Court Opinion

ID: 4443989
Source: CourtListenerOpinion
Date Created: 2019-10-03 17:01:26.729235+00
Date Added: 2024-06-11T14:27:55.769103
License: Public Domain

FOR PUBLICATION

   UNITED STATES COURT OF APPEALS
        FOR THE NINTH CIRCUIT

ARLENE ROSENBLATT, an individual,                 No. 17-55879
on behalf of herself and all others
similarly situated,                                 D.C. No.
                    Plaintiff-Appellant,         2:16-cv-04481-
                                                   ODW-AGR
                     v.

CITY OF SANTA MONICA, a municipal                   OPINION
corporation; THE CITY COUNCIL OF
THE CITY OF SANTA MONICA, a
governing body,
               Defendants-Appellees.

        Appeal from the United States District Court
           for the Central District of California
        Otis D. Wright II, District Judge, Presiding

           Argued and Submitted October 12, 2018
                    Pasadena, California

                      Filed October 3, 2019

  Before: Mary M. Schroeder and Jacqueline H. Nguyen,
  Circuit Judges, and Michael H. Simon, * District Judge.

                   Opinion by Judge Nguyen

    *
      The Honorable Michael H. Simon, United States District Judge for
the District of Oregon, sitting by designation.
2          ROSENBLATT V. CITY OF SANTA MONICA

                          SUMMARY **

                           Civil Rights

    The panel affirmed the district court’s dismissal of a
putative class action against the City of Santa Monica and
Santa Monica City Council alleging that the City’s short-
term vacation rental ordinance violates the dormant
Commerce Clause.

    Santa Monica’s ordinance prohibits property rentals of
30 days or less with an exception for rentals where a primary
resident remains in the dwelling. Plaintiff is a Santa Monica
resident and homeowner who, prior to the passage of the
ordinance, rented out her house on Airbnb.

    The panel first held that the ordinance is not a per se
violation of the dormant Commerce Clause because it does
not directly regulate interstate commerce. At most, the
ordinance has an interstate effect because it makes travel
lodging to Santa Monica less accessible, available and
affordable. Moreover, the ordinance penalizes only conduct
in Santa Monica, regardless of whether the visitors are in-
state or out-of-state. The panel rejected plaintiff’s argument
that the ordinance violates the dormant Commerce Clause by
directly regulating booking and payment transactions that
may occur entirely out-of-state. The panel held that the
ordinance applies evenhandedly and does not directly
restrain interstate commerce although it may regulate
transactions with an interstate component. The panel further
held that nothing in the ordinance suggested that its
    **
       This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
          ROSENBLATT V. CITY OF SANTA MONICA                3

advertising ban was intended to have extraterritorial
application.

    The panel held that the ordinance does not discriminate
against interstate commerce by favoring in-state over out-of-
state interests. The panel determined that Santa Monica’s
ban on vacation rentals applies in the same manner to
persons nationwide, including Santa Monica residents who
may be interested in renting a vacation home from another
resident. The panel further noted that the ordinance applies
equally to renters and property owners from outside
California, California residents outside of Santa Monica, and
Santa Monica residents. The panel held that the complaint
did not adequately allege that the ordinance increases the
relative market share of local businesses or that it has a net
negative effect on commerce outside of California. Finally,
the panel held that the complaint failed to plausibly allege
that the home-sharing exception obviously advantages Santa
Monica residents at the expense of out-of-state homeowners.

    The panel held that the complaint failed to plausibly
allege that the ordinance unduly burdens interstate
commerce through its incidental effects. Because plaintiff
failed to show a high burden on interstate commerce – and,
at most, suggested some negligible burden on the local
economy of Santa Monica – the complaint could not meet
the standard established in Pike v. Bruce Church, Inc., 397
U.S. 137 (1970). Thus, the complaint’s allegations did not
adequately demonstrate how the alleged burden on interstate
commerce would clearly exceed the stated benefits of the
ordinance.
4        ROSENBLATT V. CITY OF SANTA MONICA

                        COUNSEL

Robert L. Esensten (argued) and Jordan S. Esensten,
Esensten Law, Los Angeles, California, for Plaintiff-
Appellant.

Yibin Shen (argued), Chief Deputy City Attorney; Heidi
Von Tongeln and Michael R. Cobden, Deputy City
Attorneys; Lane Dilg, City Attorney; Santa Monica City
Attorney’s Office, Santa Monica, California; for
Defendants-Appellees.

                        OPINION

NGUYEN, Circuit Judge:

    This case involves the perennial clash between a city’s
exercise of traditional police powers in regulating land use
and the rights of property owners to use their property as
they see fit. But this familiar problem has a not-so-familiar
backdrop: online marketplaces—such as Airbnb and
HomeAway—where travelers can rent privately-owned
residential properties as vacation rentals.

    Santa Monica resident Arlene Rosenblatt used to rent out
her house on Airbnb when she and her husband went on
vacation. Santa Monica passed an ordinance prohibiting
property rentals of 30 days or less (“vacation rentals”) with
an exception for rentals where a primary resident remained
in the dwelling (“home sharing”). Rosenblatt brought a
putative class action against the city of Santa Monica and
Santa Monica’s City Council (collectively, Santa Monica),
arguing that the ordinance violated the dormant Commerce
             ROSENBLATT V. CITY OF SANTA MONICA                        5

Clause. Rosenblatt contended that the ordinance directly
and indirectly regulated and burdened interstate commerce.

    The district court dismissed the amended complaint
without leave to amend, concluding that Rosenblatt failed to
allege a Commerce Clause violation as a matter of law. We
have jurisdiction under 28 U.S.C. § 1291. Reviewing de
novo, see Chinatown Neighborhood Ass’n v. Harris, 794
F.3d 1136, 1141 (9th Cir. 2015), we affirm.

    I. FACTUAL    AND                              PROCEDURAL
       BACKGROUND

    Santa Monica has implicitly prohibited short-term
property rentals in residential zones since at least 1988. 1 In
2015, Santa Monica explicitly codified this zoning
prohibition on vacation rentals in an ordinance. See Santa
Monica Ordinance 2484 (May 12, 2015) (codified as
amended at Santa Monica Mun. Code §§ 6.20.010–
6.20.100). 2 The ordinance created an exception for home
sharing to allow residents to “host visitors in their homes, for
compensation . . . , while at least one of the dwelling unit’s
primary residents lives on-site, in the dwelling unit,
throughout the visitors’ stay.” Santa Monica Mun. Code
§ 6.20.010(a).

