P. "Transient" or "Transient user" shall mean any person or persons who, for any
period less than thirty (30) consecutive calendar days either at his or her own expense,
or at the expense of another, obtains lodging in a lodging unit or the use of any lodging
space in any unit, for which lodging or use of lodging space a charge is made.
5.95.015 Residential Properties Eligible for Short Term Lodging Permits.
Only properties in a residential district that are authorized under Titles 20 and 21 of this
Code and this chapter shall be eligible for a short term lodging permit.
Subsequent to June 1, 2004, no annual permit shall be issued to or renewed for any
dwelling unit on any parcel zoned for "Single-family Residential (R-1)" or that is
designated for a single-family residential use as part of a Planned Community
Development Plan, Specific Area Plan or Planned Residential District, unless a permit
has previously been issued for that lodging unit and the permit was not subsequently
revoked.
M
Ordinance No. 2020-15
Page 7 of 18
5.95.020 Permit Required.
No owner of a lodging unit shall advertise for rent or rent a lodging unit located within a
residential district for a short term without a valid short term lodging permit for that unit
issued pursuant to this chapter.
5.95.025 Agency.
An owner may retain an agent to comply with the requirements of this chapter,
including, without limitation, the filing of an application for a short term lodging permit,
the management of the short term lodging unit or units, and the compliance with the
conditions to the short term lodging permit. The permit shall be issued only to the owner
of the short term lodging unit or units. The owner of the short term lodging unit or units
is responsible for compliance with the provisions of this chapter and the failure of an
agent to comply with this chapter shall be deemed non-compliance by the owner.
5.95.030 Application for Permit.
An application for an annual short term lodging permit, or renewal thereof, shall be filed
with the Finance Director upon forms provided by the City and shall contain the
following information:
A. The name, address and telephone number of the owner of the unit for which the
short term lodging permit is to be issued.
B. The name, address and telephone number of the agent, if any, of the owner of
the unit.
C. Evidence of a valid business license issued by the City for the separate business
of operating a short term lodging unit or units.
D. The number of bedrooms in the lodging unit.
E. The gross floor area of the lodging unit.
F. The number of parking spaces available onsite and a description indicating the
location and size of each parking space.
G. A nuisance response plan, which sets forth the owner's plan for handling
disruptive guests.
H. A certification that the applicant has reviewed the covenants, conditions and
restrictions, if any, and a short term use is permitted at the location pursuant to the
terms of the covenants, conditions and restrictions, if any.
I. Acknowledgement of receipt and inspection of a copy of all regulations pertaining
to the operation of a short term lodging unit.
3-9
Ordinance No. 2020-15
Page 8 of 18
J. Such other information as the Finance Director deems reasonably necessary to
administer this chapter.
5.95.035 Denial of Permit.
If permits are available for issuance, no application filed by an owner for an annual
permit or renewal of a permit for a unit eligible to be used as a short term lodging unit,
as provided for in Section 5.95.015 and this Code, shall be denied unless: the owner
does not have a current valid business license; the owner has failed to pay transient
occupancy tax, the visitor service fee, a penalty, a fine or inspection cost, due and
owing to the City; the nuisance response plan is deemed inadequate by the Finance
Director; or the short term lodging permit for the same unit and issued to the same
owner has been revoked.
5.95.040 Filing Fee.
An application or renewal application for a short term lodging permit shall be
accompanied by a fee established by resolution of the City Council, provided, however,
the fee shall be no greater than necessary to defer the cost incurred by the City in
administering the provisions of this chapter and for providing the answering service.
5.95.045 Conditions.
A. All permits issued pursuant to this chapter are subject to the following standard
conditions:
1. The owner shall prohibit a lessee of a lodging unit from renting the lodging
unit to a transient user for a short term and from home -sharing.
2. The owner shall not rent a lodging unit to a transient user that is under the
age of 21.
3. The owner shall enter into a written agreement with the transient user that
requires:
a. All persons residing in the short term lodging unit to live together as
a single housekeeping unit; and
b. Limits the overnight occupancy of the short term lodging unit to the
maximum permitted by the Building Code and Fire Code.
