By: Jondi Gumz (email@example.com)
POSTED: Wednesday, April 11, 2018 – 8:13 p.m.
SANTA CRUZ >> New rules to cap hosted rentals at 250 and phase out non-hosted rentals for vacationers in the city of Santa Cruz in response to the housing crisis got a green light from the California Coastal Commission at its meeting in Redondo Beach Wednesday.
Eight commissioners supported Santa Cruz, two supported the staff recommendation to reject that proposal, and one abstained.
The city has about 330 short-term rentals with permits, half hosted with the owner on the premises and half non-hosted, but it’s harder to calculate the number actually operating since Airbnb, the most popular platform, keeps much of its data private. An AirDNA report prepared for the city said 1,000 units have been listed on Airbnb at some point, with the state agency estimating “roughly 600” short-term rentals in Santa Cruz.
The staff called the city proposal a ban, contending that families visiting the coast were priced out by hotels and citing a lack of evidence that short-term rentals are a significant factor in the city’s housing shortage.
Dan Carl, Central Coast district director and a Santa Cruz resident, contended the growing population at UC Santa Cruz, 18,000 students now and plans to add 10,000 more, “has an outsize effect” on housing in Santa Cruz, dwarfing issues created by short-term rentals.
Commissioner Aaron Peskin, a San Francisco supervisor who attended UCSC when the campus had 5,000 students, led the pushback, saying the number of housing units lost to short-term rentals was “almost four years of housing production.”
Santa Cruz Community Development Director Lee Butler presented figures showing the city adding 263 housing units from 2014 to 2016 during which time 246 short-term rentals began paying room taxes.
“The ordinance is not a ban,” Peskin said, calling non-hosted rentals “speculative behavior you want to shut down.”
Commissioner Donne Brownsey shared her daughter’s experience living in a renovated garage while attending UCSC, calling the open space on campus “ripe” to meet student needs.
Brownsey said she considered buying a home in Santa Cruz until she was shown one in the coastal zone with buckets to catch rain due to a leaky roof listed at $995,000. After spending 45 minutes on Highway 1 trying to get from Aptos to Capitola, she was sympathetic to members of the hospitality union Unite Here who have long commutes to work and supported the city proposal.
Housekeepers, cooks and others working at the Santa Cruz Dream Inn cannot find an affordable place to live in Santa Cruz, said Lee Strieb of United Here, asking workers dressed in red union T-shirts to stand up.
“We should look at respecting local control,” said commissioner Mark Vargas, though he was uncomfortable with two sets of numbers, an estimated 600 short-term rentals and only 330 with permits.
Commissioners Carole Groom, Steve Padilla, Ryan Sundberg, Erik Howell, Effie Turnbull-Sanders, Sara Aminzadeh and Vargas voted with Peskin.
YEAR OF STUDY
The Santa Cruz proposal was adopted by the City Council after a year of public input and in-depth study by an 11-member citizens committee.
Khristina Horn, a committee member with two grandfathered short-term rentals on West Cliff Drive, contended short-term rental operators should have been surveyed. She also wanted to know how many long-term rentals were converted to short-term rentals.
Horn told the Coastal Commission the committee recommendations were not as strict as those approved by the council.
The committee favored allowing 75 more non-hosted rentals and did not support a cap on hosted rentals.
Commissioners got 50 emails from people with vacation rentals calling for no restrictions, saying, “Santa Cruz should not be reserved for locals only,” and ceding speaking time to the Santa Cruz County Vacation and Renters Alliance.
“Santa Cruz remains a welcoming place for families,” said Mayor David Terrazas after the vote.
Derek Timm, who has a short-term rental in Santa Cruz and spoke in Redondo Beach against the city’s proposal, noted people with a hosted rental can sign up for one of the 120 additional permits.
“If you have unhosted rental that is not registered, you’re out of luck,” he said.
He expects visitors may choose to stay in Capitola or Santa Cruz County instead.
“For a city that has based its economy around tourism, it is a confusing result,” he said.
Butler, the city’s planning chief, said afterward, “Obviously we’re pleased. It was a tough issue.”
He said staff will be working on a new application that incorporates collection of room tax with planning data, reaching out to hosted rental operators, then reporting back to the council in 18-24 months.
SANTA CRUZ DATA
Dwelling units: 23,635
Units in coastal zone: 9,055
Legal short-term rentals: 330
Whole house rentals: 71 percent of short-term rentals
City limit: 450
Operating short-term rentals: 600*
Occupancy rate: 62 percent annually
Peak occupancy: July, 90 percent
New: 555 Pacific Ave., 94 units
Units under construction: 124
Units approved, not built yet: 442
City help: 56 affordable rentals to break ground in 2018
Source: City of Santa Cruz