San Rafael adopts 3-strikes approach for short-term rentals

SAN RAFAEL, Calif. - San Rafael has joined a growing number of cities regulating short-term rentals. 

The city council on Monday voted unanimously to adopt an "STR" program, requiring properties to be approved and registered, subject to inspections, fees and taxes. The timing, in the wake of Orinda's deadly Airbnb shooting, is coincidental. 

San Rafael, a city of 60,000, has been evaluating vacation rentals for several months. 

And as Airbnb moves to ban so-called "party houses," San Rafael's policy explicitly does so.  

"They give the entire community a bad name, give renters a bad name and they don't work well for surrounding neighbors," said San Rafael Mayor Gary Phillips.

To protect neighbors, a hotline will be set up for complaints and a "three strikes" penalty will be imposed: three rule violations and the property will be banned from the program.  

Moment of silence for Halloween victims, Orinda council to consider rental crackdown 

Phillips also noted, unlike the Orinda rental, San Rafael hosts will be required to live on their rental property as their primary residence. 

"Having the owner there won't allow things to get out of hand, and they know the neighbors, so I think it works better for everyone," he said. 

Prior to the vote, several residents spoke during a public hearing on the issue. 

Many expressed misgivings about enforcement, quality of life, lack of street parking, and a shrinking rental market. 

Only one broached the recent massacre. 

"Consider the Orinda Halloween rental where five people were murdered, it was unusual but it happened," said Linda Kruger, who opposes short-term rentals.  

Kruger and her spouse have been vocal critics of their next-door neighbors, with whom they share a driveway.  

"We have safety and privacy issues, literally strange people walking up our driveway, and we have no idea who they are," said husband Charlie Comella. "They arrive late and leave early, so what good are they doing for the economy of San Rafael, just finding a cheaper place to stay and travel on?" 

Steps away, neighbors Sean and Cambria Terheyden, insist they have bent over backwards to accommodate the couple.    

"All the other neighbors are fine, but I think often, people just don't like change," said Cambria, showing KTVU the "tiny house" she rents out for short stays. 

At 96 square feet, it holds only a futon for sleeping. It has a toilet, but no kitchen, and the shower is outdoors.

But the patio offers a tiny hot tub and fire pit, and the unit rents for about $110 nightly. 

"We have single travelers or couples, and we've never had any noise complaints, they're very respectful," said Terheyden.  

Income from the extra space, plus a converted guest bedroom as well, allows Cambria to work from home with a new baby, and the couple to launch a small business as franchisees in a housecleaning company. 

"Hosting means being able to cover our mortgage and expenses," said Cambrian,"and we get to meet people from all over the country and the world, we've made a lot of friends from it." 

Currently, an estimated 300 shor-term rental units are offered online in San Rafael.

The council had three options: leave them alone, ban them outright, or strike a balance with regulation. 

"We're young and these places are a lot easier on the bank than a hotel, " said guest Brandon Wells, arriving at the Terheyden's tiny house.  

Wells said he opts for VRBO or Airbnb for affordability and the personal vibe.

He and his girlfriend, arriving from Reno, had already done some sightseeing in the Marin headlands, and were looking forward to more exploring and a trip to the coast. 

"We like the coziness of these rooms, the convenience, and it's nicer, you get a more unique experience than a hotel," said Brittney Lathrop, as the couple carried their bags to their lodging. 

San Rafael's City Council, in response to critics, said it would monitor the results of the program and make adjustments if needed.