Monday, August 20, 2012

Vacation Rentals & Lincoln City, Oregon – A Partnership?

This article was published as a Guest Editorial in the Lincoln City (Oregon) News Guard newspaper on August 15th, 2012 - as the city neared the end of a Consensus Building process that was designed to make recommendations to the City Council about how the city should deal with its "VRD problem".

by Doug Coates

State and local governments spend a lot of your money and their time on bringing new businesses and more tourists to an area; because they know that the jobs and tax revenues that come from these efforts pay off for decades. It may take years to convince a manufacturing or service business to move into an area, but if the city is a tourist destination, it takes considerably less effort to attract more tourists.

So why do some cities, including Lincoln City, Oregon, ignore the fact that short term rental homes are enormously successful in bringing in new tourists? Lincoln city leaders have passed 3 major new VRD laws since the 1989 law was abandoned in 2007 – each more restrictive than the last. Last year they announced that additional restrictions might be enacted, without specifying what they might be, and the VRD sector has been in decline ever since.

The city’s VRD Consensus Group says the current law is unenforceable, and has discussed the need for a simpler, more straightforward law. Some Group members still want to limit VRD activity. Some push for ejection of VRDs from Residential Zones, while others propose caps and quotas to control the number of VRDs in an area.

Caps and quotas address concerns of a certain vocal local residents, but this works against city goals to increase tourism. An alternative would be to work with VRDs, to build tourism in the city and to build support for local businesses – without giving up on effectively regulating VRDs.

What would happen if city leaders, businesses, residents and VRD owners became partners in an economic and tourism development approach designed to reap the many benefits that a vibrant VRD sector can bring, while still addressing concerns of local residents and the need for an appropriate level of regulation?

It has happened in other cities, and it is time for it to happen here.

  • Some cities some work directly with VRDs to spend property taxes, lodging taxes and permit fee revenues on new economic and tourism development efforts. 
  • Some cities that once banned or restricted VRDs in residential zones have removed or relaxed restrictions in favor of more VRDs economic activity. 
  • Some cities actively work with VRDs to bring tourist in during the slow season, when the local economy is at its weakest. Can you imagine a winter Whale Watching promotion, with our Visitors Center and the VRDs working together to bring in young families? 
  • One city welcomes VRD guests with a “Good Neighbor” brochure that is produced at the expense of the city, and is found in every licensed VRD home. The brochure invites the guests to take advantage of everything the city has to offer, while also reminding guests that “being a vacation renter also means being a good neighbor” to the full time residents. 
There are certain facts that many already agree on in Lincoln City:
  • VRD activity brings tax revenues, jobs and business to the city, and our city government should not interfere with that. 
  • Full time residents have a right to quietly enjoy their homes, without ongoing disturbances from nearby VRDs. 
  • Certain types of restrictions on VRD activity violate the property rights of VRD owners, as enshrined in Oregon’s Measure 49 and the 5th and 14th Amendments to the US Constitution. 
  • An appropriate level of VRD regulation addresses neighborhood concerns, helps ensure guest safety, and provides a framework within which VRDs can provide the most benefits to everyone. 
If we agree the current VRD laws need to be rewritten – how will that happen? Should the matter be handed back to the city council a 4th time? Has that worked before? 

There are certain principles that tend guide the formation of effective VRD laws in many cities. These laws:

  • should be structured to support the city’s economic development and tourism goals, and to address documented problems that VRD have caused in the city. 
  • should not contain provisions concerning parking, noise, trash and landscaping, because most such regulations should apply citywide, not just to VRDs. 
  • should require reasonable inspections and adequate insurance, to protect guests. 
  • should never penalize owners for illegal activity of VRD guests. How many hotels would survive if illegal guest activity was considered a legitimate reason to shut down a hotel? 
  • should not prevent owners from owning more than one property, or passing a VRD on to their heirs. 
  • should allow for reasonable growth in the VRD sector. 
  • should be designed using the considerable expertise of local VRD owners and managers. 
  • should not interfere with a local VRD association’s efforts to establish standards, build dialog with the community, self-regulate and actively participate in managing the role of VRDs in the city. 
How have these approaches worked in other cities? We don’t have to look far to find areas where VRDs do well.

Tillamook County in Oregon passed its first VRD law in 2009, with considerable involvement by an active group of VRD owners and managers, who wrote portions of the law. Earlier this year the county told me that there have been almost no complaints, and no VRD permits have been revoked. More tellingly, there is no noticeable discord about VRD activity in the county. Everyone seems to be able to live with the law, and I can say from personal experience that the law has improved the way I operate my own two VRDs.

Heading south, the city of Yachats, Oregon has a law consisting of only 5 pages plus exhibits, that “recognizes the desire of many owners to rent their property on a short-term basis and provides for the orderly use and regulation of such rentals to preserve the health, safety and welfare of the community”. The law is short and to the point. It doesn’t generate much discord in the community and it is rare for there to be a complaint or a permit revocation. Are we looking at Yachats for guidance?

The VRD law for the City of Palm Springs, California starts off by recognizing that “family dwelling units provide alternate visitor serving opportunities for the city”, and goes on to specify regulations that reap the most benefits for the city out of VRDs, while providing guidance on how VRDs should operate. The city runs a Hotline to help solve problems and produces literature to educate VRD owners and their guests. The city’s desire to partner with its VRDs is obvious.

Lincoln City’s problems are not new. As the popularity of vacation rentals grows, the issue is being discussed all over the nation and in many other countries. Three years ago in Tillamook, VRD representatives sat down with a small group of citizens who had concerns about VRDs, and a solution was worked out. Maybe Lincoln City is ready for a similar approach.
Read more about vacation rentals in these other communities and other background information at

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