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7.B. - Page 2 of 9 ■ Prohibiting rentals from being used for special events which have the potential to cause traffic, parking, noise, or other problems; and Clarified the pre-existing requirement for short-term rental hosts to pay Transient Occupancy Taxes (TOT). More information and the complete ordinance can be found at www.redwoodcitV.org/shorttermrentaIs. On October 22, 2018, the City Council authorized the City Manager to execute a services agreement with Host Compliance to ensure compliance with the short-term rental ordinance. Staff evaluated different methods and service providers, and determined Host Compliance to be the most robust and cost-efficient service. The agreement is for five years with an annual cost of $29,929.60, for a total agreement amount of $149,648. Host Compliance's services includes: • A web- and mobile- platform that enables online registration and tax collection, • Neighbor complaint support in the form of a 24/7 hotline and online complaint forms, which would then be provided to the City's code enforcement team, • Verification and validation of eligibility and applicant documents, • Monthly monitoring of short-term rental listings on more than 50 short-term rental platforms such as Airbnb, VRBO, Craigslist, • Address identification and the ability to take high-resolution screenshots of active listings collected on a weekly basis, • Ongoing monitoring for zoning, registration, and TOT compliance, including automatically generated letters, and • Capabilities for outreach to short-term rental hosts concerning City requirements ANALYSIS R;; -i-. fnr FPP The proposed fee seeks to recover the cost of staff time associated with short-term rental program administration and the Host Compliance monitoring service. In the staff report associated with the Host Compliance agreement that was presented to the City Council, staff had indicated that the cost of the agreement would be recovered in full by registration fees. The annual cost of the agreement ($29,929.60) was based on an initial review of short-term rental listings conducted by Host Compliance. That initial review found that there were approximately 600 short-term rental listings. The annual cost Host Compliance distributed among the listings would be approximately $49 per short-term rental unit. While Host Compliance's services will greatly aid the City in overseeing short-term rentals, staff time is still required to answer questions from the public, to follow up on potential code -related issues, and to administer the short-term rental program. Staff estimated the amount of time it would take to administer a short-term rental program based on existing practices for similar services in the Planning and Housing Division and Code Enforcement. It is expected that staff would answer questions about the program, interact with property owners and neighbors, and monitor compliance. Considering the labor and Host Compliance service costs, staff recommends adopting a proposed annual fee amount of $205 per short-term rental unit. This fee would increase overtime as staff costs change. Additional supporting information is on file with the City Clerk and was made available for public review ten days prior to the public hearing. City of Redwood City 1017 Middlefield Road, Redwood City, CA. 94063 Tel: 650-780-7000 www.redwoodcity.ore 507