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Coastal Commission Approves Morro Bay Short-Term Vacation Rental Ordinance (Finally!)

Updated: Oct 18, 2021

On September 9th, the California Coastal Commission (CCC) approved the short term vacation rental (STR) ordinance that was approved by the Morro Bay City Council. Because the City had involved the community at all levels during the process of creating these new regulations, the CCC reviewed as a "de minimus" (consent agenda) item, meaning that they felt it was fair and complete enough that it did not require a full-blown hearing. The new STR ordinance is now in effect. The final version of the regulations can be read Here

The key components of the regulations are:

  • All existing STR licenses will be “grandfathered” meaning that they will not be at risk of losing their license as long as they continue to pay the minimum amount of Transient Occupancy Tax (TOT) required ($500/yr) and they are not subject to the new density regulations (described below)

  • The maximum number of STR licenses allowed for full-home (non-hosted) vacation rentals in residential neighborhoods is 175.

  • There is no limit on the number of hosted (home share) vacation rentals that can hold STR licenses but they too will be subject to the minimum TOT requirements.

  • There is no limit on the number of STR licenses that can be issued in Commercial and Mixed Use zones of the city.

  • Density regulations state that for any new licenses issued for full-home, non-hosted rentals in residential areas, all STRs must be separated by 175 feet radius measured from the property line of any existing vacation rentals. This density rule does not apply to hosted vacation rentals but does apply to accessory dwelling units.

  • IMPORTANT: The new regulations state that the minimum age for anyone booking a vacation rental is 21 years old. This regulation applies to the person who actually contracts to rent an STR, not to all guests.

  • Parking for all guests and visitors of an STR must be on-site. No on-street parking is allowed.

  • Occupancy for any STR cannot exceed 2 people per bedroom plus 2 additional people up to a maximum of 10 people in a home.

  • Each host of a vacation rental must provide a “Good Neighbor Brochure” in the rental informing guests of pertinent regulations and reminding them that they are staying in quiet, residential neighborhoods.

  • Guests must provide all contact information to the owner or manager of the property and must provide written acknowledgement that they are responsible for compliance with all laws and rules governing the STR.

  • A sign must be posted on the property and be visible from the street that identifies the property as an STR and includes a local contact number that is available 24X7 for reporting of any issues.

We anticipate that the community will be more aware of homes that are vacation rentals and may be quicker to report noise or parking issues going forward and because of the required signage, they will have the information available to do that.

We are pleased that these regulations are now settled and that they continue to allow for vacation rentals in the Morro Bay community. The city and its businesses recognize that vacation rentals are the preferred lodging choice for many families and friends that come to visit our beautiful area. We ask all of you that come to stay in STRs in the future recognize and respect these regulations so that you can continue to have this type of lodging available to you in the future.

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