Solvang City Council looks to tighten zoning on short-term rentals

Shift in retirement benefits program, plans for Julefest and Half-Marathon also discussed in busy meeting

The Solvang City Council culminated a busy Monday, Aug. 11, regular meeting by directing staff to draft a new ordinance focused on short-term rentals (STRs) in the city in an effort to limiting them to the Village Mixed-Use zone. The council on this evening was just four members, with Councilmember Claudia Orona absent.

During the meeting, the council also voted to change how the city handles retirement benefits, discussed plans for the upcoming Julefest Christmas celebration and next year’s Wine County Half-Marathon.

Back in March, the City Council had directed city staff to begin revisions to the City’s short-term rental (also known as vacation rental) ordinance, which would include a framework of an ordinance for further input from the City Council and residents.

Planning Development Director Rafael Castillo in giving his report, said the main objective of the ordinance is determining where the rental (which by definition are homes where people reside for 30 days or less) was where the council would allow the STRs in the city.

Currently, the areas in the city zoned for STRs are the Village Mixed-Use Area (VMA), and some lots in the R-3 zone of the city, along Copenhagen Drive, east of Fifth Street. Castillo said staff recommend that the STRs be limited to the Village Mixed-Use Area only.

Residents who spoke in Public Comment agreed the STRs should be kept in the VMU area. Dennis Beebe said the council needs to make the VMU boundaries “explicitly defined,” along with the limits for STRs. C.J. Jackson and Aaron Peterson reiterated their views that city’s should not allow STRs in residential areas. “Have a nice neighborhood and put in transient people is not something we should not consider,” Peterson said. “Hotels basically are vacation rentals.”

Although the council was on board with limiting the rentals to the VMU area, Councilmember Elizabeth Orona did remind her colleagues of the importance of tourists and visitors, including those using STRs, to the city’s economy, and wondered if there could be a way to allow them outside the VMU with further conditions like caps, allowed usage, and a minimum distance betweens STRs.

However, Councilmember Mark Infanti said his problem was with the “outside the VMU part of that,” and Mayor David Brown agreed the rentals should be focused within the VMU.

“I’m not sure the juice is worth the squeeze — doing the entire city,” Brown said. “If we can limit it to Village we’ll be OK, outside that, there would be lots of problems.”

Castillo then suggested the compromise of limiting STRs outside the VMU to “homestays” where the property owner would have to be present, Mayor David Brown also favored limiting them downtown.

Castillo and staff were directed to draft an ordinance limiting the STRs to the VMU, but adding the possiblity of allowing the homestays outside the VMU and listing the conditions of them. Castillo said the draft could be presented at the next meeting in September.

In other business:

The council voted 4-0 to move its city employees retirement plan from the management of CalPERS to that of the Public Agencies Post-Employment Benefits Trust administered by Public Agency Retirement Services (PARS).

Administrative services director Wendy Berry introduced Rachel Sanders from PARS to make a presentation on the program to the council. Sanders said benefits of the program would be complete local control over assets, pension rates stabilization, establishment of a “Rainy Day Fund,” and more diversification

The plan would see the city’s retirement fund go into two “buckets” — a Pension bucket and Other Post-Employment Benefits (OPEB) bucket —, require a plan adminstrator, and would be subject to annual reviews or more frequents reviews, if desired. It also gives the city the option of active and passive approaches to investments within the plan.

The council approved the item, along with an add-on to add language that council will select strategy and annually review the strategy.

Solvang Marketing and Events Coordinator Candice Libera addressed the council on two discussion items, one regarding plans for this year’s Julefest Celebration in December, and next May’s Wine Country Half Marathon.

She first spoke on the half-marathon, which has run in Solvang every Mother’s Day weekend since 2008, and draws approximately 2,500 participants plus their friends and families, Libera said. However, she also said that there were complaints about restricted access to businesses with the race’s finish line on Copenhagen Drive, as well as concerns about litter and damage to the grass at Solvang Park, where the post-race gathering is held. Libera said that changes would be made to the race course, placing the finish line at a new location that wouldn’t inhibit access to merchants, and measures would be taken to mitigate the litter and placement of equipment at the park to protect the grass.

She also said advertising and promotional materials would more prominently feature the Solvang name, another point of contention.

For the Julefest, Libera said that the city was close to a deal to bring in snow at some point during the monthlong celebration, and with consideration for traffic and safety on Copenhagen Drive, the street would be closed to vehicles between Alisal Road and 1st Street for the entire Julefest and the light diplay at Solvang Park would be expanded.

Libera said options to address parking concerns were being looked at, including the opening of Lot 72 east of Alisal Road for additional parking.

The City Council will take a scheduled break, with no meeting on Aug. 25, and will next meet on Monday, Sept. 8.