At the last city council meeting on May 21, the Sebastopol City Council waded into the national debate about online vacation rentals and their effect on local housing stock by requesting that the city staff prepare a moratorium on unhosted vacation rentals.
This request came as the council took the unusual step of overturning the planning commission’s approval of a use permit to turn a small house on Johnson Street into an unhosted vacation rental. It was the first permit request for an unhosted vacation rental since the city approved its new general plan and updated the zoning in 2018.
At its March 26 meeting, the planning commission voted 5-1 to approve the permit for the Johnson Street house, but one of the planning commissioners, Linda Kelley, the lone holdout, appealed their decision to the city council.
“I am appealing this planning commission decision in order to bring this important housing issue to the city council, as our city’s housing goals to maintain and retain our housing stock are a high priority,” Kelley wrote in her appeal.
Introducing Kelley’s appeal, Planning Director Kari Svanstrom said, “The appeal is two fold — the conversion of a single family house to a vacation rental will affect the housing stock by removing a viable unit that could be used for low-income housing; also it’s inconsistent with the housing element of the general plan, which is to preserve housing resources, including low-income and affordable units.”
Much to the dismay of the owner of the house on Johnson Street, the members of the city council agreed with Kelley’s appeal.
Sebastopol’s rules on vacation rentals
Looking at Sebastopol’s zoning regulations, it’s easy to see why the planning commission approved the permit for the Johnson Street house. While the city’s general plan is quite clear about protecting residential neighborhoods and preserving housing stock, the zoning regulations allow both hosted and non-hosted vacation rentals. (In a hosted rental, the homeowner lives onsite; in a non-hosted rental, the owner lives elsewhere.)
All vacation rentals require either an administrative permit, which is granted by the planning department, or a conditional use permit — a more complicated process that requires approval by both the planning commission and the city council.
Whether a vacation rental qualifies for an administrative permit or conditional use permit depends on whether it’s hosted or non-hosted and the total number of days the unit is proposed to be rented per year:
• A hosted vacation rental in a private home requires a simple administrative permit.
• A non-hosted vacation rental that is rented 30 days or less per year also requires only an administrative permit.
• A non-hosted vacation rental that will be rented 31 days or more per year requires a conditional use permit.
• Accessory dwelling units built prior to July 1, 2017, require only an administrative permit, whether they are hosted or non-hosted.
• Accessory dwelling units built after July 1, 2017, require a conditional use permit
The Johnson Street property fell into the third category: a non-hosted vacation rental that would be rented 31 days or more.
The council’s response
According to City Planning Director Kari Svanstrom, city staff estimates that there are between 40 to 80 short-term vacation rentals in Sebastopol — but only 24 have permits from the city. (It’s sometimes difficult to tell from looking at the Airbnb and VRBO websites whether a rental listed for Sebastopol is within the city limits or in the surrounding countryside.) Of the rentals with permits, 80% are being listed as whole house rentals.
The city council was in no mood to see even one more house in Sebastopol turned into an unhosted vacation rental.
Council members blamed short-term unhosted vacation rentals for numerous problems, including exacerbating the housing shortage and inflating local real estate prices.
“Each non-hosted vacation rental removes a unit of housing from long-term renters or potential homeowners,” Council Member Una Glass said in her extensive remarks on the appeal. “There’s an economic incentive to rent out short term because you can make more money by Airbnb-ing a property than by making it a long-term rental. We’re asking long-term renters to compete with short-term visitors, and I don’t think that’s why people elected us. They wanted us to protect our community and keep our community intact.”
Councilmember Sarah Glade Gurney said that a longtime resident had recently written every member of the city council telling them that she was being evicted from her six-unit property by a new absentee owner who said, “he was going to Airbnb the whole thing,” according to Gurney.
“We’ve heard many, many stories of San Francisco and Marin County money investing up here, raising rents and ridding our community of long-term community members,” Gurney said.
Councilmember Patrick Slayter spoke to the “hollowing out” effect that non-hosted vacation rentals have on neighborhoods, as did two neighbors from Johnson Street, Jan Peterson and Linda Marietta, who spoke during the public comment section.
“Vacation rentals are not good for neighborhoods,” Peterson said. “Having a home remaining empty or with groups of tourists moving in and out isn’t good for neighborhood cohesion or security.”
Fellow neighbor Linda Marietta agreed.
“My concern is that it’s a commercial space in a residential neighborhood,” she said. “Hosted rentals are fine because they still have families living there who contribute to the community.”
This last sentiment was also echoed by all the council members, who were careful to save their ire for “unhosted” whole house rentals, as opposed to hosted rentals.
Ultimately the council chose to approve Linda Kelley’s appeal. They refused to give a conditional use permit to the owner of the Johnson Street property, stating that to do so would violate several sections of the general plan.
“This decision isn’t about an individual application,” Glass said. “This is a policy issue, and my job as a decision maker on the city council is to look out for the good of this town. It’s not to look out for the success of individual businesses or individual investments; it’s to look out for the general welfare of us as a city and as a community.”
An angry owner
Tanja Beck, the owner of the property in question, was clearly unhappy with the council’s decision.
“I’m very frustrated,” she said. “I feel you’re denying the application which has cost us time, money, effort and goodwill … You should just put in your guidelines that unhosted rentals are not allowed. I jumped through all the hoops; I did everything. Now nobody will go through these hoops and that will just encourage illegal rentals even more. If you deny this permit, I request all my money back because I feel it’s unfair to be the guinea pig and not have a chance.”
Ultimately the council chose to refund both the applicant’s and the appellant’s fees: Planning commissioner Linda Kelley will be refunded the $615 fee she had to pay to file the appeal, while Beck will be reimbursed the $1,325 that she and her partner had paid in the process of filing for the conditional use permit.
Request for a moratorium
Slayter brought up the idea of a moratorium on unhosted vacation rentals early in the evening, and the council came back to this idea at the end of the discussion. The council requested that the staff prepare a moratorium on non-hosted vacation rentals in Sebastopol, for consideration at a future city council meeting. They also requested that the staff get firmer numbers on how many hosted and non-hosted, permitted and non-permitted vacation rentals exist in Sebastopol.
“This council has used the moratorium in a number of ways over the years to essentially hit the pause button and allow careful consideration of an item, while we’re not being pressured by multiple applications,” Slayter said. “It is a big issue, and we don’t want to have our housing stock depleted or eroded by short-term vacation rentals.”