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Long-Term Solutions to Short-Term Rentals <br /> <br />2024-2025 Orange County Grand Jury Page 4 <br /> <br />SUMMARY <br />Short-term rental (STR) is defined as occupancy of a residence such as a home or an apartment <br />for fewer than 30 days. <br />Some Orange County residents complain that the growth of STRs impinges on their quality of <br />life and adds costs to city government for additional code enforcement. The 2024-2025 Orange <br />County Grand Jury (Grand Jury) investigation revealed that: <br />• Cities with a growing number of STRs did not always receive higher complaint volumes. <br />• Some cities employ effective strategies to manage complaints and other cities can learn <br />from their success. <br />• When cities ban STRs, this often leads to a never-ending game of “whack-a-mole”—as <br />soon as one unpermitted STR is shut down, another opens. <br />• Code Enforcement (CE) errs on the side of leniency. <br />• Some cities rarely pursue fines for STR violations or collect the Transient Occupancy <br />Tax (TOT) on unreported STR income. <br />• Some cities rely on the “honor system” for STR owners to report and pay the correct <br />TOT. <br />• The commonly held belief that STRs negatively impact affordable housing is not evident <br />in cities with STRs. <br />This report identifies best practices that city councils and their planning departments can use to <br />more efficiently and effectively manage their STRs. This includes modifying STR ordinances, <br />and for some cities, utilizing third-party digital tools for better code enforcement and data <br />tracking to collect unreported TOT. <br />BACKGROUND <br />For many years, Orange County has been an international destination, with its forty-two miles of <br />scenic coastline, Disneyland, Knotts Berry Farm, Angel Stadium, Honda Center, and other <br />attractions. Vacation rental properties in Orange County’s beach communities go back many <br />decades; for instance, in the 1920s, Crystal Cove State Park offered camping sites to the public, <br />and in the 1940s it offered trailers. <br />For some, STRs are business opportunities. To others, STRs are a nuisance and impinge on <br />neighbors’ quality of life. In response to these conflicting priorities, some cities in Orange <br />County have banned STRs, some have limited their number, and some have no limits. <br />  <br />  <br />City Council 10 – 6 8/5/2025