Port Angeles Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in Port Angeles

Port Angeles, located on the Olympic Peninsula in Washington state, is a popular tourist destination known for its stunning natural beauty and outdoor recreation opportunities. As such, there is a high demand for short-term rentals like Airbnb and VRBO in the area. However, before starting a short-term rental business in Port Angeles, it's important to understand the local regulations.

In 2017, the City of Port Angeles passed Ordinance 3577, amending the municipal code to regulate short-term rentals. The ordinance prohibits STRs in certain residential zones (R7, R9, R11) while allowing them to have a permit in others (RMD, RHD, most commercial zones).

However, enforcement of these zoning restrictions has been inconsistent. Many STR operators were unaware of the rules and continued operating in prohibited zones. In 2023, the city began cracking down, issuing over 100 cease and desist orders to non-compliant STRs, threatening fines of $500 per day.

This has led to an ongoing debate over how to best regulate STRs in Port Angeles. Some residents argue that vacation rentals are exacerbating the local housing shortage by removing long-term rentals from the market. Others, including many STR owners, say that the rentals provide important income and support the tourism economy.

In response, the Port Angeles City Council is considering several options to update the STR ordinance in 2024:

1. Option A: No cap on STR licenses, with a path for existing non-conforming rentals to come into compliance.
2. Option B: Cap STRs at 250 licenses city-wide or 3% of total housing units, whichever is greater.
3. Option C: Cap STRs at 100 licenses city-wide or 1% of total housing units, whichever is greater. Eliminate the non-conforming use allowance.

As of March 2024, the council appears to be leaning towards Option C, the most restrictive proposal. This would likely require many existing STRs to shut down if they cannot obtain one of the limited licenses.

Regardless of which option is chosen, all STR operators in Port Angeles will need to obtain a business license and pass fire and safety inspections starting July 1, 2024. The city is developing an online portal to handle applications and renewals.

For those looking to start a short-term rental in Port Angeles, the key steps are:

• Research the local market and understand the regulations, including zoning restrictions and license requirements.
• Choose an eligible and desirable property for STR use. Consider proximity to tourist attractions.
• Obtain necessary licenses and permits from the city, including a business license and any required inspections.
• Prepare the property for guests with furnishings, amenities, and safety equipment.
• Create a listing on platforms like Airbnb and VRBO. Develop an attractive listing and competitive pricing.
• Implement a system for managing bookings, communication, cleaning, and maintenance.
• Launch your listing and provide excellent customer service to guests. Encourage positive reviews.
• Stay up-to-date on any regulatory changes that may affect your business. Maintain all licenses and tax obligations.

Given the strong tourism demand, starting a short-term rental business in Port Angeles can be lucrative. However, the regulatory landscape is complex and evolving. Prospective hosts should carefully review all requirements, work closely with the city, and stay informed on any ordinance updates that could impact operations. By being proactive and compliant, STR owners can build successful and sustainable businesses in this Olympic Peninsula destination.

Short-Term Rental Licensing Requirement in Port Angeles

As of July 1, 2024, all short-term rental operators in Port Angeles must obtain a short-term lodging business license and pass a fire life-safety inspection to legally operate. This applies to both Type I and Type II short-term rentals as defined in the newly adopted ordinance.

To apply for a short-term rental license, owners or authorized agents must submit a complete application through the city's online licensing portal, which will be available starting July 1, 2024. The application will require the following information and documentation:

1. Property owner contact information
2. Short-term rental property address and parcel number
3. Proof of ownership or authorization to operate the rental
4. Designated local contact person who can respond to issues within a specified timeframe
5. Floor plan sketch showing room layout, safety features, and occupancy
6. Parking plan demonstrating adequate off-street parking for guests
7. Proof of liability insurance covering short-term rental use
8. Application fee payment

Once a complete application is submitted, city staff will review it for compliance with all zoning, building, and health and safety requirements. If approved, the applicant will be issued a short-term rental business license after passing the required fire life-safety inspection.

Licenses will need to be renewed annually, with a new fire life-safety inspection required for each renewal. The frequency of inspections may be adjusted to every three or five years for operators with a history of compliance, at the discretion of the Community and Economic Development Department.

