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Arcata council weighs keeping 100-license cap, to allow 20 operators already paying TOT into program
Summary
Arcata staff told the City Council Wednesday that the city has 97 active nonexempt short-stay vacation rental permits (two pending) and about 55 exempt permits, and asked whether the council wanted to modify the existing 100-license cap or change enforcement tools.
City staff gave the Arcata City Council an update Wednesday on the short-stay vacation rental program and asked for policy guidance about the city's permit cap, exemptions and potential enforcement tools.
David Loya of the Department of Community Development told council members the city's ordinance limits nonexempt short-stay permits to 100 properties. He said the city currently has 97 nonexempt permits issued, two applications in process and about 55 exempt permits (owner-occupied, designated historic landmarks or properties rented fewer than 30 days a year).
"Short-stay rental permits are attributed to the property," Loya said. "We actually have 2 in process, so we anticipate to have 99 in the very near term." He added the city had previously allowed a larger grace period when the program began and that many earlier operators either obtained permits or stopped operating.
Loya said cross-referencing the city's transient-occupancy-tax (TOT) rolls and the short-stay permit list identified about 20 operators who are remitting TOT but are not yet on the city's short-stay permit list; staff said some of those discrepancies likely resulted from internal process gaps when TOT registration and short-stay-permit processes were not coordinated.
Policy questions Loya presented to council included whether the 100-permit limit should be revised, whether the three exemption categories remain appropriate, whether to allow the roughly 20 TOT-paying operators into the program given the absence of anyone on the waiting list, and whether to pursue commercial software that scans listing sites to identify unpermitted short-stay rentals.
Council members discussed the housing-stock impact and customer demand, and several members said they preferred retaining the 100-permit cap but allowing the existing TOT-paying operators to obtain short-stay permits without displacing anyone on a wait list. Council members also suggested the permit fee could fund software to help identify unpermitted listings.
Council consensus at the end of the discussion was to: keep the current cap and exemptions, allow the approximately 20 operators already remitting TOT to apply for short-stay permits, and pursue further information on enforcement software and fee adjustments to pay for it. Staff said they will present cost and feature details and a fee resolution for council consideration in upcoming budget discussions.
No ordinance changes were made at Wednesday's meeting; staff will incorporate council direction into next steps and return with more specific cost and implementation proposals.
