Regulating Short-Term Vacation Rentals: Do You Have Your Placer County Permit?

Our community is well aware of the significant amount of short-term vacation rentals (STRs) around Truckee, Lake Tahoe, and Donner Lake. The term “STR” encompasses a wide range of housing including single family residences, condominiums, and accessory dwelling units. Due to the recent surge in popularity of the short-term rentals, it is common to hear concerns about endangering the health and safety of residents and the environment and resources that attract visitors to the area.

While several aspects of tourism are welcomed in our region, STRs sometimes lack appropriate requirements and policies for parking, occupancy, noise, and garbage collection, among other issues. After receiving several complaints from residents and analyzing other short-term rental ordinances, Placer County recently approved the addition of Article 9.42 to its County Code requiring annual permits and regulating all STR operators. The STR ordinance took effect on January 1, 2020, and properties in east Placer County with elevation over 5,000 feet need to obtain an STR permit by March 31, 2020. STRs in west Placer County will still be required to obtain a Transient Occupancy Tax (TOT) certificate but will not need to obtain an STR permit.

What does the new ordinance require?

The ordinance adds sections 9.42.010 through 9.42.090 to the Placer County Code, which requires owners to apply for and obtain STR permits and comply with certain regulations, such as having a local contact person available 24 hours a day and who can be physically present at the property within 60 minutes. If you rent one or more properties in east Placer County, here’s a summary what you need to know:

• STR Permits: Owners have until March 31, 2020 to obtain a permit. Applications can be submitted through Host Compliance, which maintains the platform for Placer County’s STR and TOT compliance. STR permit application requirements include:
  • A fee. Notably, even after considering the benefit that property management companies provide to reduce problems associated with STRs, Placer County declined to approve a reduced permit fee for STRs managed by professional management companies.
  • An application that includes: the rental address and Assessor Parcel Number, local contact person information, number of bedrooms, maximum occupancy, rental unit type, number of onsite parking spaces, proof of existing garbage service, total number of receptacles, and the number and location of fire extinguishers, smoke and carbon monoxide alarms.
  • Certification of compliance with fire code and life safety requirements (requires scheduling an inspection)
  • Proof of a TOT certificate (can be obtained after registering online with Placer County)

• Renewal of STR Permit: Owners must reapply each year. Permits will be renewed if updated information similar to the information required for the original permit is timely received by the County. By March 31, 2021, however, all STRs must have installed a bear bin, or an animal-proof trash enclosure. Permits will be denied if owners fail to abide by this regulation designed to remedy garbage issues and the negative effects caused to Tahoe’s wildlife.

• Operational Standards and Prohibitions. To minimize STRs from causing disturbances which may disrupt the peace, safety, and general welfare of communities, some operational standards and prohibitions in the new ordinance include:
  • Owners must prevent nuisances and inappropriate behavior, and notify each renter of his or her duty to comply with the STR ordinance and all aspects of the Placer County Code
  • Establishing a local contact person that can be physically present at the STR within 60 minutes
  • Providing onsite parking at the STR or a county-approved parking plan for offsite parking
  • Owners cannot offer STRs for properties deeded or zoned as affordable dwelling units, or deed restricted secondary dwelling units
  • Restrictions against open wood burning pits, bonfires, or campfires; and grills and barbeques must be more than ten feet from any structure
  • Occupancy within the STR is more limited—“maximum occupancy” is defined as “two people per bedroom, plus two additional people, excluding children under 16. Occupancy limits may be increased on a case-by-case basis, at the discretion of the Community Development Resource Agency Director.”
  • To limit fire concerns (particularly related to the misuse of barbeques), owners must have fire district staff conduct an inspection once every three years. These inspections will also confirm that each STR has smoke and carbon monoxide detectors

Are any STRs exempt from the ordinance?

Yes. The ordinance does not apply to STRs at or below 5,000 feet in elevation. Timeshares, fractional ownership lodging facilities, hotels, motels, or existing resorts above 5,000 feet are exempt from obtaining an STR permit if the lodging facility has an existing permit, business license, and TOT certificate from Placer County. The rational for this exemption is that these facilities were proposed, entitled, and constructed as transient lodging uses and have staff to address potential guest issues.

For owners of single-family dwellings within a resort, owners may be granted an exemption from permit requirements at the discretion of Placer County’s Community Development Resource Agency Director, if they can demonstrate an ability to enforce standards that address noise, parking, trash, and guest safety.

Certain residential associations (i.e., homeowner, condo, and townhouse associations) may also be exempt. To qualify for an exemption, an owner must submit a written request showing that their residential association has noise, parking, and trash requirements in place through its CC&Rs. Any exemption request must also include a history of the residential association enforcing their requirements and a certification from the homeowner that the rental has functioning smoke alarms, carbon monoxide detectors, and fire extinguishers.

What are the penalties and enforcement measures if the ordinance is not followed?
Violating the STR ordinance is considered a public nuisance and misdemeanor and, according to the language of the STR ordinance, declared to be contrary to the public interest. If a violation is assessed, Placer County may suspend or revoke an owner’s STR permit or seek to enjoin any continuing violation. Owners may also be charged penalties of $500 per day for the first citation, and $1000 per day for subsequent violations. And for properties that are exempt, the ordinance includes a provision that allows revocation of the exemption if five or more complaints are made to the County within a six-month period.

A procedure was developed to allow a significant “safe harbor” for owners to properly deal with renters violating the STR ordinance. Neighbors are encouraged to contact Placer County Code Enforcement. Code Enforcement will contact the local contact, and he or she has one hour to resolve the issue. If it is not resolved, Code Enforcement will arrive at the property to resolve the issue, which may result in a citation to the owner.

Is Truckee next?

It seems likely. The Town of Truckee continues to analyze whether it should increase its regulation of short-term rentals. In October 2019, the Town awarded a contract to Host Compliance (the same company assisting with STRs and TOT compliance in Placer County), to gather STR market data in Truckee and make recommendations of how to improve regulation and the Truckee Municipal Code. But the Truckee Town Council has not considered its own STR ordinance at this time.

The above is a summary of the Placer County Short-Term Vacation Rental Ordinance. It does not address each requirement or subsection of the new laws. Owners must promptly comply with the new ordinance and have a trustworthy local contact if problems arise with certain renters. If you need any assistance with the new ordinance, lease, or rental issues, Porter Simon regularly handles these matters for our local clients.

Ethan Birnberg is an associate attorney at Porter Simon and is licensed in California, Nevada, Colorado, and Wyoming. He can be reached at birnberg@portersimon.com or www.portersimon.com. Porter Simon has offices in Truckee and Tahoe City, California, and Reno, Nevada. Its attorneys regularly assist clients with all types of real estate issues, including landlord tenant issues, lease formation and disputes, evictions, development, construction, HOAs, insolvency and bankruptcy-related matters, and issues that span across several other practice areas.