November 30, 2023 - 11:31 pm
A topic that’s been on the minds of several as of late, including city staff and council, has been short-term vacation rentals and whether or not to allow their existence in Boulder City.
Let me start by saying at this time I’m not taking a stance, but instead, I want to give some personal insight into the topic.
From 2013 to 2021, I was the assistant managing editor of the Sedona Red Rock News in Sedona, Ariz. And as head writer, I covered the STR topic extensively. When word got out that then-Gov. Doug Ducey was planning to sign what later turned out to be Senate Bill 1350, I began looking into the topic.
The bill, which passed in 2016, stated that municipalities and counties could not prohibit the practice of STRs. Ironically, the only ones who could were HOAs. He initially said the reason was to allow homeowners the ability to rent out a portion of their home to help pay their mortgage.
The practice was technically illegal in Sedona and fell under code enforcement. I remember writing an article before the bill was signed and doing a crude count of the various STR platforms. I found between 400-500 listed for Sedona and immediate areas around town including the village of Oak Creek and Oak Creek Canyon. I should note that these three areas combined have a smaller population than Boulder City and get an estimated three million visitors a year.
Once the bill was signed, the floodgates were opened to the practice of owning and operating a vacation rental. For those who have been to Sedona, you know how beautiful and popular that area has become. So, it came as no surprise that STRs began popping up just about everywhere.
Homeowners saw the potential for making a lot of money and either turned their own home into a short-term rental or if they already owned a long-term rental, they did the same. There’s the first problem.
What happened was, a hypothetical Bob and Mary, who had been renting a house at $1,500 a month for a few years did not have their lease renewed because the owner knew they could make two to three times that a month as a STR. Quickly, already high rental prices in and around Sedona began to increase due to low supply and high demand.
Both the city and chamber of commerce hired companies that would help give an accurate count as to the number of STRs. Because many owners had their rental(s) listed on several platforms, it wasn’t as simple as adding those listed on AirBnB, Home Away and VRBO.
In the end, the number that has been used for several years is around 1,200 STRs in the Sedona area. As of Oct. 31, the city of Sedona had 1,140 identified STRs or 17% of all the available housing in Sedona.
By no means am I discounting the concerns of Boulder City residents, but when there’s talk of 20, 30 or maybe 40 STRs in town, I have to chuckle because imagine there being 40 times that amount in a less-populated area.
A complaint often heard in Sedona was that the character of the town was being impacted because in some neighborhoods, every other house seemed to be a STR. They said they didn’t know their neighbors any longer. Those in favor said, often it is the case that one doesn’t know or like their full-time neighbor and that with STRs, you deal with “a bad apple” for a week or less. Those in favor also pointed out that because of the competition, the exterior of their rental was often nicer than the full-time ones. I can’t dispute that in many cases.
As the years passed, what you were seeing was investors coming into town and buying up two, four, six homes at a time and making them vacation rentals. And because of SB1350, there was nothing to stop it.
The city of Sedona, as well as others like Scottsdale and Flagstaff, tried valiantly to get the state Legislature to give smaller communities a little more say as opposed to SB1350’s blanket denial to have one. The thing is, even if the senate bill had been overturned, every single STR owner would have to be grandfathered in because many bought or turned their homes into vacation rentals when it was legal. Imagine the lawsuits if they were then banned altogether.
Arizona did allow cities and towns to permit/license STRs but without giving jurisdictions any real regulatory authority over them. Sedona, along with several other communities negatively impacted by STRs, will again seek legislative changes next year to allow small communities to cap the number of STRs and impose distance requirements so entire neighborhoods aren’t converted to STRs.
Many, including myself, thought that once the bubble burst and Sedona was oversaturated with vacation rentals, many would revert back to owner-occupied or long-term rentals. For the VAST majority, that never happened.
In the early days of SB1350, resort managers and owners had little issue with STRs because it was a different clientele, young families with lower household income, who would not be staying at hotels and paying $400 or more a night. Slowly, multi-million-dollar homes became rentals and then, that started taking away resort customers and thus, their concerns increased.
Here is one thought related to Boulder City I wanted to mention. I know there is a push, led by the chamber, to make Boulder City more than just a day trip but rather a destination, which could benefit many local businesses. At last count there were 245 motel/hotel rooms within Boulder City’s limits and 900 when you include Railroad Pass and Hoover Dam Lodge. If STRs are banned in Boulder City, is that enough rooms here in town to make it more than just a day trip, especially during popular events or the busy season?
The Boulder City Council was expected to further address the matter this week by formally adding STRs to the list of prohibited property usages rather than just depending on the “if it’s not a permitted use then it is prohibited” status quo.
But that’s been postponed until after the first of the year. I know I said I wasn’t going to take a side on this but here is a suggestion. I’ve never been one to say throw any controversial issue on the ballot because that’s why you have elected officials. But this may not be a bad one to put to the voters. As is often the case, the vocal minority is the loudest. And it may be that Boulder City is not in favor of STRs, even if they are strictly regulated, but why not find out?