Currently in the city of San Luis Obispo, it is illegal to host a traveler in your own home for less than 30 days. This outdated law needs to be revised to encourage a new class of traveler to visit “The Friendliest Town In America.” Doing so does not mean that the current ban on vacation rentals within the city needs to be lifted. The city of SLO simply needs to add a new “Residence Stay” lodging definition to the current zoning ordinance, allowing owners of primary residences to host travelers in their own homes for short-term stays.
SLO HOSTS, a homeowner rights advocacy group, represents owners of primary residences in the city of SLO. Unlike normal vacation rentals, owners of primary residences live at the property where they rent rooms to short-term travelers. This is an important distinction, because the owner of the primary residence is normally present at the property where guests stay, which is a different use than a typical vacation rental.
As a member of SLO HOSTS, I am appealing a decision by the city of San Luis Obispo, which currently bans me from welcoming travelers into my own home for periods of less than 30 days. Provided I ensure that my guests comply with current residential noise and safety ordinances, does it really matter if they are relatives, friends, or simply travelers from another community?
Operating according to city standards
Ironically, when I originally inquired with the city of SLO about conducting short-term rentals in my home through airbnb, a vacation rental site, the city employee advised me that all I needed to be legal was a business license. I specifically asked about complying with bed or occupancy taxes, and I was again advised, in writing, “all I need is a business license.” I obtained my business license from the city, paid my fee, and began renting rooms in my home via the airbnb website. At no time was I told that operating a vacation rental within the city limits was in violation of any city zoning ordinance.
After obtaining my business license, I also took out special insurance, which would cover me for renting out rooms in my house. The cost of the insurance is $2,800 per year, which is well above my regular insurance of $1,200 per year. But again, I was trying to do everything properly. I have since found an insurer that will cover me for far less and considers anyone staying with me as a boarder. Unfortunately for me and for travelers who want to spend money in our community, the city of SLO does not.
Benefiting our local community
The benefits of short-term rentals include a unique experience for a variety of travelers, increased tax and tourism revenue in our community, and supplemental income to make home ownership in the city more affordable. In our community, the economic benefit to our local economy is impressive. According to SLO HOSTS, the direct annual economic impact of allowing primary residence stays is more than $7.6 million. Additionally, the Transit Occupancy Tax (TOT) that the city is losing is approximately $150,000.
Furthermore, residence stays provide a desired accommodation alternative for many individuals, families, or groups that may not exist through traditional lodging options available in the city. Without a residence-stay option, some travelers will simply spend their vacation dollars in communities that cater to their lodging preferences. The fact that residence-stay visits are generally double the 1.7-day average for traditional lodging creates substantial increased revenue for local businesses.
With the high cost of housing in the city of San Luis Obispo, residence stays afford primary residence owners the ability to work and live in SLO rather than commute from lower-cost communities. Increasing owner-occupied dwellings is a stated goal of our City Council, so banning residence stays actually defeats their own occupancy goal, which seems senseless.
Finally, residence stays do not significantly reduce the local housing or rental stock. The reason for this is that an owner renting out rooms in their home for short-term stays will generally not rent a room in their own house to a student. Similarly, professionals generally do not want to live full time in an owner-occupied home. So unfortunately, the room simply goes vacant, which is a detriment to travelers and our local economy.
Positive effect on neighborhoods
The benefits of residence stays to our community are clear, but I certainly understand neighbor concerns. As the primary resident of the home, I offer for short-term stays in the city of SLO, I support compliance with existing laws meant to encourage residents and their guests to be good citizens and good neighbors. I live at the property where my guests stay. As such, I can observe guest behaviors, and I am available to ensure the guest and neighbor experience is positive. This significantly reduces the negative issues that are common with normal unregulated vacation rentals.
As an on-site homeowner, I am sensitive to noise, litter, overcrowding, parking difficulties, and other anti-social behavior, and I am on-hand to ensure against it. Neighbors generally prefer the occasional short-term traveler to a home of full-time students, which is a likely alternative for secondary income property.
Additionally, nearly half of the income derived from short-term rentals is spent on home improvements, thereby increasing property values in the neighborhood by making the property more beautiful. Residence stays in primary residences do not exceed normal occupancy and parking restrictions and actually impact local neighborhoods less than full-time renters.
Finally, many neighbors, who also own their own homes, do not want the city to limit their homeowner rights to derive economic benefit from the house that they own.
Ease of regulation and enforcement
The members of SLO HOSTS are committed to ensuring that residence stays are managed and regulated in a way that supports economic benefits to our community, while enhancing local neighborhoods. They are collaborating with city of SLO officials to create a win-win-win situation for travelers, the local economy, and neighbors.
Limiting short-term rentals to owners of primary residences is easy to monitor and will reduce enforcement costs that the city is currently incurring. Owners of primary residences receive a property tax bill from the Assessors Office that identifies them as a primary residence. This makes it easier to identify underground vacation rentals that do not meet the primary residence standard, which reduces compliance headaches.
SLO HOST members want to play by the same tax rules as hotels, B&Bs, and other lodging establishments. As such, they feel that residence stays should be taxed, which brings a new source of revenue into city coffers.
With so many positives for travelers, our economy, and neighbors, I encourage the Planning Department to agree with my appeal and take the following actions:
• Temporarily discontinue enforcement of residence stays until the City Council can vote on the issue
• Advise City Council to support the addition of a “Residence Stay” definition to Chapter 17.100 of the zoning code
• Recommend a negative declaration for residence stays as part of a study session with City Council.
Residence stays, offered by owners of primary residences, make sense for our community. They create millions of dollars of economic benefit for local businesses, expand tax revenue for our city, and actually help increase home ownership for people who work in our community. With so many benefits for our community, isn’t it time to say, “Yes” to visitors?
Sky Bergman is a member of SLO HOSTS. Send comments to the executive editor at firstname.lastname@example.org.