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O2748City Council Meeting: May 23, 2023 Santa Monica, California ORDINANCE NUMBER 2748 (CCS) (City Council Series) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA MONICA AMENDING SANTA MONICA MUNICIPAL CODE CHAPTER 6.20, HOME-SHARING AND VACATION RENTALS, TO AUTHORIZE HOME-SHARING IN CERTAIN QUALIFYING ACCESSORY STRUCTURES AND INCORPORATE A HOME-SHARING LEGALIZATION PROGRAM WHEREAS, on May 12, 2015, the Council adopted Ordinance 2484 (CCS), adding Santa Monica Municipal Code Chapter 6.20, Home-Sharing and Vacation Rentals, to clarify the City’s long-standing prohibition of renting any dwelling unit, in whole or in part, for a period of thirty consecutive days or less for exclusive transient use, or “vacation rentals”, and to relax that prohibition by allowing renting of one or more bedrooms in a dwelling unit that is the primary residence of the host for a period of thirty consecutive days or less, while the host lives on site, in the dwelling unit, throughout the visitors’ stay, or “home-sharing” (the “Home-Sharing Ordinance”); and WHEREAS, on January 24, 2017, Council adopted Ordinance 2535 (CCS) to amend the Home-Sharing Ordinance to clarify certain definitions and, in response to portions of the ordinance challenged by home-sharing platforms, to limit the obligations imposed on those platforms; and WHEREAS, on June 27, 2017, Council adopted Ordinance 2547 (CCS), to amend the Home-Sharing Ordinance to treat accessory dwelling units (“ADUs”) that received building permits on or after March 31, 2017 as separate dwelling units for the purpose of defining home-sharing activity; and DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 WHEREAS, on September 24, 2019, Council adopted Ordinance 2616 (CCS), to further amend the Home-Sharing Ordinance to strengthen regulation of home-sharing and vacation rentals; and WHEREAS, permitting regulated home-sharing while prohibiting vacation rentals strikes an important balance: allowing residents to supplement their income through home-sharing and providing home-share visitors with potentially more affordable accommodations, while deterring landlords from evading rent control laws, evicting tenants, and converting residential units into de facto hostels or hotels, thus removing needed permanent housing from the market while at the same time changing the character of and undermining community ties in residential neighborhoods; and WHEREAS, Santa Monica Municipal Code Section 9.21.020 provides that accessory structures shall be considered part of the principal building if the accessory building is located less than 6 feet from the principal building or if connected to it by fully enclosed space; and WHEREAS, Santa Monica Municipal Code Section 9.21.020 prohibits an accessory structure from containing a shower or tub enclosure; and WHEREAS, the Santa Monica Municipal Code previously required certain property owners to record deed restrictions which, in part, prohibited using accessory structures that were not accessory dwelling units as rented rooms or sleeping quarters; and WHEREAS, since September 2020, the City has denied applications for renewal of home-share licenses for properties that were previously approved for home-share due to changes in regulations in the home-share regulations or because the permits were previously erroneously issued; and DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 WHEREAS, on June 8, 2021, City Council directed staff to return with proposed amendments to Santa Monica Municipal Code Chapter 6.20, the City’s home-sharing ordinance, to allow the home-sharing of detached accessory buildings located more than six feet from the main building occupied by the host; and WHEREAS, amendments to Santa Monica Municipal Code Section 9.21.020 were also necessary for consistency with Council direction; and WHEREAS, until the amendments to Chapter 6.20 and Section 9.21.020 could occur, on October 25, 2022, City Council adopted a Resolution to Establish a Home- Share Legalization Program (“Program”) that allowed Council to authorize previously licensed home-share operators to receive a temporary, conditional license to resume operations pending updates to the Home-Share Ordinance, as long as the proposed home-share units do not have any outstanding unpermitted work in order to protect the health and safety of home-sharing guests; WHEREAS, that Program expires on the earlier of: 1) effective date of amendments to Santa Monica Municipal Code Chapter 6.20 and Section 9.21.020; or (2) June 30, 2023; and WHEREAS, on April 11, 2023, the City Council adopted Ordinance Number 2742 (CCS), amending the text of the Zoning Ordinance to, among other things, eliminate the prohibition on accessory structures from containing a shower or tub enclosure, which is expected to become effective May 11, 2023; and WHEREAS, Council now seeks to codify the Program through amendments to Chapter 6.20 prior to the June 30, 2023, expiration date. DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1. Santa Monica Municipal Code Section 6.20.010 is hereby amended to read as follows: 6.20.010 Definitions. For purposes of this Chapter, the following words or phrases shall have the following meanings: (a) Accessory Dwelling Unit. “Accessory Dwelling Unit” shall have the same meaning as set forth in 9.21.020(A). An accessory dwelling unit that received its building permit on or after March 31, 2017, constitutes a separate dwelling unit for purposes of this Chapter. (b) Bedroom. Any habitable space in a dwelling unit other than a kitchen or living room that is intended for or capable of being used for sleeping, is at least seventy square feet in area, is separated from other rooms by a door, and is accessible to a bathroom without crossing another bedroom. (c) Booking Transaction. Any reservation or payment service provided by a person who facilitates a home-sharing or vacation rental transaction between a prospective visitor and a host. (d) Dwelling Unit. One or more rooms designed, occupied, or intended for occupancy as separate living quarters, with full cooking, sleeping, and bathroom facilities for the exclusive use of a single household. A