HomeMy WebLinkAboutStaff Memo 02-13-19 PCWS-6 02-25-19 LU 18-0034 (02) f VA t o MEMORANDUM
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TO: Planning Commission
FROM: Scot Siegel, Planning and Building Services Director
Bill Youngblood, Senior Code Enforcement Specialist
SUBJECT: Short-Term Rentals—Work Session 6 (LU 18-0034)
DATE: February 19, 2019 MEETING DATE: February 25, 2019
ACTION
Review a preliminary draft of the amendments to the Community Development Code regulating
Short-Term Rentals (STRs), and provide input to staff on finalizing the amendments for a public
hearing on April 22.
EXECUTIVE SUMMARY
As directed by City Council and pursuant to the Planning Commission's 2018 Work Plan, the
Commission has spent the past year soliciting public comment and researching best practices
on planning for Short-Term Rentals (STRs).1 For reference, please refer to the prior Planning
Commission Staff Reports for:
• Work Session #1: Council Direction, Background, Scope, Schedule—June, 25, 2018
• Work Session #2: Existing Regulations and Issues—July 23, 2018
• Work Session #3: Research —August 13, 2018
• Work Session #4: Survey Results and Additional Research — November 14, 2018
• Work Session #5: Code Concepts— February 11, 2019
On February 11, 2019, the Planning Commission reviewed a concept for implementing Short-
Term Rentals following the "Social Model," per City Council direction. This would allow home
sharing in conjunction with a residential use, akin to Home Occupation, where residents host
visitors in their homes for a fee. The Commission also discussed allowing exceptions to certain
Home Occupation regulations with Conditional Use Permit [if CUP option is elected]approval
1 Lake Oswego code defines transient lodging as overnight accommodations for 30 days or less. [LOC 24.02.010
Transient Lodging Tax]The city's development code [LOC 50.03.002 Use Table] does not define or classify short-
term rentals or bed and breakfast inns;all types of transient lodging are classified as Hotels,which are allowed
only in commercial zones.
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following a public hearing. The Council has asked the Commission to provide its
recommendation by June of this year; hence, the public hearing scheduled for April 22.
DRAFT COMMUNITY DEVELOPMENT CODE AMENDMENTS
STR as "Home Occupation"
Based on feedback from the Commission on February 11, staff recommends classifying STRs as
Home Occupations and requiring STRs to meet supplemental standards that are intended to
maintain residential character of the neighborhood and avoid infringing upon the right of
residents to the peaceful enjoyment of their neighborhood.
Home Occupations are defined in the CDC as "a lawful use conducted in a residential zone in or
on the premises of a dwelling unit, said use being secondary to the use of the dwelling for
dwelling purposes." [Emphasis added]
The proposal is to amend the following Community Development Code sections:
• LOC 50.10.003 Definitions
• LOC 50.03.004 Accessory Structures and Uses
• LOC 50.07.005 Conditional Uses[only if CUP option is elected]
Amendments shown in bold underline text for additions and =*r�,keeuts for deletions. [Boldface
text in brackets] are optional provisions that the Planning Commission may want to include in
the public hearing draft. The commentary in text boxes is not part of the code and will be
removed before ordinance enactment.
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LOC 50.10.003 DEFINITIONS
2. Definition of Terms
Short-Term Rental Lodging
The offering of one or more bedrooms (and use of common areal within a sinale-
family detached dwelling for transient residential purposes to serve paving guests
for periods of 30 days or less.
Comment: This definition sets STRs apart from Hotel, which is a use that is permitted in
some commercial zones.The intent is for STRs to be accessory to a Single-Family
Residential use and limit STRs to detached single-family dwellings. This is to avoid
conversion of apartment or condominium buildings into de facto hotels, i.e., where
multifamily residential is allowed but hotels are not.
Hotel or Motel
A building or group of buildings used for transient residential purposes containing rental
units which are designed to be used, or which are used, rented or hired out for sleeping
purposes, including associated retail uses within the hotel or motel intended to serve
paying guests but not including short-term rental dwellings.
Comment: The definition of Hotel/Motel (limited to commercial zones) is
amended to set it apart from Short-Term Rentals, which this draft proposes to
allow as an accessory use to single-family detached dwellings.
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Residence, Primary
A dwelling where a person lives most of the time. At a given time, a person does
not have more than one primary residence. For purposes of determining whether a
dwelling is a primary residence. the City may consider whether the dwelling is the
legal residence of an individual for purposes of voting, motor vehicle/ driver
licensing, income tax calculation the time the person spent at the residence, and
other such factors.