     1
       Santa Monica’s zoning ordinance authorizes property in residential
zones to be used for single- and multiple-family “dwelling units,” and
defines “dwelling” as “[a] structure or portion thereof which is used
principally for residential occupancy.” The zoning ordinance prohibits
uses that are not specifically authorized. Single-family “R1” zones do
not allow transient occupancy uses—such as bed and breakfasts, hotels,
and motels, while higher-density residential zones allow some or all of
those uses with a conditional use permit.

    2
        A copy of the ordinance is attached as Appendix A.
6         ROSENBLATT V. CITY OF SANTA MONICA

    The ordinance defines vacation rentals to cover
situations where the unit owner or lessee rents out the
property for “exclusive transient use,” meaning that “none
of the dwelling unit’s primary residents lives on-site . . .
throughout any visitor’s stay.” Id. § 6.20.010(f). Violations
of the vacation rental ordinance are punishable by a fine not
exceeding $500 and up to six months in jail. Id.
§ 6.20.100(a).

    In enacting this ordinance, the Santa Monica City
Council sought to preserve the city’s “available housing
stock and the character and charm which result, in part, from
cultural, ethnic, and economic diversity of its resident
population,” and “its unique sense of community which
derives, in large part, from residents’ active participation in
civic affairs, including local government, cultural events,
and educational endeavors.” Santa Monica Ordinance 2484,
pmbl. The city council stressed that “vacation rentals . . . are
detrimental to the community’s welfare and are prohibited
by local law, because occupants of such vacation rentals,
when not hosted, do not have any connections to the Santa
Monica community and to the residential neighborhoods in
which they are visiting” and “the presence of such visitors
within the City’s residential neighborhoods can sometimes
disrupt the quietude and residential character of the
neighborhoods.” Id.

    Rosenblatt is a Santa Monica resident and homeowner
who, prior to the ordinance, rented out her house on Airbnb
for $350 per night when she and her husband traveled. After
the city of Santa Monica enacted the ordinance, Rosenblatt
sued the city and its city council to enjoin the ordinance and
recover damages on behalf of herself and a class of similarly
situated individuals, claiming that the ordinance violates the
dormant Commerce Clause.
          ROSENBLATT V. CITY OF SANTA MONICA                7

    Rosenblatt alleges that the development of “an online
marketplace to list privately-owned properties for rent on a
short-term basis” allowed tourists to opt for less expensive
residential rentals over “the ultra-luxurious, highly
occupied, and pricey hotels in the City.” According to
Rosenblatt, Santa Monica’s real reason for enacting the
vacation rental ordinance was to prop up demand for the
city’s high-end hotels and thereby reverse a decline in
revenue from the city’s 14% transient occupancy tax, which
the hotels paid but the vacation rentals did not. The district
court dismissed Rosenblatt’s initial complaint for failure to
state a claim, and Rosenblatt filed her first amended
complaint. The district court again dismissed Rosenblatt’s
amended dormant Commerce Clause claims under Federal
Rule of Civil Procedure 12(b)(6), this time without leave to
amend. Rosenblatt appeals.

   II. DISCUSSION

       A. The dormant Commerce Clause

    The Commerce Clause affirmatively grants to Congress
the power to regulate interstate commerce. In order to
advance national solidarity and prosperity, the Supreme
Court has given meaning to the Clause’s “great silences.”
H.P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 535
(1949). The Court refers to these silences—the Clause’s
“negative” aspect—as the dormant Commerce Clause. See
Tenn. Wine & Spirits Retailers Ass’n v. Thomas, 139 S. Ct.
2449, 2459 (2019).

    The dormant Commerce Clause “denies the States the
power unjustifiably to discriminate against or burden the
interstate flow of articles of commerce.” Or. Waste Sys., Inc.
v. Dep’t of Envtl. Quality, 511 U.S. 93, 98 (1994). “The
primary purpose of the dormant Commerce Clause is to
8        ROSENBLATT V. CITY OF SANTA MONICA

prohibit ‘statutes that discriminate against interstate
commerce’ by providing benefits to ‘in-state economic
interests’ while ‘burdening out-of-state competitors.’” Ass’n
des Éleveurs de Canards et d’Oies du Québec v. Harris, 729
F.3d 937, 947 (9th Cir. 2013) (quoting Nat’l Ass’n of
Optometrists & Opticians v. Harris, 682 F.3d 1144, 1148
(9th Cir. 2012)); see also C & A Carbone, Inc. v. Town of
Clarkstown, 511 U.S. 383, 390 (1994) (explaining that the
“central rationale” of the dormant Commerce Clause “is to
prohibit state or municipal laws whose object is local
economic protectionism, laws that would excite those
jealousies and retaliatory measures the Constitution was
designed to prevent”).

   In reviewing challenges to local regulations under the
dormant Commerce Clause, we follow a two-tiered
approach:

       [1] When a state statute directly regulates or
       discriminates against interstate commerce, or
       when its effect is to favor in-state economic
       interests over out-of-state interests, we have
       generally struck down the statute without
       further inquiry. [2] When, however, a statute
       has only indirect effects on interstate
       commerce and regulates evenhandedly, we
       have examined whether the State’s interest is
       legitimate and whether the burden on
       interstate commerce clearly exceeds the local
       benefits.

Brown-Forman Distillers Corp. v. N.Y. State Liquor Auth.,
476 U.S. 573, 579 (1986) (citations omitted); see also S.D.
Myers, Inc. v. City & County of San Francisco, 253 F.3d
461, 466 (9th Cir. 2001). “It is well settled that a state
          ROSENBLATT V. CITY OF SANTA MONICA                9

regulation validly based on the police power does not
impermissibly burden interstate commerce where the
regulation neither discriminates against interstate commerce
nor operates to disrupt its required uniformity.” Constr.
Indus. Ass’n of Sonoma Cty. v. City of Petaluma, 522 F.2d
897, 909 (9th Cir. 1975); see also Village of Euclid v. Ambler
Realty Co., 272 U.S. 365, 390 (1926) (upholding zoning
regulations that excluded hotels from residential areas).

    To succeed on her facial challenge under the dormant
Commerce Clause, Rosenblatt must establish “that no set of
circumstances exists under which the [Ordinance] would be
valid. The fact that [the Ordinance] might operate
unconstitutionally under some conceivable set of
circumstances is insufficient to render it wholly invalid.”
S.D. Myers, Inc., 253 F.3d at 467 (alterations in original)
(quoting United States v. Salerno, 481 U.S. 739, 745
(1987)). Because of this high burden, “we construe the
Ordinance narrowly and resolve any ambiguities in favor of
the    interpretation     that  most    clearly   supports
constitutionality.” Id. at 468.

