Short-term rentals are defined by the city as renting a living space for less than 30 days. Available options are commonly listed by homeowners on websites such as Airbnb and Vrbo.
Given that short term-rentals are not explicitly addressed in Fountain Valley’s municipal code, the city previously took the stance that they were prohibited. Due to the lack of an explicit prohibition, it was challenging to hold violators accountable. The city estimates that there are approximately 175 short-term rental operators in the city.
At recent August and November council meetings, the city council reduced approaches on how to deal with short term rentals to just two choices: either prohibit them completely or allow them with a “moderately restrictive level of regulations.”
For moderately restrictive regulations, the city manager explained it would entail a number of rules. First, the city would introduce a permitting process, where only one license per owner would be issued, in order to prevent corporations from taking over housing stock. The ordinance would also limit the number of unhosted short term rentals, where the owner is not present, to 100. There would be no limit on hosted operations.
Councilmembers said the current system of businesses taking over neighborhoods needs to be changed.
“Somebody needs to speak up for our city and for our residences. We literally have businesses operating from our homes here. This is a residential community. I’m just floored,” Mayor Pro Tem Kim Constantine said. “We don’t issue permits, we don’t issue licenses for this.”
Constantine, who voted against allowing the operation to continue with restrictions, said the $250,000 in tax revenue the city would receive from taxing operators is not worth it.
“Let me tell you something, I am not excited about the $250,000 potential revenue, because we’re really going to have to have this policed with code enforcement, the police, various city staff, planning and building, and others. It’s just it’s not worth it to this city.”
Councilmember Michael Vo said whether the city allows or prohibits short term rentals, it will cost the city money because they need to enforce it.
“Whether we regulate it so that it can happen in an orderly manner that would benefit our residents or we just [prohibit STRs] and it will grow … it could go underground … and other people can rent the house for 30 days and sublease it to other people [in an effort to get around the ordinance].”
The council voted to direct city staff to bring back a motion to approve short term rentals with the moderate level of restrictions, with Mayor Patrick Harper and Mayor Pro Tem Constantine dissenting.
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