NAPA, CA— The County of Napa has reached a legal settlement with the owner of a vacation rental that operated unlawfully in an unincorporated area for several years. The settlement permanently bars the owner from conducting short-term occupancies of less than 30 days, and it requires payment of up to $250,000 in penalties, taxes and fees.
In 2010, Napa County adopted an ordinance prohibiting the advertising, negotiation, and rental of dwelling units for purpose of short-term occupancy of less than 30 consecutive days. Following the ordinance’s adoption, the County began receiving complaints about short-term rental activities at a property owned by Calistoga Wine, LLC, and operated by its manager, Linda Fotsch, located at 4099 Silverado Trail.
After conducting an investigation, the County in April 2017 issued a Notice of Violation and ordered the property owner to cease all advertising and negotiating of short-term commercial occupancies of the property. But Calistoga Wine, LLC, and Linda Fotsch continued to advertise and negotiate the short-term rental of the property.
In November 2018, the County filed a civil action seeking to compel the owner to comply with the County Code and to pay civil penalties for their unlawful rental activities as well as pay Transient Occupancy Tax (TOT) that should have been collected from short-term renters, along with penalties and interest on the unpaid TOT, enforcement costs and attorney’s fees.
On Nov. 27, 2019, the County entered into a settlement agreement in Napa County v. Calistoga Wine, LLC, and Linda Fotsch (Napa County Superior Court case No. 18CV001606). The agreement places a permanent injunction that requires the owner and operator to do the following:
- Permanently cease and desist from engaging in any short-term rental activity on the property;
- Pay the County up to $250,000 in civil penalties, investigative costs, TOT, and attorney’s fees as a result of their violations. They will be required to pay $100,000 over the course of 18 months and pay an additional $150,000 if they are found in the future to have engaged in any further unlawful rentals on the property.
The injunction includes a prohibition on using rental arrangements or artifices designed to make illegal short-term rentals appear lawful on their face. The injunction prohibits, for example, the use of a lease that appears to be for 30 consecutive days or more—which is allowed under the County Code— but limits the tenant to an occupancy for a shorter term. Such action would constitute a violation of the ordinance even if the property was not occupied by any other tenants in a month.
David Morrison, Director of Planning Building and Environmental Services (PBES), said: “This settlement was reached after more than a year of focused efforts by Code Compliance and County Counsel staff. The result is a clear demonstration that the County aggressively enforces against illegal short-term rentals and that owners will pay a heavy penalty for their violations.”