       B. The complaint does not allege a per se
          violation of the dormant Commerce Clause

               1.     The ordinance does not directly
               regulate interstate commerce

    A per se violation of the dormant Commerce Clause
occurs “[w]hen a state statute directly regulates or
discriminates against interstate commerce, or when its effect
is to favor in-state economic interests over out-of-state
interests.” Daniels Sharpsmart, Inc. v. Smith, 889 F.3d 608,
614 (9th Cir. 2018) (alteration in original) (quoting Brown-
Forman Distillers Corp., 476 U.S. at 579). A local law
directly regulates interstate commerce when it “directly
10        ROSENBLATT V. CITY OF SANTA MONICA

affects transactions that take place across state lines or
entirely outside of the state’s borders.” Id. (quoting S.D.
Myers, Inc., 253 F.3d at 467).

               a. Vacation rentals

    Rosenblatt argues that the ordinance directly regulates
interstate commerce because 95% of Santa Monica vacation
rentals involve an out-of-state party. Although we agree that
vacation rentals generally implicate interstate commerce, see
Camps Newfound/Owatonna, Inc. v. Town of Harrison, 520
U.S. 564, 573 (1997), the relevant question here is whether
the ordinance directly regulates the interstate or
extraterritorial aspect of the vacation rental business. See
Chinatown Neighborhood Ass’n, 794 F.3d at 1145 (“[E]ven
when state law has significant extraterritorial effects, it
passes Commerce Clause muster when, as here, those effects
result from the regulation of in-state conduct.”).

    Rosenblatt relies heavily on Camps, but that case
addressed whether state law discriminated against interstate
commerce, not whether it directly regulated it. There, a state
statute provided a tax break to charitable institutions but
expressly exempted institutions that were “conducted or
operated principally for the benefit of persons who are not
residents” of the state. 520 U.S. at 568. The Supreme Court
concluded that “[t]he services that [the camp] provides to its
principally out-of-state campers clearly have a substantial
effect on commerce, as do state restrictions on making those
services available to nonresidents.” Id. at 574. However,
the Court recognized that “the discriminatory burden is
imposed on the out-of-state customer indirectly,” not
directly. Id. at 580.

    When this court has considered laws directly regulating
interstate commerce, we have also distinguished between
          ROSENBLATT V. CITY OF SANTA MONICA                 11

laws that directly regulate extraterritorial activity and laws
that indirectly regulate the effects of commerce. In
Chinatown Neighborhood Association, we held that a state
law banning shark fin trading survived a dormant Commerce
Clause challenge even though the law had direct effects on
commerce outside the state. 794 F.3d at 1145. We
contrasted extraterritorial effects that “result from the
regulation of in-state conduct,” id., with legislation that
directly regulates interstate commerce by either “fix[ing]
prices in other states, requir[ing] those states to adopt
California standards, or attempt[ing] to regulate transactions
conducted wholly out of state,” id. at 1146.

    Here, Santa Monica’s ordinance does not directly
regulate interstate commerce by prohibiting vacation rentals
for Santa Monica homes. At most, Rosenblatt alleges that
the ordinance has an interstate effect because it “makes
travel lodging in Santa Monica less accessible, available, and
affordable.” The ordinance penalizes only conduct in Santa
Monica, regardless of whether the visitors are in-state or out-
of-state. Accordingly, we conclude that the complaint does
not sufficiently allege that the vacation-rental ban itself is a
direct regulation of interstate commerce.

               b. Booking and payment transactions

    The ordinance makes it illegal to “undertake, maintain,
authorize, aid, facilitate or advertise any vacation rental
activity.” Santa Monica Mun. Code § 6.20.030. Rosenblatt
argues that the ordinance violates the dormant Commerce
Clause by directly regulating booking and payment
transactions that may occur entirely out-of-state.
Rosenblatt’s argument relies primarily on the plurality
opinion in Edgar v. MITE Corp., 457 U.S. 624 (1982), and
our decision in Valley Bank of Nevada v. Plus System, Inc.,
914 F.2d 1186 (9th Cir. 1990).
12        ROSENBLATT V. CITY OF SANTA MONICA

    In MITE, the state law directly regulated interstate
communications by preventing interstate tender offers
unless certain requirements were met. 457 U.S. at 640. The
Supreme Court held that this “direct regulation” surpassed
the “incidental regulation” of interstate commerce permitted
under the dormant Commerce Clause. Id. The MITE
plurality did not opine, as Rosenblatt asserts, that “state and
local laws purporting to regulate transactions and/or
commercial offers that occur ‘across state lines’ constitute ‘a
direct restraint on interstate commerce.’” Appellant’s
Opening Br. at 30 (quoting MITE, 457 U.S. at 641–42). The
plurality instead held that the particular state statute at issue
was “a direct restraint on interstate commerce” because it
regulated conduct that “would not affect a single [in-state]
shareholder” and had “a sweeping extraterritorial effect.” Id.
at 642. A state or local law that regulates transactions with
an interstate component is not in itself problematic; the law
becomes problematic when it directly regulates the interstate
component of the transaction.

    Valley Bank, in contrast, held that a state law regulating
in-state ATM transactions did not violate the Commerce
Clause even though it directly affected the workings of an
interstate ATM network. 914 F.2d at 1190–93. There, we
rejected the ATM network’s argument that the law directly
regulated interstate commerce just because uniformity
among ATMs in different states was important to the
network’s efficient operation. Id. We stressed that “the
commerce clause does not exist to protect a business’s right
to do business according to whatever rules it wants,” which
is especially true in industries where uniformity is not a
necessity. Id. at 1192. We also noted that a state’s law “is
not ‘discriminatory’ under the commerce clause simply
because it applies most often to out-of-staters.” Id. We
          ROSENBLATT V. CITY OF SANTA MONICA                 13

concluded that a law “that applies evenhandedly certainly
passes muster under the commerce clause.” Id. at 1193.

     As discussed above, the ordinance here applies
evenhandedly. Unlike MITE, the ordinance does not directly
restrain interstate commerce although it may regulate
transactions with an interstate component. Because every
out-of-state booking and payment that the ordinance
regulates necessarily concerns property within Santa
Monica, we cannot characterize these transactions as
activities that are separate and entirely out-of-state. They are
better categorized as part of a contractual relationship that
Santa Monica properly regulates under its police power.
Further, uniformity is not necessary to the vacation rental
market. Even if numerous municipalities nationwide
adopted ordinances like Santa Monica’s, the national market
for vacation rental bookings and payments would not be
stifled. See Valley Bank, 914 F.2d at 1191–93; see also
Exxon Corp. v. Governor of Maryland, 437 U.S. 117, 128
(1978) (stating that the Court “has only rarely held that the
Commerce Clause itself pre-empts an entire field from state
regulation, and then only when a lack of national uniformity
would impede the flow of interstate goods”).

               c. Advertising

    Rosenblatt also contends the ordinance “purports to ban
wholly extraterritorial communications and advertisements
made over the Internet and in other jurisdictions” by
preventing the advertisement of Santa Monica vacation
rentals. The argument concerns section 6.20.030 of the
ordinance:

       No person, including any Hosting Platform
       operator,   shall    undertake,   maintain,
       authorize, aid, facilitate or advertise any
14         ROSENBLATT V. CITY OF SANTA MONICA

         Home-Sharing activity that does not comply
         with Section 6.20.020 of this Code or any
         Vacation Rental activity.

