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HomeMy WebLinkAboutI. C. SHORT-TERM RENTAL TASK FORCE UPDATE 1.21.2025SHORT TERM RENTAL ENFORCEMENT TASKFORCE January 21, 2025 CITY COUNCIL BRIEFING Andrew Cohen, Chair Kimberly Denton, Vice Chair Kevin Kemp, Zoning Administrator City Council Resolution In December 2023, the City Council created the Short Term Rental (STR) Enforcement Taskforce. The Taskforce objectives included: •STR rental enforcement and registration, including grandfathered properties •Recommend how to improve enforcement and registration, including recognition of STR owners who are fully regulations-compliant The Taskforce did not consider revenue enforcement, new geographic areas for STRs, nor overhauling the STR ordinance as these were beyond the Taskforce scope. 2 Taskforce Members Taskforce Members:Andrew Cohen, Chair Kimberly Denton, Vice Chair John Drescher Elaine Fekete Phillip Hines John Mannarino Aric Martinez Page Miyares Nancy Parker Rachel Perry Representatives from the Planning Department, the City Manager’s office, the City Attorney’s office, and the Commissioner of Revenue participated as subject matter experts and advisors, including: •Kevin Kemp, Zoning Administrator •Brandon Hackney, Deputy Zoning Administrator •Sherri Yanev, Short Term Rental Manager •Eric Schmudde, Chief Deputy Commissioner of Revenue •Crystal Marcus, Deputy Commissioner for Investigations Commissioner of Revenue •Victoria Eisenberg, City Attorney’s Office A neutral facilitator convened the meetings and provided support to the Taskforce in developing recommendations. The Taskforce met 6 times between June and October 2024 for a total of 26 hours. 3 STR Taskforce 4 Recommendation Goals •Public safety and peaceful enjoyment •Protect renters, neighbors and neighborhoods, and homeowners •A less burdensome process for operators and the City •Improved, proactive enforcement •City control of the ordinance •Effective regulation and enforcement of different property types •Appropriately flexible requirements for grandfathered properties •Incentives for compliance 5 Data used by Taskforce Category Total Registered with Commissioner of the Revenue (active) 2,699 Total STR Listings 3,030 Annual Zoning Permits Issued 729 Annual Zoning Permits Pending 193 Grandfathered Properties 428 Conditional-Use Permits Approved 248 Home Shares (active)201 STR Enforcement Actions Summons issued since February 2022 269 Voluntary Compliance (advertisement removed or permit obtained) 136 Fines are paid prior to court date 48 Court case ruled in City’s favor (penalty imposed) 38 Court case dismissed by Judge 7 Not able to serve the summons 40 Note: This data was presented at the February 14, 2024 Planning Commission Meeting 6 Taskforce Takeaways •Unanimous Agreement on 13 out of 20 Recommendations •Only 1 or 2 members offered dissents of each of the other Recommendations •7 Recommendations for Fairly Simple “Text Amendments” •2 Recommendations for Additional Planning Staff •3 Recommendations for City Council’s Legislative Agenda •Most Recommendations are for Action by Planning Department Note: Some of these are already in progress 7 Summary of Recommendations by Study Area The Taskforce recommendations have been categorized under the following study areas:Number of Recommendations Targeting these study areas: Registration & Renewal 15 Enforcement 12 Recognition for Compliance 3 Grandfathered Properties 3 8 Summary of Recommendations for Action by both City Council and the Planning Department listed by Recommendation Number Ordinance Changes: 1. Update STR Sign Requirements 4. Accept Attestations for Registration and Renewal Processes 6. Grandfathered STRs: Accept Parking as Required at Time of Construction 11. Reduce Frequency for Structural Safety Inspections Budget: 13. Add a Full-Time STR Customer Service Representative 14. Hire Additional Zoning Inspectors 9 Summary of Recommendations for Action byCity Council only and listed by Recommendation Number Ordinance Changes: 2. Include Class A, B, or C General Contractors as Structural Inspectors 5. Charge a Non-Refundable Application Fee in Addition to the Permit Fee 12. Make Penalties Criminal Legislative Agenda: 15. Local Authority to Require Platforms to Remove Listings of Noncompliant STRs (HB 1557 and HB 1688) 16. STR Policy Statement Opposing State Pre-emption of Local Authority 17. Increase Fines for Violations 10 Summary of Recommendations for Action by the Planning Department only and listed by Recommendation Number 3. Simplify STR Renewal Process 7. Clarify Allowable Parking Materials for All STRs 8. Bring Unpermitted Grandfathered STRs before Council to Consider Status Revocation 9. Update Posted Guest Rules with More Detailed Trash and Recycling Requirements 10. Use More of the Capabilities of Host Compliance for Registration and Enforcement 18. Increase Public