County Board of Supervisors issue partial ban on short-term rentals

The Santa Barbara County Board of Supervisors reached a major decision regarding the highly contentious issue of short term rentals.

After hearing from dozens of people on both sides, the board decided to partially ban short-term rentals in unincorporated areas of the county.

County Supervisor Janet Wolf said, “I think the outcome was excellent. What we did today was reaffirm the importance of zoning in our community and the integrity of zoning in our community.”

The issue has pitted neighbor against neighbor for years. Opponents of short-term rentals say they are subjected to loud noises, partying and a decrease in parking availability. They also complain short-term rentals are decreasing property values and eliminating housing stock from an already constrained housing market.

County staff said there is currently no reliable source to calculate the vacancy rate in the county because most agencies use a different metric. The 2010 Census calculated an 8.5% vacancy rate in the county. In 2016, Housing and Urban Development calculated a 4.6% vacancy rate, according to staff. The next Census will happen in 2020.

Proponents argue short-term rentals can be regulated fairly to maximize revenues needed for the county and decrease the number of complaints. They said many people who are renting out their ‘second’ home actually spend 20 to 50% of their time living on the property each year. Others told supervisors they are relying on the income to make a living in a tight economy.

At the hearing, supervisors voted to outlaw short term rentals for non-owner occupied properties in all residential zones. However, they will likely allow owners who occupy their properties while their guests are there to continue short term rental operations– effectively renaming the practice a ‘homestay’.

Supervisors also ordered staff to come back with actions to establish a ‘homestay’ permit in residential and AG-1 properties.

“When that comes back to us, the intent is is that they will continue to pay a TOT and there will probably be other requirements,” Wolf said.

Opponents said the county will lose revenue with the ban.

“They are going to find out that prohibition is not going to work. It’s proven elsewhere it doesn’t. They are going to have to learn the hard way and see their revenues plummet,” said Theo Kracke, president of Paradise Retreats.

County officials said the county collects between 1.6 and 1.8 million dollars in the Transient Occupancy Tax per year and when the partial ban takes effect, most of that income will be gone.

City staff said there are about 450 short-term rental properties paying TOT, but they believe there are hundreds more which are not. The known short-term rental properties are primarily located in Montecito and the Santa Ynez Valley.