It's important to note that the number of Type II short-term rental licenses will be capped at 200 or 2% of the city's total single household dwelling/duplex unit housing stock, whichever is greater. Preference for licenses will be given to operators who were in compliance with the previous location-based zoning rules, followed by a lottery system for any remaining licenses.

Failure to obtain or renew a short-term rental license, or operating a rental that does not meet health and safety standards, can result in significant penalties. Violations are subject to a $500 fine for the first offense, $1000 for the second offense, and $1500 plus a two-year prohibition on applying for a new license for the third offense.

The city will monitor short-term rental platforms and listings to identify unlicensed or non-compliant operators. Enforcement will begin on November 1, 2024, after a four-month grace period to allow operators time to come into compliance with the new licensing requirements.

For those considering starting a short-term rental in Port Angeles, it's crucial to carefully review the new ordinance requirements and prepare application materials well before the July 1 licensing portal launch. Existing operators should also take steps now to ensure they will meet all criteria to obtain a license under the new system.

The city has indicated that it will be providing more detailed guidance and educational resources leading up to the July 1 implementation date. Short-term rental owners and managers should stay tuned to official city communications and attend any upcoming information sessions to ensure a smooth transition to the new licensing program.

Required Documents for Port Angeles Short-Term Rentals

Property owners must submit several required documents to the city to successfully apply for a short-term rental license in Port Angeles, Washington. These documents help ensure that the rental property meets all necessary safety standards and complies with local zoning regulations.

According to the City of Port Angeles website, the following documents are required as part of the short-term rental licensing process:

1. Completed Short-Term Rental Business License Application – This application form is available on the city website and must be filled out completely and accurately by the property owner or authorized agent.

2. Site Plan – A detailed short-term rental property site plan must be submitted, drawn to scale, and showing the entire dwelling unit, all structures, parking areas, and entrance/exit locations. The site plan can be hand-drawn or computer-generated, but must include all relevant information as required by the Director.

3. Floor Plan – A floor plan of the short-term rental unit, drawn to scale, is also required. This must show the dimensions of each room, total square footage, and the locations of all smoke/carbon monoxide alarms and fire extinguishers. The floor plan should clearly label each room and designate all sleeping accommodations. The city may deny sleeping accommodations outside of bedrooms for safety reasons.

4. Proof of Insurance – Short-term rental owners must provide proof of at least $1,000,000 in general liability insurance coverage specific to the rental operations. Proof of standard homeowners or property insurance is also required.

5. Signed Good Neighbor Policy – The city requires all short-term rental owners to sign and submit a Good Neighbor Policy, which outlines expectations for guest behavior and consideration of neighboring properties. This policy must be posted prominently in the rental unit.

In addition to these core documents, short-term rental owners must also provide:

1. A copy of their Washington State business license
2. Proof of ownership of the rental property, such as a deed or property tax record
3. Contact information for a designated local representative who can respond to any issues at the property within a specified timeframe

For short-term rental license renewals, owners must also submit documentation of the previous year's rental activity, including:

1. A log of all rental bookings, including dates, durations, and rental amounts collected
2. Records of lodging tax payments made to the State of Washington for the rental income

The city is in the process of developing an online portal system to streamline the short-term rental licensing process, which is expected to launch in July 2024. This system will allow owners to submit all required documents and information electronically.

It's important to note that incomplete applications or missing documentation can delay the licensing process. The city encourages short-term rental owners to review the requirements carefully and reach out to the Department of Community and Economic Development with any questions.

By gathering all the necessary documents upfront and ensuring they are complete and accurate, short-term rental owners in Port Angeles can demonstrate their commitment to compliance and help facilitate a smooth licensing process. Staying organized and keeping detailed records of rental activity and tax payments will also make renewing the license easier in future years.

Port Angeles Short-Term Rental Taxes

In addition to obtaining a business license and passing safety inspections, short-term rental operators in Port Angeles, Washington, are also required to collect and remit several taxes on their rental income.

The primary tax that applies to short-term rentals in Port Angeles is the Washington State sales tax. As of 2024, the state sales tax rate is 6.5%, which must be collected on all rental transactions. Short-term rental owners must register with the Washington State Department of Revenue to obtain a tax registration number and file regular tax returns.

