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Short-term Rental Bills Introduced – ‘Good Neighbor’ Legislation is Good Sense Compromise

Posted on October 21, 2021 by Jennifer Rigterink

Legislation balancing the necessity for communities to provide proper regulation and oversight over commercial enterprises in their neighborhoods while continuing to allow short-term rental properties in all communities was introduced today.

The “Good Neighbor Policy” legislation, House Bills 5465 and 5466 is supported by a coalition of organizations representing local government, public safety, the restaurant and lodging industry, economic development and more. The compromise legislation was initiated as an alternative to the harmful HB 4722, currently on the House floor, which eliminates all authority for municipalities to zone for short-term rentals and creates a top-down, one-size-fits-all approach for every community in the state.

Recognizing the value that this lodging option provides to communities, visitors and property owners, HB 5466 amends the Michigan Zoning Enabling Act to allow every property owner the ability to rent their property for up to 30 days per year in all residential areas, while allowing for reasonable zoning regulations. The legislation will help mitigate the impact on the state housing crisis, which is exacerbated by out-of-state companies purchasing homes solely for short-term vacation rentals. The bill creates greater parity between requirements and regulations among the unregulated short-term rental enterprises and other “typical” hotel and motel lodging.

HB 5465 establishes the Short-term Rental Regulation Act that requires all short-term rentals and hosting platforms, like AirBnB or VRBO, to register the property with the state Department of Licensing and Regulatory Affairs, allowing for improved awareness and regulatory enforcement. The properties are required to adhere to safety features, such as liability insurance, and on-site smoke and carbon monoxide detectors and fire extinguishers. Municipalities may enact reasonable regulations to protect health and safety, and proactively mitigate nuisance issues, such as noise, parking and traffic.

The League remains ready to work with all interested parties on a solution that provides a sensible compromise for Michigan communities, the economy and tourism industry while safeguarding property rights and the quality of life for residents.

Jennifer Rigterink is a legislative associate for the League handling economic development, land use and municipal services issues.  She can be reached at jrigterink@mml.org or 517-908-0305.

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