A moratorium on vacation rental permits could be ahead in Seaside, with the aim to study their impact on affordable housing and city infrastructure.
“One of the discussion items that we’ve been having is, do we have too many vacation rentals?” Mayor Jay Barber said. “Do we need to consider putting a cap on them or do we need to consider a moratorium on them?”
The City Council and Planning Commission met last Monday to discuss city zoning policies regarding vacation rentals and updating the city’s comprehensive plan.
Seaside has 316 vacation rental business licenses and 28 vacation rental applications pending approval, code enforcement officer Jeff Flory said.
Since Jan. 1, the planning department has received 73 land use applications. Of those, 57.5% are for short-term rentals, including 32 vacation rentals, seven rental condos and three bed-and-breakfasts.
Overall, there are 411 short-term rental units active and pending, Flory said.
Applications are supported for properties located west of Neawanna Street on the city’s north end, west of N. Holladay Drive and S. Holladay Drive and west of S. Roosevelt Drive. The locations where vacation rental applications are not supported are dominated by full-time residential homes.
The Planning Commission will not support the approval of a vacation rental conditional use permit application if more than 40% of the surrounding properties within 100 feet of an applicant’s property are licensed as vacation rentals.
“When it comes to the spatial distribution, what is it doing in the current real estate market as a house comes for sale?” Flory said. “Is it affecting the sale of that property because it is over the density requirement? That’s the first question we get asked when someone calls when a property goes for sales. ‘Can it be a vacation rental?’”
If the density is over 40%, property owners are discouraged from applying for the permit because the recommendation coming out of the planning department is going to be to deny it based on policies that are already set in place, Flory said.
That density may be too high, planning commissioners and councilors said, leading to adverse impacts on housing affordability and demands on city infrastructure.
“My concern is that new vacation rentals are displacing long-term residents,” Planning Commissioner Seth Morrisey said.
Vacation rental dwellings are turning into a business model, he said, and their numbers will accelerate.
City Councilor Randy Frank said competition for vacation rental dwellings could create a bidding war, artificially inflating the price of lodging. “That ultimately could harm our ability to stay competitive with other places on the coast,” Frank said.
City Councilor Tita Montero said the density of vacation rentals in a neighborhood is a factor that should determine how many dwellings are allowed, but there are others as well, including how they affect the people who live here.
“We don’t want an overpopulation of the VRDs in any segment of the city,” Montero said. “What we need is a pause and moratorium, that we stop providing any more VRD licenses or permits over a period of time so that we can look at every one of these different options, see what we think is going to work and see what works for other places. We’re not taking away something that somebody already has. What we’re saying is, from this period of time, no new VRD licenses.”
Density should not be the only way of measuring their needs, Planning Commissioner Kathy Kleczek said.
“Whether we’re talking about sewage and water and electricity and broadband, emergency services and the rest of the community services are also impacted by all of these things,” she said. “This is something that we need to look at and reduce so that we can be forward-looking instead of trying to catch up all the time with what’s happening to us.”
In future weeks, the city will need to “basically face-lift the entire comprehensive plan,” Planning Director Kevin Cupples said.
Zoning ordinances would need to be updated to match plan revisions.
“And then from that, you’d know whether you want to move forward or not,” City Manager Mark Winstanley said. “This would be a discussion that the council should be having at a council meeting as to whether they want to move forward with that kind of work.”
As for a potential moratorium on vacation rental permits, Barber asked city staff and City Attorney Dan Van Thiel, in conjunction with the League of Oregon Cities, to provide the steps necessary if a moratorium is considered the right path.
The city may consider a part-time consultant to help with the research, Barber said.
“I’d like someone to tell us what we would need to undertake so we could have a moratorium, so we could make the decision on solid ground,” he said.