4. The owner shall ensure that the transient user complies with all terms of
the written agreement set forth in Subsection 5.95.045 A (3).
3-10
Ordinance No. 2020-15
Page 9 of 18
5. The owner shall use best efforts to ensure that the transient user,
occupants and/or guests of the short term lodging unit do not create unreasonable noise
or disturbances, engage in disorderly conduct, or violate provisions of this Code or any
state or federal law pertaining to noise, disorderly conduct, the consumption of alcohol,
or the use of illegal drugs.
6. The owner shall, upon notification that any transient user, occupant and/or
guest of his or her short term lodging unit has created unreasonable noise or
disturbances, engaged in disorderly conduct or committed violations of this Code or any
state or federal law pertaining to noise, disorderly conduct, the consumption of alcohol
or the use of illegal drugs, promptly use best efforts to prevent a recurrence of such
conduct by any transient user, occupant or guest.
7. The owner of the short term lodging unit shall use best efforts to ensure
compliance with all the provisions of Title 6 of this Code.
8. The owner of the short term lodging unit shall provide the transient user
with a copy of Sections 5.95.047, 10.28.007, 10.28.010, 10.28.020, 10.58.030, and
10.66.020 of this Code.
9. The owner of the short term lodging unit shall provide the transient user
with a copy of the good neighbor policy created by the City and available on the City
website, post a copy of the short term lodging permit and post a copy of the conditions
set forth in this subsection in a conspicuous place within the unit. The notice shall be in
substantial compliance with a template created by the City, which shall be available on
the City website, and contain the following:
a. The name of the local contact person(s) and phone number at
which that person(s) may be reached on a twenty-four (24) hour basis. The local
person(s) must be located within twenty-five (25) miles of the unit and shall respond to
any call related to the unit within thirty (30) minutes;
b. The number and location of onsite parking spaces;
C. The street sweeping schedule for all public rights-of-way within
three hundred (300) feet of the unit;
d. The trash collection schedule for the unit, and the Code rules and
regulations concerning the timing, storage and placement of trash containers and
recycling requirements;
e. Notification that no amplified sound or reproduced sound is
allowed outside or audible from the property line between the hours of 10:00 p.m. and
10:00 a.m.; and
3-11
Ordinance No. 2020-15
Page 10 of 18
f. Notification that any transient user, occupant or guest is
responsible for all activities occurring on the property and that any transient user,
occupant or guest may be cited and fined for creating a disturbance or violating any
provision of this Code.
10. With respect to any short term lodging unit that is located in any Safety
Enhancement Zone, the owner of the unit and any agent retained by the owner shall
take immediate action during the period that the Safety Enhancement Zone is in effect
to prevent any transient user, occupant or guest from engaging in disorderly conduct or
committing violations of this Code or state or federal law pertaining to noise, disorderly
conduct, the consumption of alcohol or the use of illegal drugs.
11. The owner shall:
a. Ensure that all transient occupancy taxes and visitor service fees
are collected and remitted to the City and otherwise comply with all transient occupancy
tax and visitor service fee requirements, as set forth in Chapters 3.16 and 3.28.
b. If the owner uses an agent to collect and remit the transient
occupancy tax and the visitor service fee, either voluntarily or as directed by the City,
the owner shall be responsible for ensuring that the agent collects and remits the
transient occupancy tax and the visitor service fee to the City pursuant to the
requirements set forth in this chapter, Chapter 3.16 and Chapter 3.28.
C. If the Finance Director directs, in writing, a hosting platform to
collect and remit the transient occupancy tax and the visitor service fee, the owner shall:
(i) be responsible for ensuring that the hosting platform collects and remits the transient
occupancy tax and the visitor service fee to the City in accordance with this chapter;
and (ii) when filing a return in accordance with Sections 3.16.070 and 3.28.040, the
owner shall provide the City with a copy of all receipts showing the date the short term
lodging unit was rented, the name of the hosting platform, the amount of transient
occupancy tax and visitor service fee collected by the hosting platform, and proof that
the transient occupancy tax and visitor service fee was remitted to the City.
