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Santa Barbara must allow vacation rentals on the coast, court rules

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A California construction executive who won a $180 million lottery is selling his ridge-top mansion and 865-acre property in Santa Barbara County for $26 million.
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A California construction executive who won a $180 million lottery is selling his ridge-top mansion and 865-acre property in Santa Barbara County for $26 million.

In a big blow to the City of Santa Barbara, a court has ruled that the city must again allow vacation rentals in the coastal zone.

The Feb. 20 ruling from Ventura County Superior Court Judge Mark Borrell states that Santa Barbara must allow short-term vacation rentals in the coastal zone on the same basis as it had allowed them to operate prior to banning them in 2015.

“This is a tentative decision, so we are cautiously optimistic,” said Theo Kracke, a vacation rental property owner, who filed a lawsuit against the city. “Nevertheless, we are thrilled it appears the court embraced our arguments that the city acted improperly.

“If the final decision falls our way, it will be a victory for those people who could not otherwise enjoy the Santa Barbara coastline.”

Santa Barbara City Attorney Ariel Calonne said the case is likely not over and that the city will appeal.

“Of course we are disappointed,” he said, “but this is an instance where new law is being made, and we’ve known from Day One that the case would likely end up in the appellate courts.”

Kracke’s lawsuit alleged that Santa Barbara’s 2015 ban on short-term vacation rentals was illegal and a violation of the California Coastal Act, which requires that the general public must have affordable accommodations within and access to the coastal zone. The City Council voted to ban the practice as a way to preserve affordable housing in the city, reasoning that property owners would rent the residences to locals instead of to out-of-town vacationers.

Borrell ruled that the city failed to apply for a coastal development permit to ensure its actions conformed to the state Coastal Act and its own Local Coastal Plan. Short-term rentals, or STRs, are barred in residential zones in the city.

In June 2015, the City Council voted to enforce its longstanding zoning regulations after years of turning a blind eye to zoning violations.

STRs are only permitted in zoning districts that allow hotels, which are mostly commercially zoned districts.

Kracke, who is represented by Travis Logue and Jason Wansor, partners in the Santa Barbara law firm Rogers, Sheffield & Campbell LLP, expects the city to continue the battle.

“Given the city’s aggressive tactics over the last few years, I am sure this fight will continue,” he said.

Noozhawk staff writer Joshua Molina can be reached at jmolina@noozhawk.com. Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.
Joe Tarica is the editor of The Tribune in San Luis Obispo. He’s worked in various newsroom roles since 1993, including as an award-winning copy editor, designer and writer of the Joetopia column. A California native, he has been a resident of San Luis Obispo County for more than three decades and is a Cal Poly graduate.
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