Arcata City Council Passes Vacation Rental Ordinance, Reduces Permit Cap to 100 Units | Lost Coast Outpost

Arcata City Council members (clockwise from top left) Stacey Atkins-Salazar, Sarah Schaefer, Emily Goldstein, Brett Watson (Sofia Pereira recused herself on this discussion)

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During Wednesday night’s meeting, the Arcata City Council passed an ordinance that places stricter regulations on vacation rentals and caps the number of these rentals allowed in the city at 100. The vote was 3-1, with Councilmember Sarah Shaefer dissenting. Mayor Sofia Pereira recused herself because she rents an AirBnB and felt it would be a conflict of interest.

Under the new ordinance, vacation rental owners will have to apply for a permit and complete a building inspection (costing around $220) if a building official believes there may be any violations on the property, in addition to purchasing a business license and paying transient occupancy tax — both already required by the City. Folks who are currently operating a vacation rental will be given a six-month grace period to apply for the permit before new ones are issued. Initially the ordinance required owners to have operated the rental within the last 12 months to be eligible, but council requested an exception for owners who have had to temporarily close their rentals due to the pandemic.

“If the vacation rentals operations had been discontinued during the previous 12-month period due to the COVID-19 pandemic, the owner may demonstrate vacation rental operating income from activity occurring in 2019 in order to qualify for the limitation exemption,” the ordinance states.

Additionally, the ordinance requires owners to post a contact number somewhere that is visible by the public, so that people can call with concerns about noise or other issues without having to always resort to calling the police.

Several community members spoke during the meeting, most of them vacation rental owners themselves who were opposed to the idea of imposing a cap on these types of rentals.

“I want to object to the idea that there’s a lack of housing here,” Patrick Swartz said to the council, adding that he owns a property that he had difficulty keeping occupied by long-term renters. “Putting a cap on this is stopping potentially tourism, which is so important for our small community — we need to embrace this.”

Several of the speakers also took issue with the requirement that owners post their contact information, saying that this could pose privacy issues. Councilmember Stacey Atkins-Salazar pointed out that people who are concerned about this could set up a Google phone, like most of the council members have.

While all the council members felt that AirBnBs and other vacation rentals do serve an important role in providing lodging and promoting tourism, they also felt that having a cap on the number of these rentals was important to help regulate the housing stock and maintain the character of neighborhoods.

Vice-Mayor Brett Watson Councilmember Emily Grace Goldstein requested that the cap — which was initially set at 125 — be reduced to 100, a number that represents about 1.2 percent of Arcata’s current housing stock. The cap does not apply to “owner-operated” vacation rentals — meaning the owner lives on the property and only rents out a portion of it. Most of the other council members agreed to the cap of 100, which the council can raise at a later date.

“I have a feeling that there’s going to be plenty of space,” Vice Mayor Brett Watson said during the meeting. “I think people’s concerns are a little bit overblown. I think it’s a good stop gap to move forward with this ordinance and then we can reassess.” 

Councilmember Sarah Schaefer explained that her dissent was due to the abrupt change in the cap, which she felt required further discussion. “My vote was not out of overall opposition for the ordinance,” she wrote to the Outpost. “I am happy with the modifications staff made to the ordinance and think it reflects the needs of renters and the housing market in Arcata. However, I would have liked more discussion of the cap number and the choice to amend it.”

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CORRECTION: This article originally stated that all vacation rental permits require a building inspection and has been changed to reflect that the inspection is only required if the City determines it is necessary. The article also has been changed to reflect that Councilmember Goldstein suggested the 100-unit cap, not Watson. The Outpost regrets the errors.