Comment: Under the proposed definition of Residence, Primary, a resident would
have to live "most of the time" at the dwelling during the period of the short term
rental, and under the proposed short-term rental regulations [LOC
50.03.004.1.b.ii(7)(c), a primary resident would have to be on the premises during
specified hours when the unit is rented.
Option: Could the "resident" be on site during the period of the STR rental, but
have a primary residence elsewhere? Example: Owner has a house that they live in
7 months of the year elsewhere, live in the Lake Oswego dwelling 5 months, and
rent the bedrooms out only while they are here. Consider in conjunction with
Home Occupation standard ii(7)(d) below.
LOC 50.03.002 USE TABLE
2. RESIDENTIAL USE TABLE
TABLE 50.03.002-1: RESIDENTIAL DISTRICTS USE TABLE
P = Permitted Use I Blank= Not Permitted I C =Conditional Use I A=Accessory Use
[x]Table notes located at the end of the table
Residential
Use R-0 Use-Specific
Use Type R- R- R- R- R-3
Category 15 10 7.5 DD f�R-6 R-5 R-W R-2 fJ Standards
ACCESSORY USES
Community garden A A A A A A A A A A 50.03.003.6.1
Home occupation A A A A A A A A A A 50.03.004.1.b.ii
Accessory
Uses Short Term Rental A/C A/C A/C A/C A/C A/C A/C A/C A/C A/C 50.03.004.1.b.ii
Lodging f51
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TABLE 50.03.002-1: RESIDENTIAL DISTRICTS USE TABLE
P = Permitted Use I Blank= Not Permitted I C = Conditional Use I A=Accessory Use
[x]Table notes located at the end of the table
Residential
Use R-0 Use-Specific
Use Type R- R- R- R- R-3
Category 15 10 7.5 DD f�R-6 R-5 R-W R-2 f3] Standards
u
Accessory dwelling A A A A A A A A A 50.03.004.1.b.vi
unit
[1] Erected on pilings over the water of Oswego Lake.
[2] No commercial activity allowed.
[3] If lot has multiple zones,e.g., R-0/EC, see LOC 50.02.002.2.e.
Notes: [4] Site-specific use limitations, see LOC 50.02.002.2.c.
[51 May exceed floor area, single transient guest booking, number of overnight stays_number of
transient guests, and on-site parking limitations of LOC 50.03.004.1.b.ii(5).and/or 7(a. b, d, g)with
Conditional Use Approval.
LOC 50.03.004 ACCESSORY STRUCTURES AND USES
1. Accessory Uses
b. Standards for Specific Uses
ii. Home Occupation
A home occupation may be conducted where allowed by other provisions of this Code if
the following conditions are continuously complied with:
(1) The use does not alter the residential character of the neighborhood nor infringe
upon the right of residents in the vicinity to the peaceful enjoyment of the
neighborhood.
(2) A current and valid business license is maintained.
(3) No ernple persons other than family members who reside at the dwelling may
be employed or otherwise work in the home occupation, except persons
performing housekeeping, yard maintenance, or other domestic services for
the dwelling where the short-term rental lodging occurs.
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Comment: This would allow employment of housekeeping, yard maintenance, or
other domestic employees who may help maintain or operate a STR.
(4) No outside storage of goods or materials other than vegetation.
(5) No more than 25% of the aggregate floor area on the lot is devoted to
nonresidential use; an accessory structure may be used provided the provisions of
this subsection are met. [Short term rental lodging may exceed floor area
limitation with conditional use approval.l
Comment: Where a short-term rental would use more than 25% of aggregate floor
area, suggesting a higher intensity use and increasing the risk that residential
character could be harmed, a conditional use permit is required.
Floor Area is the gross building floor area excluding attics, vent shafts, courtyards,
garages, allowable projections (e.g., bay window), decks, patios, uncovered exit
stairs, and uncovered above-grade driveways. (LOC 50.10.003.2)
(6) Marijuana facilities are prohibited.
Comment: Short-term rental lodging in a dwelling is not a "marijuana facility," so
this standard would be automatically met. [Ord. 2689 bans all marijuana facilities
in the City, and the voters approved continuation of the ban on Nov. 8, 2016.]
