To: Board of Supervisors
From: Treasurer/Tax Collector
Agenda Section: Consent
Vote Requirement: Majority
SUBJECT:
title
Support for SB 346 (Durazo) Regarding Information Sharing by Short-Term Rental Facilitators
end
RECOMMENDATION(S):
Recommendation
That the Board of Supervisors:
1. Authorize the Chair to sign the letter of support (Attachment 1) regarding SB 346.
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STRATEGIC PLAN:
This action supports the following areas of your Board’s Strategic Plan.
Area of Focus: Core Services/Other
Strategic Plan Category: 9999 - Core Services/Other
DISCUSSION:
Senate Bill (SB) 346, introduced by Senator Durazo, is a bill that squarely addresses an issue described in the county’s 2025 legislative platform (General Government, Finance and Technology, Item 3.b) around requiring short-term rental operators to share information and allow audits. Specifically, it would enable cities and counties to require short-term rental platforms (e.g. Airbnb, VRBO), upon request, to provide the Assessor Parcel Number (APN) of a listing to a local agency, require the publishing of the local license number and Transient Occupancy Tax (TOT) Certification on the short-term rental listing, and would authorize audit authority to local governments on TOT when collected and remitted by a short-term rental platform.
Recent growth in short-term rental of residential units, both licensed and unlicensed at the local level, significantly impacts communities throughout California. Increased and undisclosed short-term rentals alter neighborhood character, can be a public safety risk, and reduce the availability of already scarce affordable housing in many communities, collectively creating additional demands on local public service providers.
Additionally, online hosting platforms receive revenues from short-term rental (STR) transactions that are not permitted by local ordinances, and in some communities, transient occupancy taxes can go uncollected or collected and remitted incorrectly.
Furthermore, local governments often enter into Voluntary Collection Agreements (VCAs) with short-term rental platforms that allow the platform to collect and remit the applicable TOT. Unfortunately, it is often the case that entering into these agreements results in the local agency waiving or significantly restricting their ability to audit these dollars. This raises the question, is the correct amount of tax being collected and remitted?
Local agencies with VCAs were required, as part of those agreements, to waive access to addresses of the actual host properties. As such, the information that can be yielded from an audit is limited and could prevent local governments from recovering taxes owed from activity generated at those properties. Furthermore, it creates a circumstance where local governments could be unknowingly accepting collections from properties that are operating illegally. This raises serious policy concerns and underscores the critical nature of local agencies having the statutory tools to ensure operators are operating legally and are collecting and remitting the correct amounts of transient occupancy taxes to the correct local agency.
TOT collections in Humboldt fund, among other local needs, housing, local grant programs for community-based organizations, activities to further promote tourism, and support of the county’s General Fund, which is a critical source of dollars that can flexibly be used to meet community needs.
SOURCE OF FUNDING:
Hotel & Motel Tax (10710)
FINANCIAL IMPACT:
Narrative Explanation of Financial Impact:
There is no financial impact to sending a letter of support as advocacy activities have already been included in the Fiscal Year 2024-25 budget. However, if SB 346 is signed into law, it could impact the county’s ability to collect TOT revenue from STR operators.
STAFFING IMPACT:
Narrative Explanation of Staffing Impact:
If signed into law, SB 346 would allow the county to impose local ordinances to require information sharing. This would require staff time to develop and enforce.
OTHER AGENCY INVOLVEMENT:
None
ALTERNATIVES TO STAFF RECOMMENDATIONS:
Your Board could choose not to support SB 346. This is not recommended as this issue has been a long-standing item in the Board’s legislative platform.
ATTACHMENTS:
1. Letter of Support for SB 346
2. Bill Text for SB 346
3. Senate Local Government Committee Analysis
PREVIOUS ACTION/REFERRAL:
Meeting of: Oct. 20, 2020; Nov. 19, 2019
File No.: 20-1300; 19-1607;