Glazer Bill Would Increase Penalties for Short-Term Rental Violations

Sen. Steve Glazer (D-Contra Costa) proposed new legislation Monday allowing cities to impose fines of up to $5,000 on short-term rental hosts who violate local laws.

The bill, triggered by the killing of five people in an Orinda home at a Halloween party, is intended to deter “party houses” that attract massive gatherings in otherwise quiet residential neighborhoods.

“Done right, short-term rentals can be good for homeowners and for the economy,” Glazer said, “but they can also be public nuisances or even threaten public safety.

“This bill gives cities the power to enforce their laws in a way that will get the attention of those who abuse their right to rent out a home. The fines have to be large enough so that they don’t just become another cost of doing business.”

The current maximum fine for violating an ordinance in a general law city is $1,000. Glazer’s bill raising the cap applies only to short-term rentals because, he said, that’s where cities are struggling to deal with this potentially dangerous new trend.

Joining Glazer as a co-author of the bill is Assemblywoman Rebecca Bauer-Kahan (D-Orinda).

“This bill is a much-needed tool for our cities and public safety officials to ensure that they can enforce the reasonable limitations put on short-term rentals, and so that we can protect the safety of our community,” Bauer-Kahan said.

Orinda Mayor Darlene Gee praised Sen. Glazer for coming to the aid of Orinda and other cities struggling with abuses in the short-term rental industry.

“We are very appreciative of Sen. Glazer’s leadership in giving communities greater ability to ensure that short-term rentals are a positive experience, and to help prevent poor behaviors from turning tragic,” Gee said.

Summary

This bill would authorize a city to impose a fine of up to $5,000 for a violation of a short-term rental ordinance.

Background

Short-term rentals have exploded in popularity over the last decade with the rise of hosting platforms such as AirBnB, HomeAway, and VRBO.

AirBnB alone now lists short-term rentals in 81,000 cities and 191 countries.

Though short-term rentals offer a way to improve tourism and earn owners some extra money, their recent proliferation has allowed bad actors to use the platform to advertise and secure homes for large parties.

With social media to amplify the reach of a party ad, a short-term rental property can quickly become the site of underage drinking, brawls, noise complaints, and – in some instances – violence.

In the last half of 2019 alone, 42 people were shot inside or just outside short-term rental properties across the United States and 17 died.

Issue

Many homes on these platforms rent for $1,000, $2,000, $3,000, or more dollars per night.

In these instances, a maximum fine of $1,000 per violation is not enough to deter bad actors from trying to make a quick profit.

Existing Law

Current law allows a general law city’s legislative body to impose a fine of up to $1,000 for violations of ordinances.

Charter cities are allowed to enact ordinances providing for various penalties so long as such penalties do not exceed any maximum limits set by the charter. Los Angeles, for example, allows for fines of up to $2,000 per night or two times the nightly rent charged, whichever is more, for some short-term rental violations and fines of up to $8,000 for violations involving large parties that disturb neighbors.

Elsewhere, other cities have also moved to increase their fines in order to better deter bad actors. One example is in Miami where, in 2016, they increased the fine for a violation of a short-term rental ordinance from $1,500 to $20,000 for the first violation, raising to as much as $100,000 for the fifth.

Proposal

This bill would allow general law city legislative bodies to impose fines of up to $5,000 for a violation of a short-term rental ordinance.

This bill would also define “short-term rentals” as a residential property that is rented to a visitor for fewer than 30 days through a centralized online platform where the rental is advertised and payments for the rental are securely processed.

Specific fine schedules would be set by each city’s legislative body.