7) Short-term rentals shall meet the following additional standards, except as
allowed by a conditional use permit:
(a) No booking or guest stay shall occur for more than one transient lodaina
at a time on the lot, i.e.. one guest may rent multiple bedrooms but two
separate guests may not each rent a bedroom for use on the same lot a
he same time. [Multiple transient lodging at one time may be permitted
with conditional use approval.l
b) The number of guest stays on the lot shall not exceed 120 nights in a
calendar year. [Overnight limitation may be exceeded with conditional
use approval.l
c) The number of bedrooms shall not exceed the total number of bedrooms
on the lot minus one.
d) The total number of transient guests in the dwelling shall not exceed XX
regardless of the number of bedrooms. rTransient guest number
limitation may be exceeded with conditional use approvall.
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(e.1) The property owner (who shall make the dwelling their primary
residence) shall be on the premises during the hours of midnight to 6:00
AM.
e.2) An individual who makes the dwelling their primary residence shall
be on the premises during the hours of midnight to 6:00 AM.
e.3) The individual property owner shall be on the premises during the
hours of midnight to 6:00 AM.
Comment: To ensure that the "residential character" and "peaceful enjoyment of
the neighborhood" are maintained, two versions of the social model of short-term
rental are presented for the public hearing, only one of which will be adopted: d.1)
an owner of title who makes the dwelling their primary residence be on the
premises during specified hours during rentals; d.2) an individual who makes the
property their primary residence shall be on the premises during specified hours;
d.3) the individual property owner (not owned by entity and present on premises
by employee or representative) must be on the premises during the rental, but it
need not be the owner's primary residence for "most of the time."
(f) No other commercial uses are allowed in conjunction with or accessory
to a short-term rental. The short-term rental shall not be marketed for
group events such as weddings, classes, or similar events for example.
Comment: The intent of"no other commercial uses allowed" is to prohibit
marketing of short-term rental properties for weddings and other large group
gathering events, as this would be contrary to Home Occupation. The provision
does not prohibit a second home occupation in the dwelling if(1) it is not
associated with the short term rental lodging, e.g., consulting business; and (2) all
other home occupation standards are met, e.g., the consulting business and the
short term rental lodging collectively do not exceed the floor area limitation. The
provision also does not prohibit someone from having a wedding ceremony in a
short-term rental, but the unit cannot be marketed for weddings, parties, etc., or
violate any other Home Occupation standard.
a) One on-site parking space shall be provided for up to every two
bedrooms rented. The short term rental lodging parking space shall be
located to ensure it does not interfere with the parking or maneuvering of
any other vehicle. rReguired parking space may be located on adjacent
property with conditional use approval.l
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Comment: The Planning Commission has considered requiring parking based on
number of bedrooms or number of occupants. For enforcement purposes staff
recommends basing the standard on number of bedrooms and requiring that the
STR parking spaces do not block access to required residential parking.
50.06.002 PARKING
2. STANDARDS FOR APPROVAL
a. Vehicle Parking
TABLE 50.06.002-3: MINIMUM OFF-STREET PARKING SPACE REQUIREMENTS
Type of Use Parking Space Required f11
(A) RESIDENTIAL
1. Single-family dwelling and 1 space per dwelling unit
duplex
2. Accessory dwelling unit 1 space per unit(in addition to 1 space required for main dwelling unit). See
LOC 50.03.004.1.b.vi(1)(a)for siting standard.
4. Rooming and boarding house; 1 space per each guest room plus 1 for owner
bed and hreakfas
(B) COMMERCIAL RESIDENTIAL
1. Hotel or motel 1 space per unit
Comment: The Bed and Breakfast parking standard is deleted to avoid confusing Bed and
Breakfast with STR, Hotel, and Restaurant, each having its own parking standard. A STR host
could provide meals to their guests only (not marketed as a restaurant), provided they meet
health/food handling and other code requirements and not be a Hotel or Restaurant. The
additional parking standard for short-term rentals is proposed to be located within the Home
Occupation standards, not in the parking table, as is done for other use-specific standards.
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ALTERNATIVE LAND USE APPROVAL TRACK WITH CONDITIONAL USE PERMIT
The Planning Commission has considered whether the code should provide flexibility for
permitting short-term rentals that do not meet one or more of the proposed Home Occupation
Standards, for examples: floor area greater than 25%, more than one booking customer at a
time (two bedrooms, each rented out by separate guests), more than 120 overnight bookings,
or to allow parking on adjacent property. The Commission proposes that any such exception
would require a public hearing and Conditional Use Permit (CUP) approval by the Development
Review Commission.
Staff requests Planning Commission feedback on the specific Home Occupation standards
(above) that should part of the CUP review process. The relevant CUP criteria follow.
