Managing Editor
Dianne McNinch, who has been using Airbnb to rent out a bedroom in her 1908 Craftsman home for over five years, says that when she first joined the website as a host, she showed up at Long Beach City Hall to pay a transient-occupancy tax (TOT). However, she was informed that the City does not collect such a fee.
It’s a policy with which she does not agree.
“We Airbnb hosts should be paying the TOT, and our City should [and] needs to develop a system for that to be collected,” McNinch said. “When I first became a host, I went to the City and said, ‘I am an Airbnb host and want to pay the TOT’ and was told that, at that time, there was no system in place for me to do such a thing.”
After her visit to the City, McNinch proceeded with renting out her room to travelers from around the world, using the income it generated to supplement her “very small” Social Security checks.
“I pay property tax, keep my home insured and contribute to the community by volunteering on many fronts all over our city,” she said. “Volunteering actually costs money, gas, meals out and contributions.”
She depends on the money from Airbnb to live the life she finds fulfilling.
However, McNinch, who has earned a user rating of five out of five stars from 203 reviews on Airbnb, is— technically— doing something that is not permitted in Long Beach.
Municipal Code 21.51.270 prohibits short-term rentals in the city, according to a March 16 press release from 2nd District Councilmember Jeannine Pearce’s office.
“Despite this, there are approximately 1,120 units of this type currently available in the city, with the majority of units located in the 2nd District,” the press release states. “An estimated 58 percent, or 425, of these listings are being rented out as entire homes/apartment units.”
Pearce, like McNinch, doesn’t want those short-term rentals (STRs) to end— she just wants them to be regulated.
At Tuesday’s city council meeting, she advocated for their use as part of a “sharing economy” and requested that the city manager and city attorney review and report back within 60 days on next steps for drafting an ordinance to allow and regulate them.
In an interview with the Signal Tribune at her downtown office earlier that day, Pearce explained that the issue came to her attention near the beginning of her term on the council.
“I think it was my first month in office. We received a handful of calls and emails,” Pearce said. “People were concerned about whole units being converted. Neighbors were really concerned about their safety. We did a little bit of digging and found out that, on the low end, we have somewhere around 1,000 STRs in the city.”
She said her staff had garnered that information from insideairbnb.com, a website that claims to be “an independent, non-commercial set of tools and data that allows you to explore how Airbnb is really being used in cities around the world.”
Pearce also explained that the recent mayor’s study session on housing brought to light a shortage of vacancies.
“When we started thinking about short-term rentals being whole units taken off the market, [we realized] we’re not going to build our way out of the housing crunch,” she said. “We have about 2 to 3 percent housing vacancy, which isn’t a healthy rate. And, so, making sure that units that could be rented to residents are used for that purpose and not taken off the market as short-term rentals, those dots started connecting for us.”
The Signal Tribune asked Pearce what happens if it is discovered a property owner is indeed using a site such as Airbnb, HomeAway or VRBO to rent out rooms or entire units.
“Right now, what happens is it’s complaint-driven,” she said. “So, a neighbor might call code-enforcement. We need to verify with two different visits that it’s actually an STR. Then we send a cease-and-desist letter. If complaints continue […] we don’t do anything right now. We don’t have the funds to monitor [and] enforce, outside of sending a cease-and-desist letter. So, it’s a challenge to have a rule on the book that you’re not able to enforce.”
Pearce said that, when the time comes to determine just how much the TOT for STRs will be, she would like it to be the same as that of hotels.
“The conversation around STRs is complicated,” Pearce said. “We have a lot of cities that have done this work before us. So, I really want to make sure that we have all the research before we make a final decision about what an ordinance would look like, but if there’s a whole unit on the market that’s being used as an STR, it should pay the equal transient-occupancy tax that hotels do.”
She said, however, that she is requesting that the city attorney research how the TOT can be used directly for housing. She hopes for two things: to address the housing problem and generate revenue for the city.
“I think that Airbnb and short-term-rental companies want to remain legal. They want to get their legal status in the city,” she said. “They want to figure out a way to work with the City so that they can continue to generate income for them but also be an economic driver for the city. The challenge is finding that fine line around […] ‘When do the dollar signs make you forget about the purpose of doing it?'”
Pearce explained that she wants to avoid having multiple-unit properties that owners rent out as STRs rather than offering them as long-term housing spaces.
“What happens is that takes those four units or that unit off the rental market,” she said. “And that then drives up rental costs. Anything more than three months— to me— that’s a unit that should be a rental that should be accessible to residents looking for a home. That’s the challenge. And that’s why I think 90 days is a good number.”
That’s a point on which McNinch disagrees. She would prefer that the limit on the number of days each year a host may rent out their property— or parts thereof— be 160.
“This allows me a greater than subsistence-level existence,” McNinch said. “The income I get from Airbnb just is essential to my life. It helps me pay my utilities. It gives me the flexibility to use gas money to volunteer all over the city. I’m really happy with my association (with Airbnb). I’m quite pleased we’re going to look at ways to make sure the integrity of Airbnb continues in Long Beach.”
As for the city on the hill, Charlie Honeycutt, Signal Hill city manager, told the Signal Tribune this week that short-term rentals are not a permissible use there.
At Tuesday night’s Long Beach City Council meeting, Pearce gave a presentation on STRs, particularly stressing the importance of compliance. She cited several other cities that have regulated STRs, including San Francisco and Portland, and said Long Beach can look to those municipalities for direction.
She said that, a year after San Francisco passed regulations on STRs, only 130 out of 5,000 hosts had set appointments with the city’s planning department.
“In Portland, 93 percent of its hosts were not in compliance,” she said. “And, so, no matter what we put on the books, we really need to make sure that this part is something that city staff is able to spend some time digging into. When there’s no enforcement, there’s no reason for hosts to comply with the City.”
Third District Councilmember Suzie Price, whose area includes Belmont Shore and the peninsula, said the issue is a significant one for her district.
“It’s a problem for the residents in the 3rd District mostly because of quality-of-life and public-safety issues,” Price said. “It’s great that Long Beach is and continues to be an attractive place for tourism. We have a vibrant community, great music and beaches and amazing people, but we don’t want these positives that we have to create problems for our residents as a result of the short-term home rentals.”
Vice Mayor Rex Richardson seconded Pearce’s motion to request city staff’s review of regulating STRs, and it was passed by an 8—0 vote.
