1. Sonoma County, California enacted short-term rental regulations in 2011. Tax revenues have increased and the county has been pleased with the results so far, saying “so far so good.” Click for more.
2. Estes Park, Colorado is discussing how to improve STR regulations and make the city code clear and enforceable. Click for more.
3. An article from Hudson County, New Jersey looks at the growing trend of STRs across the state—and mentions that the Super Bowl will bring a lot of visitors looking for rentals. Click for more.

More and more cities across the country are discussing how to regulate and improve short-term rental rules. STRAC is dedicated to help share success stories and provide resources that will help local advocates and policymakers find the best possible solutions.

http://www.theglobeandmail.com/commentary/quebec-should-work-with-short-term-renters-not-scare-them-away/article12358933/

1. Homeowners can rent their properties once a year for a period shorter than a month without any city involvement
2. STRS are permitted without a license in a few select circumstances: in connection with a contract to sell the property or if someone is displaced while their own home is repaired
3. Anyone who wants to rent their property more than once per year must obtain a license from the city for $50 per year
4. In order to obtain a license, operators must provide notice to neighbors and gain approval from the City Council

The heavily debated issue began with a call for the council to ban short-term rentals outright in response to one specific rental. STRAC believes that existing city regulations often provide the tools for addressing a few bad actors and that the market should not be penalized as a result. According to Evanston Now, Alderman Coleen Burrus voted against the ordinance and said it was “trying to fix things that aren’t broken.”

Just last month, Howard Handler, the government affairs director for the North Shore-Barrington Association of REALTORS®, wrote in the Chicago Tribune:

“Most homeowners don’t anticipate renting their property on a short term basis, but if the need arises, the owner should not have to plead their case to city staff for permission to do so. Evanston may have a need to regulate those running quasi-hotels out of their home, which have been the source of some complaints, but the City should leave the rest of Evanston property owners free of additional, unnecessary regulation.”

Good regulations should be easy to locate, understand and comply with. The short-term rental marketplace is growing quickly across the country and Evanston risks thwarting the market and losing valuable tourist dollars.

New York is a perfect example of why we need fair and reasonable regulations that both short-term rental operators and renters can easily understand and follow. Nearly half of travelers plan to use short-term rentals as part of their vacation this year, according to a recent TripAdvisor survey. And these properties provide enormous economic benefits in local communities across the country. As the market for short-term accommodations continues to grow, fair and reasonable laws will allow the market to continue to thrive while addressing community concerns.

The city believes the current law prevents rentals of less than 60 days, while the owners believe that the regulation is unclear with regards to vacation rentals. The city and owners would prefer to find a compromise without legal action.

The group of owners, including Gail Morin, a previous STRAC guest blogger, have begun working with a lawyer who has suggested seeking an advisory opinion from the state attorney general which may provide further clarification for the city’s code.

In a previous op-ed in the Palm Beach Post, vacation rental owners Carol Lewis and Bernard Ray asked: “In a city plagued by foreclosures, is it advisable to foreclose the great economic benefits of short-term rentals?” Lewis and Ray calculated the economic impact of short-term renters is $3.5 million a year and asked why the city was opening itself up to litigation when a solution could be found.

“Lake Worth should try to find some middle ground that would benefits our tourism economy while addressing community concerns. The city’s responsible vacation rental owners have a proposal, but they need a chance to be heard. The city commission should ignore the hysteria, stick to the facts and look at other cities for best practices that allow the benefits of short-term rentals to continue in our community. Visitors and residents would benefit.”

For now, it’s promising to see that the city and the owners are working to find a compromise that would work for both sides.

The Bradenton Area Convention Center & Visitors Bureau is partnering with Southern Living magazine to host a restaurant week and country music concert in the fall of next year. How is it all being funded? Through revenues from the bed tax that all Manatee County visitors pay when they stay in a local hotel or short-term rental property.

Add Bradenton to the list of places across the country where short-term rentals are bringing tangible benefits to the local community. Places like Encinitas, CA, where occupancy taxes paid by hotel and short-term rental visitors helped fund research for a beach replenishment project. And Blue Ridge, GA, where short-term rental providers like C.J. Stam have banded together to create a Blues and BBQ festival that attracts thousands of visitors each year in the town’s off-season.

Know of another good example? Drop us a note at info@stradvocacy.org. And read more about the economic benefits short-term rentals are bringing local communities here.

The ability to rent one’s property is included in the bundle of rights associated with property ownership and is well established in common law. Financially distressed property owners may count on a one-time or occasional short term rental to pay their mortgage or even to put food on their table… Ironically, the proposal will create an environment where those that are operating quasi-hotels will be able to operate while most Evanstonians will be effectively prohibited from renting their property even once for less than 29 days… In effect, this ordinance empowers the properties it seeks curtail and disenfranchises those that were not the original target of this policy.