Visibility of Complaints, Enforcement Activities, & Compliant STRs 19. Provide Public Outreach to STR Guests on How to be a Good Neighbor 20. Increase Public Outreach to STR Owners & Operators, Prop. Mgrs., Real Estate Agents 11 1. Update STR sign requirements. Study Area:Registration & Renewal Action by: City Council & Planning Department Rationale:To improve the ability to quickly respond to issues and decrease the number of calls to Zoning or 311 that do not pertain to enforcement or general STR issues. To improve the aesthetics of the sign. To decrease neighbor and STR operator dissatisfaction and the negative consequences associated with signage. A.CITY COUNCIL ACTION: Text amendment adding permission to include owner or property manager contact information on required sign or on a separate sign. B.PLANNING DEPARTMENT ACTION: Update sign sample to clarify that signs can be made more aesthetically pleasing if they meet requirements for content per 241.2(4). Dissent:Three Taskforce members believe the STR sign requirement should be removed altogether. One Taskforce member added that property management signs should be sufficient as they identify the property as being managed by a rental company and provide contact information that can resolve issues far quicker than the hotline process. They added that houses with STR signs have been targeted for break-ins and have increased crime in neighborhoods. 12 2. Include Class A, B, or C General Contractors as allowable structural inspectors. The structural safety inspection should remove the load capacity requirements and instead require validating the structure has been built to the applicable residential building code. Study Area:Registration & Renewal Action by: City Council Rationale:To provide more qualified inspectors for inspections and create a faster and less difficult registration process. To make the inspections more meaningful and practical without sacrificing safety. A.CITY COUNCIL ACTION: Text amendment including Class A, B, or C General Contractors as structural inspectors. 13 3. Simplify STR renewal process. Study Area:Registration & Renewal Enforcement Recognition for Compliance Action by: Planning Department Rationale:To reduce burdensome requirement of registration and renewal, provide incentives for compliance, and make the registration process faster and more streamlined for STR operators and city staff. A.PLANNING DEPARTMENT ACTION: If an STR registered with Zoning the previous year, their STR permit can be renewed by paying the permit fee and attesting the STR is still in compliance with STR requirements. 14 4. Accept attestations for the registration and renewal process. Study Area:Registration & Renewal Recognition for Compliance Grandfathered Properties Action by: City Council & Planning Department Rationale:To reduce burdensome requirements of registration, provide incentives for compliance, and make the registration and renewal process faster and more streamlined. Allow STR operators to attest to compliance with certain registration or renewal requirements rather than requiring them to provide proof. A.CITY COUNCIL ACTION: •Life Safety inspections should be required when seeking an STR permit and again five years later. In years when an inspection is not required, an attestation can be submitted. • Add to inspection or attestations that a parking plan showing available spaces is posted in the STR. B.PLANNING DEPARTMENT ACTION: •Parking attestations can be used for the renewal process. •Accept Certificates of Insurance as proof of liability insurance. •Attestations should confirm an operator is abiding by the STR ordinance. •Attestations should acknowledge consequences of providing false information. •Attestations should be subject to auditing for verification. Dissent:With respect to Recommendation 4.A., insurance companies essentially already perform life safety inspections, which makes the city performing them unnecessary unless there are complaints.Attestations should only be used after the initial STR permit application has been inspected and approved.15 5. Charge a nonrefundable application fee in addition to a permit fee. Study Area:Registration & Renewal Action by: City Council Rationale:To cover the cost of staff time to review. To provide the necessary funding for City staff operations of this program. To decrease time staff spends reviewing applications by encouraging applicants to do their due diligence regarding eligibility prior to applying. A.CITY COUNCIL ACTION: Text amendment adding a non-refundable application fee, in addition to the yearly $200 permit fee. If the application is approved, the application fee is applied to the permit fee. 16 6. If a grandfathered property meets the parking requirements for the dwelling at the time of its construction, additional parking spaces do not need to be added to meet STR