HomeMy WebLinkAboutC32282- Svcs to Identify Homeowners - Short-term RentalsCITY OF PALM DESERT
FINANCE DEPARTMENT
STAFF REPORT
REQUEST: APPROVAL OF CONTRACT NO. C32282 , A PROFESSIONAL
SERVICES AGREEMENT WITH VACATION RENTAL COMPLIANCE IN
THE AMOUNT NOT -TO -EXCEED $24,000 FOR CONTINUATION OF A
CONTRACTED PROGRAM TO IDENTIFY AND BRING INTO
COMPLIANCE PALM DESERT HOMEOWNERS NOT CURRENTLY
COMPLYING WITH PALM DESERT MUNICIPAL CODE SECTION
3.28.020 — TRANSIENT OCCUPANCY TAX (TOT) AND SECTION 5.10 —
SHORT TERM RENTALS
SUBMITTED BY: Paul S. Gibson, Finance Director
DATE: September 25, 2014
CONTENTS: Contact No. C 32282 - Professional Services Agreement
Recommendation
By Minute motion, that the City Council approve Contract No. C 32282 with
Vacation Rental Compliance in an amount not to exceed $24,000 to identify and
register non -compliant short-term rental properties in Palm Desert.
Background
On March 8, 2012, Council adopted Ordinance No. 1236 amending Palm Desert Municipal Code
Chapter 3.28.020 and adding Chapter 5.10 relative to Transient Occupancy Tax and short-term
rentals respectively. A professional services agreement received Council's approval to provide the
City with services to identify and bring into compliance unlicensed short-term rentals. The
consultant fulfilled the terms of the agreement by:
• Investigating ongoing short-term rental activity on various websites to identify
unregistered short-term rental properties;
• Designing a monitoring and licensing program for City requirements that will be part of
the new Short-term Rental Ordinance;
• Contacting unregistered short-term rental property owners; and
• Educating the community about the new Short-term Rental Ordinance.
As of July 1, 2014, 1,101 short-term rental permits have been processed. 756 of these permits
were issued to property management companies, while the remaining 345 were issued to
Staff Report
Approval of Contract with Vacation Rental Compliance
September 26, 2013
Page 2 of 2
homeowners. Staff continues to receive applications on a regular basis. Transient Occupancy
Tax (TOT) in the amount of $528,991.00 was collected for Fiscal Year 2012/2013 versus
$621,299.00 for Fiscal Year 2013/2014, an increase of 17% over the previous fiscal year. To
this end, staff wishes to renew the contract with the specialty consultant in an effort to complete
the project.
Online reservation sites and property owners are likely to be most active in the coming months
as Palm Desert experiences its "high season". Staff feels that this is the most opportune time to
engage a consultant to research and locate those property owners who may only operate and
advertise for a few months out of the year. Conducting this project in the busy season will
provide the City with the greatest opportunity to bring remaining property owners into
compliance.
Fiscal Impact
Contract N. C32282
Previously, staff reported that there are hundreds of unregistered short-term rental property
owners not paying Transient Occupancy Tax (TOT). A great deal of progress was made during
the first year of this program, and its continuation, combined with the renewal of a professional
services contract, will assist staff with bringing the remaining unregistered short-term rentals into
compliance with Section 3.28 Transient Occupancy Tax, which will further augment that
revenue stream. As we have witnessed with the initial results of the program, bringing in TOT
and short-term rental licenses will provide a financial benefit to the City that will more than offset
the cost of this professional services agreement contract.
Submitted by:
Paul S. Gibson, Finance Director
Approval:
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John M` Wohlmuth, City Manager
CITY COUNCILA z'rI
APPROVED VV
RECEIVED
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Original on File with City Clerk's Office
MEETING DATE
AYES:
NOES:
ABSENT:
ABSTAIN:
VERIFIED BY:
G:\Finance\Niamh Ortega\Staff Reports\Short term rentals\STR Consultant contract renewal 092514.docx
Contract No. C32282
/ Vacation Rental Compliance
Proposal
City of Palm Desert
September 15, 2014
Vacation Rental Compliance is offering the City Palm Desert the following proposal for contract services
to continue the implementation of the current short-term vacation rental compliance program. The scope
of work outlined below is for nine additional months, beginning October 1st 2014 through June 30th
2015.
Scope of Work
1. Continue to identify new properties on VRBO and additional sites.
2. Continue to contact identified owners for registration.
3. Continue to inform Code Compliance of owners who refuse to register.
4. Prepare a monthly report on the progress of the program, which will be included with
monthly billing.
5. Contact rental agencies who have not complied with the ordinance.
6. Contact owners who do not have their permit number on their advertisement.
TOTAL (40 HRS PER MONTH AT $60 PER HR) $2,400 PER MONTH
x 9 MONTHS
Cindy Gosselin
President/CEO
Vacation Rental Compliance
TOTAL CONTRACT $ 21,600.00
72-877 Dinah Shore Drive, Suite 103
Rancho Mirage, CA 92270
(760) 799-5748
vacationrentalcompliance@yahoo.com