Coastal Commission approves Santa Cruz County vacation rental limits
By Jason Hoppin
Posted: 07/14/2011 01:30:47 AM PDT

Santa Cruz County’s controversial vacation rental rules were met with acclaim Wednesday at its last legislative step before becoming law.

During a San Rafael hearing of the California Coastal Commission that backers saw as a the culmination of more than a year of work, the law regulating and limiting vacation rentals in the Live Oak area and beyond won unanimous approval from the 12-member body, despite continued opposition by some vacation home owners.

“I think it shows that if you have an idea that is ripe for working on, and you go out to the community and engage in a dialogue, you can come up with a solution that balances all the interests: the neighborhood, the commercial interests and the county as a whole,” said Supervisor John Leopold, who first proposed the ordinance more than a year ago.

Through numerous public hearings, the law remained deeply divisive. Owners of vacation rentals argued against it, worried about the law’s impact in their investments. Live Oak residents countered that years of trying to calm occasional loud parties and other neighborhood problems proved ineffective.

The law limits the number of vacation rentals to 15 percent in the Live Oak area, and 20 percent on any one block. Owners would be required to post a local contact number on the property, in case problems arise.

Vacation rentals outside Live Oak must also acquire a county permit, though the law doesn’t limit their numbers. Live Oak rental owners would have to renew their licenses every five years; those outside the area get licenses that last in perpetuity.

All current vacation rentals would be grandfathered in, though the county has a moratorium on new rentals. At some point, the county board — likely in August — is expected to lift that moratorium.

The law has also provided a boon to county coffers. Vacation rentals must pay taxes just like any other lodging, and since the county is using tax payments to validate existing rentals, an unusually high number have signed up to fork over their share.

When the law was proposed, barely 100 vacation rentals paid the tax. “In year that we’ve talked about it, that number has jumped to 256,” Leopold said.

Judith Buck, who manages about 60 vacation rentals in the county, said vacation renters bring money into the county, with stays costing anywhere from $200 to $1,000 a night. And there is the added money visitors spend on attractions and restaurants.

Moreover, Buck worries about the future of her business. She said areas closest to the shore already have more than their quota of vacation rentals, and the law effectively shuts off any hope of new ones in those areas.

“They’re not leaving us any place to grow where people want to be,” Buck said.

Opponents of the new rules have already filed suit over the law, and vacation rental owner Bruce Keiser said Wednesday foes would weigh including adding the Coastal Commission as a defendant.