In addition to the state sales tax, short-term rentals in Port Angeles are also subject to a special 4% lodging tax. This tax, also known as a hotel/motel tax or transient occupancy tax, applies to all rentals of less than 30 consecutive days. The revenue from this tax is used to fund tourism promotion and facilities in the city.

Short-term rental operators are responsible for collecting both the state sales tax and the local lodging tax from their guests and remitting the taxes to the appropriate authorities. Failure to properly collect and remit these taxes can result in penalties and interest charges.

To help ensure compliance, the City of Port Angeles requires short-term rental owners to keep detailed records of all rental transactions, including dates, rental amounts, and taxes collected. These records must be available for city officials to inspect upon request.

In addition to the sales and lodging taxes, short-term rental income is also subject to federal income tax. Owners must report their rental income on their annual tax returns and pay the appropriate tax based on their total earnings. However, many expenses related to operating a short-term rental, such as cleaning fees, supplies, and a portion of utilities and maintenance costs, may be tax-deductible.

It's important for short-term rental owners in Port Angeles to carefully track all income and expenses related to their rental business and to consult with a qualified tax professional to ensure they are meeting all their tax obligations. Proper record-keeping and tax compliance are essential for avoiding costly penalties and maintaining a successful rental operation.

To help simplify the tax collection process, some short-term rental platforms like Airbnb and VRBO offer integrated tax collection services. These services automatically calculate and collect the applicable taxes from guests and remit them to the proper authorities on behalf of the host. However, even if using one of these services, hosts are still ultimately responsible for properly paying all taxes.

As the short-term rental market continues to grow in Port Angeles, the city and state may make changes to the tax requirements and rates. Short-term rental owners should stay informed about any updates and adjust their pricing and accounting practices accordingly.

By staying on top of their tax obligations and maintaining good records, short-term rental operators in Port Angeles can minimize their risk of audits or penalties and focus on providing a great experience for their guests. While the tax requirements may seem daunting at first, they are a necessary part of running a legitimate and profitable short-term rental business in this popular Pacific Northwest destination.

Washington Wide Short-Term Rental Rules

In addition to the specific regulations in Port Angeles, some several state-wide rules and laws apply to short-term rentals across Washington. These rules provide a framework for local governments to follow and enforce.

One of the key state-level requirements for short-term rentals is the payment of sales and lodging taxes. As mentioned in the previous section, all short-term rental operators in Washington must collect and remit the state sales tax (currently 6.5%) and any applicable local lodging taxes on their rental transactions. This applies regardless of the rental platform used or the length of the rental period.

Short-term rental owners must register with the Washington State Department of Revenue to comply with these tax requirements and obtain a tax registration number. They must then file regular tax returns and remit the collected taxes according to the state's schedule.

In addition to taxes, there are also some state-wide health and safety requirements for short-term rentals. The Washington State Department of Health has established minimum standards for things like fire safety, carbon monoxide detectors, and emergency evacuation plans. Local governments may impose additional or more stringent requirements, but all short-term rentals must meet these baseline state standards.

Another important consideration for short-term rental operators in Washington is insurance. While not explicitly required by state law, most insurance companies require short-term rental owners to have a specific endorsement or separate policy to cover the unique risks associated with renting out a property to guests. Failure to have appropriate insurance coverage could result in denied claims or even policy cancellation.

At the state level, there have been some efforts to establish more uniform regulations for short-term rentals. In 2019, the Washington State Legislature considered a bill (HB 1798) that would have created a state-wide registry for short-term rentals and set some baseline operational standards. However, this bill did not ultimately pass.

More recently, in 2023, the legislature passed a bill (SB 5334) that prohibits local governments from banning short-term rentals outright, but allows them to regulate things like health and safety standards, parking requirements, and permitting processes. This bill was seen as a compromise between protecting the rights of property owners and preserving local control over community impacts.

Despite these state-level efforts, the regulatory landscape for short-term rentals in Washington remains somewhat piecemeal, with significant variation from city to city. Some local governments, like Port Angeles, have adopted fairly comprehensive ordinances governing things like zoning, licensing, and operational standards. Others have taken a more hands-off approach or are still in the process of developing their short-term rental policies.

