Cities cracking down on short-term rental taxes

Positively Palermo has received concerns about short-term rentals, including a case in which an owner apparently on multiple occasions has rented out to 10 or so people, causing problems for neighbors. Rentals under 30 days are against the condo rules. Short-term rentals also need a permit from the city and must have taxes paid on them. Now the newspaper has an article saying cities are cracking down such rentals and pointing out that those who don't pay taxes have an unfair advantage of business owners/employers who do. The article states: "Several Coachella Valley cities are boosting their revenues by proactively tracking and taxing short-term vacation rentals. Cities already receive money from desert hotels, which pay a transient occupancy tax, also known as the “bed tax.”But short-term vacation business is tougher to track because owners who are not affiliated with established rental management companies tend to operate under the radar.Palm Springs, the first valley city to spot this growing travel trend, passed laws in 2008 to require landlords or owners to register their individual properties and pay bed tax, and limit occupancy.The law also set up specific rules on loud parties and trash and created a hotline. “Its mission isn't only meant to drive up TOT revenues," Palm Springs Mayor Steve Pougnet said. “It levels the playing field for rental agencies and hotels. It gives the city oversight over who is renting the property and how it's being managed. ”Palm Springs' laws since have inspired communities such as Rancho Mirage to become more proactive in collecting the rental property tax.“Vacation rental has become a big item,'' said Palm Springs Finance Director Geoffrey Kiehl. “We are up to $2 million in revenue from this segment of the tourism business. ”As of 2008, Palm Springs has seen its bed tax revenue from short-term vacation homes, condos, casitas and flats grow from $1.4 million to more than $2 million annually.The number of private individuals registered to rent to visitors has nearly doubled — rising from fewer than 200 people to more than 375 in the city. Another 790-plus short-term sites are licensed through various Coachella Valley property rental companies.These agencies work hand in hand with the city to help with enforcement." Miss Penny Lane says: Everyone wants to stay at Palermo.