Santa Monica Mun. Code § 6.20.030(a) (2015) (emphasis
added). Rosenblatt contends that the ordinance’s reference
to ‘person’ deprives any person—within or outside of Santa
Monica and regardless of whether she actually intends to
rent out her property—of her right to advertise a Santa
Monica vacation rental.

     Santa Monica offers a different interpretation. 3 It
contends that canons of construction compel us to construe
section 6.20.030 narrowly as applying only within the city’s
territorial limits. Federal courts “must accept a narrowing
construction to uphold the constitutionality of an ordinance
if its language is ‘readily susceptible’ to it.” Nunez ex rel.

     3
        At oral argument, Santa Monica’s counsel argued that section
6.20.030’s use of ‘person’ is limited by the second half of that sentence,
which requires any advertising to comply with section 6.20.020’s
requirements for hosts who engage in home sharing. But “person”
applies to one who advertises either “any Home-Sharing activity that
does not comply with Section 6.20.020” or “any Vacation Rental
activity.” Underscoring this point, in 2017 Santa Monica reversed the
order of these two independent clauses: “No host shall undertake,
maintain, authorize, aid, facilitate or advertise any vacation rental
activity or any home-sharing activity that does not comply with Section
6.20.020 . . . .” Santa Monica Mun. Code § 6.20.030 (2017). A host
“includes any person who offers, facilitates, or provides services to
facilitate, a vacation rental or home-share, including but not limited to
insurance, concierge services, catering, restaurant bookings, tours, guide
services, entertainment, cleaning, property management, or maintenance
of the residential property or unit.” Id. § 6.20.010(b). Rosenblatt
confirmed at oral argument that her challenge was specific to the 2015
version of the ordinance, not the 2017 version.
           ROSENBLATT V. CITY OF SANTA MONICA                        15

Nunez v. City of San Diego, 114 F.3d 935, 942 (9th Cir.
1997) (quoting Virginia v. Am. Booksellers Ass’n, 484 U.S.
383, 397 (1988)). A California municipality “may not
exercise its governmental functions beyond its . . .
boundaries,” S.D. Myers, Inc., 253 F.3d at 473 (quoting City
of Oakland v. Brock, 67 P.2d 344, 345 (Cal. 1937))
(emphasis omitted), and courts “presum[e] that the
legislative body intended not to violate the constitution”
when enacting ordinances, City of Los Angeles v. Belridge
Oil Co., 271 P.2d 5, 11 (Cal. 1954). Courts interpreting a
municipal ordinance therefore “presum[e] that the governing
body of the city was legislating with reference to the conduct
of business within the territorial limits of the city.” Id.
(quoting City of Sedalia ex rel. Ferguson v. Shell Petroleum
Corp., 81 F.2d 193, 196–97 (8th Cir. 1936)). Because
nothing in the ordinance here suggests that it was intended
to have extraterritorial application, 4 we reject Rosenblatt’s
broader construction of the ordinance’s advertising ban.

                  2.     The     ordinance       does   not
                  discriminate against interstate commerce

    We next consider Rosenblatt’s arguments that the
ordinance is a per se violation of the dormant Commerce
Clause because it favors in-state over out-of-state interests.

    The party challenging legislation on dormant Commerce
Clause grounds bears the initial burden of showing
discrimination. Int’l Franchise Ass’n v. City of Seattle, 803
F.3d 389, 400 (9th Cir. 2015). The most common form of
    4
      Even if the ordinance could be construed broadly to apply to a non-
resident’s vacation rental advertising occurring wholly outside of the
city, Rosenblatt, as a Santa Monica resident, lacks standing to challenge
Santa Monica’s direct regulation of such a transaction. See Sierra Med.
Servs. All. v. Kent, 883 F.3d 1216, 1227 (9th Cir. 2018).
16        ROSENBLATT V. CITY OF SANTA MONICA

discrimination against interstate commerce is disparate
impact: the “differential treatment of in-state and out-of-
state economic interests that benefits the former and burdens
the latter.” Or. Waste Sys., Inc., 511 U.S. at 99. The
Supreme Court has also found discrimination when a law
imposes costs on out-of-staters that in-state residents would
not have to bear. See, e.g., Hunt v. Wash. State Apple Advert.
Comm’n, 432 U.S. 333, 350–51 (1977) (finding a state law
discriminatory partially because of the costs imposed on out-
of-state producers as compared to in-state producers).

    Further, “local regulations that treat out-of-staters in a
disparate manner will be treated as discriminatory even
though they also discriminate against those in other parts of
that state.” Erwin Chemerinsky, Constitutional Law:
Principles and Policies, § 5.3.4, at 475 (6th ed. 2019). In
Dean Milk Co. v. City of Madison, 340 U.S. 349 (1951), the
Court considered an ordinance that required all milk sold in
a city to be pasteurized within five miles of the city. See id.
at 351–52. The ordinance effectively prevented the sale of
milk pasteurized in other states, as well as milk pasteurized
in most other parts of the state. See id. at 352. The Court
concluded that the ordinance violated the dormant
Commerce Clause because it “erect[ed] an economic barrier
protecting a major local industry against competition from
without the state.” Id. at 354. In a footnote, the Court
stressed the irrelevance of the fact that the law also
discriminated against in-state sellers: “It is immaterial that
Wisconsin milk from outside the Madison area is subjected
to the same proscription as that moving in interstate
commerce.” Id. at 354 n.4.

   Similarly, in Fort Gratiot Sanitary Landfill, Inc. v.
Michigan Department of Natural Resources, the Supreme
Court held that a state law was discriminatory when it
          ROSENBLATT V. CITY OF SANTA MONICA               17

limited the ability of a county to accept waste for disposal
from other counties or other states. 504 U.S. 353 (1992).
Again, the Court recognized that discrimination against
other counties does not change the analysis because “a state
(or one of its political subdivisions) may not avoid the
strictures of the Commerce Clause by curtailing the
movement of articles of commerce through subdivisions of
the State, rather than through the State itself.” Id. at 361.

