Santa Monica’s homesharing rules have been affirmed again in court following a Thursday ruling by the Ninth Circuit Court of Appeals saying the City’s rules do not violate regulations on interstate commerce.
Santa Monica resident Arlene Rosenblatt brought the class action suit against the city claiming the restrictions violated constitutional protections on interstate commerce because they unfairly restricted the ability of visitors to access the coast.
“We are pleased that the Ninth Circuit has now twice upheld the City’s Home-Sharing Ordinance – first in the face of a challenge brought by online platforms Airbnb and Homeaway.com and now in rejecting Ms. Rosenblatt’s claims,” said City Attorney Lane Dilg. “The City’s Home-Sharing Ordinance is a lawful exercise of local government power and a key tool in our multi-pronged strategy to produce and preserve affordable housing in Santa Monica.”
A federal court rejected Rosenblatt’s case for the first time in 2017 and the 9th Circuit also ruled in the city’s favor earlier this year in a similar case brought by companies Airbnb and HomeAway.
“This case involves the perennial clash between a city’s exercise of traditional police powers in regulating land use and the rights of property owners to use their property as they see fit,” said Jacqueline H. Nguyen representing the three judge panel. “But this familiar problem has a not-so-familiar backdrop: online marketplaces — such as Airbnb and HomeAway — where travelers can rent privately-owned residential properties as vacation rentals.”
Rosenblatt and her husband said they should be able to list their home on a website like Airbnb while they are traveling out of town to supplement their social security checks.
The Court said the ordinance does not discriminate against interstate commerce by favoring in-state over out-of state interests and determined the ban on vacation rentals applies in the same manner to persons nationwide, including Santa Monica residents who may be interested in renting a vacation home from another resident.
“The complaint does not allege that Santa Monica’s ordinance interferes with activity that is inherently national or requires a uniform system of regulation. Land use regulations are inherently local,” said the ruling. “They are not a significant burden on interstate commerce merely because they disappoint would-be visitors from out of state.”
The 2015 ordinance is meant to prevent permanent housing from being converted to vacation rentals while allowing residents to earn some extra income by hosting guests in their home for 30 days or less while living on-site. City Hall recently tightened the rules to prohibit hosts from accepting more than two bookings at a time and from acting as the host for more than one home-share.
Bedrooms are now limited to two adults per room with no more than 10 people per dwelling. Guests are limited to one car per bedroom or no more than two vehicles total depending on preferential parking rules.
The expanded rules define a “host” as a person, not a company and stipulates hosts must have lived in the home as their primary residence for one year. Hosts must provide proof of insurance of $500,000, comply with the city’s noise limits and maintain fire extinguishers, smoke detectors and carbon monoxide detectors.