He concludes:

Most homeowners don’t anticipate renting their property on a short term basis, but if the need arises, the owner should not have to plead their case to city staff for permission to do so. Evanston may have a need to regulate those running quasi-hotels out of their home, which have been the source of some complaints, but the City should leave the rest of Evanston property owners free of additional, unnecessary regulation.

The ordinance will go before the Evanston Planning and Development Committee on Tuesday, May 28^th. All residents or people interested in protecting the future of short-term rentals in Evanston should plan to attend or follow the outcome. The meeting will be held at the Morton Civic Center, 2100 Ridge Ave., in Evanston at 7:15 PM.

Oregon already has a statewide lodging tax.  Most local communities have lodging taxes too, so tourists often pay between 10% and 15% in lodging taxes when they visit our state.  Lodging taxes are common, but to my knowledge no other state has lodging tax laws that would be as invasive as the laws in Oregon would be if this new bill passes.  If the law passes in Oregon, other states will take notice and this could become a nationwide trend.

The new tax would have immediate impact on vacation rental owners and the businesses that serve rental owners and their guests.

• If your property is booked through an on-line travel site  and you pay the site any fees for handling your booking transaction, the listing site would pay a new tax on those fees, and the tax might be passed onto the property owner.
• If your property is booked through a local travel agent or a rental property manager and there are any per-booking fees or other charges associated with the booking, the agent or manager would pay a new tax on those special fees, and the tax would likely be passed through to the property owner.
• If you book your own properties, and there are any special service fees that would not normally be taxed under existing local and state lodging taxes (hot tub usage fees, cleaning reimbursements, etc.), under this new bill a tax might be assessed.
• Regardless of what your association is with Oregon tourism, the new tax could have negative impacts on vacation rentals, bed & breakfasts and small locally owned hotels, decreasing bookings and interfering with the current economic recovery, especially in small rural communities that depend on tourism.

Some opponents of the bill say it favors large, out of state, corporate hotel chains.  These chains handle most of their bookings internally, so there are no extra fees to tax.

Proponents of this new tax apparently do not realize that online travel sites, property managers and short term rental owners promote Oregon to a world of potential tourists at no charge to the state. In doing this they generate $8.8 billion in spending in the state, help fill the state’s tax coffers, bring significant tax revenues to many small communities that desperately need them, and support between 90,000 and 100,000 jobs in the state.

Small lodging operations are a primary driver of tourism into small Oregon towns, and are often one of the 3 largest sectors of local economies that help such towns survive.  Taxes are a fact of life, but let’s be smart about what we tax.

It makes no sense to discourage tourism with a new tax, and then turn around and spend millions of dollars promoting the state as a tourist destination.

It makes no sense to lay a new tax in the lap of small business owners statewide who work hard to bring tourism into our communities, while these businesses are struggling to survive, and are already collecting significant tax revenues for local and statement government activities.

Doug Coates is the director of the Oregon Association of Vacation Rentals and writes a blog on Vacation Rental Regulations, Standards & Practices — www.vrregs.com. He can be reached at doug.coates@oravro.com or 503-320-1133.

Two important examples:

An article in Crain’s New York Business notes that short-term rentals are “expected to generate around $1 billion in local economic activity in 2013, outstripping the impact of the city’s booming cruise-ship industry five times over” and previews new legislation being proposed by New York State Sen. Martin Golden.

His proposal would also create an exemption for a “specific class of good actors” who provide tax revenue and tourism dollars to the city and the state.

 

The bill proposes creating a registration process where individuals would pay the Buildings Department $200 per apartment to register as a short-term rental unit. SROs, rent-stabilized and rent-controlled units would not be eligible. No individual could have more than 30 short-term rental registrations under his or her name, and hotel taxes would be required, as well as smoke detectors and evacuation diagrams.

 

New Yorkers would be limited to hosting one person per 100 square feet of floor area. The law as it stands “is ridding New York state of a legitimate business model: short-term rental units used by tourists, hospital patients and business guests,” the bill reads.

The proposal strikes us as far more fair and reasonable – not to mention enforceable – than an outright ban on short-term rentals. We’ll continue to watch how it plays out in the legislature.

Meanwhile, The Record looks at “a large number of North Jersey homeowners who’ll be renting space to short-term tenants” during next year’s Super Bowl (February 2, 2014 at MetLife Stadium in East Rutherford, NJ). The article notes that “in recent Super Bowls in New Orleans, Dallas and Indianapolis, demand from travelers for home rentals more than doubled as fans either were shut out of hotels or looked for bigger spaces” and encourages individuals who are considering renting out their homes to make sure they follow all of the necessary rules and regulations.

One recent example: The city of Encinitas, California used the roughly $500,000 it pulled in from an occupancy tax on short-term rentals to help fund research for a project to replenish eight miles of its beaches.

Encinitas is a great example of how communities can put additional revenues to work for the benefit of its residents and future visitors.

Many other communities have realized that with fair and reasonable regulations in place, short-term rentals are resulting in huge economic benefits, which can be put right back to work for the local community.