Short-term room and home rentals are quickly becoming the frugal traveler's preferred choice of accommodations. Harkening back to the days of boarding houses, where travelers could rent single rooms with local families, popular websites like Airbnb that offer such digs are becoming increasingly popular.
But the growing presence of such rentals in Petaluma caused city officials to question the largely unregulated sector and its ability to skirt the city's transient occupancy tax laws at a special City Council meeting held Monday.
Petaluma officials have recognized short-term rentals as a tourist draw for the city. Travelers can avoid the high costs of hotel rooms, stay in neighborhoods where there aren't hotels and often connect with hosts that expose the visitor to the local life in town, rather than just the tourist version.
Such is the case for Thomas Holsboer, a citizen of the Netherlands who is renting a room in a Petaluma home that he found on Airbnb.
"This is my second stay in Petaluma and it has been wonderful," Holsboer told the council on Monday. "I'm not just renting a room. I'm staying with friends. At least, that's how it feels to me."
With short-term rentals, travelers receive affordable accommodations in friendly neighborhoods, while hosts are able to vet their guests and refuse service to anyone they are not comfortable having stay in their homes.
But some neighbors are concerned that the rentals are bringing a commercial feel into their residential neighborhoods.
"Hosts are responsible for vetting the people staying with them, but it's largely unregulated," said Petaluma resident Nancy Sasser, who lives near one such short-term rental facility on Keokuk Street and echoed the sentiments of several Petaluma residents at Monday's meeting. "This provides access to criminals and sexual predators. It's unlikely, but it's a reality. You don't want to ask people why they're standing in front of your house, looking at it, but you have to wonder."
For the Petaluma City Council, it's an issue of losing out on the transient occupancy tax, also known as TOT, revenue. Guests staying at standard hotels, motels, bed and breakfasts and campgrounds currently pay a 9 percent TOT charge on top of their hotel bill, which goes straight into the city's general fund. Informal, short-term rental businesses currently are completely unregulated by the city and their guests are not subject to the same fees.
While several local homeowners wanted the city to completely ban short-term rentals in residential neighborhoods, the City Council expressed more of an interest in taxing these establishments.
"I get the sense that Airbnb is here to stay," said Councilmember Mike Harris. "So the question is how do we regulate this going forward?"
Councilmember Gabe Kearney said that he has used Airbnb services on more than one occasion.
"We have a lot of information to look at," said Kearney. "But I'm looking forward to the discussion and thankful that other cities are going through the same thing."
Much like the debate online retailer Amazon.com faced over paying sales tax to local jurisdictions, Airbnb is facing similar issues across the globe. Currently, payment for accommodations is collected through the website and distributed to the host. The website keeps a portion of the guest's payment for itself. No revenue is directed to cities or counties. And council members acknowledged that it would be an ongoing and difficult battle to try to collect tax revenue from such websites.