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BREAKING NEWS: On Tuesday night, Aug 25th, the Morro Bay City Council passed an emergency ordinance prohibiting the issuance of any new Short Term Rental (STR) licenses effective immediately. This includes any transfer of a license upon sale of a home currently holding a license.

1st Planning Commission hearing on STR regulations:

We are sending this update to let everyone know about the public comments and subsequent discussions that occurred at the first Morro Bay Planning Commission meeting held on August 18th regarding the proposed Short Term Rental (STR) ordinance. Because of COVID-19 these meetings are being held via a Zoom webinar where the public can join and make comments via the “raise hand” Zoom feature or by phone. We encourage all of you to get involved. If you are a current STR license holder, please realize that you license could be revoked based on the outcome of the upcoming government meetings.

This topic was the primary focus of the PC meeting and comments and discussion lasted over 3 hours. Unfortunately, during public comment the people defending STRs were outnumbered about 5 to 1 by people advocating for more restrictive regulations and density requirements than are already in the ordinance. Based on previous community surveys and forums, we do not feel this accurately represents the sentiments of all Morro Bay residents but there is a small but very vocal group of citizens who are determined to see STRs severely reduced and restricted.

Here are the main topics of discussion by the Commission during the session:

  • Maximum # of STR licenses allowed (cap) - Many public comments requested that the number of STR licenses be reduced to 120, 150 or 175 from the current cap of 250 but most people were in favor of not including “shared homestays” in this number. FYI, licenses in commercially zoned areas are not and never have been counted toward the established cap. It seemed that the majority of the commissioners were in favor of this reduction in the cap since it would not include homestays but no official vote was taken to change this in the ordinance. That will probably happen at the next meeting.

    • Homestays - Both the public comment and commissioners seemed to be in favor of not setting a cap for these types of STRs since the sentiment is that with someone present during the guest stay, there are not the neighborhood disturbances that people experience with non-hosted stays. The question was brought up to the city as to how they would enforce that there truly was someone present at these types of accommodations and the City Development Director said it would be based on the contact person’s address being the same as the STR address.

  • Density/proximity requirements – The proposed ordinance calls for a separation of 3 lots between STRs and same across the street and behind which would eliminate more than 50 current license holders. Many public comments were made about this with most of the local residents advocating for 200 – 250 ft separation between STRs. The City Manager was able to display different maps to the commissioners showing the overlap of STRs with these proximity rules. He pointed out that regulations like this would end up eliminating 70 – 100 of the current compliant STR licenses if a lottery is held in the future to bring all STRs in to compliance with the new regulations. Those of us who made public comment representing STR owners made it clear that this is not fair to those people who have invested much money and time in establishing STRs and who have been compliant in their operations to arbitrarily have their license revoked.

  • Grandfathering versus sunsetting of STR licenses – THIS IS THE BIGGEST AND MOST THREATENING ISSUE CURRENT STR LICENSE HOLDERS FACE! This topic was talked about a lot in the public comments. As you might expect, the vocal residents spoke in favor of the lottery to reduce the density of STRs and most wanted it to happen sooner than the proposed timeline which is to hold the lottery in 3 years and give the revoked licensees 1 year to sunset their operations. Those of us in favor of allowing all STRs to come in to compliance via attrition pointed out that we do not think the Coastal Commission will support this and should the city go forward with doing this, they can expect a class action lawsuit from those who lose their license from this. One commissioner was really pushing to make all licenses good for only 5 years and then have it revoked so others could have a chance at getting a license. Again, nothing was decided but this and the density requirements will be the big issues to be discussed and voted on at the next meeting.

  • Home Inspections - The commissioners discussed this requirement and asked for more detail about what this inspection would include. The City Development Manager and the City Manager answered questions on this and it was stated that both a building inspector from the city and the fire department would be teaming up to conduct these inspections but that is not what we were told during the sub-committee meetings so more clarification is required on this. The concern was whether STR homes would need to be brought up to current building codes but it was stated that this would be a very hard requirement to enforce.

WE NEED ALL OF YOUR VOICES TO HELP BALANCE THE INPUT THAT THE PLANNING COMMISSION IS HEARING! Please express your thoughts and concerns to the Planning Commission by either sending an email to: or even better, join the PC Zoom webinar next Tuesday, Sept 1st at 6:00 p.m. by clicking on this link: Please click this link to join the webinar: ➢ Planning Commission Meeting. The password is 135692. You can do this from the comfort of your own living room or office! You can find schedules and agendas for both the Planning Commission and the City Council at


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