Friday, 03 February 2023

Sen. McGuire’s online vacation rental legislation advances to Senate committee

NORTHERN CALIFORNIA – Sen. Mike McGuire’s critical legislation regulating online vacation rental businesses is advancing and the highly anticipated bill will proceed to the Senate Transportation and Housing Committee later this month.

Senate Bill 593 (SB 593) was officially submitted for Senate Committee consideration this week. The premise of SB 593 is simple.

This bill reinforces local laws already on the books. Where vacation rentals are legal, the bill will assist local jurisdictions in their regulation and collection of Transient Occupancy Taxes (tourist taxes) as more than 430 cities and 55 counties impose a tourist tax.

Where vacation rentals are illegal by local ordinance, the bill will prohibit online vacation rental businesses (OVRB’s) from making a rental.

“This bill is simple – It makes online vacation rental businesses follow local laws, just like the rest of us. I have always supported the ability for folks to rent their home for short term vacation rentals and believe that the new ‘sharing economy’ has a lot of benefits. That said, the multibillion dollar corporations need to do their part, follow local laws, and share in the prosperity of local communities,” McGuire said.

SB 593 – the Thriving Communities and Sharing Economy Act – will empower local control by providing the data needed to gather desperately needed funding for parks, road improvements, fire and police services and promote safe neighborhoods.

Recently, large cities and counties have had to negotiate individually with corporations like Airbnb to work out deals in order to collect taxes that have been owed to them for years.

Even after a deal had been struck, in San Francisco for example, there is no enforcement mechanism in place, which is why the San Francisco Planning Department recently reported that their newly adopted ordinance isn’t working.

In the case of the city of Malibu, the city council even had to subpoena records from Airbnb just to kick-start negotiations, which ultimately led to a settlement this week requiring Airbnb to directly charge the tourist tax on behalf of the residents sharing their homes.

“Cities shouldn’t have to issue subpoenas to get companies to come to the table,” McGuire said. “It’s time for this statewide legislation to put the simple regulations in place that will benefit all of us.”

SB 593 reinforces local ordinances by requiring online vacation rental businesses to disclose information (address of host rental, amount of nights stayed, and amount paid by the visitor) to the cities and counties upon request (similar to the way hotels - and some law abiding rental owners – currently report their TOT). This information will allow cities and counties to ensure their local laws are being followed.

Right out of the gate, SB 593 has garnered broad support. California State Association of Counties Executive Director Matt Cate said, “The California State Association of Counties (CSAC) greatly appreciates Senator McGuire’s leadership in making sure local communities have the ability to regulate on-line hosting platforms. In particular, we support the Senator’s legislation to ensure cities and counties can collect transient occupancy taxes that fund critical services in our communities.”

Other supporters include California Police Chiefs Association, California Professional Firefighters, California State Association of Counties, California Teamsters Public Affairs Council, California Association of Code Enforcement Officers, California Hotel & Lodging Association, Neighbors for Overnight Oversight, California Association of Boutique and Breakfast Inns, Santa Cruz County Conference & Visitors Council.

McGuire (D-Healdsburg) represents the Second Senate District on California’s North Coast.

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