City Council meets to discuss short-term rental regulations

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On Thursday, City Council reviewed and passed two motions for city staff to act on the regulation of short-term rentals.

The motions that passed will call for the city code enforcement unit to notify and fine landlords operating short-term rentals, which are currently illegal in the city of Berkeley. The motions also authorized the creation of a proposal on the use and election of a third-party vendor to collect data and determine legality of rentals.

Currently, the city is facing issues on how to legalize short-term rentals, create a licensing system for those rentals once they are made legal, fine illegal rentals and identify what the negotiations with companies such as Airbnb will entail.

“What we’re trying to stop is the fact that Airbnb and other housing platforms make a huge amount of their revenue on illegal (housing) units that could never get permits in San Francisco or the city of Berkeley,” said Taylor Hudson, research analyst at the labor union Unite Here.

Council discussion on short-term rentals began two years ago when Worthington proposed to legalize, tax and regulate short-term rentals. If short-term rentals are made legal in Berkeley and are required to have permits, renters will pay a transit occupancy tax, which will go to the city general fund, along with an enforcement fee of 2 percent of the rents charged that will enforce the ordinance.

Mayor Tom Bates introduced a proposal to officially legalize short-term rentals several months ago, working with council members Lori Droste and Jesse Arreguin. The proposal was reviewed by the planning commission and passed on its first reading on May 31, but went on hold because of concerns from Airbnb. Bates recently considered an agreement with Airbnb where short-term rentals would not require a license and taxes would instead be directly collected from Airbnb.

“It’s disrespectful to the two years of public process (to go through legislature) and it’s basically getting taxes through something illegal,” Arreguin said on Bates’s previous negotiations. “There’s issues with the agreement and most importantly, if they’re not legalizing and regulating them, we’re going to see lots more apartments being removed from the market.”

Much of the issue with short-term rentals has been over the concern that they may potentially displace longterm affordable housing. This could lead to many landlords choosing to evict existing residents and instead using a platform such as Airbnb to rent out their property for a few days at a time for higher profits.

Various campus members such as ASUC Senator Rosa Kwak and ASUC Senator Chris Yamas’s chief-of-staff Caiden Nason spoke out during the meeting against short-term housing’s detrimental effects to longterm affordable housing for students. Community member Richard Rose of the Panoramic Hill Association argued that the “mini-dorms” created by large numbers of short-term rentals pose a fire threat in the Berkeley Hills area.

Other Berkeley community members spoke out against harsh regulation against short-term rentals, however, arguing that there was no data to support the claims that these rentals would displace longterm housing. Others were concerned about the economic consequences and  complications that would arise if licensing were required.

“The people that are using Airbnb are increasing the number of neighborhoods that are generating income,” said Eileen Starr Moderbacher, a community member who used Airbnb to rent out parts of her property, adding that hotels can cause geographical economic disparities because they are in central locations. “It’s good for the community and the human aspect.”

The council will meet to discuss this issue in September after the proposal from the planning commission is finished. The meeting adjourned in memory of Tarishi Jain, a UC Berkeley student recently killed while abroad, and in memory of Alton Sterling and Philando Castile.

Contact Lillian Dong at [email protected].

A previous version of this article misquoted Councilmember Jesse Arreguin as saying the mayor’s proposal regarding Airbnb was “just respectful.” In fact, he called it “disrespectful.”