The Santa Barbara City Council considered a plan to allow vacation rentals citywide at Tuesday’s meeting.
The Santa Barbara City Council considered a plan to allow vacation rentals citywide at Tuesday’s meeting.  (Joshua Molina / Noozhawk photo)

A proposal to allow vacation rentals in residential neighborhoods blew up at Tuesday’s City Council meeting.

Vacation rental advocates and opponents agreed in comments that the “framework” brought to the City Council was half-baked, and council members tasked the Planning Commission with working on a new plan.

“We are 100% against short-term rentals in single-family neighborhoods,” said homeowner Steve Fort said. “There is no compelling reason to allow them.”

Vacation rentals are only allowed in areas where there are also hotels. Even so, homeowners are running illegal vacation rentals citywide, and not paying transient occupancy taxes. Of the city’s 1,119 vacation rentals, only 101 are paying transient occupancy taxes. 

So the city proposed a plan to allow vacation rentals citywide, but make it tougher and more strict for homeowners to operate them.

The changes called for creating a tighter framework, a code of conduct, limiting total rented days to 90 a year, and requiring the homeowner to live at the property. The city was also hoping to increase the number of rentals paying transient occupancy taxes.

Santa Barbara has long struggled with a proliferation of vacation rentals. At a time when the city and the state are suffering from a housing shortage, community activists and city planners contend that these homes should be rented to people who live in the community, not out of town tourists.

Some neighbors have reported loud parties, loud music, and a flurry of cars driving and parked on streets near the rentals. 

“A principal concern is the impact to long-term housing,” said project planner Timmy Bolton. “Operating a residential unit as a short-term rental is typically far more lucrative than renting that same unit on a long-term basis, which can encourage the loss of long-term housing, increase real estate speculation and inflate housing costs.

“This is especially problematic in communities like Santa Barbara that are experiencing a significant housing crisis.”

Even advocates for vacation rentals did not like the proposal. 

Samantha Ireland, who owns a vacation rental company in Santa Barbara, said she represents 55 owners in town. She said a majority of them own second homes and do not live in the homes they use as vacation rentals. 

The proposed plan would have required them to live at the home they’re renting out, which would exclude her clients. 

“When they are not here, Santa Barbara gets to be home to tourists, which the council has said they want,” Ireland said. “Would you rather have it sitting empty, or would you rather have it bringing in legitimate TOT tax that you can use for the city?”

Councilwoman Kristen Sneddon fired back at that logic.

“A second home could be someone’s all-the-time home,” Sneddon said. “And if someone was living in it as their all-the-time home, they would be volunteering in the community. sending their children to school, possibly employing workers as well.”

Sneddon said the overall community would likely be against allowing vacation rentals in residential neighborhoods.

“I wholeheartedly believe that if this was taken to the voters, the voters would say ‘no,’” Sneddon said. 

The focus of any new program, she said, should be limiting vacation rentals, collecting transient occupancy taxes, and enforcing action against illegal ones. 

“That’s a problem, that’s our problem.” Sneddon said. 

Councilman Eric Friedman agreed: “Putting them in residential neighborhoods is problematic. Especially when we can’t even enforce what we have.”

Santa Barbara Mayor Randy Rowse said was hesitant to support strict enforcement on what homeowners can do with their properties.

“I am more worried about neighborhood sanctity than I am worried about what the profile of what our different housing stock is going to look like, because it is not our housing stock, it’s private housing stock, frankly,” Rowse said.

He said the people in the San Roque, Upper Eastside and Samarkand neighborhoods “are cranky” over the proposal.

During public comment, several residents were opposed to the proposal. 

Fort noted that there was no prior outreach to the community on the proposal until the agenda for the meeting came out. 

“Do you believe sacrificing the integrity of neighborhoods is a worthwhile economic vitality strategy?” Fort said. “Telling us there is a code of conduct is an insult to our intelligence.”

James Fenkner, who owns a vacation rental property, asked why the city was considering expanding short-term rentals into residential zones. 

“It seems crazy. No other business is allowed in there,” he said. 

Rob Fredericks, executive director of the city’s Housing Authority, opposed the proposal for the impact on housing. 

“Rather than increasing areas of short-term rentals, perhaps we should be looking at decreasing or not allowing them at all,” he said. 

Noozhawk staff writer Joshua Molina can be reached at Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.