Special City Council meeting to vote on urgency VHR ordinance

If anyone thought they knew how the South Lake Tahoe City Council was going to vote on the proposed Vacation Home Rental (VHR) Ordinance on Tuesday they were most likely surprised with the turn of events after hours of public comment and Council discussion.

City staff had two weeks to create a new Vacation Home Rental Ordinance based on input and bring it to the Council to vote on a first reading October 17.

The City Council has sought to create an ordinance that both recognizes and protects the City's vibrant VHR industry while also improving the quality of life of the citizens.

The new SLT Recreation Center will be funded by the collected 2 percent Transient Occupancy Tax (TOT) from VHRs and motels/hotels. The TOT from VHRs is a large percentage of the total collected annually. In July 2017, the TOT collected from lodging properties was down 5.73 percent from 2016 - $478,504.87, and from VHRs it was $427,127.57, up 13.87 percent. Year to date, the collected TOT from VHRs has been $1,697,547.25 (up 11.44 percent) and lodging $2,258,858.18 (up .74 percent).

There is no arguing the financial impact of no VHRs in the community would be devastating to the budget and what it pays for, but there is the human side involved and people are affected.

Almost two dozen public meetings and workshops have been held since the last VHR ordinance was created in 2015. City staff and City Council have sought to identify solutions to a list of community complaints stemming from either bad VHR renters, bad VHR home owners, or a combination of both. Neighborhoods have been impacted by the current way to vacation - renting a home for short term so families and/or friends can be together. While most stay in South Lake Tahoe with no complaints or issues, neighbors are reacting by the impact short-term rentals have on their neighborhoods even though, based on complaint numbers and violations this is a small percentage of renters.

Code amendments were presented at the September 5, 2017 Council meeting, and as the result of public testimony and council input there they were brought back on October 3 for further refinement.

At Tuesday's meeting, staff brought everything back in a new ordinance to be reviewed in what was to be a "first reading."

As it the protocol, there was a presentation on the matter and the public weighed in.

On the table were the following changes:
- Eliminate citation warnings to VHR owners and make them violations
- Three Strikes and you're out - Three violation in 24 months and owners lose ability to rent their home out as a vacation rental.
- Reduce occupancy to two people per bedroom plus four in homes with two bedrooms or less, and allow only two people per bedroom in larger homes.
- Require bear boxes based on number of bedrooms at a home.
- A cap of 1,400 VHR permits issued.
- VHR permit issued only if not within 150 feet of another permitted home.

In what was a surprise move to many, Mayor Pro Tem Wendy David stated she was not in favor of the 150 foot rule but was in favor of a cap, just not both. She said she had grappled with the proposed ordinance over the past two weeks since the last meeting, and said the increased enforcement and three strikes you're out will be a game changer.

"Strong enforcement brings change," she said, something other councilmembers agreed with.

Brooke Laine has always said she struggled with a cap on VHRs and has proposed slow changes to see what is effective. Changing a lot in a short time will not show the City what is working, and what is not.

"The density piece is problematic," said Laine. "Put together your best policy and make it enforceable."

She is also a proponent of an ordinance along with Councilman Jason Collin for clear, coherent and defensible policy.

Collin wanted staff to collect data so they could make a decision based on that and not passion.

Mayor Austin Sass was clearly surprised at the turn of events Tuesday.

"I think this is not listening to the people," he said. "Total disregard for people who live here."

Collin said he disagreed. "This is listening to the people and makes a clean and clear policy."

As the number of how many VHRs should be in South Lake Tahoe is not clear (there are currently 1,352 in non-tourist core areas), the Council has called for a special meeting on Tuesday, October 24 at 5:00 p.m. The only thing that can be discussed there will be an urgency ordinance. They will vote on capping the number of VHRs to the number that is permitted that day. That urgency ordinance would have to be approved by all four of the members allowed to vote on VHRs (Councilman Tom Davis has long recused himself from the discussion due to his part ownership in Tahoe Keys Resort).

The reason for the urgency vote is to give the council 45 days to evaluate data to arrive at what the cap should be. It is possible that all permit requests currently in the cue would go onto a waiting list until an opening in the cap occurs.

All other portions of the updated ordinance will come forward in another first reading at a later date. A first reading couldn't be voted on Tuesday due to the big changes presented.

Changes would also include a change to occupancy: two per bedroom plus four for all homes, no matter the size. An owner can always rent to lower numbers.

Another new portion concerns expiration dates: an owner will have to get a new permit and pay their fees prior to the expiration date and no longer have a 30-day grace period. Also, if a person is next in line to get a permit and declines, they move to the bottom of the list and their place isn't "held."

Chuck Maas, a long-time local and proponent of VHRs in the community told the council and audience of a group, Good Vacation Owners. He proposes everyone getting along in a peaceful and constructive manner. Maas said they are starting a website with rules on how to be a good and respectful owner.