City of Seal Beach 08/13/25*

Despite the increasing media coverage of Online Booking Agencies (OBAs), short-term rentals (STRs) are not a new phenomenon in Orange County. The City concurs that STRs existed well before the popularity of OBAs.

The steady growth of STR usage in the last decade raises concerns of potential public nuisance. The City concurs that the growth of STR uses has raised concerns of public nuisance.

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. The City does not have evidence that necessarily supports this Finding, but believes that inspections are a useful tool in STR compliance, and incorporates inspections into its permitting process. City of Seal Beach Response to Grand Jury Report August 14, 2025

Direct remittance of taxes by OBAs does not capture all transient occupancy tax (TOT) for an STR because of direct booking practices. The City concurs with this finding, a portion of Seal Beach STRs remit TOT independently.

Some cities in Orange County have outdated systems for tracking short-term rental TOT making the process less effective and more difficult for staff. The City can only attest to its own system, which is manual in nature at this time.

In some cases, STRs are improperly recharacterized as long-term rentals to circumvent the collection of TOT and any applicable penalties. The City does not have any direct experience with such recharacterizations, but agrees it would be difficult for City staff to discern between the two without complaints or other reporting from neighbors.

Online Booking Agencies in foreign languages are outside the current capabilities of Code Enforcement to monitor and track unpermitted STRs. The City concurs with this Finding. Finding I0: Cities that fail to routinely review their STR waiting lists potentially lose TOT revenue and contribute to a greater prevalence of unpermitted STRs. Seal Beach actively manages the STR waiting list, and therefore has no direct evidence to support this Finding, but agrees the Finding is reasonable.

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. The City concurs with this Finding.

City leaders have no regular communication with each other concerning STR issues, limiting opportunities to develop strategies and expertise to improve service. The City agrees that communication between leaders in different communities related to STRs is limited.