Revised VHR ordinance settles lawsuit

A fine of up to $20,000 for operating a vacation home rental without a permit has been restored after Douglas County commissioners approved a revised ordinance last week.

County commissioners finalized the ordinance revisions as part of a settlement agreement with nine vacation homeowners, who sued the county in federal court a week before the ordinance was to take effect in July 2021.

“The case has been dismissed with prejudice,” Chief Civil District Attorney Doug Ritchie said at the April 7 commission meeting. “So, the lawsuit is over, and they are barred from challenging the current VHR regulations again.”

After five years of work, the revisions to the ordinance sailed through the county commission without any public comment.

“This will be the final nail in the coffin, so to speak, until the advisory board comes back to us with other changes,” Commission Chairman Mark Gardner said.

On Thursday, Ritchie told commissioners that the $20,000 fine is for the worst offenders. A federal judge had capped the fine at $5,000.

“For the worst violators, the maximum fine can be increased to $20,000,” Ritchie said. “It is believed this higher amount is required to deter those who have no intention of complying with the VHR regulations.”

Staff members will determine whether a violation warrants the highest penalty, which can be appealed to county commissioners, Ritchie said.

The ordinance also expands that fine to property managers who aid unpermitted vacation home rental owners.

Vacation home rentals are prohibited in the East Fork Township, which includes all of Douglas County outside the Tahoe Basin.

The ordinance caps the total number of Tier 2 and 3 vacation home rentals in the Tahoe Township at 600. Tier 1 vacation homes are not included in the cap because they are limited to four renters.

The VHR Advisory Panel still has significant work ahead of it, as there are slightly more than two dozen tier 3 permits that could come before them.

“It is hard to estimate a good number for this as are now getting owners just applying for a tier 2 with occupancy of 10,” Community Development Director Tom Dallaire said.

There are seven Tier 3 permits due to go before the advisory panel and another 19 that could apply for Tier 3 status which would allow them occupancies of 11 or more people.

In the nearly six months since the vacation home rental board first met on Oct. 26, 2021, they have approved half of the 16 Tier 3 permits that have come before them.

Owners seeking a Tier 3 permit must have an approved Tier 2 permit and undergo a public hearing. Panel members have given weight to testimony from neighbors when determining whether to approve a permit. Decisions of the VHR panel may be appealed to county commissioners.

The advisory panel meets again 1 p.m. April 27 in Minden.