Court Rejects Santa Barbara's Coastal Vacation Rental Ban
By edhat staff
Santa Barbara City's ban on the majority of short-term rentals in the Coastal Zone was rejected by an appeals court on Tuesday.
In 2015, the city banned vacation rentals along the beachside strip of land that extends approximately a half-mile inland and decided to treat the properties like hotels with limited permits. Before the ban there were 114 homes available for rent, afterwards, there were only six.
City officials argued short-term rentals were driving up housing costs, reducing the amount of housing, and "changing the character of residential zones."
Second Appellate District Judge Steven Perren upheld the 2019 trial court’s decision effectively forcing Santa Barbara to allow short-term vacation rentals in the coastal zone. The lawsuit was brought on by Theo Kracke, CEO of Paradise Retreats, a local vacation rental company.
Judge Perren wrote in his opinion that regulation of short-term rentals must be decided by the city and the Coastal Commission stating, "The city cannot act unilaterally, particularly when it not only allowed the operation of [short -term vacation rentals] for years but also benefited from the payment of transient occupancy taxes.”
Steve Kinsey, the former head of the coastal commission, sent an advisory to several cities in 2016 stating vacation rental bans by local governments were unlikely to be legally enforceable.
The California Coastal Act requires that overnight accommodations in the Coastal Zone are to be available at a range of price points. Based on this landmark decision, the court rules that this Act protects the rights of property owners to rent their coastal residences.