The Ojai City Council is weighing a proposal to tax second homes as a potential funding source for affordable housing programs and development.
The council discussed the item at its Sept. 22 meeting. No decisions were made because the item was presented for conceptual review, but council members requested additional information from staff because of potential legal issues and other tax alternatives.
City Manager Ben Harvey said in an email on Sept. 24 that a return date has not been set.
The discussion stems from a Dec. 2 meeting when council members raised the possibility of a vacancy tax because of the city’s high number of unoccupied second homes, according to a Sept. 22 staff report. The proposal failed to gain support because of legal concerns.
Council member Andrew Whitman said he does not want Ojai to become a “community of visitors” with homes occupied less than 50% of the year.
“My idea about this tax would always be raising money to address issues of housing affordability or workforce housing,” he said.
Mayor Andy Gilman expressed reservations about the proposal.
“I do see this effort as long and difficult and uncertain versus other things that could be more concrete,” he said.
A second-home tax may be more legally defensible because it does not distinguish between properties used as rentals and those that are not, said Bethany Burgess, city attorney for Ojai. As a result, property owners would not be penalized for operating rentals, and the tax would apply whether a home is vacant or occupied, she said.
Second homes could be identified through owner self-reporting, or by comparing public records, such as county assessor and clerk-recorder’s databases, Burgess said.
Indicators of a second home could include an individual owning multiple properties or a property with a mailing address different from its physical address, she said.
Enforcement could be challenging because the city would need resources to administer the program, though staff could further explore the issue, she said.
Council member Rachel Lang said she was concerned about owners who rent second homes to residents at affordable rates.
“I would not want anyone with those kinds of situations to suffer or be penalized for trying to do something good,” she said.
Lang suggested exploring alternatives to a second home tax if it is set aside, including a document transfer tax charged when a property is sold.
Whitman said he did not intend to tax homeowners who rent out properties that serve as someone's residence.
"I'm thinking about the home that has nobody as a resident," he said. "Let's find what somebody's doing successfully and see if we can implement it here."
Two speakers supported the second-home tax, while a third proposed a voluntary donation program to encourage owners of vacant homes to contribute to a housing fund.
Wes Woods II covers West County for the Ventura County Star. Reach him at wesley.woodsii@vcstar.com, 805-437-0262 or @JournoWes.
This article originally appeared on Ventura County Star: Ojai considers tax on second homes to aid affordable housing