12. The owner shall provide the City with the name and twenty-four (24) hour
phone number of a local contact person(s) (who reside within twenty-five (25) miles of
the property) who shall respond to contacts from the answering service, respond to any
call related to the unit within thirty (30) minutes, and ensure compliance with this
chapter in a timely manner. The owner or agent must provide a new local contact
person and his or her phone number within five (5) business days, if there is a change
in the local contact person(s).
3-12
Ordinance No. 2020-15
Page 11 of 18
13. The owner shall ensure that all available parking spaces onsite, which
may include garage, carport, and driveway spaces, as well as tandem parking are
available for the transient user, occupant or guest of the short term lodging unit. The
owner shall disclose the number of parking spaces available onsite and shall inform the
transient user, occupant and/or guest that street parking may not be available.
14. The owner shall maintain a valid business license and short term lodging
permit when engaging in short term lodging.
15. The owner shall include the City issued short term lodging permit number
on all advertisements for the rental of the short term lodging unit and shall ensure the
transient user is informed of the amount of the transient occupancy tax and visitor
service fee prior to completion of the booking transaction.
16. The owner shall ensure that a permitted short term lodging unit is only
used for residential purposes and not used for non-residential uses, including, but not
limited to, large commercial or non-commercial gatherings, commercial filming and/or
non -owner wedding receptions.
17. The owner shall ensure that no amplified sound, or reproduced sound is
used outside or audible from the property line between the hours of 10:00 p.m. and
10:00 a.m. and that the transient user does not violate the requirements set forth in this
chapter, Chapters 10.28, 10.58 and 10.66.
18. The owner shall comply with the nuisance response plan submitted with
the application for a short term lodging permit and approved by the Finance Director.
19. The owner shall allow the City to inspect the short term lodging unit to
confirm the number of bedrooms, gross floor area, and number/availability of parking
spaces, seven (7) calendar days after the City serves the owner with a request for
inspection in accordance with Section 1.08.080. If, based on the inspection, it is
determined that the information submitted to the City in accordance with Section
5.95.030 was false, in addition to any other remedy set forth in this chapter, the owner
agrees that the owner shall be liable for the cost of conducting the inspection.
20. The owner shall provide the City with a copy of any written rental
agreement(s) and the good neighbor policy, within seven (7) calendar days after the
City serves the owner with a notice of request for written rental agreements and the
good neighbor policy in accordance with Section 1.08.080.
B. The City Manager shall have the authority to impose additional standard
conditions, applicable to all short term lodging units, as necessary to achieve the
objectives of this chapter.
3-13
Ordinance No. 2020-15
Page 12 of 18
C. The City Manager shall have the authority to impose additional conditions on any
permit in the event of any violation of the conditions to the permit or the provisions of
this chapter subject to compliance with the procedures specified in Section 5.95.065.
5.95.047 Violations of Permit Conditions by Transient User, Occupant or Guest.
In addition to other provisions of this Code, it shall be unlawful for any transient user,
occupant or guest of a short term lodging unit to:
A. Exceed the overnight occupancy limit designated for the short term lodging unit.
B. Use street parking prior to utilizing all available onsite parking space(s) for the
lodging unit.
C. Place trash for collection in violation of this Code's rules and regulations
concerning:
1. The timing, storage or placement of trash containers; or
2. Recycling requirements.
D. Amplify or reproduce sound between the hours of 10:00 p.m. and 10:00 a.m.:
1. Outside of the lodging unit; or
2. That is audible from the property line for the lodging unit.
E. Use the short term lodging for any non-residential purpose, including, but not
limited to, large commercial or non-commercial gatherings, commercial filming and/or
non -owner wedding receptions.
5.95.050 Agents and Hosting Platform Responsibilities.
A. If directed to do so by the Finance Director, in writing, agents or hosting platforms
shall:
1. Collect all applicable transient occupancy taxes and visitor service fees
that are imposed on the transient, pursuant to Chapters 3.16 and 3.28, from the
transient, or from the person paying for such rental, at the time payment for such rental
is made; and
2. Remit to the City any transient occupancy taxes or visitor service fees
collected by the hosting platform or agent to the City before the last day of the month
following the close of each calendar quarter or on the day specified by the Finance
Director if a different reporting period has been established.