LOC 50.07.005
3. AUTHORIZATION TO PERMIT OR DENY CONDITIONAL USES
a. An application for a conditional use shall be allowed if:
i. The requirements of the zone are met; and
iii. The site is physically capable of accommodating the proposed use; and
iv. The functional characteristics of the proposed use are such that it can be made to be
reasonably compatible with uses in its vicinity.
b. In permitting a new conditional use, or the modification of an existing conditional use, the
hearing body, or the City Manager in the case of a minor modification, may impose conditions
which are suitable and necessary to assure compatibility of the proposed use with other uses in
the vicinity. These conditions may include, but are not limited to:
i. Limiting the manner in which the use is conducted, by restricting the time an activity
may take place and by minimizing such environmental effects as noise, vibration, air
pollution, glare and odor.
ii. Establishing a special yard, setback, lot area or other lot dimension.
iii. Limiting the height, size or location of a building or other structure.
iv. Designating the size, number, location and design of vehicle access points.
v. Increasing roadway widths, requiring street dedication, and/or requiring
improvements within the street right-of-way.
vi. Designating the size, location, screening, drainage, surfacing or other improvement
of a parking area or truck loading area.
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vii. Limiting or otherwise designating the number, size, location, height and lighting of
signs.
viii. Limiting the location and intensity of outdoor lighting, requiring its shielding, or
both.
ix. Requiring berming, screening or landscaping and designating standards for its
installation and maintenance.
x. Designating the size, height, location and materials for fences.
A. Protecting and preserving existing trees, soils, vegetation, water resources, wildlife
habitat or other significant natural resources.
xii. On- and off-site public improvements.
The Development Review Commission reviews CUP applications in a public hearing following
the Major Development procedure in LOC 50.07.003.15.2
z The current application fee for a CUP is$5,814.A pre-application conference and neighborhood meeting are also
required.
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NON-LAND USE REQUIREMENTS
The following non-land use requirements suggested by the Planning Commission would be
considered separately by City Council:
1. Prior to issuance of business license, the applicant shall notify owners of all adjacent
properties of the short-term rental as a courtesy. This would require mail to
neighbors under LOC 45.12.100. (Amend LOC Ch. 20 Licenses)
2. Owner required to provide licensee contact information, and City to post short-term
rental licensee contact information online. (LOC Ch. 20 Licenses)
3. City to collect transient lodging taxes and require reporting of number of stays or
bookings with transient lodging tax filings. (LOC Art. 24.02 Transient Lodging Taxes)
4. Owner to comply with building code, health, and fire and life safety requirements.
This does not require separate action, as all property owners are required to comply
with the building code.' (LOC 45 Building Code; LOC 15.06 Fire Prevention Code);
and County health permits)
5. City Council to review the ordinance within three years of adoption. The ordinance
would have to be reenacted for short-term rentals to be allowed after three years.
(Ordinance adopting CDC amendments)
6. Limit the number of short-term rental business licenses to 100, selected first-come-
first-serve during 3-year trial period. If 100 licenses were issued, opportunities for
new licenses would open up only as licenses are not renewed. (Ordinance amending
LOC 20 Licenses)
3 The building code establishes a minimum floor area for habitable rooms(e.g., bedrooms)of 70 square feet,
minimum ceiling height of 7 feet,and egress.A sleeping room(at the time it is created or converted) must have a
smoke detector that is interconnected with a smoke detector in an adjacent hallway,common area,or immediate
vicinity of sleeping rooms and is located on a floor that has a functioning carbon monoxide alarm.Carbon
monoxide alarms shall be located in each bedroom or within 15 feet outside of each bedroom door.
Staff also researched the Landlord-Tenant provisions of ORS 91.262:
"3) If adopted,an occupancy guideline for a dwelling unit shall not be more restrictive than two people per
bedroom and shall be reasonable. Reasonableness shall be determined on a case-by-case basis. Factors to be
considered in determining reasonableness include, but are not limited to:
(a)The size of the bedrooms;
(b)The overall size of the dwelling unit;and
(c)Any discriminatory impact on those identified in ORS 659A.421.
(4)As used in this section:
(a)"Bedroom"means a habitable room that:
(A) Is intended to be used primarily for sleeping purposes;
(B)Contains at least 70 square feet;and
(C) Is configured so as to take the need for a fire exit into account.
(b)"Habitable room" means a space in a structure for living,sleeping, eating or cooking. Bathrooms,toilet
compartments,closets, halls,storage or utility space and similar areas are not included."
