Goldwater Takes Legal Action Against City and Jablow Over Short-Term Rental Controversy

The Goldwater Institute has initiated legal action against the city of Sedona, its Mayor Scott Jablow, and City Manager Anette Spickard. This lawsuit arises from the city’s refusal to issue a short-term rental permit to Oak Creek Hospitality LLC, which recently acquired the Oak Creek Mobilodge.

Situated in a 59-space mobile home park, this property changed ownership in September 2023, though formal recording of the sale occurred in June 2024. The mobile home park, predating Sedona’s incorporation in 1988, has been classified as a legal nonconforming use, as noted by former Community Development Director Audree Juhlin in a 2017 letter to previous owner Don Campbell.

Juhlin emphasized that under Arizona Revised Statutes (ARS) §9-500.39, the city cannot restrict short-term rentals in single-family homes. “The mobile home park has historically provided single-family homes on a rental basis,” she stated.

On December 7, attorney John Thorpe from the Goldwater Institute reached out to Sedona officials to verify that the mobile home park was still eligible for short-term rental permits. City Attorney Kurt Christianson’s response on December 19 argued against this eligibility, asserting that a mobile home park does not fit the definition of a ‘one-to-four-family house.’

Christianson referenced ARS §33-1409(15), clarifying that mobile home parks are defined as parcels containing four or more mobile home spaces. He disputed the claim that these restrictions significantly impede the property’s value and stressed that the legislature likely intended to protect residents of mobile home parks from potential evictions for the sake of short-term rentals.

Following further correspondence with short-term rental expert Teresah Arthur, Oak Creek Hospitality and the Goldwater Institute formally filed their lawsuit in Yavapai County Superior Court on August 7. Thorpe contended that the city’s prohibition violates state law, arguing that each mobile home unit qualifies as a single-family dwelling and is therefore eligible for short-term rental status.

The complaint references past communications from the city indicating that mobile homes could serve as short-term rentals, which Oak Creek Hospitality asserts contradicts the city’s current stance. The lawsuit seeks remedies, including an injunction against the city’s prohibition, a declaration affirming the property’s lawful usage for short-term rentals, and coverage of legal fees.

In response, the city filed a motion to dismiss the suit on October 10. This motion was rejected a few days later due to procedural issues but was refiled on October 15 with the required documentation. The city maintains that each unit in a mobile home park does not constitute an individual use, arguing instead for the park to be viewed as a singular entity in terms of licensing.

The case has been allocated to Judge Linda Wallace, known for previously nullifying a ban on short-term rentals enacted by the Village of Oakcreek Association. The trial date remains undetermined, but additional developments will be reported in an upcoming issue of Sedona Red Rock News in November.