Report of Panel Discussion: Short Term Rentals – What’s the Future?

The panel: from L to R, Omar Passons (standing), Eric Murphy, Gio Ingolia, Joe LaCava, Gil Cabrera, John Anderson, Belinda Smith. (Photo from PL Dem Club)

Editor: The following is a slightly-edited report of a panel discussion on short term rentals held at the July meeting of the Point Loma OB Democratic Club.

By PL OB Dem Club Admin

The moderator, Omar Passons, attorney that the San Diego municipal code does not currently define a short-term vacation rental and that ordinance and formal definitions would soon be introduced by City Council.

There is a ‘border and lodger’ definition (generally stays are more than 30 day stay) and a ‘bed and breakfast’ definition (generally stays are less than 30 day stay, but this is not within the code) within the code. Short-term vacation rentals (STVR) means the renting of any portion of your property for less than 30 days.

TOT maps reveal alarming growth of more than 400 STVR units in just three months in San Diego neighborhoods (2,315 units available on January 15, 2015 vs. 2,738 units available on April 30, 2015).

The panelists included:

Belinda Smith, Short Term Rental Alliance of San Diego.

Belinda stated that there are 200 members of her Alliance and that the vast majority desire a simple transparent mechanism to pay the City taxes affiliated with their rentals. San Diego City has a new deal with AirBnB for the company to pay the approximate 11% TOT tax directly to the City.

The City of San Francisco has a similar agreement with AirBnB and has been receiving $1 million a month from AirBnB.  Her closing remarks stated that we need to embrace density and address the 30 foot height limit in order to better address housing affordability.

John Anderson, North Park homemaker and AirBnB host.

Founding member of the San Diego Short Term Rental Alliance and Bike San Diego board member, John spoke to the benefits of using AirBnB for accommodations, and touched upon the new ‘sharing economy.’

John reported that they rent out their small cottage on their property for economic reasons and benefits. In his closing remarks, he stated that we need to be mindful of our rights in how we utilize our houses and property.

Joe LaCava, Chair of the San Diego Community Planners Committee and candidate for San Diego City Council District 1.

Joe believes we have two different kinds of regulations that are needed: quality of life regulations and economic regulations.

Joe warned that investors and big money interests are coming in to kick out community members that are renters in order to book more STVRs. In his closing remarks, he stated that he doesn’t know of another City that spends more time kicking policy down the road and thus not allowing people to be on the same page and understand their investments.

Gil Cabrera, the Cabrera Firm, APC and candidate for San Diego City Attorney.

Gil stated that while the City Attorney office shouldn’t be driving policy, we’re trying to shoe horn STVRs into bed-and-breakfast descriptions, which doesn’t equate to fair enforcement. The municipal code must be amended to include STVR at the City Council.

In his closing remarks, Gil stated that we’ve too long let private interests negotiate our public interests behind a veil, and that he will bring transparency to these negotiations.

Giovanni Ingolia, Co-Chair of the OB Community Plan update sub-committee, has served 8 years on the OB Planning Board and former chair.

Giovanni raised concerns about zoning issues in communities whereby single family homes are becoming vacation rentals and de facto hotels and pushing out affordable housing. He said the new policy should protect our affordable housing stock and protect our quality of life.

In his closing remarks, Gio stated that he hopes the City Council will also seek the approval and feedback of the local community planning groups, and that the policy must protect local renters.

Eric Murphy, Research Analyst for UNITE-HERE Local 30, a union of more than 4,500 hotel and food service workers in the San Diego area.

He stated that there is a difference between ‘owners on site’ and ‘owners off site,’ which affects community quality of life in that it creates mini hotels and pushes out community renters. Eric stated that in LA, 89% of AirBnB’s revenue is derived from owners-off site. He warned of AirBnB’s power dynamics and that of investors, which could also drive down wages of hotel workers and cleaning persons. In his closing remarks, Eric cautioned the systemic market affects of giant corporations on our local communities.

Here are several questions from the audience:

Why does the City recognizes STVRs under the B&B code to receive taxes, but doesn’t recognize these entities in the zoning code to protect community quality of life?

Joe LaCava stated that this is because the City cares more about money than it does about neighborhoods. Gil Cabrera stated that it also shows the power of the enforcer to pick and choose what gets regulated and enforced.

What is the industry perspective on how to protect affordable housing?

John Anderson, stating that he doesn’t represent the AirBnB industry, replied that what what is absent from today’s conversation is the number of empty/vacant units in the City of San Diego, of which there are more parcels than there are STVRs. He also stated that the 30-foot height limit has impacted affordable housing stock.