The long-running friction between short-term rental operators and the City of Santa Barbara has come to a head, with one operator filing a lawsuit challenging the city’s restrictions on the rentals.
The suit was filed on Nov. 30 by Theo Kracke, the head of short-term rental management company Paradise Retreats, who is claiming that Santa Barbara’s ban on short-term rentals in many zoning districts violates local and state policies.
Short-term rentals, or STRs, are barred in residential zones in the city. In June 2015, the City Council voted to enforce its longstanding zoning regulations after years of turning a blind eye to zoning violations.
STRs are only allowed in zoning districts that allow hotels, which are mostly commercially zoned districts. Current STR business licenses are valid only through Dec. 31.
Kracke told Noozhawk that 10 of the properties he manages in the city are in the coastal zone — the strip of land within 1,000 yards of the ocean.
“The California Constitution and the Coastal Act require coastal access to be protected, provided, and maximized for all,” Kracke and his attorneys, Travis Logue and Jason Wansor of Rogers, Sheffield & Campbell LLP of Santa Barbara, said in a statement Monday.
“STVRs serve as an alternate form of visitor-serving accommodations within the Coastal Zone, that provide a lower-cost alternative to renting hotel or motel rooms for families from diverse demographic sectors and range of incomes to enjoy unique local coastal resources,” the statement said.
In an unrelated Nov. 30 letter to the Santa Barbara County Board of Supervisors — for a meeting at which the board took no action on a proposed STR ordinance — California Coastal Commission staff wrote that the commission has not supported local coastal plan amendments that prohibit short-term rentals “in a manner that will diminish the public’s ability to access and recreate on the coast.”
“A ban on short-term rentals within all residential zones in Santa Barbara County would thus be inconsistent with previous commission actions as well as public access policies in the county’s (local coastal plan) … that seek to protect and encourage visitor-serving development and lower-cost visitor and recreational facilities,” read the letter, which was written by coastal program analyst Michelle Wagner.
Commission staff have written that the agency prefers regulation in the coastal zone, rather than an outright ban, given the common complaints that STRs can cause various nuisances and affect the character of neighborhoods.
“We were working on this a long time,” Kracke said. “And we’ve been meeting with (the city), we’ve been showing them very reasonable alternatives.
“Unfortunately, the City of Santa Barbara has left us no reasonable alternative but to seek legal relief from their arbitrary and unlawful decision to prohibit short-term rentals.”
Kracke said he wants the city to either amend its local coastal plan and seek Coastal Commission approval for it, or submit and process a coastal development permit.
City Attorney Ariel Calonne said that “the case raises what I would characterize as very novel and creative arguments.”
Because the case is still very new, he said, he could only provide general commentary, but told Noozhawk that “there is no reported case law upon which Mr. Kracke’s arguments can be based.”
“The petition alleges that the City Council has done something new here,” he said. “The reality is the city regulations that forbid hotels in residential zoning have existed for decades and decades, so that they all pre-date the California Coastal Act,” which was enacted in 1976.
“So my assumption, without having investigated it, is that the city did not consider the Coastal Act because it was not required to, because the Coastal Act didn’t exist,” Calonne said.
Earlier this year, Kracke’s company, Paradise Retreats, was taken to Superior Court by the city and compelled to comply with a legislative subpoena requesting records that include rental rates and the duration of renters’ stays.
— Noozhawk staff writer Sam Goldman can be reached at sgoldman@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.
