Short-Term Rental Rules Headed to City Council Vote

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Members of the Planning Commission discuss a proposed short-term rental ordinance.

Bonnie Arbittier / Rivard Report

Members of the Planning Commission discuss a proposed short-term rental ordinance.

The City's Planning Commission unanimously approved a proposed short-term rental ordinance Wednesday, a key vote towards regulating platforms such as Airbnb, HomeAway, VRBO, and others.

The proposal, developed by a 23-member task force over almost a year, includes different fees and permit processes for two different types of short term-rental properties: owner-occupied, or "hosted," and non-owner-occupied. The fees and level of difficulty in obtaining a permit for the latter in residential areas is much higher in an attempt to discourage potential loss of housing stock in desirable neighborhoods – a serious concern for many neighborhood associations.

Click here to download the draft ordinance.

Under the proposal, owners or operators of both types of rentals would be required to pay local Hotel Occupancy Taxes on each stay and provide one off-street parking spot per listing.

The approval came with a note from the commission to City Council that members would like the City to "look into" prohibiting Type 2 – non-owner-occupied or "non-hosted" – short-term rentals in City historic districts. Commissioner Mary Rogers said she didn't want to see a "hotel district" replace a historic neighborhood. 

Outright prohibition in historic districts, said Development Services Administrator Catherine Hernandez, might conflict with equal-protection laws. Rules that limit what kind of people can live or use certain property for a period of time can expose Texas cities to lawsuits, a City attorney added. In other words, historic districts are established around design characteristics – not who lives there.

The ordinance gained unanimous approval – with an amendment – from the Board of Adjustments on Monday and will continue to the Zoning Commission, Equity and Health Committee, and then to City Council, which will consider all three recommendations and make the final decision. Council could approve  the ordinance as is, reject it entirely, or modify the proposal.

The board added a recommendation that short-term rentals can't "alter the essential character of the district and location" of a neighborhood and that it can consider over-saturation in its deliberations.

Michael Dice, Development Services Department Policy Administrator, presents a proposed short-term rental ordinance to members of the Planning Commission.

Bonnie Arbittier / Rivard Report

Michael Dice, Development Services Department policy administrator, presents a proposed short-term rental ordinance to members of the Planning Commission.

Michael Dice, Development Services Department policy administrator, pointed out that ordinances – especially those attempting to regulate an industry-disrupting technology – go through a kind of review period. Twelve to 18 months after implementation begins, staff can produce a "post-mortem report" to outline possible improvements and efficiencies, he said.

The task force settled on a process that mirrors its permit of occupancy process for owner-occupied rentals, Dice said. A "special exemption" process is used for non-owner-occupied rentals in residential areas – which requires a supermajority vote from the Board of Adjustments and that it's a certain distance away from other non-hosted listings.

The supermajority requirement could be "unduly prohibitive," Commissioner Casey Whittington pointed out, as that would mean approval would be needed from nine of 11 board members.

"We're not going to get everything right on our first attempt," Whittington said, and asked City staff to follow up on how often applications are rejected or accepted by the quasi-judicial board.

Click here to download Dice's presentation to the commission.

The density/distance rules for non-hosted rentals are similar to the City's traditional bed-and-breakfast regulations. Some residents said all short-term rentals should conform to all of those rules.

"The longstanding B&B ordinance has successfully balanced short-term lodging through zoning regulations," said Margaret Leeds of the King William Association.

Another option the task force considered was a zoning requirement for all short-term rentals, Dice said, but the proposed process allows permits to be non-transferable to another owner, operator, or location.

Some residents are unhappy with the results of the task force's deliberations.

"It allows houses in single-family and residential neighborhoods to be operated as hotels,” said Rosalyn Cogburn, who has lived in the King William neighborhood for 30 years. Short-term rentals bring "strangers that come and go and care nothing for the neighborhood they leave behind."

But short-term rentals provide property owners an opportunity to make additional income that helps them maintain, restore, and thrive in homes with increasing property taxes, said Charlotte Kerr Jorgensen.

“For us as a family, it has been a remarkable addition,” said Jorgensen, who has a listing at her home in Olmos Park Terrace and served on the task force. She has had positive experiences with the guests that stay at her home. 

As for the task force (click here to download a list of members) process, she said, "it made me proud of democracy."

Representatives from short-term rental platforms, the Real Estate Council of San Antonio, and neighborhood associations joined several short-term rental operators and district staff from Districts 8 and 10 for several meetings to hash out the details.

They worked off a rough draft of recommendations put together after then-Councilman Mike Gallagher (D10) submitted a request for review of the emerging industry.

Staff and the task force reviewed policies in several similar cities, but focused on those in Texas as property laws vary by state, Dice said. And the State could still undo much of the local work done.

Although Senate Bill 451 and House Bill 2551 – aimed at restricting rules local municipalities can impose on short-term rentals – died in committee during the last session of the Texas Legislature, he added, "based on the two bills, I would assume [the issue] would come back.”

