Vacation rentals attract county scrutiny

The ads are all over the Internet: Charming, private cottages, perfect for a weekend getaway, minutes to restaurants, shopping, hiking and local wineries. They promise an idyllic taste of the wine country, a carefree Sonoma Valley weekend (or week, or longer). But while many of these vacation rentals deliver on what they promise, more than half of them are in violation of City of Sonoma or Sonoma County ordinances on vacation rentals, according to informed realtors and officials.

Tracking unpermitted vacation rentals is a task that 1st District Supervisor Susan Gorin has been focusing on of late, in response to rising complains from her constituents. “It should not be OK that we have renters coming in, renting a house for party purposes, and having wild parties in the backyard that disturbs the serenity and slumber of people in the surrounding neighborhood,” she said.

And according to Matt Sevenau, “Vacation rentals are very hard to track.” Sevenau, a realtor for Sonoma’s Pacific Union office, added, “My guess is no more than a third are permitted.” His colleague at the vacation rental agency he co-founded in 2009, Sonoma Valley Escapes, is Heather Hanlon. Using popular online services, such as Vacation Rentals By Owner (VRBO) and AirBnB, she calculated that there are as many as 3,000 such units available in Sonoma, Glen Ellen and Kenwood, though there is the possibility of overlapping listings.

But according to the county Permit & Resource Management Department (PRMD), there have been only 775 user permits for vacation rentals issued since 2011, when they began to be required. The City of Sonoma reports only 50 such permits on 35 properties. Not only are the other listed properties illegal, they are dodging payment of the required 9 percent Transient Occupancy Taxes (TOT) that other lodgings, such as hotels and resorts, must impose on their guests. “It would be nice to level the playing field and ensure that all vacation rentals are in compliance with rules and regulations that keep Sonoma safe and quaint,” said Hanlon.

Vacation rentals are defined as a dwelling unit or guesthouse rented for less than 30 days; a bed and breakfast is a single-family dwelling, with an owner in residence, with up to 10 guest rooms. Both are subject to regulation, but the evidence is strong that while most B and Bs go through the permitting process, many vacation rentals are still under the radar.

The issue is not a new one in Sonoma County, and it became newsworthy early in 2010 when a deck collapsed from the weight of a large crowd of young revelers at a house in Guerneville, sending at least one person to the hospital and crushing a Lincoln Town Car parked beneath it. At that time, there were estimated to be 1,000 vacation rentals in the county, a number that has surely increased in the nearly five years since.

Nor is the issue confined to Sonoma. The San Francisco Chronicle last year reported almost 5,000 rentals available through Airbnb, and the city attorney there has taken landlords to court for illegally converting residential buildings to pricey tourist hotels and evicting longtime tenants. Even in Europe, the freewheeling online vacation rental market has been curtailed by regulation in some cities, including Berlin and Paris.

Closer to home, Healdsburg has been cracking down on short-term vacation rentals, which are only allowed in its relatively small downtown historic district. Healdsburg also recently published an online form for residents to complain about vacation rentals, allowing the planning department to follow up and contact the homeowner. “We’ve experienced quite a spike in complaints in the last year,” said Healdsburg city planning director Barbara Nelson, though the city council there has balked at implementing further controls on vacation rentals.

Although most vacation renters are unaware if not unconcerned about regulation – “I have never had a guest inquire about the legality of a vacation rental,” said Hanlon – reputable vacation rental agencies take pains to explain the limits on noise, traffic and events to anyone who wants to rent one of their properties.

“We only work with homes that have a vacation rental permit,” said Liza Graves of Beautiful Places, a Sonoma luxury home rental firm. “We work with the owner to make sure it’s licensed, submit all the paperwork and attachments required, including neighbor notification. And we collect the TOT and submit it to the city.”

Neighbor notification is a key element in the reinforced county vacation rental policies, Gorin and others stressed. The owner must provide in writing a phone number to all neighbors that they can call to get a response in one hour, either from the owner or a designated property manager. The $295 user permit is issued on a one-time basis and is non-transferable to a new owner who, if he or she elects to continue in vacation rental, must reapply for the permit and update contact information with the neighbors.

If an effort to contact the owner or manager fails, neighbors are encouraged to contact the county’s Code Enforcement division directly. And if it’s an immediate situation, such as a noise violation, a call to the Sheriff’s Office may be in order.

It’s the impact of vacation rentals on local neighborhoods that most concerns realtors and officials alike, perhaps even more so than uncollected tax revenue. “I’m concerned that lower income workforce housing supply is being eroded by speculators who are purchasing the homes and then renting them out for vacation rentals,” said Gorin. That concern is shared by the Sonoma Valley Economic Development Partnership, which found the number-one concern among area businesses is lack of workforce housing.

Gorin pushed for a new PRMD staff position to track unregistered vacation rentals in the coming fiscal year’s budget, arguing that the position could easily be paid for from the revenue collected from user permits. Ironically, those fees also go partially to support regional tourism promotion.

“I don’t want to take steps that would send the message that we don’t want visitors to come to Sonoma County,” said Gorin, who was clearly animated and engaged by the issue during an hour-long interview with the Index-Tribune. “What I’m looking for is to make sure we have responsible property owners paying TOT, that they are registered and complying with requirements that the neighbors are protected, and that the property owners are being responsive to what the neighbors are experiencing.”

What the neighbors are experiencing, in some cases, are excessive vehicles parking on residential streets, litter, late night noise violations, large parties and even weddings, events that should require special-use permits. Even though there is a county-wide 10 p.m. noise curfew, Sevenau told of one property his company manages that had to impose a 9 p.m. curfew because noise carried so far in the hillside neighborhood. “If you want to use the hot tub after 9 o’clock, you literally cannot talk,” he tells his prospective renters. “They (the neighbors) will hear you, they will call us and they will complain.”

“If they’re responsible renters and managers, then it’s not a problem and it blends in seamlessly to the neighborhood,” said Supervisor Gorin. “If they think this is just a business and they don’t have to be respectful to the neighborhood, that’s when we have problems. “

It’s a problem that will not be solved overnight, not only because of the popularity of wine country destination travel – and the accelerating real estate market. When asked if he had potential buyers asking about purchasing a house as a vacation rental property, Sevenau confirmed, “All the time.”

Then he added, “It’s really not a great business model. People think they’re going to buy these vacation houses and make a bunch of money. I basically paint them a picture of what it’s like to own a vacation rental, the regulations that go into it, what their lives are going to be like.?“I always ask if they’re doing it to make money or offset expenses. If they’re doing it to make money, my answer is, I’d probably put my money elsewhere.”

But not everyone views vacation rentals as a business. Some of the area’s homeowners who rent out rooms, cottages or even their own houses are only trying to make ends meet. “It was the best idea I could come up with,” said one Eldridge woman who moves into her converted garage on weekends and rents out her two-bedroom home. “I can make more than I could if I get a full time, minimum-wage job.”