3-14
Ordinance No. 2020-15
Page 13 of 18
Hosting platforms shall not collect or remit such taxes unless expressly
authorized to do so by the Finance Director, in writing. Nothing in this subsection shall
be deemed to relieve an operator, as that term is defined in Sections 3.16.020 and
3.28.010, from complying with the requirements set forth in Chapters 3.16 and 3.28 of
this Code, or to interfere with the ability of an agent or hosting platform and an owner to
enter into an agreement regarding fulfillment of the requirements of this subsection.
B. Subject to applicable laws, agents and hosting platforms shall disclose to the City
on a regular basis each home -sharing and vacation rental listing located in the City, the
names of the persons responsible for each such listing, the address of each such listing,
the length of stay for each such listing and the price paid for each stay.
C. Agents and hosting platforms:
1. Shall prompt any person utilizing their advertising services to include the
City -issued registration number in their listing(s), in a format designated by the City and
shall not advertise any short term lodging unit where a registration number is not
provided. Upon notice from the City that a listing is non-compliant, agents and hosting
platforms shall cease any short-term rental booking transactions for said listing(s) within
five (5) business days. An agent or hosting platform shall not complete any booking
transaction for any short term lodging unit subject to a City notice that a unit is non-
compliant, until notified by the City that the short term lodging unit follows the local
registration requirement.
2. Shall not collect or receive a fee, directly or indirectly for facilitating or
providing services ancillary to an unpermitted short term lodging unit including, but not
limited to, insurance, concierge services, catering, restaurant bookings, tours, guide
services, entertainment, cleaning, property management, or maintenance of the short
term lodging unit.
D. A hosting platform operating exclusively on the internet, which operates in
compliance with subsection (A), (B), and (C) above, shall be presumed to be in
compliance with this chapter, except that the hosting platform remains responsible for
compliance with the administrative subpoena provisions of this chapter.
E. The provisions of this section shall be interpreted in accordance with otherwise
applicable state and federal law(s) and will not apply if determined by the City to be in
violation of, or preempted by, such law(s).
3-15
Ordinance No. 2020-15
Page 14 of 18
5.95.055 Issuance of Administrative Subpoenas.
The City Manager shall have the authority to issue and serve administrative subpoenas
to the owner, agent or hosting platform, as necessary, to obtain specific information
regarding short term rental listings located in the City, including but not limited to, the
names of the persons responsible for each such listing, the address of each such listing,
the length of stay for each such listing and the price paid for each stay, to determine
whether the short term rental listing complies with this chapter. Any subpoena issued
pursuant to this section shall not require the production of information sooner than thirty
(30) calendar days from the date of service. A person that has been served with an
administrative subpoena may seek judicial review during that thirty (30) calendar day
period. Failure to respond to an administrative subpoena in accordance with the terms
set forth therein shall be punishable in accordance with Section 5.95.060 and the City
may file a judicial action to compel compliance with the subpoena.
5.95.060 Violations, Penalties and Enforcement.
A. It shall be unlawful for any person to violate any provisions or to fail to comply with
any of the requirements of this chapter.
B. In addition to, or separate from, the foregoing criminal penalties, any person
violating any of the provisions or failing to comply with any of the requirements of this
chapter is subject to the issuance of an administrative citation pursuant to the provisions
of Section 1.04.010(E) and Chapter 1.05.
5.95.065 Suspensions and Revocations.
In addition to any fine or penalty that may be imposed pursuant to any provision of this
Code including, but not limited to Section 5.95.060, a short term lodging permit for a unit
may be suspended or revoked as provided in this section.
A. Suspensions/Revocations.
1. Except as otherwise provided in this subsection, if any person violates any
short term lodging permit condition two (2) or more times in any twelve (12) month
period or any other provision of this Code, state law or federal law, two (2) or more
times in any twelve (12) month period, and the violation relates in any way to the unit
that has a short term lodging permit, the short term lodging permit for the unit may be
suspended for a period of six (6) months in accordance with subsection (B).
