Vacation Rental Licenses Increase in SLO County
More short-term vacation rentals began complying with the law in 2017 thanks to the County’s efforts to better enforce its regulations.
Almost 200 new licenses were issued in 2017 for short-term vacation rentals that were not previously licensed. They are now paying their fair share of taxes and assessments.
In late 2016, the County Auditor-Controller-Treasurer-Tax Collector-Public Administrator (ACTTCPA) and the County Department of Planning and Building partnered on a program that would allow the County to better enforce its vacation rental laws. This program allowed the County to investigate the online listings of short-term rental properties located in SLO County but outside of the seven incorporated cities. (Note: Each incorporated city has its own rules regulating vacation rentals.)
All vacation rentals located in SLO County but outside of incorporated city limits are required by law to operate with a valid County business license. In early 2017, more than 1,000 properties in the County’s jurisdiction were listed on various online platforms, such as Airbnb. But the County had no way of knowing if the properties were licensed or not. Unfortunately, those rentals advertised without disclosing specific addresses, making investigation and enforcement difficult.
The County solved this problem by working with Host Compliance to identify specific addresses associated with those online rental listings. Then the County determined if a valid business license existed for each address. By January 2017, the County sent hundreds of letters to the addresses of listed rental properties that didn’t have a business license, advising them of their responsibilities to comply with the law.
As a result, nearly 200 new businesses licenses were issued and almost 700 listings were removed from various websites. Some people chose to remove their rental listings rather than get a business licenses, while others removed listings due to local community restrictions that prevent them from operating a short-term vacation rental in their location. Those who continued to have active online listings, but did not respond to the letter from the Tax Collector’s Office, were referred to Code Enforcement division of the County Planning Department.
At the time of this report, the County collected $80,000 in additional taxes thanks to these efforts, which more than covers the $70,000 it cost to hire Host Compliance and develop this enforcement program.
Additionally, in August 2017, the ACTTCPA negotiated an agreement with Airbnb on behalf of the County to automatically collect the required taxes and assessments due from guests who rent lodging in the unincorporated areas using Airbnb’s online platform. This method allows guests to easily pay the required taxes, as the payments are automatically included in their transaction. Airbnb then transmits the payments to the County, which processes them and distributes them to the appropriate entities for public services. By October 2017, Airbnb began collecting the required taxes and assessments.
As SLO County continues to grow, automation and efficiency helps the ACTTCPA office manage a larger workload with fewer staff members.
The Auditor-Controller-Treasurer-Tax Collector continues to work with local stakeholders, including vacation rental property managers, to work through this transition.
Almost 200 new licenses were issued in 2017 for short-term vacation rentals that were not previously licensed. They are now paying their fair share of taxes and assessments.
In late 2016, the County Auditor-Controller-Treasurer-Tax Collector-Public Administrator (ACTTCPA) and the County Department of Planning and Building partnered on a program that would allow the County to better enforce its vacation rental laws. This program allowed the County to investigate the online listings of short-term rental properties located in SLO County but outside of the seven incorporated cities. (Note: Each incorporated city has its own rules regulating vacation rentals.)
All vacation rentals located in SLO County but outside of incorporated city limits are required by law to operate with a valid County business license. In early 2017, more than 1,000 properties in the County’s jurisdiction were listed on various online platforms, such as Airbnb. But the County had no way of knowing if the properties were licensed or not. Unfortunately, those rentals advertised without disclosing specific addresses, making investigation and enforcement difficult.
The County solved this problem by working with Host Compliance to identify specific addresses associated with those online rental listings. Then the County determined if a valid business license existed for each address. By January 2017, the County sent hundreds of letters to the addresses of listed rental properties that didn’t have a business license, advising them of their responsibilities to comply with the law.
As a result, nearly 200 new businesses licenses were issued and almost 700 listings were removed from various websites. Some people chose to remove their rental listings rather than get a business licenses, while others removed listings due to local community restrictions that prevent them from operating a short-term vacation rental in their location. Those who continued to have active online listings, but did not respond to the letter from the Tax Collector’s Office, were referred to Code Enforcement division of the County Planning Department.
At the time of this report, the County collected $80,000 in additional taxes thanks to these efforts, which more than covers the $70,000 it cost to hire Host Compliance and develop this enforcement program.
Additionally, in August 2017, the ACTTCPA negotiated an agreement with Airbnb on behalf of the County to automatically collect the required taxes and assessments due from guests who rent lodging in the unincorporated areas using Airbnb’s online platform. This method allows guests to easily pay the required taxes, as the payments are automatically included in their transaction. Airbnb then transmits the payments to the County, which processes them and distributes them to the appropriate entities for public services. By October 2017, Airbnb began collecting the required taxes and assessments.
As SLO County continues to grow, automation and efficiency helps the ACTTCPA office manage a larger workload with fewer staff members.
The Auditor-Controller-Treasurer-Tax Collector continues to work with local stakeholders, including vacation rental property managers, to work through this transition.