By Bridget Manley
Almost a year after the city of Harrisonburg began looking at how to regulate Airbnb properties, the city council is still grappling with how to do it in an enforceable and fair way.
Harrisonburg is not alone. Many cities and towns are struggling to regulate and tax Airbnb properties and are finding it hard to meet the different — and sometimes competing — needs in their municipalities. It’s part of a bigger trend in the new wild west of the sharing economy, raising more questions for city officials in a changing landscape of “collaborative consumption.”
One idea was for property owners to apply for a special use permit to operate an Airbnb. But Harrisonburg council members, concerned with the permit’s cost, asked city staff during the September 11 meeting to come back with more options.
In response, city staff have come up with a new approach: two zoning uses — a “home stay” use and a “short-term rental” use. “Home stay” use would apply to any occupant renting out part of his or her primary residence. And the occupant would have to be there during the length of the renter’s stay. “Short-term rentals,” meanwhile, would need a permit but wouldn’t require the host to be present for someone to stay there.
Adam Fletcher, Director of Planning and Community Development outlined the new uses at the Nov. 13 council meeting.
This proposal now has to go back to the planning commission and would require public hearings, so the legal use of Airbnb in the city won’t be settled until at least sometime next year.
Illegal…for now
Currently, running an Airbnb in Harrisonburg is illegal, Fletcher said.
However, the city doesn’t seek out properties for enforcement. If the city receives a complaint from a resident about an Airbnb, they send a letter asking the owner to cease and desist all operations within thirty days. Ultimately the city can take a short-term renter to court if the notice is disregarded.
“It’s a complicated issue,” Fletcher said. “People in all good faith don’t know how zoning rules work…and how it might disrupt neighborhood operations, and how it might change the character of peoples neighborhoods.”
A quick search of Airbnb in Harrisonburg shows about a dozen properties for rent within the city limits. One Airbnb host, who asked only to be named as “J” so as not to call attention to herself,said she became a short-term renter after opening her home to nieces and nephews throughout the years. She rents out the basement of her home.
“The extra income is very nice,” she said. “I use [the money] either for special things like travel, or emergency expenses, and lately have been using it to do larger repairs to my home.”
Fletcher said the city isn’t necessarily interested in blocking Airbnb properties from operating but is trying to figure out how it fits into an already complicated housing market.
“We are looking at it from a bigger picture perspective,” Fletcher said. “How does this impact the city’s ability to keep housing costs low? Short-term turnover might not be a big deal, but how does it impact the available units that people can rent in the city?”
Permit and tax concerns
City officials spent months working with Harrisonburg’s planning commission to amend regulations in the zoning code to account for Airbnb and other do-it-yourself rentals.
In September, city staff proposed requiring a special use permit to run any short-term rental. That permit application costs around $500.
However, council members were interested in including “by-right permissions,” which means changing the zoning requirements to allow owners to use their properties’ without getting special permissions.
Another area of contention is that Airbnb rentals do not currently pay the 7% tax that the city charges for short-term lodging like hotels, motels and bed & breakfast establishments.
That will change.
“At the end of the day, no matter what, the city will end up with an ordinance of some type or regulation to be able to collect the lodging tax,” Fletcher said. “Once we put them on the books to start regulating them and allowing them in some way, we’ve opened Pandora’s Box about how they then can be controlled.”
Home stay vs. short term rentals
In the new proposal — the dual “home stay” and “short term rental” approach — allows for the two most common models that have emerged among Airbnb hosts. Some, like “J,” rent out a spare room or floor for extra money, while others have turned spare houses into business opportunities.
“It does put a little bit of a kink in the way some folks want to operate,” Fletcher said of the potential new regulations, “but staff believes it gives a different kind of dimension on the enforcement, because it keeps the operation kind of small, and there is onsite accountability.”
Fletcher said the “home stay” rule would keep the primary occupant on site in case of any problems or safety issues as well, and it could prevent more people from buying multiple properties to use as short-term rentals. City officials want to avoid that, so it doesn’t contribute to sharply increasing home prices in the city.
The “short-term rental,” which would require a special use permit, would allow people who do not want to be on site during the renters stay to do so. Those who want this designation could run multiple short-term rentals, and the city would be able to hold public hearings and make sure surrounding neighbors are told before they begin operations.
For its part, Airbnb is not opposed to regulations, saying in a statement to The Citizen: “We, along with our host community, welcome fair and reasonable regulations around short term rentals. Located in the Shenandoah Valley and home to James Madison University, Harrisonburg is a vibrant travel and cultural destination for the Commonwealth of Virginia, and we’re pleased home sharing is a resource that allows more travelers to visit the city and gives local residents opportunities to make extra income by sharing their homes.”
Fletcher said city officials are not trying to outlaw Airbnb, but they are trying to address the needs of most city residents.
“We hear concerns from the community about over occupancy,” he said. “We have a difficult task of ‘what’s the right choice?’ We think this is where our society is going…how do we go about it and not have any negative impact in the neighborhood?”
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