Short-term Rental Bill – Vote Update

Posted on June 25, 2021 by Dene Westbrook

The House of Representatives has adjorned for the evening without taking up House Bill 4722. The bill was pulled from the agenda. Thank you to everyone who reached out and contacted your state representative today to oppose. Those interactions matter! The House is back in session next week, and we anticipate another attempt to push this bad piece of public policy to a vote. Continue to have conversations with your legislator.

The latest draft substitute for HB 4722 includes a new section (5) which states “a local unit of government may limit the number of units under common ownership used for short-term rental in the local unit. The limit set by the local unit of government shall not be fewer than 2 units.” While this may appear to allow municipalities to protect neighborhoods from an oversaturation of short-term rentals, it only allows you to limit no more than two UNITS being used for short-term rentals. It does not include all dwelling types as listed under the definition of short-term rental. The definition states “the rental of a single-family residence, a dwelling unit in a 1- to 4- family house, or any unit or group of units in a condominium, for terms of not more than 30 consecutive days“.

The definition of common ownership is also an issue, it states “ownership in whole or in part by the same individual, individuals, or legal entity“. With the minimal tweaking of ownership structures, someone would be able to have an unlimited number of short-term rental units in your community.

The latest draft also adds a new section (6) which states “a local unit of government may limit the total number of units used for short-term rental in the local unit. The limit shall not be less than 30% of the number of existing residential units in the local unit of government and shall apply without regard to the location of dwelling units“. This language would allow for approximately 1 in every 3 homes to be a short-term rental, and it does not give municipalities the ability to spread those short-term rentals throughout the community. Neighborhoods could be overrun with vacation rental properties.

Share with your legislator why this newly added language is problematic. Remind them that none of the existing bill language has been struck or changed. Section (1) still states that a short-term rental is a by-right residential use, permitted in all residential zones. That it is not subject to a special use or conditional use permit, or procedure different from those required for other dwellings in the same zone (ie owner-occupied), and that under no circumstance can it be a commercial use of property.

If you have a rental inspection program, share with your legislator how the language in section (4) is problematic. It allows inspections, but doesn’t allow a rental registration or licensing component. It also states your rental inspection can’t have the effect of prohibiting short-term rentals. If someone fails an inspection, you’ve now had the effect of prohibiting. This is problematic for all communities with rental inspection programs, even if you’re not facing a short-term rental issue. Any lease could be amended to be less than 30 consecutive days to be defined as a short-term rental.

Much work still needs to be done on this issue! Ask your legislator, what’s the rush? By working together, we can develop model legislation that the rest of country will look toward that prevents the commercialization of our neighborhoods and ensures all property owners in a community are being good neighbors.

If you are unsure of where your legislator is on this issue and want to discuss further, contact Jennifer Rigterink at [email protected].

Jennifer Rigterink is a legislative associate for the League handling economic development, land use and municipal services issues.  She can be reached at [email protected] or 517-908-0305.

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