parking requirements. Study Area:Registration & Renewal Grandfathered Properties Action by: City Council & Planning Department Rationale:To align ordinance requirements with the intended goal of allowing grandfathered properties to continue to operate by creating appropriately flexible requirements. To provide renters with information about permissible parking. A.CITY COUNCIL ACTION: •Add text amendment creating this change. •Maintain ordinance that revokes grandfathered status from any dwelling that expands by a certain amount. B.PLANNING DEPARTMENT ACTION: Provide an attestation at renewal that STR listing includes the number of available parking spaces. Dissent:Reducing on-site parking requirements to less than one parking space per bedroom will have negative impacts on residents and neighborhoods. 17 7. Clarify allowable parking material for all STRs. Study Area:Registration & Renewal Action by: Planning Department Rationale:To create consistency in the ordinance and to facilitate the process for STRs endeavoring to come into compliance with the ordinance. A.PLANNING DEPARTMENT ACTION: Additional parking spaces in the Overlay District must use permeable materials. Additional parking spaces elsewhere can be built with any parking surface material approved by the Planning Director. 18 8. Bring unpermitted Grandfathered STRs before City Council to consider status revocation. Study Area:Registration & Renewal Enforcement Grandfathered Properties Action by: Planning Department Rationale:To encourage grandfathered properties to come into compliance with the STR ordinance and reduce noncompliant STR listings. To reserve grandfathered status for properties actively operating as STRs. A.PLANNING DEPARTMENT ACTION: As Recommendation 6 will facilitate grandfathered properties coming into compliance, the Taskforce believes a deadline should be set for grandfathered properties to become permitted STRs or risk losing their grandfathered status and that grandfathered properties that remain unpermitted should be brought before City Council for consideration of status revocation. 19 9. The required posted guest rules should include more detailed trash and recycling requirements. Study Area:Registration & Renewal Action by: Planning Department Rationale:To decrease neighbor dissatisfaction and pests associated with trash. To decrease costs to the city associated with sorting recycling items out from garbage. To decrease garbage and recycling receptacles sitting on streets for an unnecessary amount of time. A.PLANNING DEPARTMENT ACTION: Posted rules should include trash and recycling schedules and rules, including city fines for non-compliance, as well as a list of recyclable items. 20 10. Use more of the capabilities of Host Compliance for registration and enforcement. Study Area:Registration & Renewal Enforcement Action by: Planning Department Rationale:To make the registration process streamlined and faster. To create faster and proactive enforcement by increasing technical capacity to track complaints and identify issues, like identifying unpermitted STRs and properties circumventing enforcement. To integrate Zoning and Commissioner of Revenue registration processes. To consolidate information in a single place. To increase responsiveness. A.PLANNING DEPARTMENT ACTION: •Integrate Host Compliance and Accela. •For registration, include a how-to apply guide, a digital application tool, and tracking for renewals. •For enforcement, use Host Compliance to identify violations. 21 11. Reduce frequency for Structural Safety inspections. Study Area:Registration & Renewal Enforcement Action by: City Council & Planning Department Rationale:To reduce burdensome requirements of registration and make the registration process faster and more streamlined, without compromising safety. A.CITY COUNCIL ACTION: •Structural Safety inspections should be required when seeking an STR permit and again every five years. •City Council should consider that structures less than 30-inches should not be required to obtain a structural safety report. B.PLANNING DEPARTMENT ACTION: Update policy so decks constructed within 5 years do not require an inspection. Dissent:Structural safety inspections are neither effective nor necessary. These inspections are part of the insurance process and inspections do not always catch imperfections and issues. Permits & Inspections Administrator said this deck collapse (and most others) could likely not have been caught by a structural safety inspection. 