Many municipalities around the country and the region have begun looking into ways, or have adopted regulations, to regulate the rapidly growing industry of short term rentals. Companies such as Air BnB, VRBO, and others are transforming the travel industry by allowing citizens the ability to rent out their homes to travelers with the ease of a website. These travel options join the list of other community sharing innovations like Uber. Municipalities are trying to find the best way to handle these rentals, as they are generally unregulated because municipal codes and ordinances have not yet been developed to regulate them. Common reasons that cities want to regulate short term rentals are:
1. To preserve the residential character of neighborhoods
2. Concerns for property maintenance
3. Collection of transient guest taxes
4. To create a level playing field with competing hotels, motels, bed and breakfasts, etc.
5. For the protection and safety of renters, owners, and neighbors
Independence is not currently regulating this new industry, as there is no clear way to know how many property owners are actually renting out their homes. Last summer, City management asked staff to begin looking at this issue after complaints from citizens about specific properties they believe are participating. A staff working group made up of members from the Planning Division, Regulated Industries Division, Building Inspections Division, City Manager’s Office, Fire Department, Finance Department and Park, Recreation and Tourism Department was created, and have met various times throughout this process. The biggest concerns from the staff working group include safety for renters during a fire, zoning concerns with parking, business licensing, and collection of transient guest tax.
Additionally, the City Council was been briefed on this subject in two separate Study Sessions. In the first Study Session, City Council’s feedback included:
· creating a definition for short term rentals
· creating unique rules for short term rentals (such as safety, parking, insurance and trash)
· reviewing the impacts on neighborhoods
· balancing and protecting all interests
· limiting road blocks for short term rentals
· making sure all licensing and transient guest taxes were collected
Finally, the Independence Hotel and Lodging Alliance was briefed on this subject. After meeting with the Hotel and Lodging Alliance, it was determined that staff work closely with the bed and breakfast operators within the City of Independence as they had more of an interest on the regulating of short term rentals. After meeting with the bed and breakfast operators, the concerns noted included:
· creating a separate and unique definition from the existing bed and breakfast definition
· limiting the number of guest rooms in a short term rental
· limiting the number of days a short term rental can rented
· the impacts of the city lodging permit
· management of short term rentals
· not allowing short term rentals to serve meals
· inspection of short term rentals
· the application process for short term rentals
· enforcement and penalties on short term rentals
· business license numbers be posted on short term rental websites
With the feedback collected over the last year, staff has drafted proposed regulations for short term rentals.
Draft Planning Commission minutes are attached to this Council agenda item.