Vacation Rentals in Capitola

By Margaret Kinstler and Nels Westman, CVRA members

Rentals of homes for less than 30 days are prohibited in most areas of Capitola. Vacation rentals are almost always for less than 30 days and are thus illegal. An exception for vacation rentals is in the Transient Occupancy Overlay District (essentially the Capitola Village area) where vacation rentals are permitted with the necessary city permits and the collection and remittance of the 10% Transient Occupancy Tax to the City.

With the increased popularity of such websites as Airbnb and VRBO there are a growing number of vacation rental properties operating illegally in Capitola’s residential neighborhoods. Numerous complaints have been filed with the City regarding this growing problem. These complaints center on exacerbated parking problems, noise, late night parties, a constant turnover of strangers and an elevated level of activity typical of the party atmosphere of vacation rentals. Residents feel that this activity conflicts with the quiet enjoyment of their R-1 neighborhoods and that it changes the nature of their residential neighborhoods. They feel that this is the reason the City created the Transient Overlay District in the Village area where more activity, congestion and parking challenges of vacation rentals are more the norm.

As a result of these many complaints the City Staff brought the issue first to the Planning Commission and then to the City Council. The Planning Commission recommended keeping the existing regulations in place and supported a pro-active information and enforcement program designed to curb vacation rental violations. This program is designed to insure all vacation rental operators in the Transient Overlay District have the required permits and collect and remit the 10% TOT Tax to the City. It is also designed to stop illegal vacation rentals in all residential neighborhoods through effective enforcement of the existing zoning laws.

The issue then went to the City Council at their January 14 meeting. The Council unanimously supported the city staff program. Several Council Members said that it was important to act soon to reverse the growth of illegal vacation rentals in residential neighborhoods of Capitola. Enforcement includes citations and fines ranging from $100 to $500 per violation.

What’s next? The City will soon do an informational outreach to all citizens to insure that everyone clearly understands the vacation rental rules. This will be included in the next City Newsletter which is mailed to all residents. Much of the enforcement activity by the City will be in response to neighbors’ complaints. To assist the City in stopping illegal vacation rentals, neighbors are encouraged to report apparent illegal vacation rental operations in their neighborhoods to the City Planning Department. The city staff will follow up on every complaint. The location of many vacation rentals can be seen by visiting the websites of Airbnb and VRBO and searching for rentals in Capitola.

Should you wish to make a complaint to the City, please visit the Home page of www.cityofcapitola.org and click on “Forms and Permits.” Then select the “Code Enforcement Complaint Form” to download the form to use. Complaints must be made in writing and cannot be anonymous. However, your name will be held confidential if you ask. If you have any questions please contact the Planning Department at (831) 475-7300.