    Nevertheless, the Supreme Court has been careful to
distinguish discrimination through purpose or effect—which
may violate the dormant Commerce Clause—from the non-
discriminatory, incidental effects of a law. In Exxon Corp.
v. Governor of Maryland, 437 U.S. 117 (1978), the Court
examined a state law that prohibited petroleum producers
and refiners from operating gas stations in the state. All of
the petroleum products sold in the state were produced and
refined out-of-state; the effect of the law was to prevent all
oil companies from owning in-state gas stations, benefiting
local business. Id. at 127–28. The Court still concluded that
the law was not discriminatory:

        [T]he Act creates no barriers whatsoever
        against interstate independent dealers; it does
        not prohibit the flow of interstate goods,
        place added costs upon them, or distinguish
        between in-state and out-of-state companies
        in the retail market. The absence of any of
        these factors fully distinguishes this case
        from those in which a State has been found to
        have discriminated against interstate
        commerce.

Id. at 126.
18        ROSENBLATT V. CITY OF SANTA MONICA

    We now address each of Rosenblatt’s specific arguments
that the ordinance discriminates against out-of-state
interests.

                a. Access to residential neighborhoods

    First, Rosenblatt argues that Santa Monica is attempting
to “preclud[e] out-of-state travelers from accessing
[residential] neighborhoods.” Given the availability of
reasonable alternatives to vacation rentals, the ordinance
does not preclude anyone from accessing city
neighborhoods. And, insofar as the ordinance might favor
owners by allowing them to live in residential
neighborhoods, it does not discriminate against persons
outside of Santa Monica, who stand on equal footing with
Santa Monica residents in their ability to purchase Santa
Monica property and reside there.

    Rosenblatt relies heavily on City of Philadelphia v. New
Jersey, 437 U.S. 617 (1978), which involved a state law that
was facially discriminatory: It “prohibit[ed] the importation
of most solid or liquid waste which originated or was
collected outside the territorial limits” of the state. Id. at 618
(internal quotation mark omitted). The Supreme Court
explained that the state would have been free to ban the flow
of waste into its landfills altogether, even if such a measure
affected interstate commerce. See id. at 625–26. The Court
held that the state statute, however, violated the dormant
Commerce Clause because it “discriminat[ed] against
articles of commerce coming from outside the State,” as
opposed to all waste. Id. at 626–27. It made no difference
whether the state’s intent was environmental conservation or
economic protectionism because the state provided no
reason, “apart from their origin, to treat them differently.”
Id. at 627.
          ROSENBLATT V. CITY OF SANTA MONICA                 19

    Here, Santa Monica’s ban on vacation rentals applies in
the same manner to persons nationwide, including Santa
Monica residents who may be interested in renting a
vacation home from another resident. “Thus, it ‘visits its
effects equally upon both interstate and local business.’”
CTS Corp. v. Dynamics Corp. of Am., 481 U.S. 69, 87 (1987)
(quoting Lewis v. BT Inv. Managers, Inc., 447 U.S. 27, 36
(1980)); see also Pharm. Research & Mfrs. of Am. v. County
of Alameda, 768 F.3d 1037, 1042 (9th Cir. 2014) (holding
that local ordinance did not directly discriminate against
interstate commerce because it “applies to all manufacturers
that make their drugs available in Alameda County—
without respect to the geographic location of the
manufacturer”); Ass’n des Éleveurs de Canards et d’Oies du
Québec, 729 F.3d at 949 (holding that California statute
banning the sale of products from force-fed fowl was not
directly discriminatory because it “applies to both California
entities and out-of-state entities . . . regardless of where the
force feeding occurred”).

               b. Support of local hotels and the cost of
                  travel lodging

    Rosenblatt argues that Santa Monica’s purported support
of hotels discriminates against interstate commerce by
favoring local interests over out-of-state interests. She
further contends that by limiting competition for the City’s
local hotels, the ordinance “increase[s] the City’s
[occupancy tax] revenues at the expense of out-of-state
travelers, who must incur increased costs for travel lodging
in the City.”

    First, the ordinance applies equally to renters and
property-owners from outside California, California
residents outside of Santa Monica, and Santa Monica
residents themselves. By claiming otherwise, Rosenblatt
20        ROSENBLATT V. CITY OF SANTA MONICA

asserts that the hotels represent local interests (because of the
tax revenue) and the vacation rental industry represents out-
of-state interests. As the district court correctly reasoned:

        This argument is illogical. A hotel in Santa
        Monica can be owned by an in-state or out-
        of-state person or entity, just as would-be
        vacation rentals can. Similarly, Californians
        may wish to rent a hotel room or vacation
        rental in Santa Monica. The Ordinance treats
        all of these interests equally; there is only one
        set of rules, and it applies to all regardless of
        the origin of the interest.

Like the hotel industry, the vacation rental industry
represents both local and out-of-state interests. Moreover,
the ordinance applies equally to Santa Monica residents who
wish to rent a hotel room or vacation rental.

    Second, the complaint does not adequately allege that the
ordinance increases the relative market share of local
businesses. See Exxon Corp., 437 U.S. at 126 & n.16
(explaining that local regulations that affect interstate
commerce do not discriminate, even if they
disproportionately affect out-of-state businesses, if they do
not increase the relative market share of local businesses).
Nor does the complaint plausibly allege a net negative effect
on commerce outside of California. See Nat’l Paint &
Coatings Ass’n v. City of Chicago, 45 F.3d 1124, 1132 (7th
Cir. 1995) (“To determine whether there is a disparate effect
on interstate commerce . . . , we need to know what
consumers will replace [Santa Monica vacation rentals]
with.”).
           ROSENBLATT V. CITY OF SANTA MONICA                         21

                  c. The lack of a residency requirement

    Lastly, Rosenblatt argues that the ordinance
discriminates against interstate commerce because it
“contains an unconstitutional residency requirement
allowing only Santa Monica residents to engage in short-
term rentals.” By “residency requirement,” Rosenblatt
refers to the ordinance’s exception for home sharing, which
allows short term rentals if “at least one of the dwelling
unit’s primary residents lives on-site, in the dwelling unit,
throughout the visitors’ stay.” Santa Monica Mun. Code
§ 6.20.010(a).