dwelling unit includes a single‐family residence, and each unit of an apartment, duplex, or multiple dwelling structure designed as a separate habitation for one or more persons, but does not include units located within DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 City-approved hotels, motels, and bed and breakfasts, as defined in Section 9.51.030(B)(15). Notwithstanding anything to the contrary in 9.21.020(A), for purposes of this Chapter, an accessory building shall be considered part of the principal dwelling unit if it is located on the same parcel as the principal building. (e) Eligible Resident. Any natural person who: (1) is either: (i) a long-term resident of a dwelling unit, or (ii) an owner of a dwelling unit; and (2) uses that dwelling unit as his or her primary residence. (f) Home-Sharing. Renting for a period of thirty consecutive days or less, one or more bedrooms in a dwelling unit that is the primary residence of the host, while the host lives on site, in the dwelling unit, throughout the visitors’ stay. A dwelling unit rented out for home-sharing is referred to as a “home-share.” (g) Host. Any natural person who is an eligible resident of a dwelling unit offered for use as a home-share. (h) Hosting Platform. A person who participates in the home-sharing or vacation rental business by collecting or receiving a fee, directly or indirectly through an agent or intermediary, for conducting a booking transaction using any medium of facilitation. (i) Lives On Site. Maintains a physical presence in the dwelling unit, including, but not limited to, sleeping overnight, preparing and eating meals, and engaging in other activities in the dwelling unit, of the type typically maintained by a natural person in the dwelling unit in which he or she is an eligible resident. (j) Long-Term Resident. Any natural person who, as of the date a home-share application is submitted pursuant to Section 6.20.021: (1) has occupied the dwelling unit that is the subject of the home-share application as his or her primary residence for at DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 least the prior twelve months; and (2) has either: (i) if the natural person is a tenant, subtenant, lessee, or sublessee, a written rental housing agreement for the dwelling unit for a period of twelve months or more after the date the home-share application is submitted, or (ii) if the natural person is not a tenant, subtenant, lessee, or sublessee, written documentation establishing that the natural person will reside at the dwelling unit for a period of twelve months or more after the date the home-share application is submitted. (k) Owner. Any person who, alone or with others, has legal or equitable title to a dwelling unit. A person whose interest in a dwelling unit is solely that of a tenant, subtenant, lessee, or sublessee under an oral or written rental housing agreement shall not be considered an owner. (l) Person. Any natural person, joint venture, joint stock company, partnership, association, club, company, corporation, business trust, or organization of any kind. (m) Primary Residence. The usual place of return for housing of an owner or long- term resident as documented by at least two of the following: motor vehicle registration, driver’s license, California state identification card, voter registration, income tax return, property tax bill, or a utility bill. A person can only have one primary residence. (n) Vacation Rental. Renting for a period of thirty consecutive days or less any dwelling unit, in whole or in part, for exclusive transient use. Exclusive transient use shall mean that no eligible resident of the dwelling unit lives on site, in the dwelling unit, throughout any visitor’s stay. Rentals of units located within City-approved hotels, motels, and bed and breakfasts shall not be considered vacation rentals. (o) Visitor. A natural person who rents a home-share or vacation rental. DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 SECTION 2. Santa Monica Municipal Code Section 6.20.110 is hereby added to read as follows: 6.20.110 Home-Sharing Legalization Program. Notwithstanding the foregoing, or anything to the contrary in this Code, an accessory dwelling unit that received its building permit on or after March 31, 2017, shall not constitute a separate dwelling unit for purposes of this Chapter if it meets all of the following conditions: (a) The City previously issued the applicant a home-share permit for the dwelling unit in accordance with this Chapter; (b) The City subsequently denied the applicant’s request to renew the home-share permit due to changes in the City’s home-share regulations or because the permit was previously erroneously issued; and (c) The dwelling unit applicant proposes to use for home-sharing activities does not have any outstanding code violation for unpermitted work. SECTION 3. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to the extent necessary to effect the provisions 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 by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional. SECTION 5. The Mayor shall sign and the City Clerk shall attest to the passage of this ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective 30 days from its adoption. APPROVED AS TO FORM: _________________________ Douglas Sloan, City Attorney DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 Approved and adopted this 23rd day of May, 2023. _____________________________ Gleam Davis, Mayor State of California ) County of Los Angeles ) ss. City of Santa Monica ) I, Denise Anderson-Warren, City Clerk of the City of Santa Monica, do hereby certify that the foregoing Ordinance No. 2748 (CCS) had its introduction on May 9, 2023 and was adopted at the Santa Monica City Council meeting held on May 23, 2023, by the following vote: AYES: Councilmembers de la Torre, Brock, Zwick Mayor Davis NOES: None ABSENT: Mayor Pro Tem Negrete ATTEST: _____________________________________ _________________ Denise Anderson-Warren, City Clerk Date A summary of Ordinance No. 2748 (CCS) was duly published pursuant to California Government Code Section 40806. DocuSign Envelope ID: DBE22380-BD07-4F5C-989E-BCF3278F0445 5/24/2023