The proposed ordinance will be reviewed by Zoning Commission on Tuesday, Jan. 16, the Community Health and Equity Committee on Thursday, Jan. 25, and then to City Council for a vote on Thursday, Feb. 8.

 

13 thoughts on “Short-Term Rental Rules Headed to City Council Vote

  1. I traveled in 5 countries for a total of 5 months last year. For at least 65% of my stays, I rented entire homes or apartments. It’s the best way to try to have a local experience. I shopped in local markets, cooked 1-2 meals a day in the rental units, explored the neighborhoods, etc. Rather than be offended by “strangers” coming and going in their neighborhoods, local residents should embrace the renters as persons interested in the neighborhood and the city. Those complaining seem to be trying to control other people’s lives beyond the boundaries of their own property. We have too many people in the country who want everyone else to do what they tell them to do and the way they tell them to do it!!

    • We are complaining because our neighborhoods are being turned into commercial zones, despite their residential zoning. On one street in my neighborhood, that is only one block long, there are seven short-term rentals, the majority of which are not owner-occupied. That’s not about paying property taxes or supplementing income, that’s about big business.

  2. Yes staying in an entire home or apartment gives you a local experience. But when that home or apartment is not occupied for days or weeks at a time, there is no one to embrace. If multiple homes that are not owner occupied –and are rented out for days, line the blocks in your neighborhood, it is not clear how this helps the neighborhood. I have lived in King William for many years. I own rental property in King William and have long term renters–retired military, cook at downtown hotel, medical support workers among others. They participate in the neighborhood and are known to neighbors. I have no objection to STR1 (aka owner occupied property) use of property so long as the individuals pay taxes on the rentals. I do object to STR2 (not owner occupied) properties and do not understand how having convention visitors staying for 3 or 4 days sustains the neighborhood. The spread of STR2s in the King William neighborhood has effectively eliminated many residential rentals—it is more profitable to charge $125 to $400 a night for even a couple of days in a week 4 times a month than to rent to an individual who lives in the property and works in San Antonio. When people talk about getting to know neighborhoods, they usually mean getting to know residents of the neighborhood. When you have 40-50 or more STRs in a neighborhood like King William, there are ever fewer residents as in people who live in the neighborhood. (again the granny flat owner occupied property is not what I object to)

    • I agree with you, Nancy! The economics of this may help, however. There are so many STRs that supply is outstripping demand, and, property and HOT taxes will quickly narrow the supply down as it profitability will be limited. I can only hope.

    • I agree with you completely. STR2s destroy a community. I live in Denver Heights, and even over here, STR2s are abundant, and they are actively driving out long term renters, and longtime home owners that can no longer afford to remain in the area.

      I’m fine with owner occupied rentals. They’re a great way for a family to add extra income, and they don’t hurt anyone else.

      I would support a total ban on non-owner occupied rentals inside loop 410, but I know it won’t happen.

  3. this is such a bad idea for our city. if I was the city I would pause this effort and get a recommendation from the new innovation council that the mayor is standing up.

    • I would love the City to slow down this fast moving train and review the issue from all angles, not just the CCR that promoted the task force. The service STRs is providing is not new. The B&B ordinance is not perfect. It’s time to approach the two topics with an innovated eye, one that can balance business interests with those who want to protect the investment of people who bought residential property and want to preserve their neighborhood.

  4. Hey everyone, we live in Texas. You own your property and have the right to do what you want with it as long as it complies with existing codes and ordinances. There is nothing which restricts short term rentals in most city neighborhoods. If you don’t like short term rentals, you need to move to a neighborhood which has deed restrictions against them.

    I get it, you (the ones complaining) don’t want them in your neighborhood. But, why should you superior rights over the short term rental owner’s right to use their property as they choose? I know….. you are more important

    • What about the rights of people who purchased residentially zoned property? What gives neighbors or the City the right to de facto rezone the property? Why is that not an unconstitutional taking?

      There IS something that restricts short term rentals: the B&B ordinance. A B&B is broadly defined as providing overnight lodging to a guest for a fee. There’s nothing in the ordinance that references providing food, and there is a legal tenant that says nothing in the title of the ordinance restricts or enlarges its meaning. At the time the B&B ordinance was amended in 1999, many such services had stopped serving food. Just because we have the same old service as before under a new name doesn’t mean that it’s new.

      • Rose, the Texas courts (like it or not) have already rules that a short term rental is a “residential use” – no change in zoning required to operate a short term rental

    • That is a selfish, short-sighted comment, TW. Do a little study about how STRs are having a negative impact on cities around the world. If we can take action to slow down the damaging effects of STRs here in San Antonio, we should. Density issues should also be a factor for STR1 and BnBs. I have enjoyed using AirBnB when travelling. If I had the space or inclination, I might be tempted to create an STR1 myself. But not at a detrimental cost to my neighborhood. It simply isn’t worth it. I plan to be here for the long-haul and I want neighbors who are invested in the LIFE of my city and neighborhood. Not just a glorified hotel entrepreneur. A little regulation is a good thing.

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