After five years of operating with few complaints from the public, the city of Napa’s vacation rental program could be expanding.
“I was a vocal critic of the program when it first started,” said Napa Councilman Peter Mott. “I was worried that these rental properties would be a burden on the surrounding neighborhoods and residents. But everything I’ve heard seems to be the opposite.”
Napa’s vacation rental ordinance governs 42 properties. It was established in 2009, in part to weed out vacation rental homes that were operating illegally. The permits are non-transferable, limiting the number allowed in the city.
Short-term rentals in vacation destinations are often criticized by residents for having absentee landlords who are not part of the community. Though this isn’t always the case, it has caused many places to ban such temporary rentals — including unincorporated Napa County.
Prior to 2009, those who rented their homes for less than 30 days to visitors simply applied to the city for a conditional business license. But after several neighborhoods complained about noise and disturbances from vacationers, the City Council voted to regulate the local industry.
Under the 2009 law, rental owners were required to pay the city $1,000 per year to operate. That fee has since decreased to around $200 per year.
The city also collects hotel tax revenue from vacation rentals. According to city data, in 2013 these rentals accounted for about $317,000 of the city’s nearly $13.5 million in hotel tax revenue — about 2.35 percent of the total.
The amount of tax revenue from vacation rentals has increased annually, even though the number of rentals has decreased. With an apparent growing demand, city officials are eyeing the program as a potential revenue booster.
“If we were to increase the number of allowed vacation rentals by 15 or 20, it could be a great opportunity,” said Mott. “But it would need to be studied by city staff and highly regulated.”
Mott, who in 2009 favored phasing phase out short-term rental properties, said new rentals should be confined to the downtown area. “They don’t belong in every neighborhood,” he said. “So we would need to think about that.”
Councilman Alfredo Pedroza said he is also interested in expanding the program — but only if the regulations in the ordinance were extensive.
“I am open to it, but only in the downtown core and only if they are very regulated,” he said Tuesday. “Our main concern has to be the surrounding neighborhoods.”
City Planner Karlo Felix, who currently oversees the program, said it is going quite well from the city’s standpoint.
“There haven’t been any major issues,” he said Monday. “From time to time we get the occasional noise complaint, but that’s about it.”
Napa resident Sandy Austin-Stansberry owns one such vacation rental on Division Street. She converted three of her building’s units into vacation rentals and lives in the fourth. She said Tuesday that she is pleased with the city’s regulations.
“It’s been really easy,” she said Tuesday. “The city has been helpful with everything we need to do, and they help us anytime we have questions. We get to meet a lot of people and we are usually pretty full.”
While Austin-Stansberry thinks that adding more such vacation rentals to Napa would be good for the city’s tourism industry, others are not fully convinced.
Councilwoman Juliana Inman owns a vacation rental property next door to her own downtown home. While she doesn’t vote or make decisions on the city’s vacation rental policy, she said that adding more properties to the program needs to be done in a thoughtful manner.
In addition to the 42 vacation rental properties in Napa, St. Helena has 25, with 10 more properties on a waiting list. Officials in the Upvalley city reported in February that the program has worked extremely well — especially at regulating illegal vacation rentals.
The rest of Napa County has banned all short-term rental properties. Even so, lodging websites like Airbnb.com and Homeaway.com had about 265 short-term vacation rentals listed in the Napa Valley on Tuesday morning. Many were single rooms, but a large portion were entire homes for rent that were not listed on St. Helena’s or Napa’s list of complying vacation rentals.
“While I think our program works well for owners, it still hasn’t fully addressed the many illegally operating vacation rentals in Napa,” Inman said Tuesday. “There just isn’t enough money for enforcement on these illegal rentals.”
“Now, if we added a few more vacation rentals, we would have more money to police it. But like I said, it would require studying and an effort to balance the rest of the community’s needs.”
Felix said that if the City Council directs staff to research expanding the program, it would take some time to look at the ramifications. Mott said Monday that he would be bringing the matter before the council in the near future.