UPDATE: The council agreed on Tuesday to delay the vote on whether to settle the city’s lawsuit that the San Clemente Coastal Access Alliance and the Coastal Environmental Rights Foundation filed in November 2018.

The two groups—a coalition of vacation rental owners and environmentalists—challenged the city’s authority to enforce its ordinances that govern short-term lodging units within the coastal zone without first having the California Coastal Commission’s approval to do so.

The draft of the settlement proposes that the city pay $125,000—$25,000 to the Foundation and $100,000 to the Alliance for attorney’s fees. According to the city estimates, by not settling the lawsuit now, ongoing litigation could cost the city as much as $350,000 if it loses.

The city would also agree to extend an amortization period to certain STLU operators who previously held licenses and were in good standing when the ordinance went into effect in the spring of 2018.

During Tuesday’s council meeting, which was conducted via teleconference, City Attorney Scott Smith noted that about 25 to 30 licensees could qualify for the amortization.

Should the council approve the settlement, the groups would drop their suit and agree not to sue the city again “except to enforce the terms of this Agreement.”

However, Councilmember Kathy Ward asked her fellow councilors to push the vote back because she still had some concerns that hadn’t been addressed yet. She said they were supposed to discuss those concerns during the council’s closed session on Tuesday, but because of time constraints, they didn’t get to it.

Councilmember Gene James agreed with Ward, stating that “this is an issue that impacts families, this is an issue that impacts neighborhoods and we are in a special, unprecedented time here.”

“I would really like interested parties to be able to give us, the council, meaningful public comment,” he added.

Touching on the public’s ability to weigh in on the issue, Mayor Dan Bane said residents have had an opportunity to submit comments and has “seen a number of emails from people voicing their objection to (the settlement).”

“I think a lot of the emails and letters I saw did get that point across,” Bane said, before responding that the settlement doesn’t give the STLU operators cart blanche.

He also emphasized that the 25 to 30 former licensees “might—and that’s a might—be  approved to operate.”

“The alternative is far, far worse for our community than approving this settlement,” Bane said. “That’s my belief but I will support continuing this motion.”

The council will conduct its next meeting via teleconference on April 21 at 6 p.m. when deliberation over the settlement is expected to resume. The meeting can be live-streamed through the city’s YouTube channel.

Below is the original version of the story that was published on Monday, April 6.

By Shawn Raymundo

City councilors on Tuesday, April 7, are scheduled to vote on whether to settle a lawsuit with the coalition of vacation rental owners and an environmental group that challenged the city’s authority in regulating short-term lodging units (STLU) within the coastal zone.

According to the proposed settlement agreement with the San Clemente Coastal Access Alliance and the Coastal Environmental Rights Foundation, the city would be on the hook to pay $125,000, as well as extend an amortization period to select STLU operators.

In return, the two groups would dismiss the lawsuit filed against the city back in November 2018 and also agree not to sue the city again “except to enforce the terms of this Agreement.”

In their joint lawsuit, the two groups alleged that the city didn’t have the authority to enforce its laws governing STLUs within the coastal zone because it lacked approval from the California Coastal Commission (CCC).

“The settlement is sort of an imperfect resolution for both parties. It means everybody gave a little bit,” said Livia Borak Beaudin, attorney for the Coastal Access Alliance.

Based on a recent court ruling that struck down the city of Santa Barbara’s ban on vacation rentals in its coastal zone, Beaudin said their case is on solid ground. However, she continued, litigation could take years.

“The settlement is a way to get something now versus rolling the dice,” she said, adding, “this eventually will go to the Coastal Commission, either this year or next year. The Coastal Commission will have final say—we all agree on that. For us, this was a win to expand access to the coast in the interim.”

Currently, the item is scheduled for deliberation on the agenda for the council’s April 7 meeting. However, according to Beaudin, she received word from the city on Monday, April 6, that the council is likely going to continue the discussion to a later date as the city continues encouraging residents to practice social distancing amid the coronavirus pandemic.

In May of 2016, amid a myriad of complaints related to the businesses operating in residential neighborhoods, the city adopted ordinances to regulate STLUs and establish designated areas of San Clemente where such rentals could be permitted.

The action, however, prompted a legal challenge by a separate group of vacation rental owners and property managers, called the San Clemente Vacation Rental Alliance. The proponents of the STLUs had argued that the city should punish only people who cause distress for their neighbors, while noting such a business is a primary means of income, news files state.

To settle that lawsuit, the city council in the fall of 2017 proposed to relax many of the provisions in the ordinances. Some of the amendments included the elimination of STLU-specific parking standards and expanding the allowed areas to include lots on Avenida Montalvo and Buena Vista, according to previous city reports.

Per that settlement with the Vacation Rental Alliance, the city extended the amortization period for 19 properties to continue operating as vacation rentals until 2026. That settlement agreement was finalized in April 2018.

During the process of settling that previous lawsuit, the city, according to its agenda report on the latest settlement agreement, has been working with the Coastal Commission to have the amendments to the STLU ordinances incorporated into San Clemente’s proposed Local Coastal Program (LCP)—a planning tool used by local governments to guide development.

The SC Coastal Access Alliance and the environmental group, however, believe that the city’s enforcement of those amended STLU ordinances without first having its LCP in place is unlawful. And in doing so, the groups claim, there are fewer affordable accommodations to those looking to visit San Clemente, particularly around the coastal area.

As part of the latest settlement, the city is agreeing to an amortization hardship extension for STLU operators who had active licenses and were in good standing when the ordinances were put in place. The city estimates that there could be about 25 to 30 licensees who qualify for the amortization.

Under the proposed settlement, the amortization period would extend to May 17, 2026, or until the property is sold or transferred—whichever comes first.

The council meeting will begin at 6 p.m. on Tuesday, April 7. The meeting can be streamed through the city’s YouTube channel.

SR_1Shawn Raymundo
Shawn Raymundo is the city editor for the San Clemente Times. He graduated from Arizona State University with a bachelor’s degree in Global Studies. Before joining Picket Fence Media, he worked as the government accountability reporter for the Pacific Daily News in the U.S. territory of Guam. Follow him on Twitter @ShawnzyTsunami and follow San Clemente Times @SCTimesNews.

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