Months after initially moving to update the city’s short-term vacation rental (STVR) rules, and years after a review was due, the Palm Springs City Council moved closer to a final vote on the matter Thursday evening.
Following hours of public testimony and discussion, councilmembers agreed on a cap on the percentage of homes that can be licensed in each neighborhood (20%) and the introduction of a “junior permit” that allows for a half-dozen annual rental contracts. The new permit is designed to enable homeowners to rent their residences during highly profitable festival weekends.
Once the additional regulations are approved, none – including a change to the number of annual contracts vacation rental owners could sign, from 36 to 26 — would apply to existing permit holders or those currently going through the application process until Jan. 1, 2026.
For dozens of vacation rental owners and industry professionals who spoke Thursday evening, a proposal that permit holders to occupy their homes for a certain number of days each year drew the most protest.
“It’s frankly a poison pill and will create chaos,” said David Feltman, a co-founder of Vacation Rental Owners and Neighbors of Palm Springs. “Honestly, I feel like it’s peeping in people’s bedrooms to an extent.”
That proposal failed to move forward after a majority of councilmembers could not agree on whether the requirement was necessary and, if it was, how many days should be required.
“I’m concerned about how you implement it,” Mayor Pro Tem Grace Garner said about the occupancy proposal, echoing the concerns of others. “Even with requiring 30 days, we have people who are very upset about vacation rentals, so do we get what amounts to kindergarten tattling?”
Thursday’s discussion was likely the last step before the Council makes a final vote on the additional regulations. That vote is expected at the next regular meeting on Nov. 28.
Last month the Council voted 4-0 to halt processing new permits for the rentals until Nov. 30. By instituting the pause, they hoped to be able to fine-tune existing regulations in response to issues that have bubbled up since they went into effect in 2017. With that fine-tuning now agreed on, the moratorium will be lifted.
In 2018, Palm Springs voters rejected a ban on short-term vacation rentals, acknowledging the importance of an additional tax revenue stream in a city dependent on the hospitality and tourism industry. Voters in other Coachella Valley cities, including La Quinta this week, have approved the bans.
Current elected officials in Palm Springs became concerned that an increasing number of those who purchased homes and received vacation rental permits did not intend to ever live in the city.
“A lot of people talk about their vacation rentals as a business,” said Councilmember Geoff Kors before reading portions of the original STVR ordinance. “Businesses are not allowed in residential neighborhoods.
“I think what has happened, especially during Covid, is that people bought them as businesses and are operating them as businesses.”