For short-term rental owners and operators in Washington, it's essential to understand and comply with all applicable state and local laws. This may require some research, due diligence, and ongoing monitoring of any regulatory changes. Joining a local short-term rental association or working with a knowledgeable property manager can help you navigate this complex landscape.

Overall, while the state of Washington has taken some steps to provide a framework for short-term rental regulation, much of the detailed policymaking is still happening at the local level. As the industry continues to grow and evolve, it's likely that these regulations will also continue to change and adapt over time. Short-term rental owners who stay informed, proactive, and compliant will be best positioned to thrive in this dynamic environment.

Does Port Angeles Strictly Enforce STR Rules?

Based on discussions in online short-term rental forums like BiggerPockets and Reddit, Port Angeles appears to have historically been relatively lax in enforcing its short-term rental regulations. However, this permissive attitude seems to be changing as the city grapples with the rapid growth of the vacation rental industry and its impacts on housing availability.

On the BiggerPockets forums, one long-time Port Angeles host shared their experience: "For years, the city basically turned a blind eye to short-term rentals operating in zones where they weren't technically allowed. As long as you weren't causing major problems or getting a ton of complaints, they didn't really crack down."

However, this host noted that the enforcement landscape has shifted in recent years, writing: "In 2023, the city started to get serious about enforcing the zoning rules and shutting down non-compliant STRs. They issued a bunch of cease and desist orders, and it seems like they're not messing around anymore."

This sentiment is echoed by other hosts on Reddit, with one commenter stating: "Port Angeles used to be a pretty Airbnb-friendly city, but that's changing fast. The city is clamping down on unlicensed and improperly zoned rentals, threatening hefty fines for violators."

The reason for this increased enforcement appears to be growing concerns about the impact of short-term rentals on the local housing market and neighborhood character. As one Reddit user put it, "Port Angeles is a relatively small city, and the proliferation of Airbnbs has really started to squeeze the long-term rental market and drive up housing costs for locals."

In response to these concerns, the city has taken a more proactive approach to regulating short-term rentals, including the development of a new licensing system and potential caps on the number of permitted rentals. While some hosts argue that these measures are too restrictive, city officials maintain that they are necessary to strike a balance between the economic benefits of tourism and the needs of the local community.

Despite the increased enforcement efforts, it's clear that some hosts are still operating short-term rentals in Port Angeles without proper licensing or zoning compliance. On BiggerPockets, one investor warned: "There are definitely still a lot of under-the-radar STRs in Port Angeles, but it's getting riskier. The city is actively monitoring platforms like Airbnb and cracking down on violators."

While Port Angeles was once considered a relatively Airbnb-friendly market, the city's attitude towards short-term rentals has shifted in recent years. Enforcement of existing regulations has become stricter, and new rules are being implemented to better manage the growth of the industry.

As one host summed it up on Reddit: "Port Angeles is no longer the wild west for short-term rentals. If you want to operate legally and avoid hefty fines, you need to follow the rules to the letter. The city is serious about this, and they're not going to let unlicensed or improperly zoned rentals slide anymore."

For prospective short-term rental operators in Port Angeles, the key takeaway is to do their due diligence, understand the evolving regulatory landscape, and ensure full compliance with all licensing, zoning, and operational requirements. While the city still recognizes the economic value of vacation rentals, it is clear that a more balanced and regulated approach is now being taken to address community concerns and impacts.

How to Start a Short-Term Rental Business in Port Angeles

If you're considering starting a short-term rental business in Port Angeles, Washington, here are the key steps to follow:

1. Research the local market and regulations

1. Analyze the demand for short-term rentals in Port Angeles, especially during peak tourist seasons. Look at comparable listings on Airbnb, VRBO, and other platforms to gauge pricing, occupancy rates, and amenities offered.
2. Review the City of Port Angeles' short-term rental ordinance thoroughly, including zoning restrictions, licensing requirements, and operational standards.
3. Understand the state-level regulations that apply to short-term rentals in Washington, such as the requirement to collect and remit sales and lodging taxes.

