Fullerton extends moratorium on new short-term rental permits to allow policy rewrite

The Fullerton City Council voted July 15 to extend an urgency moratorium on new short-term rental (STR) permits for the maximum allowable period (an additional 22 months and 15 days plus the initial 45-day period). Staff said the city has identified 173 unpermitted STR listings, opened 36 code-enforcement cases in the past year and found applicants trying to manipulate listings to bypass denials. Staff also reported enforcement costs and audits of transient occupancy tax (TOT) could take significant time.

Under the extension, the city paused accepting new STR applications. Staff said applications already submitted will remain in the queue (first-come, first-served) but will not be reviewed until the policy and enforcement work is complete. Staff estimated a best-case return with a revised policy by the end of 2025 or January 2026 but cautioned the timeline depends on enforcement and audit workload.

City staff said the moratorium is intended to allow time to: (1) conduct a comprehensive STR ordinance review; (2) perform citywide outreach and consider inspection/permit protocols and caps; (3) strengthen enforcement tools; and (4) audit TOT remittances by unpermitted operators. The council approved the urgency ordinance after a public hearing; speakers included hosts who said they had relied on earlier city guidance and asked for clarity about grandfathering and timelines. Staff and the city attorney explained legal limits on grandfathering and the statutory sequencing for moratoriums.

Next steps: staff will draft a revised STR ordinance, begin outreach and report back to council with proposed rules and an implementation timeline.