Petaluma planners to discuss new rules for vacation rentals

Petaluma city planners will tackle the thorny issue of vacation rentals in private homes Tuesday in the first vetting of a proposed ordinance that attempts to balance neighborhood needs while regulating the booming online market.

Neighbors of unofficial vacation rentals brought the divisive issue to the city’s attention more than a year ago when several of them complained about loud overnight renters who weren’t respecting their residential tranquility.

It was also learned that those renting rooms or houses weren’t paying the city bed tax required of overnight lodging businesses, nor were their rental operations licensed as a business.

The problems, increasing amid the rise of online rental sites such as Airbnb, have been reported throughout Sonoma County, in both rural areas and cities. The city of Sonoma, another popular local destination for tourists, has been going after unlicensed vacation rentals for more a year, seeking to halt the operations and collect back taxes.

In Petaluma, the issue led to a community workshop attended by nearly 100 people in an effort to find common ground and create workable guidelines that allow the city to capitalize on tourism interest in the city, which last week beat out Paris on a list of travel destinations published by Harper’s Bazaar magazine.

It’s an issue that dozens of tourist hotspots throughout California and the country are wrestling with. The rentals are technically illegal in many jurisdictions, but fly under the radar because the business is conducted strictly on websites between renters and “hosts.” The website advertises the listing and acts as a go-between among renters and property owners, collecting the fees and disbursing payments.

Until recently, Airbnb, one of the largest online rental agencies, argued that it wasn’t responsible for collecting local taxes, saying that duty rested with hosts.

Hosts have said there was no mechanism for collecting a fee. Many feel they aren’t operating a business, but providing a friendly service to introduce people to the town they call home.

But under immense pressure from many cities - including San Francisco, Los Angeles and Venice - this month, Airbnb, announced it will begin collecting required city bed taxes in San Francisco. Other cities have started legal action to collect taxes.

In San Francisco, critics have argued that the vacation rentals are decreasing the available housing stock for residents. In Venice, property owners are “buying entire apartment buildings, evicting everyone … and making it all Airbnb,” said Los Angeles Councilman Mike Bonin, according to the Los Angeles Times.

Cities also are missing out on millions of dollars in hotel taxes.

Petaluma’s issue is smaller in scale - but no less important to home owners like Christina Gleason, who dreads the site of vacationers dragging their rolling suitcases along the sidewalk looking for their lodging for the night.

“The charming neighborhoods that illuminate Petaluma could be exploited by commercial overnight rentals should the city amend the” zoning ordinance, she said. “Many oppose their neighborhoods becoming commercial corridors when they purchased homes in real neighborhoods.”

About two dozen listings for single rooms or whole homes in Petaluma are currently being advertised on several rental sites.

The proposed ordinance establishes criteria to allow the short-term vacation rentals in residential and mixed-use zones, sets up a permitting and notification program and requires them to pay hotel bed taxes.

Petaluma collects almost $2 million a year from its official lodging operators. Each renter is charged a 10 percent city tax per room per night, which goes into the general fund and in part pays for tourism promotion efforts.

The proposed ordinance also recommends limiting the number of guests per stay and informing neighbors within 500 feet of a proposed short-term rental, with a process to address complaints or revoke a permit if complaints aren’t addressed.

Rental properties would be required to meet the minimum residential parking standard, with some exceptions.

The Planning Commission will take public comment at the 7 p.m. meeting and forward its recommendations to the City Council.

You can reach Lori A. Carter at 762-7297 or lori.carter@pressdemocrat.com. On Twitter @loriacarter.