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existing hotel market, there may be significant downsides to these uses. The popularity and profitability of short-term rentals has spurred an industry where dwellings are bought and used exclusively for short-term rentals, removing housing stock that would otherwise be available for longer lease terms. A rotating series of renters in residential neighborhoods may create traffic, noise, parking, and safety concerns for neighborhoods. Short-term rentals may introduce commercial uses into previously residential areas, as larger homes may be rented for “corporate retreats” and other types of commercial and business uses. ANALYSIS Current Regulations Short-term rentals are a new type of use that has only gained popularity in the last several years. Cities throughout the country are evaluating the impacts of the use and adopting local regulations to fit local conditions. Redwood City has a permissive zoning code, which means that any use not called out specifically as permitted is considered prohibited. The current zoning ordinance does not permit short-term rentals and they are considered a prohibited use. Proposed Ordinance Amendments and Analysis Recognizing that short-term rental uses are widespread and currently operating throughout Redwood City, staff is proposing a Zoning Ordinance amendment to Article 31 (Special Uses) that would specifically allow limited short-term rentals with operating standards addressing parking, noise and other negative impacts. Concurrent with this Zoning Ordinance amendment, the City Council will also consider an amendment to the Transient Occupancy Tax (TOT) regulations (Municipal Code, Chapter 32, Article IV) and a resolution dedicating the resulting TOT money towards affordable housing projects, programs and administration. The Planning Commission recently made a make a recommendation on the Zoning Ordinance amendment portion of the proposal. There are several key considerations with the proposed Zoning Ordinance amendment. The purpose of the ordinance is to: 1. Allow limited short-term rental uses while preventing the loss of housing stock, 2. Preserve residential character and establish operating standards to reduce potential noise, parking, traffic, property maintenance and safety impacts on adjacent neighbors; and 3. Provide a registration mechanism for the City to track and enforce these requirements as needed and ensure appropriate collection of transient occupancy taxes. Allow Limited Short-Term Rental Uses While Preventing Loss of Housing Stock Short-term rentals have been a significant concern as they may reduce housing stock available for longer lease terms. The popularity of short-term rentals, and the substantial average rent that may be collected per night ($193/night average in 2015 as described in the 21 elements report) has incentivized the use of dwellings as exclusively short- 7.B. - Page 2