Hello Justin
I am writing to follow up on the Short Term Rental Update.
A) If you recall, on July 28, 2020, the City Council approved the appropriation of $35,000 from the general fund unassigned fund for fiscal year 2020-21 for a short-term rental (STR) compliance contract to activate enforcement of municipal code for transient occupancy tax collection for short-term rentals beginning in January 2021.
The council agreed to delay enforcement of the ordinance until January 2021. The delay was because Council Members Mueller and Carlton thought some households rely on the income from short-term rentals and that the tax could drive up price.
While this the position that the interest of those with second or more homes (and those of corporations) outweighs the needs of those with no housing, did not make sense, starting the collection later than never was still better than not.
See Almanac August 2020 edition.
B) However, while enforcement was to begin in January 2021, the City took no action.
C) On May 11, 2021, via Staff Report 21-098-CC of 5/11/2021, the City sought authorization of the city manager to execute an agreement with HdL Companies to provide transient occupancy tax administration and audit services for a fixed fee and short term rental transient occupancy tax enforcement for a performance based revenue share.
D) In July of 2021 the City Council authorized the signing of a contract with HdL Companies for the administration and enforcement of the Transient Occupancy Tax Ordinance. The contract started on 7/1/2021. The contract included identification and compliance of “AirBandB” type activities within the city limits. The contractor began begin developing the database in early July, with verified numbers to be made available after 10/31/2021.
E) I was informed that that as of 10/16/2021, the contractor (HdL) had identified 136 potential STR operations within the City Limits of Menlo Park. Of those, according to County tax records, 13 are owned by LLC’s and 1 is owned by an Inc. (Corporation). While it is may not be unusual for rental properties to be set up as an LLC, most of them were are not occupied by the owners of the LLC.
Of the 136 potential STR operations HdL was able to verify that 40 were actively renting. Four (4) of those were LLC’s.
F) To date, the Menlo Park residents have not received the results of this report.
G) Furthermore, I have a few other questions. Aside from tax, the information gathered via HdL can be useful to gain insight into how short term rentals are operating in the city of Menlo Park.
a) What part of the information does the City consider confidential? Perhaps the addresses of the locations? They already advertise these units.
b) Is the data you gathered from publicly available databases (or perhaps from airbnb itself)?
Insight that can be gathered includes:
1) Which neighborhood (e.g., Sharon Heights, Allied Arts) the properties are located in?
2) What is the duration of rental during the year (San Francisco has a 90 days per year maximum limit)?
3) What is the nature of property owners (not the unique names)? San Francisco limits to properties where the owner lives permanently in the property at least 275 days a year.
4) Are they registered with the City as a short term rental?
5) What is the number of unhoused nights per year (same as #2)?
6) Are they what San Francisco would consider (I understand Menlo Park does not have this, but if we were to apply SF laws) ineligible for short time rental?
7) the nature of renters: are they natural persons or business (eg Facebook)? There’s been exchanges that companies are using Airbnb to rent for their visitors, etc.
There has been a lot of discussion around whether private equity firms and companies like Zillow are buying properties usurping natural residents from either ownership opportunity and/or rentals.
All of this information is really relevant to these housing discussions and would be a shame not to be included in the report.
Best
Soody Tronson
Menlo Park resident
