Quick Take
Vacation rentals have come under intensifying scrutiny as Santa Cruz County tries to balance its tourism industry and housing supply crisis. Previously lax enforcement has given way to a stricter approach, filled with listing checks, public hearings to address neighbor complaints and violations, and the potential for license revocations.
An air of tension filled the Santa Cruz County zoning administrator’s meeting on Friday.
On one side of the room, Jeanell Martin, owner of a Seacliff Drive vacation rental, sat surrounded by a few friends and holding a thick folder of documents. Across the aisle sat a trio of Martin’s neighbors, who each walked up to the lectern with a list of complaints about how Martin operated her rental. The guests were often loud, they said, disturbed neighbors into the night, and took up too much street parking.
The county had built its own case against Martin: On three separate rental platforms — VRBO, Airbnb and FlipKey — she advertised unpermitted kitchenettes, listed the property as three separate rentals, and offered her top floor as an unpermitted studio. That was enough for county staff to recommend fully revoking Martin’s rental license.
Martin was not the only vacation rental owner facing scrutiny that day. County staff also recommended revoking Omar Devlin’s license for his rental on Alice Street in Live Oak because he was renting out an unpermitted structure and advertising more rooms than his permit allowed. The county also recommended denying Jessica Yueh’s license renewal application for her Palisades Avenue rental in Pleasure Point for regularly advertising more units than she had permitted.
Typically, these issues would result in fines or citations, addressed privately between staff and the license holder. However, this year, Santa Cruz County’s policing of vacation rentals entered a new era in which neighbor complaints and violations are more often aired in public hearings, and rental owners must defend against losing their permits.
The county’s vacation rental program kicked off in 2011; however, over the next decade, vacation rentals became too popular, especially in areas such as Pleasure Point, Live Oak, Aptos, Rio Del Mar and La Selva. In 2020, the board of supervisors voted to impose a moratorium on new vacation rental permits, as rentals were proliferating while the county fell further into a housing supply and affordability crisis. At the time, Supervisor Zach Friend said that roughly 20% of the vacation rental stock had been converted from long-term rentals.
With input from the California Coastal Commission, the moratorium on new vacation rental permits became a cap in specific neighborhoods in 2021.
The county board of supervisors voted in June 2022 to shift from a complaint-driven style of policing vacation rentals to something more proactive, signing a contract with a consultant who would help scan local listings to see whether they had permits for what was advertised. However, the county, struggling with vacancy issues, was unable to dedicate and hire staff for the program until August 2023.
Leading up to the vote, the board of supervisors had been fielding a lot of complaints about rentals, said Assistant Planning Director Stephanie Hansen. She said the county had not previously ever revoked a vacation rental license.
“It was a general kind of direction to staff to really pay more attention to repeat offenders and narrow the flexibility we’re giving them,” Hansen said. “We’re now acting proactively. It’s staff, in general, taking these more seriously.”
Before Friday, only one other vacation rental license case had come before the zoning administrator. On March 15, county staff recommended Administrator Steve Guiney revoke Timothy Clayman and Lindsay Patel’s license for their Branciforte Drive vacation rental, after code compliance staff found the couple had been renting a cathedral-like treehouse built in the center of a redwood tree fairy ring. The couple’s vacation rental permit allowed for only a hosted rental, in which the property owners rented out rooms in their primary residence.
County staff brought receipts. Planner Tim Morland told Guiney the treehouse had been rented 938 times since 2017 and brought in an estimated $200,000 in revenue.
In a letter to the county, Patel and Clayman said they were “deeply disappointed” that the county recommended revoking their license.
“We have always had courteous guests who come for a peaceful stay,” the couple wrote. “Parking is onsite and does require any street parking. None of our neighbors have ever been adversely affected by the guests staying on our property.”
However, after initially requesting a postponement because of scheduling issues, the couple allegedly told the county to proceed with the hearing despite their absence, to which Morland said he was “surprised.”
At the hearing, Guiney appeared torn.
“A permit such as this is very valuable, and to revoke a permit is a serious kind of thing because it takes some effort to get it,” Guiney said. Yet, the couple did not show up to the hearing to defend their permit, so Guiney felt he needed to follow staff’s recommendation and revoke the permit.
On Friday, Deputy Zoning Administrator Lezanne Jeffs showed that, despite a more proactive approach, the county is still offering some flexibility to violators; however, she definitely flashed some new teeth as well.
“I know the neighbors won’t be happy but I want to give you additional time,” Jeffs told Martin, the owner of the vacation rental on Seacliff Drive. “I’m deciding not to revoke this permit.”
Jeffs said the county would be tightening Martin’s leash. She had to update her vacation rental listings to advertise the correct number of beds, stop renting the top floor, and ensure that guests were not taking up extra parking spots. If Martin violated any of these conditions over the next 12 months, county staff would revoke her license without a hearing. The same went for Devlin’s property in Santa Cruz.
However, Yueh’s appeal of the county’s recommendation to deny renewal of her license for her Palisades Avenue rental did not enjoy the same fate. Yueh, like Clayman and Patel, ultimately decided to not fight the county and did not appear for the hearing. Jeffs denied Yueh’s renewal.
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