Chula Vista sets out to collect taxes from short-term rentals

The city of Chula Vista has made progress in enforcing regulations that require short-term rentals to pay taxes, collecting more than $30,000 in taxes from 95 rentals in the past six months.

City staffers said in late March that of about 375 rentals that had been advertised across the South Bay city, only eight had been paying taxes.

The reason is that the city had not been enforcing its regulations, which oblige individuals who rent a home for less than a month to pay 10 percent of their revenues.

According to the city, it has collected about $33,750 since it started to impose taxes in July.

“We’ve been happy with the process,” Finance Director David Bilby said.

To enforce its regulations, the city contracted with Host Compliance, which offers short-term rental monitoring services. Following a search of short-term rental websites in an effort to track down operators, the city in late May and early June sent out 178 notices to notify operators about the city’s regulations.

The notices informed individuals that through the partnership with Host Compliance, individuals can now register their rentals and pay taxes online. Rental operators are required to complete both tasks, which can also be done at City Hall.

“Making people aware of it is the first step,” Bilby said. “We took the stance of not being punitive.”

To that end, the city did not impose retroactive taxes or fines, though it does collect late fees.

While the city and Host Compliance can track short-term rentals advertised online, there’s no way for them to know if a home is actually rented. But that may change. Bilby said the city may contact sites such as Airbnb to collect taxes when rentals are booked. Other cities with similar agreements include tourist destinations such as Santa Monica and Huntington Beach, Bilby said.

“That’s not something we have explored yet,” he said. “We wanted to see how this will go.”

AirDNA, a website that pulls information from Airbnb and HomeAway, showed 320 active rentals across Chula Vista as of last week.