Protect Our Neighborhoods v. City of Palm Springs

California Court of Appeal·Decided January 7, 2022·No. E074233·Published

Opinion

Filed 1/7/22

CERTIFIED FOR PARTIAL PUBLICATION * IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO

PROTECT OUR NEIGHBORHOODS, Plaintiff and Appellant, E074233 v. (Super.Ct.No. RIC1704320) CITY OF PALM SPRINGS et al., Defendants and Respondents.

PROTECT OUR NEIGHBORHOODS, Plaintiff and Appellant, (Super.Ct.No. RIC1724363)

v. OPINION CITY OF PALM SPRINGS et al., Defendants and Respondents;

SCOTT GAITAN et al.,

Real Parties in Interest and Respondents.

* Pursuant to California Rules of Court, rules 8.1105(b) and 8.1110, this opinion is certified for publication with the exception of part VII.

APPEAL from the Superior Court of Riverside County. Chad W. Firetag, Judge.

Affirmed.

Law Offices of Babak Naficy and Babak Naficy for Plaintiff and Appellant.

Woodruff, Spradlin & Smart, James H. Eggart, Ricia R. Hager and Thomas P.

Kinzinger for Defendants and Respondents.

No appearance for Real Parties in Interest and Respondents.

Because the City of Palm Springs (City) is a vacation destination, there has long been a market for short-term home rentals there. Since 2008, City ordinances have expressly allowed the short-term rental of a single-family dwelling, subject to various conditions designed to protect the interests of neighboring residents (as well as the City’s own interest in collecting transient occupancy taxes, a/k/a hotel taxes).

In 2017, the City reenacted the previous ordinance, with amendments. Among other things, it made a new finding that the ordinance was consistent with the City’s Zoning Code.

Meanwhile, Protect Our Neighborhoods (Protect), a membership organization opposed to short-term rentals, filed this action. Protect claimed, among other things, that the 2017 version of the short-term rental ordinance (Ordinance) violated the City’s Zoning Code. The trial court disagreed and upheld the Ordinance.

Protect appeals, contending:

(1) Short-term rentals violate the Zoning Code because they are commercial, not residential.

(2) Short-term rentals violate the Zoning Code because they change the character of, and adversely affect the uses permitted in, a single-family residential zone.

(3) The Ordinance is inconsistent, contradictory, and based on erroneous findings.

(4) If the Zoning Code permits short-term rentals at all, it does so only on condition that the owner obtain a land use permit or a conditional use permit.

(5) If the Zoning Code permits short-term rentals at all, it does not allow owners to rent out properties that they do not live in.

We will hold that the trial court correctly ruled in favor of the City and against Protect. Hence, we will affirm.

I

STATEMENT OF FACTS

A. The “Zoning Code” Chapter of the Municipal Code.

Chapters 91 through 94 of the Municipal Code 1 are entitled “Zoning Code.”

Under the Zoning Code, the uses allowed without a permit in a single-family residential (R-1) zone include (1) use as a “[p]ermanent single-family dwelling[]” and (2) “uses customarily incident to the permitted uses when located on the same lot therewith.” (Mun. Code, § 92.01.01.A.)

1 All citations to the “Municipal Code” or “Mun. Code” are to the Palm Springs Municipal Code.

“Dwelling” is defined as “a building or portion thereof designed exclusively for residential occupancy . . . , but not including hotels, boarding or lodging houses, or mobilehomes or trailers, except when installed on a permanent foundation, or motorized homes.” (Mun. Code, § 91.00.10.B.)

All uses not expressly permitted are prohibited. (Mun. Code, § 92.01.02.) In addition, in an R-1 zone, “[c]ommercial uses” “shall not be permitted . . . by commission determination . . . .” (Mun. Code, § 92.01.02.A.) “‘Commission’ means the planning commission of the city of Palm Springs.” (Mun. Code, § 91.00.10.B.)

B. The “Vacation Rentals” Chapter of the Municipal Code.

1. The 2008 ordinance.

Title 5 of the Municipal Code is entitled “Business Regulations.” Chapter 5.25 is entitled “Vacation Rentals.”

