Marin County supervisors pass short-term rental fee program

The Marin County Board of Supervisors unanimously approved a new countywide fee program for short-term rentals.

The Community Development Agency presented the new licensing program to supervisors on Tuesday. While the agency originally presented higher retainer-based fees, the supervisors chose to lower the costs, nix several of the proposed fees and make it a flat rate for all applicants in the spirit of simplicity.

Sarah Jones, the director of the Community Development Agency, said that in the past few years, short-term rental applicants have only had to pay a $45 business license fee to the county finance department and a transient occupancy tax, which is based on their revenue.

“This is a group of our residents who have been paying $45 a year to rent a short-term rental, a great deal for them,” Supervisor Dennis Rodoni said. “To bump it up and say we need $1,000 in your first application for a license, I just think that’s sending the wrong message. It just seems to me that we’re building something here that is just way too involved.”

Supervisors approved a flat rate of $600 for new applicants, but those who are renting a space in their primary residence will receive a discounted rate of $300. Jones said the county has a cap of more than 1,200 short term rentals, and there are over 900 operating.

Jones said many older residents and low-income households use short-term rentals to supplement their income. The discounted rate is meant to recognize this fact, and these applications are often simpler and easier to process, Jones said.

“In looking to make sure that we are thinking about equity and thinking about community goals, we wanted to reduce the burden on operators who are renting out their primary residence as a STR,” Jones said.

The fee program is meant to partially offset the costs of reviewing and issuing rental licenses for people wanting to rent out for 30 days or less as visitor accommodations.

“This is in the most literal of terms, a home business,” Jones said.

The program will still require some support from the general fund, according to Jones. The board also approved the hiring of a manager for the program, and the fees might help recover some of the position’s cost.

Because it is a new program, all participants will have to submit a new application — not a renewal application — for a license this year. Next year, renewal rates for non-primary residence short-term rentals will be $300, and $150 for short-term rentals in an applicant’s primary residence. The cost to join the application waitlist is $50.

Originally, the agency proposed retainer fees of $250 to cover septic system and parking reviews the Department of Public Works and environmental health services division has to complete for the license. However, these reviews are not needed for every application.

All current registered short-term rentals, and properties connected to public septic and water services, would not need to undergo separate departmental reviews, for example. Additionally, those renting from their primary home are more likely to keep up with maintenance on these systems.

However, the supervisors chose to cut all transmittal fees from the program for now, citing the need for more data on costs before committing to a number.

Jones said employees are paid hourly, and that while data on the time and money spent to process the applications is lacking, the proposed rates were an estimate. The intent was to issue a refund to the applicant if less time was spent or separate reviews were not needed, or an invoice for more if the retainer did not cover the costs.

Rodoni noted that tracking retainer fees, costs and refunds across departments seems inefficient, and stressed the importance of simplicity. He said it would also make applicants more comfortable to know for certain what the cost will be.

“I think from the public’s perspective, they don’t see the government as giving back money very often,” Rodoni said. “The process of not having a flat fee is going to cause you some headaches.”

Supervisor Mary Sackett wondered if the department should wait even longer before changing anything to allow for more department cost and processing time data to be collected, but was in support of the flat fee system.

“I think retainers make people nervous,” supervisor Mary Sackett said.

The Community Development Agency hopes to have the program and fees in effect in two months, with a grace period to help applicants transition to the new program. The board’s approval included requiring the agency to come back to the board with more specific data before renewal applications come in next year to see if any fee adjustments can be made.