2. Choose a suitable property

1. Decide whether you want to use an existing property or purchase a new one specifically for short-term rental use. Consider factors like location, size, amenities, and parking.
2. Under the city's ordinance, ensure the property is zoned appropriately for short-term rentals. Some residential zones may prohibit or limit vacation rentals.
3. If purchasing a property, work with a local real estate agent who has experience with short-term rentals and can help you navigate the market.

3. Obtain necessary licenses and permits

1. Apply for a short-term rental business license from the City of Port Angeles. This involves submitting an application, paying a fee, and passing a fire life-safety inspection.
2. Register with the Washington State Department of Revenue to obtain a tax registration number for collecting and remitting sales and lodging taxes.
3. If required based on zoning, obtain any additional permits or approvals from the city, such as a conditional use permit.

4. Prepare your property for guests

1. Make any necessary repairs, upgrades, or renovations to ensure the property meets all health and safety standards, including smoke detectors, carbon monoxide alarms, and fire extinguishers.
2. Furnish and decorate the space to be attractive and comfortable for guests. Consider hiring a professional photographer to showcase your rental.
3. Create a welcome book with important information for guests, such as check-in/check-out procedures, house rules, and local recommendations.

5. Set up your business operations

• Choose a business structure (sole proprietorship, LLC, etc.) and register your business with the state of Washington.
• Open a separate bank account for your rental business to keep your finances organized and make tax reporting easier.
• Obtain appropriate insurance coverage for your short-term rental, including liability insurance and any additional coverage required by your lender or local regulations.

6. Create your listing and marketing strategy

• Sign up for Airbnb, VRBO, and any other short-term rental booking platforms you want to use. Create compelling listings with high-quality photos, detailed descriptions, and competitive pricing.
• Develop a marketing plan to attract guests and stand out from the competition. This could include social media advertising, email marketing, or partnering with local businesses and attractions.
• Consider offering special promotions or discounts to generate bookings during slower periods or to attract repeat guests.

7. Launch your rental and provide excellent guest service:

• Once your listing is live and you start receiving bookings, communicate promptly and professionally with guests to answer questions and provide check-in instructions.
• Ensure the property is thoroughly cleaned and well-maintained between each guest stay. Consider hiring a professional cleaning service to help with turnover.
• Be available to address any guest concerns or issues that arise during their stay, either in person or through a local property manager.
• Encourage satisfied guests to leave positive reviews and consider implementing a loyalty program to incentivize repeat bookings.

8. Comply with ongoing regulations and best practices

• Stay up-to-date with any changes to local or state short-term rental regulations and adjust your operations accordingly.
• Maintain accurate records of all rental income and expenses for tax purposes, and file all required state and federal tax returns.
• Regularly assess your pricing, amenities, and marketing strategies to ensure you're staying competitive and profitable in the Port Angeles market.
• Continue to invest in property maintenance and upgrades to provide a high-quality guest experience and protect your investment over time.

By following these steps and being proactive about compliance and guest satisfaction, you can build a successful and sustainable short-term rental business in Port Angeles. While the regulatory landscape may be evolving, savvy operators who prioritize responsible and professional practices can thrive in this popular Pacific Northwest destination.

Who to Contact in Port Angeles about Short-Term Rental Regulations and Zoning?

If you have questions about short-term rental regulations and zoning in Port Angeles, Washington, there are several local government offices and resources you can contact for guidance and assistance.

1. City of Port Angeles Department of Community and Economic Development

This department oversees planning, zoning, and permitting for the city, including the administration of the short-term rental ordinance. Contact them for questions about zoning districts, conditional use permits, and the short-term rental licensing process.

Address: 321 East 5th Street, Port Angeles, WA 98362
Phone: (360) 417-4750
Email: ced@cityofpa.us

2. City of Port Angeles Business License Office

The Business License Office handles issuing and renewing short-term rental business licenses. Contact them for questions about license applications, fees, and required inspections.

Address: 321 East 5th Street, Port Angeles, WA 98362
Phone: (360) 417-4688
Email: businesslicense@cityofpa.us

3. Washington State Department of Revenue

The Department of Revenue administers the state's sales tax and other business tax requirements, including those for short-term rentals. Contact them for questions about registering for a tax registration number, collecting and remitting sales tax, and filing tax returns.

