Board hears proposals for short-term rental ordinance
With the moratorium on business licenses for short-term residential rentals looming, the city has little time to present regulations for ratification by the Hot Springs Board of Directors before the more than four-month pause takes effect May 30.
City directors and staff heard from the public during the March 23 listening session the city hosted at the Hot Springs Convention Center. City staff heard from the board Tuesday night, receiving input informing the ordinance it plans to present at the board’s May 18 business meeting.
The board could repeal the moratorium established by the ordinance it adopted March 2 when a regulatory scheme for short-term residential rentals is in place.
“It’s a heavy lift to make it to this May 18 date,” City Manager Bill Burrough told the board at its Tuesday’s work session. “We’ve got two or three of these that are going to be tough issues to work through. We want your ideas. This is going to be your ordinance that you’re going to pass. We want to hear what you’re concerned about.”
Short-term rentals constitute an ever-growing share of the area’s lodging portfolio. Visit Hot Springs said more than 1,000 are in Garland County, with many in residential areas of the city. Their proliferation has quickly elevated the need for regulations to the top of the 2021-22 board’s agenda. The 18 goals for 2021 the 2019-20 board adopted in August didn’t address shortterm rentals.
“When I was at the (International City/County Management Association) five years ago, we met with a start-up company that mined data from all of these short-term rental sites,” Burrough told the board. “I remember that first year we went, he pulled up the city and said we had 200 short-term rentals. This is the first time I ever heard of short-term rentals. When we went back the following year we had about 700, and the next year he said we had somewhere around 1,100.”
Comments made at last month’s listening session alternated between praise for the short-term rental business, describing it as a boon for older neighborhoods in need of revitalization, to a nuisance that’s overrun residential areas with dozens of visitors vacationing in single-family homes that have effectively become hotels.
Concepts presented to the board earlier this week included applying fire safety and suppression regulations for homes operating as short-term rentals, parking and vehicle limits, occupancy limits, capping the number of short-term rentals in the city or a neighborhood and a procedure for reporting complaints.
Requiring short-term rental owners to notify nearby property owners that a short-term rental is operating in their neighborhood was also discussed.
Burrough said the ordinance Santa Fe, N.M., adopted could be a guide for Hot Springs, which, like Santa Fe, is a tourist destination. Santa Fe’s ordinance caps short-term rental permits at 1,000 for residential-zoned properties and prohibits issuing permits for residential units within 50 feet of an existing short-term rental.
The ordinance also requires a local operator be physically present at the short-term rental to respond to emergencies and complaints within one hour of receiving the complaint and caps the number of permits at 12 for multi-unit dwellings.
“We could have a complaint hotline,” Burrough said. “We’ll mandate a local contact, a local agent we can contact. We’ll build a database that whomever the inspector or officer is will be able to pull that up and get that address and contact name and be able to contact them while they’re there.”
Burrough said the $50 per bed annual business license tax established by the ordinance adopted March 2 could probably offset the city’s enforcement costs.
“I don’t know if we’ll need a permit fee or inspection fee,” he told the board. “Part of that is going to be based on how many we have. If we have 1,000 come in at $50 a bed, we’ll probably have enough money to take care of the program.”
The board discussed requiring new short-term rentals in residential-zoned areas to apply for a conditional-use permit or creating short-term rental overlays on the city’s zoning map. Overlays, such as the one the city has for mobile homes, allow uses prohibited by a zoning area’s land-use regulations.
City Attorney Brian Albright told the board existing shortterm rentals in residential-zoned areas can’t be regulated out of existence.
“Bear in mind that if it’s a pre-existing use, it’s going to continue to be a pre-existing, non-conforming use,” he said. “If you take it away, it could be argued to be an inverse condemnation.”
Burrough said the city will use Host Compliance, software that tracks short-term rentals by collecting data from online marketplaces such as Airbnb and VRBO. The Hot Springs Advertising and Promotion Commission uses the service to find unregistered short-term rentals within its taxing authority.
“We’re going to partner with the A and P and buy the additional modules,” he told the board. “They’ll be able to help us track uses of these short-term rentals. They’ll send us reports. If those don’t match with what we’re seeing in the tax base, we’ll start digging into it.”