2. In the case of a short term lodging permit for a unit that is located in a
Safety Enhancement Zone, if there is a violation of any provision of this Code during the
period that the Safety Enhancement Zone is in effect, the short term lodging permit for
the unit may be suspended for a period of one (1) year or revoked in accordance with
subsection (B).
3-16
Ordinance No. 2020-15
Page 15 of 18
3. If a lodging unit that is subject to a short term lodging permit has been the
location of two or more loud or unruly gatherings, as defined in Chapter 10.66 of this
Code, while the lodging unit was occupied on a short term basis, within any twenty-four
(24) month period, the permit may be suspended for a period of one (1) year or revoked
in accordance with the subsection (B). A loud or unruly gathering that occurred prior to
the passage of fourteen (14) calendar days from the mailing of notice to the owner in
compliance with Section 10.66.030(D) shall not be included within the calculation of the
two or more loud or unruly gatherings required to revoke a short term lodging permit.
4. If a person violates Section 5.95.020 regarding any unit that has had a
short term lodging permit suspended pursuant to subsection (B), the short term lodging
permit for the unit may be revoked in accordance with subsection (B).
5. If any person violates any short term lodging permit condition or any other
provision of this Code, state or federal law within six (6) months of having a previously
suspended short term lodging permit reinstated for a unit, and the violation relates in
any way to the unit that has the short term lodging permit, the short term lodging permit
for the unit may be revoked in accordance with subsection (B).
6. If any person violates any short term lodging permit condition three (3) or
more times in any twelve (12) month period or provision of this Code, state or federal
law three (3) or more times in any twelve (12) month period, and the violation relates in
any way to the unit that has a short term lodging permit, the short term lodging permit
for the unit may be revoked in accordance with subsection (B).
7. If any person fails to collect and remit transient occupancy tax or the
visitor service fee in accordance with the requirements of this chapter, Chapters 3.16 or
3.28 in regards to any unit that has a short term lodging permit, two (2) or more times
within any thirty six (36) month period, the short term lodging permit for the unit may be
revoked in accordance with subsection (B).
8. If any person is determined to have provided false information on an
application for an annual short term lodging permit, or renewal thereof, the short term
lodging permit for the unit may be revoked in accordance with subsection (B).
B. Permits shall be suspended or revoked, only in the manner provided in this
section.
3-17
Ordinance No. 2020-15
Page 16 of 18
1. The Finance Director shall investigate whenever he or she has reason to
believe that an owner has submitted an application that contains false information or
committed a violation of a permit condition, this Code, state or federal law related to a
permitted unit. Such investigation may include, but is not limited to, on-site property
inspections. Should the investigation reveal substantial evidence to support a finding
that warrants a suspension or revocation of the short term lodging permit, the Finance
Director shall issue written notice of intention to suspend or revoke the short term
lodging permit. The written notice shall be served on the owner in accordance with
Section 1.08.080, and shall specify the facts which, in the opinion of the Finance
Director constitute substantial evidence to establish grounds for imposition of the
suspension and/or revocation, and specify the proposed time the short term lodging
permit shall be suspended and/or that the short term lodging permit shall be revoked
within thirty (30) calendar days from the date the notice is given, unless the owner files
with the Finance Director, before the suspension and/or revocation becomes effective, a
request for hearing before a hearing officer, who shall be retained by the City, and pays
the fee for the hearing established by resolution of the City Council.
2. If the owner requests a hearing and pays the hearing fee, established by
resolution of the City Council, within the time specified in subsection (13)(1), the Finance
Director shall serve written notice on the owner, pursuant to Section 1.08.080, setting
forth the date, time and place for the hearing. The hearing shall be scheduled not less
than fifteen (15) calendar days, nor more than sixty (60) calendar days, from the date on
which notice of the hearing is served by the Finance Director. The hearing shall be
conducted according to the rules normally applicable to administrative hearings. At the
hearing, the hearing officer will preside over the hearing, take evidence and then submit
proposed findings and recommendations to the City Manager. The City Manager shall
suspend or revoke the short term lodging permit only upon a finding that a violation has
been proven by a preponderance of the evidence, and that the suspension or
revocation is consistent with the provisions of this section. The City Manager shall
render a decision within thirty (30) calendar days of the hearing and the decision shall
be final.