This chapter was first enacted in 2008, by Ordinance No. 1748 (“Original Ordinance”). It included the following provisions, which are still in the Ordinance.

It applied to rentals for 28 days or less. (Mun. Code, former § 5.25.040; see now Mun. Code, §§ 5.25.030, 5.25.040(d), (e).) 2 It required an owner of a vacation rental property to register the property with the City annually and to obtain a vacation rental registration certificate. (Mun. Code,

2 As far as we can tell, there is no difference between a “short-term rental”

and a “vacation rental.” For purposes of this case, they are both defined as rentals of 28 days or less. We use both terms interchangeably.

§§ 5.25.040(a), 5.25.060(a).) To do so, the owner had to have liability insurance. (Mun. Code, former § 5.25.060(c); see now Mun. Code, § 5.25.060(a)(10), 5.25.070(u).)

It limited occupancy based on the number of bedrooms. (Mun. Code, former § 5.25.070(b); see now Mun. Code, § 5.25.070(c), (d).) It required an owner to use “reasonably prudent business practices” to ensure that renters and their guests did not create unreasonable noise, disturbances, engage in disorderly conduct, or violate the law. (Mun. Code, former § 5.25.070(d); see now Mun. Code, § 5.25.070(f).) The owner, the owner’s agent, or the owner’s designated “local contact person” had to be available at all times to respond to complaints. (Mun. Code, §§ 5.25.060(a)(3), 5.25.070(e).)

Finally, it required the owner to pay transient occupancy taxes. (Mun. Code, § 5.25.060(a)(7), former Mun. Code, § 5.25.070(l); see now Mun. Code, § 5.25.070(q).)

2. The April 2016 amendments.

In April 2016, the City enacted Ordinance No. 1891, which amended the Original Ordinance by prohibiting short-term rentals of apartments. Short-term rentals are now allowed of single-family residences and duplexes only. (Mun. Code, §§ 5.25.030, 5.25.075(a).) Although it was a temporary urgency measure, in July 2016, Ordinance No. 1897 extended it, and in October 2016, Ordinance No. 1902 (October 2016 Ordinance) made it permanent.

3. The December 2016 amendments.

In December 2016, the City enacted Ordinance No. 1907 (December 2016 Ordinance), which would have amended Chapter 5.25 in respects not particularly relevant

here. The December 2016 Ordinance, by law (Elec. Code, § 9235; Mun. Code, § 803) and by its terms, did not go into effect for 30 days. During this 30-day period, a valid referendum petition was filed, which prevented the December 2016 Ordinance from going into effect at the end of the 30 days. (Elec. Code, § 9237.) In February 2017, rather than schedule a referendum election, the City rescinded the December 2016 Ordinance. Thus, the December 2016 Ordinance never took effect. 3 4. The current ordinance.

In March 2017, the City adopted Ordinance No. 1918 – the Ordinance at issue – which restated and amended Chapter 5.25.

Among other changes, it barred the ownership of more than one vacation rental (Mun. Code, § 5.25.040(b)), it limited vacation rentals to 36 per year (Mun. Code, § 5.25.070(b)), it revised the enforcement provisions (Mun. Code, § 5.25.090), and it added new provisions for “Estate Homes” with five or more bedrooms (Mun. Code, §§ 5.25.030, 5.25.070(d)) and for “Homesharing” (Mun. Code, §§ 5.25.030, 5.25.078).

It also made a couple of findings that mentioned zoning.

First, it added a finding that one of the purposes of the Vacation Rentals chapter is to “ensure that vacation rentals . . . are ancillary and secondary uses of residential property consistent with the provisions of the City’s Zoning Ordinance . . . .” (Mun. Code, § 5.25.020(b).)

3 Protect seems to think that, as a result, there was no short-term rental ordinance at all. We disagree. The October 2016 Ordinance remained in effect. Ultimately, however, this point is not material to our resolution of the issues.

Second, it added a finding that: “The primary use of single-family and multi-

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