Measure A will permanently phase out all short-term vacation rentals in residential areas, but still allowing “home-stays” where homeowners are present on the site. [Opinion]
La Quinta is the latest city to go on the attack against short term vacation rentals (STVRs) in the Valley. Cathedral City, Palm Desert and Rancho Mirage have preceded us, and Indio is tackling abuses that are rampant in its community. The big difference is that in La Quinta, the residents are fighting not only a well-funded STVR owner/operator group (VRONLQ), but also our own City Council.
This issue will be resolved with Measure A, on the November 8 ballot. Measure A will permanently phase out (by the end of December 2024) all STVRs in residential areas, while still allowing “home-stays” where homeowners are present on the site. Also, STVR permits will be encouraged in the eleven tourist commercial zones which are now in full operation with more on the drawing boards or under construction.
What’s all the fuss? Well, the city maintains that the problems are few, and the STVRs are being phased out under the ordinance passed in April of 2021, and that the financial sky will fall due to loss of taxes (TOT) and fees paid by operators. Therefore, the city claims, (get ready) police and fire and all kinds of city services will have to be cut, or taxes will be raised. (Taxes can only be raised on a vote of the electorate, they fail to point out.)
The supporters of Measure A remind us that an ordinance can be overturned by a vote of the Council. A measure is permanent (unless overturned by the voters). No matter what owners or Council say, these mini-hotels in our midst can never be fully regulated. They bring disruption and danger, while once-affordable housing disappears off the housing inventory, and school enrollment declines due to loss of young families. Most importantly the quality of life in our neighborhoods is threatened.
Plus, the projections by the city and its “unbiased” consultants are erroneous.
How can the City’s projections be off base? Easy. Underestimate the revenues, inflate the expenses and hide the surplus. For example, Transient Occupancy Tax revenue for the existing, and future STVRs in the tourist zones is not accurately projected. Capital improvement budgets go from $2M to $4M to $8M in the General Fund. Annual surpluses can be tucked away in various discretionary reserve accounts.
Case in point: The citizens of La Quinta wisely passed Measure G in 2016 to raise the local sales tax one cent (with the support and urging of the City Council). The main pitch to voters was that these funds would cover the rising costs of police and fire protection and some capital expenses. Revenues from this measure have exceeded expectations. Wildly exceeded expectations. Income has increased every year. But the anti-Measure A “unbiased” studies show no increase. Plus, the $7M annual net revenues have been tucked away in Reserves. According to the 2021 City audit the city has over 100 million in discretionary cash reserves and a net worth of $770 million. That’s more than enough to cover the $6M loss of revenue projected by the city while new STVRs are built and permitted in tourist zones. Don’t be fooled. La Quinta is very well off and will continue to be so. It is the Council’s (profits over people) communication campaign to make us look poor and to cry gloom and doom.
What’s more, look at the valley cities who have already curtailed STVRs. Cathedral City, for example, is projecting a $7M surplus for this fiscal year. No bankruptcy. Look around the state. Dozens of cities have banned STVRs with no disastrous financial consequences. The proof is in the pudding.
And a word about projected sales tax: Our City adversaries state that vacation renters generate millions and millions of dollars of tax revenue. Wait a minute. Most of us have vacationed for a weekend in another town. How did we spend our vacation dollars? We saw a show, went to an event, went hiking or biking, and ate in restaurants, maybe. Most of us take food with us and cook in our fun new surroundings. And we hang out and party. But do we buy clothes? Home improvement supplies? Buy a car?? No, that’s what permanent residents and long-term renters do.
Let’s turn to the housing inventory. Lack of affordable housing across the Valley (and the state and the nation) is well documented, resulting in not only stress on young families and the elderly, but homelessness. La Quinta has prided itself in wonderful affordable housing projects over the years, with at least one more on the drawing board (thanks to the City Council). We all need this affordable housing for teachers, nurses, fire and police personnel, middle management, clerks, bus drivers and maintenance personnel. These families make up the diverse fabric of our community. We need them and we want them. Investors have been snatching up homes, investing thousands of dollars in them to make them “luxury” rentals, to charge big prices for a weekend. Where do our working families live? (Apartments? Hard to find and expensive. Long term rental homes? Hard to find and expensive.)
We are community with many young families but that is changing. The school population is decreasing for a number of reasons, but lack of housing is one of them. For every 30 children gone from a community means probably one classroom, one teacher and one or more classroom aides gone. Across the school district declining attendance cuts jobs for bus drivers, cafeteria workers and maintenance personnel. The entire community suffers.
La Quinta residents are fighting a David and Goliath battle. We hope that the residents will prevail as the out-of-town operators are waiting in the wings. If it fails, they will claim it’s a mandate to reinstate new permits for STVRs across the city. Will the City Council permit more residential STVRs to increase tax revenues? It’s a risk we can’t take. We need a permanent fix. La Quinta voters please VOTE YES ON MEASURE A.
- Vacation Rental: Shutterstock