UPDATED April 28, 2014: (42 Comments-see below)Twentynine Palms, Ca.,- Today,Tuesday, April 29, 2014,at 6pm in the Community Center located on Joe Davis Drive, a workshop will be conducted to discuss and evaluate allowing “Vacation Home Rentals” to compete with the hotels who are currently struggling to keep their doors open to fill 595 rooms and, in the past, provided approximately $1 million in annual bed tax revenue to the City.
This workshop will be held jointly by the Twentynine Palms Council and Planning Commissioners to take input from residents at the Community Center at 6PM. Here is the original Press Release by Cactus Thorns for more details>LINK
There has been a half-hearted attempt to get the word out to the citizens to include a paid advertisement in the Desert Trail which does not show up on their website. There is only one letter to the Editor which does not announce this workshop, nor did the Editor add any postscript about this important meeting to discuss the issue of vacation home rentals. In the ad, City Manager Joe Guzzetta invites anyone to call him, however, the offices are closed on Fridays. When did that change? The recorded message states calls will be returned on Monday. (Update: 29Palms has been closed on Fridays for about 5 years with a 10hr/4day schedule)
It is expected to be a small turnout for this workshop due to the fact only 43% of the residential units are owner-occupied and they may not be aware of the proposed changes that will lower their property values and infringe upon their rights to expectation of “Quiet Enjoyment.” The remaining 57% housing is owned by out of area investors that benefit from renting to families from the nearby marine base and are now experiencing a lower occupancy rate.
One of the lead proponents behind permitting vacation home rentals is Paul Smith, owner of the 29 Palms Inn, who owns 4 vacant homes currently being used to handle any Inn occupancy overflow.
The base has been downsizing and completed most of their construction projects dragging down the hotel occupancy rate resulting in less TOT income, bed tax, payable to the City of Twentynine Palms. The approximate $1 million dollars paid to the city at the height of full occupancy has been trending down to 30%-60% occupancy since 2011. Last year’s TOT income took another hit of $150,000 to reflect in reducing the annual bed tax to $750,000 to the city.
On November 29, 2011, Jim Ricker, liaison from the Twentynine Palms Marine Base, G5, warned of future reduced TOT bed taxes and less diners at restaurants due to the completion of construction on the base. This warning was not heeded by the council members who continued to place this TOT income in their General Fund spending on special projects while ignoring the number #1 duty of government to provide police and fire protection for their citizens.
In the stacked Staff report of the Council’s meeting of March 25, 2014, there is a comparison to the City of La Quinta that has been allowing for vacation home rentals for almost two years. What is left out of this “comparison” is the fact that 29 Palms is no La Quinta and that they have a big problem collecting their VHR TOT.
La Quinta currently benefits from $6 million dollars hotel TOT income, not vacation home rental income.
(Update: A representative from La Quinta verified the $6 million dollars does include Vacation Home Rentals but mistakenly excluded those TOT numbers due to the current difficulty collecting these Vacation Home Rental TOT payments.)
La Quinta tourism is event driven…Located near the greater Palms Springs area with an airport, there are over 12.1 million tourists coming to this vacation locale with 28 golf courses, the PGA tour, the International Fine Arts tours, high-end retail shopping, Tamale festivals and popular music venues throughout the Coachella Valley.
What is also left out of the 29 Palms Staff report are the following concerns:
1. What are the costs to regulate and administer the proposed vacation home rentals which could be twice any amount collected from TOT taxes?
2. Will these vacation home rentals be required to be located in commercial zones or scattered in residential neighborhoods?
3. What is the criteria for a vacation home compared to hotels? Will there be mandatory ADA access, room sprinklers, commercial standards applied to electrical or plumbing and insurance coverage as is required by the hotels?
4. What about the additional noise, traffic and transient elements foisted on quiet residential neighborhoods?
5. What about the rights of home owners and long-term leasehold tenants to “Quiet Enjoyment” of their neighborhood?
6. Will the City of 29 Palms hire and staff additional code enforcement officers to regulate these home rentals on weekends?
7. Will the City be exposed to liability if a fire destroys a vacation home rental causing death due to non commercial wiring and no adequate city fire protection?
See March 25, 2014 Staff report, page 72 of 131>LINK
In closing and viewing this proposal as an investor, I need to ask these questions:
Where is the City Council loyalty and support to the businesses that invested $5 to $7 million dollars in their City of Twentynine Palms that still bring in a large hotel TOT income to the General Fund?
There is only so much of the TOT pie at this time, why would you invite vacation home rentals to compete with the hotel room business struggling to keep their 595 rooms full?
This appears to be penny-wise and pound foolish looking at the information presented above. Is this being proposed for the benefit of the special interests of the “Inn Crowd,” at the expense of the business health of Twentynine Palms financial future?
Please attend this workshop and bring your friends and neighbors to express your concerns.
Update: April 28, 2014-I received a call from the 29Palms General Manager, Joe Guzzetta, and he was very gracious to add the following information:
1.The City is currently pro-active to track down any websites/advertisements for 29Palms Vacation Home Rentals. Staff has determined in the past, these rentals were actually located outside the City limits, which is beyond their jurisdiction.
2. He would not be in favor of ANY ordinance that would bring any excessive administration costs to the City. Any fees would have to exceed the costs to regulate or collect the funds while providing income.
3. Guzzetta confirmed the next fiscal budget would be very conservative placing the projected figure of $725,000 future TOT tax income.