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7. City Council to consider any advertising restrictions on owners or STR platforms
(VRBO, AirBNB, etc) to enforce owner occupancy requirement, and any requirement
directly or as a condition upon owner to operate an STR business to require data and
advertising period disclosures.
8. City Council to consider limitations on STR platforms to require STR operator to
comply with city licensing requirements prior to advertising on platform.
The Planning Commission has discussed the potential applicability of short-term rental
regulations to the rental platforms, which are frequently the marketers and booking services of
short-term rentals. Because the proposal is for adoption of land use regulations, the regulations
would apply to users of land(property owners, tenants, etc.) not marketers; hence, the
Community Development Code standards would not apply to the short-term rental platforms.
Where a use (or land-user) violates the Community Development Code, (1) the violation is a
civil violation subject to a maximum $1000/day fine [LOC 50.09.003.1; LOC 13.02.0201; and (2)
the City may revoke (and deny) their business license [LOC 20.02.080, .085; LOC 50.09.003.2]
and seek an injunction (court order) to cease operations [LOC 50.09.003.2; ORS 30.315].
EXISTING NON-LAND USE CODE DEFINITIONS
For concurrent code amendment consideration by Council
The definitions from LOC 24.02 Transient Lodging Tax and the text of LOC 24.02.020 are
provided for context only, and to show that LOC 24.02 will need to be amended to address the
Community Development Code distinction between Hotel and Short-Term Rental, and to make
conforming amendments to impose the transient room tax upon occupancy of short-term
rentals.
[LOC 24.02.010 Definitions]
Transient
Any person who exercises occupancy or is entitled to occupancy in a hotel or short-term rental
for a period of 30 consecutive calendar days or less, counting portions of calendar days as full
days. The day a transient checks out of the hotel or short-term rental shall not be included in
determining the 30-day period if the transient is not charged rent for that day by the operator.
Any such person so occupying space in a hotel or short-term rental shall be deemed to be a
transient until the period of 30 days has expired unless there is an agreement in writing between
the operator and the occupant providing for a longer period of occupancy, or the tenancy
actually extends more than 30 consecutive days. In determining whether a person is a transient,
uninterrupted periods of time extending both prior and subsequent to the effective date of this
article may be considered. A person who pays for lodging on a monthly basis, irrespective of the
number of days in such month, shall not be deemed a transient.
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Occupancy means the use or possession or the right to the use or possession for lodging or
sleeping purposes of any room or rooms in a hotel, bedroom in a short-term rental, or space
in a mobile home or trailer park.
Operator means the person who is proprietor of the hotel or short-term rental in any capacity.
Where the operator of a hotel performs his or her functions through a managing agent of any
type or character other than an employee, the managing agent shall also be deemed an
operator of a hotel for the purposes of this article and shall have the same duties and liabilities
as his or her principal. Compliance with the provisions of these sections by either the principal
or managing agent shall be considered to be compliance by both.
Rent means the consideration charged, whether or not received by the operator, for the
occupancy of space in a hotel or short term rental, valued in money, goods, labor, credits,
property or other consideration valued in money, without any deduction.
LOC 24.02.020 Tax Imposed.
1. For the privilege of occupancy in any hotel or short-term rental in the City, each transient
shall pay a tax in the amount of 6% of the rent charged by the operator. The tax constitutes a
debt owed by the transient to the City, which is extinguished only by payment by the operator to
the City. The transient shall pay the tax to the operator of the hotel or short-term rental at the
time the rent is paid. The operator shall enter the tax on his or her records when rent is collected
if the operator keeps his or her records on the cash accounting basis and when earned if the
operator keeps his or her records on the accrual accounting basis. If rent is paid in installments,
a proportionate share of the tax shall be paid by the transient to the operator with each
installment. In all cases, the rent paid or charged for occupancy shall exclude the sale of any
goods, services and commodities, other than the furnishing of rooms, accommodations, and
space occupancy in mobile home parks or trailer parks.
2. The tax imposed by this article shall apply to all hotels and short term rentals located
within the corporate limits of the City
CONCLUSION
The above recommendations are intended to reflect the Planning Commission's discussion from
February 11. Staff requests the Commission provide direction on any changes to be included in
the public hearing draft, focusing on the Social Model that is preferred by a majority of City
Council.
This staff memo and past meeting materials can be found by visiting the project webpage using
this link:
https://www.ci.oswego.or.us/all-projects
(Under Search enter LU 18-0034 and press Enter)
503.635.0290 380 A Avenue PO Box 369 Lake Oswego, OR 97034 www.ci.oswego.or.us