Why this matters
National City has over 100 short-term rentals but no regulations or fees for them, including who can operate them.
National City councilmembers are one step closer to regulating short-term rentals seen on websites like Airbnb and Vrbo — and banning those that have been tied to serious crimes.
The council unanimously approved on Tuesday the first reading of an ordinance that seeks to regulate short-term rentals in National City. Officials have been seeking ways to prohibit people with records of prostitution and other “serious” crimes from operating the properties, according to a staff report.
The operators would also be required to primarily live in National City or near the rental, and subject to a new annual permit fee.
The ordinance also would place a cap on how many short-term rentals are allowed in the city.
Councilmembers say the proposal has been more than a year in the making and was suggested in part by the police department following reports of serious crime tied to short-term rentals.
City officials did not discuss specific crime statistics during the discussion Tuesday, though councilmembers have previously raised concerns about incidents involving short-term rentals.
Councilmember Jose Rodriguez cited what he called “nefarious activities,” including shootings, human trafficking and partying.
“It’s just inconceivable how we can be OK with this type of behavior and activity happening in our community,” he said.
No more than 180 short-term rentals would be allowed citywide, and no more than 60 per council district. There are routinely between 100 and 200 short-term rentals listed in the National City as “vacation rentals by owner, primarily on the Airbnb or VRBO platforms,” according to a city staff report.
Operators can only use the short-term rentals for residential purposes and can’t run a business from the property. They must also have a primary residence either in National City or within a quarter-mile from the property.
Tenants would be limited to renting the property no more than 90 days a year if the operator lives elsewhere. There is no limit on the number of days if the operator’s primary residence is located on the same property or next door to the short-term rental.
The city would begin charging short-term rental operators a $250 annual permit fee, similar to what’s charged in Chula Vista and Vista.
The city could also subject short-term rentals to its Transient Occupancy Tax — commonly referred to as the “hotel tax” that currently is 10% of the room rental rate.
“If there were 100 units rented out at $500 a night, the resulting loss in TOT revenue would equate to around $5,000 a day, depending on seasonality and market demand,” the city staff report said.
Officials estimate that charging the TOT tax onto short-term rentals could generate $3.3 million in additional revenue each year on the assumption that the city would have 180 short-term rentals rented at an average of $500 per night.
National City faced an $8.2 million deficit during last fiscal year, which prompted councilmembers to dip into reserves to balance the budget.
Councilmember Luz Molina said while the revenue projections sound good, she cautioned against relying on those estimates.
“I want to be as realistic about this as possible,” she said. “I can’t imagine that we will have 180 rentals at an average of $500 per night, at the maximum amount, to then count on that 3.3 million (dollars).”
Martin Reeder, the city’s acting director of community development, said implementing the hotel tax isn’t the main goal. Instead, it’s to address “public nuisance” and maintain “community character and wellbeing.”
The ordinance is still in its draft stage, so councilmembers would need to vote again at a future meeting before it becomes official.
Staff estimate the ordinance would take effect early next year.
Type of Content
News: Based on facts, either observed and verified directly by the reporter, or reported and verified from knowledgeable sources.
