Melissa Tarsky stands in her vacation rental home Monday on Hill Street. (photo by Daniel Archuleta)

OCEAN PARK — Thirty-one weeks out of the year, Melissa Tarsky welcomes total strangers into her home.

Well, her spare guest house, and they pay for the privilege.

Tarsky runs one of what may be hundreds of illegal vacation rentals spread throughout Santa Monica, which open their doors to tourists from near and far who prefer a home-based experience to the close quarters of a hotel room.

Her 900-square-foot guest home, neatly appointed and full of summer sunlight, brings in almost $40,000 in a given year, without the added burden of a 14 percent tax tacked on to hotel room bills.

And, while a moratorium on the practice has been ongoing since 2000, and an ordinance banning vacation rentals went on the books in 2004, city officials publicly stated in the past that they weren’t going out of their way to find violators.

That’s no longer the case.

After nearly four years in the business, Tarsky received a $650 citation from the building and safety division of City Hall for three violations: Operating without a proper business license, running a hotel use in a residential zone and not collecting the 14 percent tax placed on hotel rooms.

Although she knew it wasn’t legal to rent out the guest house, so many others were doing it out in the open on vacation rental websites like vrbo.com and homeaway.com that it didn’t seem like a big deal.

“It’s like so many other things, like we all drive 70 (miles per hour) when the speed limit said 65,” Tarsky said. “The city really didn’t care as long as you weren’t making too much noise.”

A year ago, that was true.

In a May 2010 Daily Press article entitled “Vacation rental ban not actively enforced,” a city official was quoted as saying that the division had been instructed to be reactive to neighbor complaints rather than pursue violators.

Now, with summer in full swing, the numbers of complaints is up, way up, and city officials are seeking out people that rent to travelers, said Ron Takiguchi, a building official for Santa Monica.

Officials investigate complaints from neighbors and also check out listings on rental sites that seem like they might be violating the ordinance.

There are currently 40 open cases against violators.

A great deal of confusion surrounds the 2004 ordinance. Many believe that if the owner rents out the spare room for more than 30 days, they skirt the provision against short-term housing, and the rental — and profit — is legal.

Actually, short-term housing is any rental for more than 30 days that comes with certain amenities including furniture or a pool, Takiguchi said.

Anything less than 30 days qualifies as a “hotel use.” Both are banned by the ordinance in most city zones.

For instance, if a family were to go away for the summer, and rented their home to another family or individual for the months that they were gone, that would still be considered “short-term housing,” and a violation of the ordinance, Takiguchi said.

Length of stay doesn’t validate it either. If a renter was there for a year with the intent to leave, and the home came with any kind of amenity, it’s a violation.

When the City Council passed the ordinance in 2004, they stated that short-term housing affected the character of neighborhoods by creating transitory populations and increasing noise.

If people are constantly moving in and out every few months, it brings down the quality of the neighborhood and the level of civic engagement, Takiguchi said.

His division uses three levels of enforcement.

The first, and least severe, is a warning. Because so few are familiar with the ins and outs of the short-term housing prohibition, officials often find that just letting residents know that the rental is illegal puts a stop to the practice.

If that doesn’t work, the landlord receives a citation. In Tarksy’s case, that was worth $650, or about the cost of a two-day stay in her guest house.

Finally, if the violator persists, the City Attorney’s Office can get involved to pursue prosecution.

“They have to weigh the cost of the business versus city enforcement,” Takiguchi said. “Our intent is to enforce the law as intended by the City Council and the citizens.”

That line of reasoning doesn’t sit well with Tarsky, who finds the rule to be out of line not only with what’s already going on in Santa Monica’s city limits, but outside of them.

Both Venice and Malibu allow vacation rentals, with minimal regulation beyond the implementation of the 14 percent hotel tax, she pointed out, and likely profit from the use.

Tarsky, who was a businesswoman before she left the professional world to be a stay-at-home mom, decided to prove her point.

After about 10 hours cruising the top three vacation rental sites — homeaway.com, vrbo.com and flipkey.com — Tarsky found over 200 vacation rentals spread throughout Santa Monica’s 8.3 square miles.

Using the assumption that those rooms were booked 20 weeks out of the year and applying the 14 percent tax, Tarsky estimated that City Hall is missing out on $1.8 million in lost revenue by not taxing and regulating vacation rentals.

Additionally, Tarsky took figures available on the Santa Monica Convention and Visitors Bureau website that track the spending habits of tourists and extrapolated that the people who rent from homeowners like herself pump another $1.8 million into the local economy.

“It’s just about the numbers,” she said.

Armed with those figures, Tarsky hopes to convince City Council members that the ordinance is hurting more than it helps.

“These taxes would mean teachers we don’t have to lay off,” she said.

At least one is adamantly opposed to the concept. Councilmember Kevin McKeown opposes vacation rentals, believing that they undermine communities and shove out long-term tenants.

“The conversion of rental housing stock to vacation mini-hotels is an erosion of our community, and a displacement of local households in favor of visitors who have no affinity for our city other than as a pleasant place to spend a week or two,” he wrote in an e-mail.

The extra tax money doesn’t outweigh the cost to the community, he wrote.

Although the CVB board of directors does not have an official position, the idea of vacation rentals does raise legitimate concerns, said Misti Kerns, president and CEO of the CVB.

Health and safety regulations may or may not be followed, and the insurance the homeowners carry may not cover that kind of use.

“We would respectfully encourage all homeowners to adhere to the laws and to work with city staff and the public process in order to express opinions and or change,” Kerns wrote in an e-mail.

Although her rental was shut down by City Hall, Tarsky is not done with this fight.

“I’m not angry,” she said. “They’re just wrong.”

ashley@www.smdp.com

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