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By Andrea Papagianis

In a split vote Tuesday night, the Dana Point City Council elected to adopt a resolution setting the city’s short-term vacation rental fee at $150.

With the cost of a part-time code enforcement officer written into the ordinance, and the city’s two-year budget passed last month—accounting for the employee’s costs—Councilman Bill Brough motioned the council to waive the permitting fee for one year.

City Manager Doug Chotkevys warned against the waiver, as the approved budget accounts for both the costs of enforcement—$ 37,500—and permit fee revenues to offset the cost. The $150 permit fee is subsidized from the $220 needed to fully recover administrative costs, city staff said.

Mayor Steven Weinberg he did not want to add more cost to the city without recovering anything.

“My feeling is those people that are using the permitting process should pay their fair share,” Weinberg said. “When you look at it … $150 is chump change and I don’t think the city should subsidize further for people renting on a week to week or day to day basis.”

Weinberg motioned to pass the resolution. The fee passed in a 3 to 2 vote, with council members Carlos Olvera and Brough dissenting.

The ordinance was approved in April after more than five years of work and discussion at the city level. According to staff reports, the city is home to some 250 vacation rentals currently not being taxed like hotels, inns and campsites are. But under the ordinance, these rentals will now be required to participate in the city’s transient occupancy tax (TOT) program—a 10 percent nightly tax, and the city’s largest source of tax revenues.

Enforcement of the city’s short-term vacation rental ordinance is set to take effect on January 15, 2014, by which time short-term vacation rental permits must be obtained.

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