Short-term rentals draw Yorba Linda attention

An interesting report on regulating short-term rentals with a focus on zoning and tax issues, among other topics, was presented to Yorba Linda City Council members earlier this month.

Currently, the city has 89 short-term rentals, estimated to be 36 for the entire house and 53 for single bedrooms or guest quarters. Just three have secured business licenses and none to date have paid the city's transient occupancy tax, according to the report.

Three rentals have been described as disruptive to their neighborhoods, noted the report from Finance Director Scott Catlett and Community Development Director David Brantley.

“Complaints...include an increase in the number of unfamiliar individuals in the neighborhood, additional traffic, a lack of available parking, loud music playing into the night and the hosting of parties and other types of special events that draw a large audience,” the report stated.

Single bedrooms or guest quarters rent for an average $100 per night, while some whole-house rentals go for more than $1,000 per night, according to data from Host Compliance, a San Francisco-based firm the city has hired to assist with managing the rentals.

The company will identify short-term rentals and owners doing business in the city, monitor the existing rentals for compliance, provide guidance to new or illegal rentals and check for rental activity to flag suspected properties for further analysis by the city.

Cost is $65 per property per year, which, based on 89 rentals would be $5,785, not including a 10 percent discount for a three-year contract, plus a $5,000 fee for changes allowing owners to pay occupancy taxes through the city's existing business license Web portal.

The city estimates the 10 percent transient occupancy tax, which is remitted quarterly, will total $17,600 and business license taxes $2,200 yearly, based on the 89 identified rentals.

A six-month amnesty period with no back taxes or license fees has been authorized as a one-time option that expires if an operator fails to respond “in a timely fashion” to an initial contact.

City officials believe a specific short-term rental ordinance is not needed at this time, since the city's zoning and noise ordinances and debt collection practices can handle issues. And court orders can require operators to cease doing business if they don't comply with city ordinances.

For example, city zoning rules don't allow homes to be used as “event facilities,” and only uses that complement “residential living” are permitted in the city's eight residential zones.

A noise ordinance has specific allowable decibel levels during day and evening hours, with violations subject to citation by Sheriff's deputies as a “disturbance of the peace.”

A “good neighbor” brochure with noise, parking, pet, trash and occupancy rules will be distributed to operators. The council will review short-term rental issues in six months.