Orange County Grand Jury • 2024-2025 • Agency Response
Response to: Long-Term Solutions to Short-Term Rentals 05/22/2

Councilmembers City Clerk Phil Bacerra Jennifer L. Hall Johnathan Ryan Hernandez Jessie Lopez David Penaloza Thai Viet

Published: December 02, 2025 35 pages
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Findings and Recommendations 12 findings

F1
Despite the increasing media coverage of Online 1 Although STRs are not a new phenomenon in Orange County, the City Booking Agencies (OBAs), STRs are not a new of Santa Ana has seen a significant rise of STRs within the last three phenomenon in Orange County. years, likely attributed to a growth in tourism following the global Covid-19 pandemic and the growth of Online Booking Agencies (OBAs).
Related Recommendations (1)
R1
Cities should review and begin to update 1 The City of Santa Ana updated its municipal code on December 3, ordinances to keep up with the rapidly changing 2024, as it relates to STRs. Moreover, the Planning Division is nature of court findings and legislation related to currently comprehensively updating the City’s zoning code, which will STRs, by December 31, 2025, and no less frequently include consistency with the latest state and federal laws, as well as than every three years thereafter. court rulings. Completion of the comprehensive update to the zoning code is expected to occur fall 2025. These updates demonstrate the City’s proactive approach to maintaining a legally sound regulatory framework.
F2
The steady growth of STR usage in the last decade 1 The steady growth of STRs in Santa Ana has raised concerns of public raises concerns of potential public nuisance. nuisance and community disruption. These include: • Loud music and disruptive gatherings • Illegal parking of vehicles • Trash accumulation and lack of waste management These nuisances have resulted in adverse impacts on residential neighborhoods, challenging the City’s efforts to preserve quality of life and neighborhood integrity.
Related Recommendations (1)
R2
Cities should consider developing a plan for 1 The City’s Planning Division recommends updates to its zoning code upcoming major events that are expected to create a for Planning Commission and City Council consideration on a yearly surge in demand for STRs and its associated Transient basis to address changes to state and federal law, and any court Occupancy Tax, by December 31, 2025, and no less ruling affecting land use. The City does not permit STRs within its frequently than every two years thereafter. jurisdiction, so there is no need to develop a strategy to address surge in demand. If the policy direction related to STRs changes, the City will develop a robust inter-agency team to create a regulatory framework to permit and tax such a use.
F3
Even with robust Code Enforcement, a city’s 2 The City’s Code Enforcement staff has the ability to receive, statutory ban on STRs is not enough to keep STRs investigate, and issue the required citations to a property owner in from operating. violation of the City’s statutory ban on STRs. However, despite a statutory ban on STRs, enforcement remains a persistent challenge. Many STRs continue to operate covertly, often changing listings or locations to evade detection. Santa Ana’s Code Enforcement team remains committed to addressing violations. The City’s Code Enforcement staff is equipped to: • Receive and investigate complaints • Identify violators • Issue citations to property owners operating illegal STRs While enforcement is ongoing, it is limited by the evolving and decentralized nature of online rental platforms. Attachment A 2024-2025 Responses to Orange County Grand Jury Findings and Recommendations “Long-Term Solutions to Short-Term Rentals” Finding City Position Response to Finding (1 or 2)*
No recommendations for this finding
F4
Anaheim’s ordinance requires OBAs to report Transient Occupancy Tax (TOT) directly to the city. This has led to the favorable consequence that unpermitted STR income is reported to the city. 2024-2025 Orange County Grand Jury Attachment B Long-Term Solutions to Short-Term Rentals
No recommendations for this finding
F5
Proactive home inspections of new and renewing STRs, which have been implemented in some Orange County cities, improve code enforcement and STR compliance with city ordinances.
No recommendations for this finding
F6
Direct remittance of taxes by OBAs does not capture all TOT for an STR because of direct booking practices.
Related Recommendations (1)
R6
Cities with a permit waiting list should implement strategies to remove non-revenue- generating licenses to allow for fair access by December 31, 2025, and annually thereafter. (F7,
F7
Some cities in Orange County have outdated systems for tracking short-term rental TOT making the process less effective and more difficult for staff.
No recommendations for this finding
F8
In some cases, STRs are improperly recharacterized as long-term rentals to circumvent the collection of TOT and any applicable penalties.
No recommendations for this finding
F9
Online Booking Agencies in foreign languages are outside the current capabilities of Code Enforcement to monitor and track unpermitted STRs.
Related Recommendations (1)
R9
City leaders should have regular discussions with 1 City staff, along with the City Attorney’s Office, will continue to have each other to share STR management strategies on a regular discussions to share STR management strategies. This biannual basis commencing no later than January 1, collaboration also includes input from the Santa Ana Police 2026. Department. *For the purposes of this Orange County Grand Jury Report, City Position 1 indicates the recommendation has been implemented, with a summary regarding the implemented action; City Position 2 indicates the recommendation has not yet been implemented, but will be implemented in the future, with a timeframe for implementation; City Position 3 indicates the recommendation requires further analysis, with an explanation and the scope and parameters of an analysis or study, and a timeframe for the matter to be prepared for discussion by the officer or head of the agency or department being investigated or reviewed, including the governing body of the public agency when applicable (timeframe shall not exceed six months from the date of publication of the grand jury report); and City Position 4 indicates the recommendation will not be implemented because it is not warranted or is not reasonable, with an explanation therefor. Attachment A 10. Orange County Grand Jury’s Investigative Report, Findings, and Recommendations Regarding Long-Term Solutions to Short-Term Rentals and City’s Response to the
F10
Cities that fail to routinely review their STR waiting lists potentially lose TOT revenue and contribute to a greater prevalence of unpermitted STRs.
No recommendations for this finding
F11
Locations that have hosted major events have reported an outsized increase in demand and pricing of STRs, a situation Orange County is likely to experience with the upcoming 2026 Los Angeles World Cup and 2028 Los Angeles Olympics.
No recommendations for this finding
F12
City leaders have no regular communication with 2 Effective STR management requires continuous communication and each other concerning STR issues, limiting collaboration. Although previously cited as lacking regular opportunities to develop strategies and expertise to coordination, City staff and the City Attorney’s Office now meet improve service. frequently to discuss STR-related issues and develop strategies to improve service and enforcement effectiveness. Continued collaboration with the Santa Ana Police Department for calls for service and enforcement inspections is an essential component of this collaborative climate. *For the purposes of this Orange County Grand Jury Report, City Position 1 indicates that the respondent agrees with the finding, and City Position 2 indicates that the respondent disagrees wholly or partially with the finding. Attachment A 2024-2025 Responses to Orange County Grand Jury Findings and Recommendations “Long-Term Solutions to Short-Term Rentals”
No recommendations for this finding