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Deadline is extended for non-compliant rentals

Suzanne Guldimann, Freelance Reporter
1:45 pm PDT August 18, 2014

As more Malibu property owners turn their homes and guest houses into short-term vacation rentals, the City of Malibu and rental property neighbors are grappling with a host of vacation rental issues including traffic, parking, noise, safety, taxes and even beach access.
While the City of Malibu continues to seek information from Internet sites that feature Malibu vacation rental listings with the goal of identifying properties that aren’t collecting the municipality’s 12-percent Transient Occupancy Tax, many Malibu residents say they are troubled by the rapid increase in vacation and party rentals that some say is changing the character of neighborhoods throughout the community.
A cursory search of the Internet turns up hundreds of Malibu vacation rentals, ranging from an opportunity to camp out at a private organic farm for $75 a night per person, to a 10-bedroom, 10-bath mansion that sleeps 16 and costs $12,000 per night — $36,000 for the minimum three-night stay.
The City of Malibu is subpoenaing the records of online vacation rental listing sites as part of the campaign to determine how many of the cozy cottages, custom airstreams, and beachside mega-mansions for rent in Malibu are registered and which property owners are still not requiring their guests to pay their share of the TOT.
At its Aug. 11 meeting, the Malibu City Council learned that only three of the five rental companies — one Malibu-owned rental business, and four culled from a list of 60-plus short-term rental internet sites identified by the City in April, were ordered to provide Malibu listing records. Of those five, and have complied, or are working to comply, with the city’s demands, according to City attorney Christi Hogin.  
Aron  Schifman, the only individual subpoenaed, is also reportedly cooperating with the City. However, TripAdvisor Holdings, LLC; and YBYC, INC, require more time, according to Hogin. The Council voted to extend the deadline for both companies to October and November, respectively.
The City charges a TOT tax on any stay of less than 30 days.
“Malibu property owners are allowed to rent out their own homes, as long as TOT is paid,” Hogan said. “A lot of members of the community are playing by rules, have registered and are paying that tax as required, and we have discovered, mostly through the listings on various vacation rental websites, that there are some homes in the City of Malibu that are being offered out for short-term rental that have not been registered with the City, and from whom we are not receiving any taxes.
“We don’t know for certain if a listing on a website has, in fact, resulted in a stay for which taxes have been remitted. So we are trying to find out how well our tax ordinance is being implemented and bring everybody into the fold of being lawful.”
“I’d like to get away from taxes, but this tax works well,” said Alan Armstrong, Malibu resident and rental property owner, during public comment.
Armstrong described the TOT as “a sort of a use tax for Malibu.
“I support what you’re doing. It’s fine with us,” he said, adding that the Council needs to be aware that not everyone is a responsible property manager. “Sometimes an outlying vacation rental is not managed well and becomes a neighborhood nuisance.
“But I think they can be managed very well in a neighborhood-friendly environment. You can always solicit neighbors, pass complaints on the sheriff if they’re not managed well.”
Other concerns that are surfacing include parking in residential neighborhoods. Many of the larger rental properties can accommodate 10, 15, or 20 people. Residents say all of those extra vehicles can clog narrow canyon and residential roads. House parties at short-term rental properties add more vehicles to the mix and often lead to late night noise nuisance calls to the sheriff’s department.
The sheriff’s department has been called on repeatedly to shut down noisy parties at a rental property in the usually quiet Point Dume area this summer. The property owner was reportedly not only not registered for the TOT program, but was also renting the property for large parties without obtaining a temporary use permit for each event.
In some neighborhoods, short-term rental property beach access has become an issue. Many online vacation rental listings advertise access to private easements that are maintained by and for residents. All Malibu beaches are open to the public, but not all easements are public easements. Some see access to private beach clubs like La Costa and Malibu West, or vacation rental beach key-lending at Point Dume’s residential beach easements that cross private property as bending the bylaws that govern the property owners’ associations, creating a gray area between deeded easement rights and open public access.
“We are located on AMAZING Point Dume in Malibu with one of the most desired surfing and paddleboard beaches on the coast,” one online listing boasts. “There is a private, gated, ravine access to those surf points just a few minutes walk from the house and WE have the key!”
Short-term rental property proponents counter that the vast majority of properties are adequately managed and that there are comparatively few problems. They add that rentals provide a valuable source of income and that home rentals can offer a practical and affordable Malibu vacation option for visitors. Observers say that the Malibu vacation rental property trend is expected to continue to grow. For the city, that trend has the potential to provide a significant source of tax revenue.