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As appeared in the Mammoth Real Estate Times, Mid-Spring 2001 edition.
Q: I see that the Mammoth Town Council has been discussing
changing the ordinance that does not allow homes in residential
neighborhoods to be rented on a nightly basis, I'm asking your
thoughts on the subject?
A: Shortly after the Town of Mammoth Lakes incorporated in
1984, one of the ordinances enacted by the new town was the
prohibition of nightly or "transient" rentals in the residential
neighborhoods, specifically the R-1 zoned neighborhoods which are now
zoned RSF or residential single family. Minimum allowable rental
period is 30 days. This is very different from many mountain resort
communities, where such rentals are allowed and promoted.
A few influential factions were responsible for the ordinance
and the thinking was to preserve the quality of the those
neighborhoods from the wrath of ski clubs, bus groups, and all sorts
of other mayhem. Remember, this was the early 80's. Conversely,
Mammoth had so many condominium projects to adequately accommodate
all sorts of transient rentals and featured on-site management,
ongoing snow removal and ice control, spas and pools, convenient
dumpsters, etc..
During the Town's infancy, code enforcement was a big issue.
The code enforcement officer sought out violators and took
appropriate actions. But it really wasn't a big issue, mainly because
the condos filled the demand and the local residents appreciated the
peace and quiet. In dealing with prospective buyers over the years
and educating them on the rentability of homes vs. condos, most
found it interesting but a positive for both segments of the market.
I would say that most purchasers of single family homes consider it
to "add value" to the residential neighborhoods in Mammoth.
Some things changed. The economic downturn of the
early 90's cleaned out much of the Town's extraneous staff including
the code enforcement officer. Along with the advent of advertising on
the internet and other resources, more and more owners are renting
homes to transient renters. Now the Town council is asking the
question about the loss of transient occupancy tax or bed tax.
In a resort community like Mammoth Lakes, the municipality
relies on bed tax to fund and support public services. Bed tax is a
very substantial portion of the Town's budget and really makes a big
difference in the overall services and quality of life that the Town
can provide residents and visitors. The idea that most visitors are
paying it and some aren't is an inequality. The Town is also back in
the code enforcement business. So the Town is aggressively pursuing
owners (mostly condos) who are renting their properties themselves
but not collecting bed tax.
That is what triggers the discussion about homes and renting.
The Town Council is obviously concerned about losing bed tax
opportunities, but you can't tax something that is against the law in
the first place (or can we?) We could make it legal and encourage
owners to rent in this fashion and create a nice revenue stream for
the Town. Unfortunately, this would come at the expense of the
quality-of-life in the neighborhoods. Issues like parking, trash,
rental "stacking" would just be the beginning. From this real estate
brokers position, I see this as degrading the quality and value of
these properties, and these are the best properties in Mammoth. A new
round of buyers might see homes as an economic opportunity because of
their business/rental capacity, but so far we have been able to sell
those buyers the value of condominium ownership.
And as Intrawest and other developers construct more and more
high quality "transient" lodging units that are adjacent to or
incorporated into activity nodes or Villages, isn't this where the
visitors belong anyway? And those visitors that are looking for a
more home-like experience can certainly find one in the many and
varied condominium projects in town. These units have professional
management (sometimes layers of it ) to provide service and
alleviate the problems.
I've never heard of anyone not wanting to visit Mammoth
because they couldn't stay in a family-type neighborhood, so I doubt
if Mammoth is really losing out on significant revenue. If it is
government's job to do what is best for the greatest amount of
people, my guess is that leaving the local residential neighborhoods
out of the rental business would be best. In the meantime, the Town
of Mammoth has a new code enforcement officer, so look out!
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