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Bed and breakfast, short-term residential occupancy licensing opens Monday

San Diego's seal is shown at the downtown City Administration Building, May 8, 2018.
Megan Wood
San Diego's seal is shown at the downtown City Administration Building, May 8, 2018.

Beginning Monday at noon, operators of short-term rental properties in the city of San Diego can apply for a license to offer stays of less than a month.

The ordinance mandating the short-term residential occupancy, or STRO, license was passed in 2021 and subsequently approved by the California Coastal Commission. Its guidelines include a requirement for rental hosts to obtain a license and establishes a cap on the number of licenses granted for whole-home rentals operating more than 20 days per year.

"After leading this effort for the past two years, I look forward to the STRO license application process opening for all tiers on Oct. 3, 2022," said Councilwoman Jennifer Campbell. "A host will be able to apply for one of the following four STRO license tiers: Part-Time, Home Sharing, Whole-Home and Mission Beach Whole Home. These new regulations will return more housing into the market and give neighborhoods more quality of life."

The STRO license will be required starting on May 1, 2023. The law caps short-term vacation rentals at 1% of the city's housing supply and prioritizes "good actors" in a lottery to determine who gets to offer properties for whole-home vacation rentals.

But the ordinance, which Campbell called last year a compromise between property owners and corporate rental services such as VRBO and Airbnb, has drawn criticism — mainly from landlords concerned about the fairness and equitability of the forthcoming lottery system.

Before beginning the application process, hosts must possess an active Transient Occupancy Tax certificate and ensure all Rental Unit Business Taxes are in active paid status, according to the city. In addition, applicants are encouraged to visit the city's STRO site, www.sandiego.gov/stro, and complete the STRO Application checklist before Monday.

"We are focused on ensuring this process is clear and easy to understand, and we are here to support applicants," said City Treasurer Elizabeth Correia. "Our team put together a comprehensive STRO application checklist and an STRO license application video that will assist hosts in a successful application submittal. We strongly encourage hosts to review the materials available on the STRO webpage."

For whole-home rentals operating more than 20 days per year, the application period for STRO licenses will be open from Monday at noon through Nov. 30 at 5 p.m. Whole-home license recipients will be announced by Dec. 16. The application period for the remaining license types will remain open indefinitely.

Hosts are encouraged to apply as early as possible.

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