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The city of Arcata is thinking about putting a cap of 125 on short-term rentals in the city in order to preserve housing for the local population.

A draft ordinance on short-term vacation rentals that was presented to the Arcata City Council on Wednesday would require short-term rental owners to get an annual $50 permit to operate as a short-term vacation rental and pay about $250 to get a building inspection done, said David Loya, Arcata’s director of community development. Owners of these rental units would also need to get a business license and begin paying the transit occupancy tax, which is paid to local jurisdictions every time a person checks into a hotel room or Airbnb rental.

The draft ordinance includes exemptions from the cap for individuals who rent out a portion of a property they live in, as well as those that are used for less than 30 days, Loya said.

“So a scenario might play out where you have a rental that you rent to a student for the majority of the year, but over the summer you rent it as a vacation rental,” Loya said. “You could be exempted from that limitation, that cap, because you’re still providing long-term housing to a population within the city of Arcata.”

There would be a six-month grace period for people who were operating short-term rentals for the past 12 months to get into compliance with the ordinance, Loya said.

A few residents who rent out portions of their property on Airbnb showed up to oppose the tax because they said short-term rentals are a good opportunity for locals to act as ambassadors for tourists and bring money into the city.

“I’d like to know more about what the impact of this is on our community before we make a decision,” said Airbnb operator Brett McFarland.

Loya said many of the people currently operating Airbnbs would qualify for an exemption from the cap and those that don’t qualify are far below the 125 cap.

The Arcata City Council voted unanimously to continue the discussion about the ordinance to Nov. 20 to allow for more people who would be impacted, such as hoteliers and Airbnb operators, to provide their input.

City Councilmembers Paul Pitino and Sofia Pereira recused themselves because they both have short-term rentals.

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