Phone: (360) 534-1400
Email: communications@dor.wa.gov

4. Port Angeles Regional Chamber of Commerce

While not a government agency, the Chamber of Commerce can provide valuable insights and resources for local businesses, including short-term rental operators. They can connect you with other hosts, industry associations, and local service providers.

Address: 121 East Railroad Avenue, Port Angeles, WA 98362
Phone: (360) 452-2363
Email: info@portangeles.org

In addition to these official government and business resources, you may also want to connect with local short-term rental associations or property management companies. These organizations can provide valuable insights into the local market, best practices, and regulatory changes.

Some helpful industry contacts in the Port Angeles area include:

• Olympic Peninsula Vacation Rental Association
  Email: opvra@gmail.com
• Coastal Vacation Rentals
  Phone: (360) 457-3529
  Email: info@coastalvacationrentals.com
• Olympic Peninsula Property Management
  Phone: (360) 457-6355
  Email: info@oppm.com

By reaching out to these local government offices and industry contacts, you can get the most up-to-date and accurate information about short-term rental regulations in Port Angeles. It's important to establish open lines of communication and build positive relationships with these entities to ensure your rental business's long-term success and compliance.

Remember that regulations can change over time, so it's important to stay in touch with local authorities and stay up-to-date on any new requirements or restrictions that may affect your short-term rental operations. Building positive relationships with city staff and other local stakeholders can help ensure your success as a responsible and compliant host.

What Do Airbnb Hosts in Port Angeles on Reddit and Bigger Pockets Think about Local Regulations?

To get a sense of what short-term rental hosts in Port Angeles think about the local regulations, let's take a look at some discussions on popular online forums like Reddit and BiggerPockets.

Reddit - r/AirBnB - "Port Angeles STR Regulations"

In this thread, hosts share their experiences navigating Port Angeles' short-term rental ordinance and licensing process. While some express frustration with the new requirements and potential caps on licenses, others acknowledge the need for reasonable regulations to address community concerns. Overall, the sentiment is that the city is taking a more balanced approach compared to some markets that have banned STRs outright.

BiggerPockets Forum - "Short-Term Rental Investing in Port Angeles"

This discussion focuses on the potential for short-term rental investments in Port Angeles, given the strong tourism demand and evolving regulatory landscape. Experienced hosts offer advice on choosing properties in eligible zoning districts, working with the city to obtain licenses, and staying compliant with tax and operational requirements. Some caution that the new rules may limit scalability for larger investors.

Reddit - r/realestateinvesting - "Port Angeles STR Crackdown"

In this post, a host shares their experience of receiving a cease and desist order from the City of Port Angeles for operating an unlicensed short-term rental. Other hosts weigh in, with some expressing concern about the city's increased enforcement efforts, while others argue that it was only a matter of time before non-compliant operators faced consequences.

BiggerPockets Forum - "Port Angeles Property Management for STRs"

This thread focuses on the pros and cons of using a local property management company for short-term rentals in Port Angeles. Several hosts share that while management fees can eat into profits, having a local team to handle compliance, guest issues, and city relations can be invaluable, especially for out-of-state investors navigating the new regulations.

Reddit - r/VacationRentals - "Port Angeles STR License Lottery"

In this post, hosts discuss the potential for implementing a lottery system if the number of short-term rental license applications exceeds the city's proposed cap. Some express concerns about the fairness and transparency of such a system, while others argue that it may be a necessary compromise to balance the needs of the industry and the local community.

Overall, the sentiment among short-term rental hosts in Port Angeles on these forums seems to be cautious acceptance of the city's evolving regulatory approach. While some hosts express frustration with the added requirements and potential limitations, most acknowledge the need for reasonable rules to address issues like housing availability and neighborhood impacts.

The general advice from experienced hosts is to stay informed about the changing regulations, work proactively with the city to obtain all necessary licenses and approvals, and prioritize responsible and professional operations to avoid drawing negative attention or enforcement actions.

As one BiggerPockets user put it, "Port Angeles is trying to find a middle ground with these new STR rules. It's not the most host-friendly environment, but it's also not a total crackdown. You can still make it work in this market if you play by the rules and run a tight ship."

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.