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By Breeana Greenberg

In a 6-2 vote, the California Coastal Commission on Wednesday, Sept. 7, decided there were “substantial issues” with a recently approved short-term rental program governing vacation rentals in Dana Point’s coastal zone following a series of appeals.

During Wednesday’s meeting, commissioners found that the issue merited further discussion after voicing concerns with the proposed short-term rental program’s potential effect on affordable housing stock.

Bridget McConaughy, of Unite Here Local 11, and Dana Point residents Mark Zanides and Kim Tarantino appealed the proposed STR program to the Coastal Commission in July on the basis that the City Council approved it through an incorrect avenue. They also claimed that the proposed program will decrease affordable housing stock in the city.

Under the proposed program, the city can issue a maximum of 115 permits in the coastal zone for non-primary STRs—when a property owner rents out homes other than their primary residence to visitors.

In an effort to encourage more homestay, multi-family homestay, and primary residence STRs—a variation of rentals in which the owner either lives on-site or is traveling for a short time during a guest’s stay—the city did not issue a cap for such permits.

However, the 115-permit cap for non-primary STRs reduces by one each time the city issues permits for homestay, multi-family homestay or primary residence STRs in the coastal zone.

City Attorney Patrick Muñoz noted during the Coastal Commission meeting that “the goal of the (City) Council in response to residential concerns was to encourage short-term rentals on properties where the property owner was physically there.”

Tarantino spoke on behalf of the appellants on Wednesday, outlining the appeal’s main arguments.

The city passed the STR program through a coastal development permit (CDP) on the basis that the city’s local coastal plan currently allows the vacation rentals. The appellants argued that Dana Point’s local coastal plan does not currently permit short-term rentals in residential zones.

Tarantino also argued that the city “already provides ample visitor-serving accommodations” and that “permitting STRs could cannibalize existing stock of low-cost accommodations.”

She added that “the Coastal Act requires the Commission to encourage housing for low- and moderate-income households that includes many tourist industry workers,” arguing that by allowing full home rentals, the proposed STR program does not balance the need for low-cost housing during a housing crisis.

In a staff report, Coastal Commission officials estimated that “the STR program would yield approximately 1.4% to 2% of housing units within the Coastal Zone only” and that “these figures are comparable with metrics found in other nearby cities.”

Conversely, residents Miriam Rupke, Deanne Slocum and Jason Colaco filed an appeal of the city’s vacation rental program, arguing that it is overly restrictive, reducing the number of available short-term rentals citywide.

Though appellants in favor of short-term rentals were not present to speak during the Coastal Commission meeting, the staff report noted that the appellants feared the city could prohibit vacation rentals outside of the coastal zone, thus “decreasing public access to the coast and reducing opportunities for overnight accommodations/lower cost visitor and recreational facilities.”

Ultimately, Commissioners Mike Wilson, Megan Harmon, Caryl Hart and Linda Escalante voiced concerns with the city’s proposed short-term rental program.

The commission’s vote did not uphold the appeal, but rather decided that the issue is worth further discussion, Wilson clarified.

Wilson noted that the proposed program may lead to an increase in property value, as properties may be evaluated by their ability to generate income. Allowing a high cap of short-term rentals in single-family residential units could end up affecting affordability, Wilson said.

“From my perspective, it creates a substantial issue,” Wilson said.

Escalante agreed, adding that the commission needed to further consider the proposed STR program’s potential effect on affordable housing stock.

“I think that we need to look at those caps more carefully in terms of how these more affordable housing options are dealt with in the coastal zone so as not to continue bleeding housing units but instead build up the stock to provide more access and to provide more justice to Californians,” Escalante said.

Commissioner Carole Groom and Commission Chair Donne Brownsey were the sole votes in favor of finding no “substantial issue” with the proposed vacation rental program.

“It seems to me that listening to the (city) attorney and listening to the mayor, this has been very carefully planned and very carefully thought out,” Groom said. “I think that we should move forward.”

Hart noted that such a controversial issue merited further discussion.

“Given the fact that this has been going on for so long, as an extremely controversial issue, even becoming a referendum, now it’s required the city to go around the normal process for incorporating this into the LCP; now it’s going into a CDP process, which I think is definitely worth further discussion,” Hart said.

“As my colleagues said, this isn’t a decision on the underlying merits; I’m only supportive of a full hearing and, therefore, I will be supporting that we find substantial issue,” Hart continued.

The Coastal Commission will later hold a hearing to listen to all the arguments on every side before making a ruling to either uphold or deny the appeals.

Breeana Greenberg

Breeana Greenberg is the city reporter for the Dana Point Times. She graduated from Chapman University with a bachelor of arts degree in English. Before joining Picket Fence Media, she worked as a freelance reporter with the Laguna Beach Independent. Breeana can be reached by email at bgreenberg@picketfencemedia.com

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