    Contrary to Rosenblatt’s characterization, the ordinance
does not require the primary resident in the dwelling to be
the owner of the dwelling. Moreover, Rosenblatt does not
explain how the ordinance would prevent an out-of-state
homeowner who owns property in Santa Monica from being
able to extract economic value from the property. For
example, the out-of-state owner could rent out the property
on a long-term basis with a condition that one of the rooms
be used for the owner’s short-term rentals. Or the owner
could expressly allow the long-term renter to sublet a room
on a short-term basis in exchange for paying a higher
monthly rent. The ordinance also applies equally to owners
who reside in Santa Monica, or elsewhere in California, but
at a property separate from their rental property.
Accordingly, the complaint fails to plausibly allege that the
home-sharing exception obviously advantages Santa Monica
residents at the expense of out-of-state homeowners. 5

    5
      Rosenblatt asserts that “a residency licensing requirement cannot
be saved on grounds that the statutory framework allows an out-of-stater
to undertake additional steps . . . to indirectly obtain a license when an
22          ROSENBLATT V. CITY OF SANTA MONICA

    Rosenblatt’s argument draws a false equivalence
between in- and out-of-state property owners with respect to
home sharing. A “fundamental element of dormant
Commerce Clause jurisprudence” is “the principle that ‘any
notion of discrimination assumes a comparison of
substantially similar entities.’” Dep’t of Revenue v. Davis,
553 U.S. 328, 342 (2008) (quoting United Haulers Ass’n,
Inc. v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U.S.
330, 342 (2007)). Santa Monica’s ordinance does not
prohibit out-of-state property owners from home sharing in
their out-of-state homes, nor does it prohibit them from
allowing home sharing in their Santa Monica properties.
While non-resident property owners cannot personally serve
as the primary resident whose presence is required during the
home share, that is because they are not similarly situated to
the Santa Monica residents who can.

    Thus, the complaint does not plausibly allege that the
ordinance directly regulates or burdens interstate commerce.

in-state business can obtain the license directly.” But the cases she cites
are inapposite because they involve substantially greater burdens and
costs on out-of-state residents. In Granholm v. Heald, the Supreme
Court struck down state laws that allowed in-state wineries to ship
directly to consumers while requiring out-of-state wineries to establish
or pay for distribution networks in the state, which increased costs,
sometimes prohibitively. 544 U.S. 460, 473–75 (2005). In Nationwide
Biweekly Administration, Inc. v. Owen, we struck down a state law that
required an out-of-state company to incorporate in California in order to
conduct business by mail with California residents. 873 F.3d 716, 736–
37 (9th Cir. 2017). Here, the ordinance does not “require an out-of-state
firm ‘to become a resident in order to compete on equal terms.’” Id. at
736 (quoting Heald, 544 U.S. at 475).
          ROSENBLATT V. CITY OF SANTA MONICA               23

       C. The complaint does not plausibly allege that
          the ordinance unduly burdens interstate
          commerce through its incidental effects

    Although the ordinance does not directly regulate or
burden interstate commerce, it does, as Santa Monica
concedes, implicate interstate commerce through its
incidental effects. If an ordinance regulates evenhandedly
with only incidental effects on interstate commerce, then the
second step of the dormant Commerce Clause analysis—the
Pike test—applies. See Pike v. Bruce Church, Inc., 397 U.S.
137 (1970). We will uphold an ordinance under Pike if it
“effectuate[s] a legitimate local public interest” “unless the
burden imposed on [interstate] commerce is clearly
excessive in relation to the putative local benefits.” Id. at
142 (emphasis added).

    Rosenblatt contends the district court erred in applying
the Pike test at the motion to dismiss stage because
determining the excessive nature of the burden is a factual
question more appropriate for summary judgment.
Rosenblatt’s suggestion that issues involving the Pike test
cannot be resolved at the 12(b)(6) stage is incorrect.

    “[T]he party challenging the regulation . . . must
establish that the burdens that the regulation imposes on
interstate commerce clearly outweigh the local benefits
arising from it.” Kleenwell Biohazard Waste & Gen.
Ecology Consultants, Inc. v. Nelson, 48 F.3d 391, 399 (9th
Cir. 1995). As our sister circuit explained:

       Pike balancing is required only if the
       challenged law has a discriminatory effect on
       interstate commerce.       And conclusory
       allegations of disparate impact are not
       sufficient; to survive the City’s motion to
24        ROSENBLATT V. CITY OF SANTA MONICA

        dismiss, the plaintiffs needed to plead
        specific facts to support a plausible claim that
        the ordinance has a discriminatory effect on
        interstate commerce.

Park Pet Shop, Inc. v. City of Chicago, 872 F.3d 495, 503
(7th Cir. 2017); see also N.Y. Pet Welfare Ass’n v. City of
New York, 850 F.3d 79, 91 (2d Cir. 2017) (holding that the
plaintiff “fail[ed] sufficiently to allege that the burden of
selling directly to City pet shops, rather than through
distributors, will fall disproportionately on out-of-state
breeders”).

     We reject Rosenblatt’s contention that her complaint
survives scrutiny as long as she alleges “any burdens on
interstate commerce” and does not allege a basis for a court
to conclude “that the [o]rdinance actually serves legitimate
state interests.” Her argument misstates the Pike test. Even
if the complaint alleges facts showing that the local benefits
claimed by the city are all illusory or illegitimate, it must also
plausibly allege the ordinance places a “significant” burden
on interstate commerce. Courts may not assess the benefits
of a state law or the wisdom in adopting it unless the law
“either discriminates in favor of in-state commerce or
imposes a ‘significant burden on interstate commerce.’”
Chinatown Neighborhood Ass’n, 794 F.3d at 1146 (quoting
Nat’l Ass’n of Optometrists, 682 F.3d at 1156). And,
contrary to Rosenblatt’s contention, we presume the law
serves the city’s legitimate interests; it is Rosenblatt’s
burden to plausibly allege otherwise. See Spoklie v.
Montana, 411 F.3d 1051, 1059 (9th Cir. 2005). Rosenblatt’s
complaint fails to sufficiently allege that the ordinance’s
effect on interstate commerce clearly outweighs the
ordinance’s local benefits.
          ROSENBLATT V. CITY OF SANTA MONICA                25

     As we previously recognized, “[o]nly a small number
of . . . cases invalidating laws under the dormant Commerce
Clause have involved laws that were genuinely
nondiscriminatory” but still imposed a clearly excessive
burden on interstate commerce. Chinatown Neighborhood
Ass’n, 794 F.3d at 1146 (omission in original) (quoting Nat’l
Ass’n of Optometrists, 682 F.3d at 1150). “These cases
address state ‘regulation of activities that are inherently
national or require a uniform system of regulation’—most
typically, interstate transportation.” Id. (internal citation
omitted) (quoting Nat’l Ass’n of Optometrists, 682 F.3d at
1148).