C. If a short term lodging permit is suspended, it shall be the owner's responsibility
to vacate any future bookings and remove all advertisements related to the short term
rental of the unit during the term of the suspension. If a short term lodging permit is
revoked, it shall be the owner's responsibility to vacate any future bookings and remove
all advertisements related to the short term rental of the unit.
D. After any suspension, the owner may reapply for reinstatement of the short term
lodging permit which shall be processed in accordance with Section 5.95.030, provided
the owner has paid the City all amounts owed the City in accordance with this chapter
and Chapters 3.16 and 3.28 of this Code.
3-18
Ordinance No. 2020-15
Page 17 of 18
5.95.070 Permits and Fees Not Exclusive.
Permits and fees required by this chapter shall be in addition to any license, permit or
fee required under any other chapter of this Code. The issuance of any permit pursuant
to this chapter shall not relieve the owner of the obligation to comply with all other
provisions of this Code including, but not limited to, those provisions pertaining to the
use and occupancy of the lodging unit or the property on which it is located as well as
the collection and remittance of transient occupancy taxes and visitor service fees in
accordance with this chapter and Chapters 3.16 and 3.28.
5.95.080 License and Permit Closure.
A. Any owner that has ceased operating a short term lodging unit shall inform the
Finance Director in writing of the date of the last rental, and having done such, the short
term lodging permit shall be closed. The City will send a final transient occupancy tax
and visitor service fee bill, which will be due and payable thirty (30) days from the date
of the invoice.
B. The Finance Director shall close any permit that has no short term lodging
activity for a period of two consecutive years as evidenced by remitting zero dollars on
the required transient occupancy tax and visitor service fee forms or has failed to return
the transient occupancy and visitor service forms. After any permit closure pursuant to
this subsection, the owner may reapply for reinstatement of the short term lodging
permit which shall be processed in accordance with Section 5.95.030.
Section 3: The recitals provided in this ordinance are true and correct and are
incorporated into the substantive portion of this ordinance.
Section 4: If any section, subsection, sentence, clause or phrase of this
ordinance is for any reason held to be invalid or unconstitutional, such decision shall not
affect the validity or constitutionality of the remaining portions of this ordinance. The
City Council hereby declares that it would have passed this ordinance and each section,
subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or
more sections, subsections, sentences, clauses or phrases be declared invalid or
unconstitutional.
Section 5: The City Council finds the introduction and adoption of this
ordinance is not subject to the California Environmental Quality Act ("CEQA") pursuant
to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable
indirect physical change in the environment) and 15060(c)(3) (the activity is not a
project as defined in Section 15378) of the CEQA Guidelines, California Code of
Regulations, Title 14, Division 6, Chapter 3, because it has no potential for resulting in
physical change to the environment, directly or indirectly.
3-19
Ordinance No. 2020-15
Page 18 of 18
Section 6: Except as expressly modified in this ordinance, all other Sections,
Subsections, terms, clauses and phrases set forth in the Newport Beach Municipal
Code shall remain unchanged and shall be in full force and effect.
Section 7: The Mayor shall sign and the City Clerk shall attest to the passage
of this ordinance. The City Clerk shall cause the ordinance, or a summary thereof, to be
published pursuant to City Charter Section 414. This ordinance shall become effective
thirty (30) days after the adoption of this ordinance.
This ordinance was introduced at a regular meeting of the City Council of the City
of Newport Beach held on the 23rd day of June, 2020, and adopted on the 14th day of
July, 2020, by the following vote, to -wit:
AYES:
NAYS:
ABSENT:
RECUSED:
WILL O'NEILL, MAYOR
ATTEST:
LEILANI I. BROWN, CITY CLERK
APPROVED AS TO FORM:
CITY TTORNEY'S OFFICE
7•i'� C cl_�_
AA ON C. HARP, CITY ATTORNEY
3-20