South Lake Tahoe finalizes vacation rental ordinance
Despite some objections from real estate interests and residents, the South Lake Tahoe City Council approved its updated regulations for new vacation home rentals Tuesday.
The council amended the ordinance at its Tuesday meeting to address some concerns council members had received since the first reading in July.
Amendments included setting Oct. 1 as the day the ordinance would go into effect, making it so inspections on current VHRs will be valid for 12 months from the date conducted and including that only new applications for properties in escrow at least 30 days can be approved.
The ordinance requires all new VHR applications go through a public process, including notification of people within 300 feet of the proposed site, inspection of the site, time for people to protest and potentially a public hearing and appeals process.
City Attorney Tom Watson said that the amendments could actually add security to a potential buyer’s decision to purchase a house in South Lake Tahoe. Market uncertainty has been the primary concern from real estate agents and VHR industry representatives as the city mulled the new rules.
Natalie Yanish, a South Tahoe Association of Realtors board member, said ordinance has already had adverse effects.
“In the last couple of weeks, there has been 12 lost sales within the city, six of them canceled escrows and six from buyers who decided to look elsewhere,” Yanish said.
She said the city should wait for the results from a holistic study it has commissioned on VHR impacts before making the decision.
Others raised a question about ignoring the wishes of the majority and pandering to the few who don’t want vacation rentals in South Lake Tahoe.
City Manager Nancy Kerry said the new ordinance strikes an even balance for those who want vacation rentals in residential neighborhoods and the actual residents.
Jim Morris, who has objected to past enforcement regulations, said the council has failed to listen to people.
“You plowed ahead and adopted this,” Morris said. “It is essential that the city council recognize that rental of a home is an essential bundle of rights to owning a home.”
Morris said there could be unforeseen legal ramifications. Morris and Lake Tahoe Vacation Rental Alliance have already filed suit against the city council over new enforcement regulations adopted in June.
Realtor Amanda Adams posed several questions, including what character of a neighborhood means and how density plays into things.
Both Kerry and Watson said density has always been a consideration, and some areas like the Tahoe Keys may see more VHR applications.
On how decisions would be made by the zoning administrator, Kerry said opinions would be weighed based on who was impacted. Someone who lived outside the city and didn’t own property would be recorded, but weighed differently than those who live within 300 feet of a potential vacation rental.
Others pointed out that the new regulations could impact businesses outside vacation home rentals and management groups, such as electricians, home keepers and the service industry.
Mayor Hal Cole said that, while it’s not the council’s intention to harm business, regulation has become necessary in an industry that’s gone unregulated.
“There is a plethora of buildings being built in neighborhoods that are essentially hotels,” Cole said. “There is a character change when you put a motel next to small homes.”
Fees related to the new ordinance were also amended Tuesday. The entire process would cost a minimum of $545 and up to a maximum of $1,743, including on-site inspection, exemption, preparation and notification for a public hearing. An actual public hearing would cost $1,200.
If a pre-existing inspection has been conducted within 12 months, $133 would be deducted from the process. Additionally, non-applicant residents who wish to appeal a zoning administrator’s decision would only have to pay $250. Applicants would still have to pay $1,500 to appeal a decision.
The city council will revisit the ordinance in 12 months to see how it impacts the community.