    The complaint does not allege that Santa Monica’s
ordinance interferes with activity that is inherently national
or requires a uniform system of regulation. Land use
regulations are inherently local. They are not a significant
burden on interstate commerce merely because they
disappoint would-be visitors from out of state. See Spoklie,
411 F.3d at 1059 (“That a particular service or recreation
appeals to out-of-staters . . . does not impose on states an
obligation to permit it.”).

     Rosenblatt argues that vacation rentals constitute a $100
billion industry and that Santa Monica’s ordinance
substantially impairs that industry. But Rosenblatt’s
complaint itself belies that argument. The complaint alleges
that the “direct result of the online marketplace” for vacation
rentals is “increased competition” for hotel revenue. The
complaint then relies on an unspecified report to allege that
“81.5% of Airbnb’s bookings are shifted from away from
hotels to Airbnb.” The complaint does not support
Rosenblatt’s argument that the ordinance impairs the
national vacation-rental industry; to the contrary, the
complaint effectively recognizes that the ordinance likely
26         ROSENBLATT V. CITY OF SANTA MONICA

diverts Santa Monica’s tourism dollars from vacation rentals
to hotels. And the Supreme Court has held that “interstate
commerce is not subjected to an impermissible burden
simply because an otherwise valid regulation causes some
business to shift from one interstate supplier to another.”
Exxon, 437 U.S. at 127 (rejecting “notion that the Commerce
Clause protects the particular structure or methods of
operation in a retail market”); see Yakima Valley Mem’l
Hosp. v. Wash. State Dep’t of Health, 731 F.3d 843, 847 (9th
Cir. 2013) (“What is really at issue is the shifting of business
from one competitor to another, not a burden on interstate
commerce.”).

    In construing inferences in Rosenblatt’s favor, we read
the complaint to allege that some of Santa Monica’s tourism
business may have been lost altogether because of the
ordinance. Rosenblatt alleges that “hotel prices in Santa
Monica have increased,” which “has resulted in a decrease
in tourism and a decrease in transient lodging use in the
City.” But the complaint fails to allege the magnitude of this
decrease, which we require. See S.D. Myers, Inc., 253 F.3d
at 471 (“While we do not require a dollar estimate of the
effect the Ordinance will have, we do require specific details
as to how the costs of the Ordinance burdened interstate
commerce.”). 6 And the complaint provides no rebuttal to the
plausible explanation that hotels may have recaptured much
of the 81.5% of vacation rental bookings that allegedly had
shifted to vacation rentals. The complaint does not plausibly
allege how any lost fraction of the vacation-rental business

     6
      The complaint’s only specific allegation is that Santa Monica “saw
a 2% decrease in the number of jobs supported by tourism” after “a
steady increase of approximately 6% for the preceding three years.” The
complaint does not explain any correlation between the loss of jobs and
the passage of the ordinance.
         ROSENBLATT V. CITY OF SANTA MONICA              27

significantly burdens commerce—let alone interstate
commerce. See Yakima Valley Mem’l Hosp., 731 F.3d at
848 (concluding that 25% decrease in medical procedure’s
performance in the region after local regulations caused
hospital to lose its business to pricier hospital “[did] not
place a significant burden on interstate commerce”).

    Because Rosenblatt fails to show a high burden on
interstate commerce—and, at most, suggests some
negligible burden on the local economy of Santa Monica, the
complaint cannot meet the standard established in Pike.
Thus, the complaint’s allegations do not adequately
demonstrate how the alleged burden on interstate commerce
would clearly exceed the stated benefits of the ordinance.

   III. CONCLUSION

    Rosenblatt fails to plausibly allege that Santa Monica’s
ordinance directly or indirectly discriminated against or
burdened interstate commerce. Accordingly, we affirm the
district court’s dismissal of those claims.

   AFFIRMED.
Appendix A
City Council Meeting: May 12, 2015                                   Santa Monica, California

                            ORDINANCE NUMBER 2484 (CCS)

                                     (City Council Series)

          AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
       SANTA MONICA ADDING CHAPTER 6.20 TO THE SANTA MONICA
  MUNICIPAL CODE CLARIFYING PROHIBITIONS AGAINST VACATION RENTALS
             AND IMPOSING REGULATIONS ON HOME SHARING

       WHEREAS, the City consists of just eight square miles of coastal land which is

home to 90,000 residents, the job site of 300,000 workers, and a destination for as

many as 500,000 visitors on weekends and holidays; and

       WHEREAS, Santa Monica’s primary housing goals include preserving its housing

stock and preserving the quality and character of its existing single and multi-family

residential neighborhoods. Santa Monica’s prosperity has always been fueled by the

area’s many attractive features including its cohesive and active residential

neighborhoods and the diverse population which resides therein. In order to continue to

flourish, the City must preserve its available housing stock and the character and charm

which result, in part, from cultural, ethnic, and economic diversity of its resident

population; and

       WHEREAS, the City must also preserve its unique sense of community which

derives, in large part, from residents’ active participation in civic affairs, including local

government, cultural events, and educational endeavors; and
       WHEREAS, Santa Monica’s natural beauty, its charming residential

communities, its vibrant commercial quarters and its world class visitor serving

amenities have drawn visitors from around the United States and around the world; and

       WHEREAS, the City affords a diverse array of visitor-serving short term rentals,

including, hotels, motels, bed and breakfasts, vacation rentals and home sharing, not all

of which are currently authorized by local law; and

       WHEREAS, operations of vacation rentals, where residents rent-out entire units

to visitors and are not present during the visitors’ stays are detrimental to the

community’s welfare and are prohibited by local law, because occupants of such

vacation rentals, when not hosted, do not have any connections to the Santa Monica

community and to the residential neighborhoods in which they are visiting; and

       WHEREAS, the presence of such visitors within the City’s residential

neighborhoods can sometimes disrupt the quietude and residential character of the

neighborhoods and adversely impact the community; and

       WHEREAS, judicial decisions have upheld local governments’ authority to

prohibit vacation rentals; and

       WHEREAS, with the recent advent of the so called “sharing economy,” there is

growing acceptance of the longstanding practice of “home-sharing,” whereby residents

host visitors in their homes for short periods of stay, for compensation, while the

resident host remains present throughout the visitors’ stay; and
       WHEREAS, long before the advent of the sharing economy, home-sharing

activities were already commonly undertaken throughout Santa Monica and throughout

the United States; and

       WHEREAS, history has shown that home-sharing activities spread the good-will

of Santa Monica worldwide and have enhanced Santa Monica’s image throughout the

world; and

       WHEREAS, home-sharing does not create the same adverse impacts as

unsupervised vacation rentals because, among other things, the resident hosts are

present to introduce their guests to the City’s neighborhoods and regulate their guests’

behavior; and

       WHEREAS, history has shown that home-sharing activities are relatively very

small in number, when compared to the number of persons utilizing vacation rentals or

the City’s hotels and motels; and

       WHEREAS, while the City recognizes that home-sharing activities can be

conducted in harmony with surrounding uses, those activities must be regulated to

ensure that the small number of home-sharers stay in safe structures and do not

threaten or harm the public health or welfare; and

       WHEREAS, any monetary compensation paid to the resident hosts for their

hospitality and hosting efforts rightfully belong to such hosts and existing law authorizes

the City to collect Transient Occupancy Taxes (“TOTs”) for vacation rentals and home-

sharing activities; and
       WHEREAS, existing law obligates both the hosts and rental agencies or hosting

platforms to collect and remit TOTs to the City.

       NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA

DOES HEREBY ORDAIN AS FOLLOWS:

       SECTION 1. Chapter 6.20 of the Santa Monica Municipal Code is hereby added

to read as follows:

       Chapter 6.20 HOME SHARING AND VACATION RENTALS

       6.20.010          Definitions

       For purposes of this Chapter, the following words or phrases shall have the

following meanings:

       (a)        Home-Sharing. An activity whereby the residents host visitors in their

homes, for compensation, for periods of 30 consecutive days or less, while at least one

of the dwelling unit’s primary residents lives on-site, in the dwelling unit, throughout the

visitors’ stay.

       (b)        Hosting Platform. A marketplace in whatever form or format which

facilitates the Home-Sharing or Vacation Rental, through advertising, match-making or

any other means, using any medium of facilitation, and from which the operator of the

hosting platform derives revenues, including booking fees or advertising revenues, from

providing or maintaining the marketplace.

       (c)        Vacation Rental. Rental of any dwelling unit, in whole or in part, within the

City of Santa Monica, to any person(s) for exclusive transient use of 30 consecutive

days or less, whereby the unit is only approved for permanent residential occupancy

and not approved for transient occupancy or Home-Sharing as authorized by this
Chapter. Rental of units within City approved hotels, motels and bed and breakfasts

shall not be considered Vacation Rental.

       6.20.020      Home-Sharing Authorization

       (a)    Notwithstanding any provision of this Code to the contrary, Home-Sharing

shall be authorized in the City, provided that the Home-Sharing host complies with each

of the following requirements:

              (1)    Obtains and maintains at all times a City Business License

authorizing Home-Sharing activity.

              (2)    Operates the Home-Sharing activity in compliance with all Business

License permit conditions, which may be imposed by the City to effectuate the purpose

of this Chapter.

              (3)    Collects and remits Transient Occupancy Tax (“TOT”), in

coordination with any Hosting Platform if utilized, to the City and complies with all City

TOT requirements as set forth in Chapter 6.68 of this Code.

              (4)    Takes responsibility for and actively prevents any nuisance

activities that may take place as a result of Home-Sharing activities.

              (5)    Complies with all applicable laws, including all health, safety,

building, fire protection, and rent control laws.

              (6)    Complies with the regulations promulgated pursuant to this

Chapter.

       (b)    If any provision of this Chapter conflicts with any provision of the Zoning

Ordinance codified in Article IX of this Code, the terms of this Chapter shall prevail.
       6.20.030      Prohibitions

       (a)    No person, including any Hosting Platform operator, shall undertake,

maintain, authorize, aid, facilitate or advertise any Home-Sharing activity that does not

comply with Section 6.20.020 of this Code or any Vacation Rental activity.

       6.20.050      Hosting Platform Responsibilities

       The operator / owner of any Hosting Platform shall:

       (a)    be responsible for collecting all applicable TOTs and remitting the same to

the City. The Hosting Platform shall be considered an agent of the host for purposes of

TOT collections and remittance responsibilities as set forth in Chapter 6.68 of this Code.

       (b)    disclose to the City on a regular basis each Home Sharing and Vacation

Rental listing located in the City, the names of the persons responsible for each such

listing, the address of each such listing, the length of stay for each such listing and the

price paid for each stay.

       6.20.080      Regulations

       The City Manager or his or her designee may promulgate regulations, which may

include but are not limited to permit conditions, reporting requirements, inspection

frequencies, enforcement procedures, advertising restrictions, disclosure requirements,

or insurance requirements, to implement the provisions of this Chapter. No person shall

fail to comply with any such regulation.

       6.20.090      Fees

       The City Council may establish and set by Resolution all fees and charges as

may be necessary to effectuate the purpose of this Chapter.
       6.20.100      Enforcement.

       (a)    Any person violating any provision of this Chapter shall be guilty of an

infraction, which shall be punishable by a fine not exceeding two hundred fifty dollars, or

a misdemeanor, which shall be punishable by a fine not exceeding five hundred dollars,

or by imprisonment in the County Jail for a period not exceeding six months or by both

such fine and imprisonment.

       (b)    Any person convicted of violating any provision of this Chapter in a

criminal case or found to be in violation of this Chapter in a civil case brought by a law

enforcement agency shall be ordered to reimburse the City and other participating law

enforcement agencies their full investigative costs, pay all back TOTs, and remit all

illegally obtained rental revenue to the City so that it may be returned to the Home-

Sharing visitors or used to compensate victims of illegal short term rental activities.

       (c)    Any person who violates any provision of this Chapter shall be subject to

administrative fines and administrative penalties pursuant to Chapter 1.09 and Chapter

1.10 of this Code.

       (d)    Any interested person may seek an injunction or other relief to prevent or

remedy violations of this Chapter. The prevailing party in such an action shall be

entitled to recover reasonable costs and attorney’s fees.

       (e)    The remedies provided in this Section are not exclusive, and nothing in

this Section shall preclude the use or application of any other remedies, penalties or

procedures established by law.
       SECTION 2. Any provision of the Santa Monica Municipal Code or appendices

thereto inconsistent with the provisions of this Ordinance, to the extent of such

inconsistencies and no further, is hereby repealed or modified to that extent necessary

to effect the provisions of this Ordinance.

       SECTION 3. If any section, subsection, sentence, clause, or phrase of this

Ordinance is for any reason held to be invalid or unconstitutional by a decision of any

court of competent jurisdiction, such decision shall not affect the validity of the

remaining portions of this Ordinance. The City Council hereby declares that it would

have passed this Ordinance and each and every section, subsection, sentence, clause,

or phrase not declared invalid or unconstitutional without regard to whether any portion

of the ordinance would be subsequently declared invalid or unconstitutional.

       SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage

of this Ordinance. The City Clerk shall cause the same to be published once in the

official newspaper within 15 days after its adoption. This Ordinance shall become

effective 30 days from its adoption.