22 12. Make penalties criminal. Study Area:Enforcement Action by: City Council Rationale:To allow more severe penalties that deter noncompliance, without adding enforcement burden for city staff. A.CITY COUNCIL ACTION: Ordinance Change in Section 104 to change violations of section 241.2 to be criminal rather than civil. Dissent:The City changed to civil penalties so cases would be easier to pursue; changing back to criminal penalties does not seem to accomplish the Taskforce’s intentions. Civil penalties have a lower burden of proof, which improves enforcement. If penalties are criminal, Host Compliance may not be a viable option for identifying violations as criminal defendants have the right to confront their accusers. 23 13. Add a full-time STR Customer Service Representative. Study Area:Registration & Renewal Enforcement Action by: City Council & Planning Department Rationale:To provide knowledgeable and responsive customer service. A.CITY COUNCIL ACTION: Authorize an additional Full-time Employee through the adoption of the Fiscal Year Budget. B.PLANNING DEPARTMENT ACTION: Hire a full-time administrative support staff member to act as an STR customer service representative and dedicated point of contact for registration, enforcement, and complaints. Dissent:Two Taskforce members expressed opposition to all recommendations that divert funds from more critical needs, such as mental health and emergency services, to an item that affects a minority of residents. 24 14. Hire additional full-time, part-time, and/or temporary Zoning Inspectors. Study Area:Registration & Renewal Enforcement Action by: City Council & Planning Department Rationale:To increase staff capacity for registration and proactive, rather than the current complaint- driven approach. A.CITY COUNCIL ACTION: Authorize additional Full-time Employees through the adoption of the Fiscal Year Budget. B.PLANNING DEPARTMENT ACTION: Hire additional Zoning Inspectors. Dissent:Two Taskforce members expressed opposition to all recommendations that divert funds from more critical needs, such as mental health and emergency services, to an item that affects a minority of residents. 25 15. Add to City Council’s 2025 legislative agenda a Virginia code amendment to give localities authority to require STR platforms to remove noncompliant STR listings. Study Area:Enforcement Action by: City Council Rationale:To improve enforcement, public safety, and peaceful enjoyment by more effectively and efficiently preventing operation of noncompliant properties listed on platforms, particularly for properties with repeat violations. A.CITY COUNCIL ACTION: Encourage Virginia Beach legislators to pursue legislation empowering localities to require an STR platform to remove a non-compliant listing and refund/cancel bookings for that listing, if that listing has had due process and an adjudicated case. Dissent:This action undercuts the enforcement improvements suggested in this document. 26 16. Include the 2023 and 2024 City Council STR policy statement in the 2025 Legislative Agenda. Study Area:Registration & Renewal Enforcement Action by: City Council Rationale:As in the city’s Legislative Agendas for 2023 and 2024, it is important to formally communicate to the Virginia Beach delegation to the General Assembly the urgency of maintaining and expanding local authority to regulate STRs and of not pre-empting that authority. A.CITY COUNCIL ACTION: Encourage Virginia Beach legislators to carry forward the STR policy statement from the 2024 Legislative Agenda. Dissent:Two Taskforce members would welcome the state legislature to step in and allow STRs by right for the Commonwealth and, therefore, would not be in favor of this recommendation. Another Taskforce member expressed disapproval of this policy statement’s intent and language. They clarified that the General Assembly allowed Sandbridge to continue offering STRs, but it did not compel them. Without that legislation, Virginia Beach would not collect approximately $200M in annual revenue from Sandbridge’s real estate taxes and STR and tourism spending. 27 17. If the City Council does not switch from civil to criminal violations as suggested in Recommendation 12, add to City Council’s 2025 Legislative Agenda an amendment to incrementally increase fines for violations. Study Area:Enforcement Action by: City Council Rationale:To increase compliance for repeat violators. To create more severe penalties that deter noncompliance. A.CITY COUNCIL ACTION: Add an amendment to incrementally increase fines for violations by repeat offenders to City Council’s 2025 legislative agenda. Dissent:Two Taskforce members do not support a law that would change the fines for the whole commonwealth, which is what this legislative matter would have to do. Whereas, it may help Virginia Beach with its enforcement, it would be overly burdensome for residents in other areas of the commonwealth. One Taskforce member disagreed with this recommendation on the basis that many STRs are only negligibly profitable and are sometimes even used as a way for homeowners to hold on to their homes. They stated that the idea that fines are not a deterrent is misinformed. Note: If Recommendation 12 is adopted, this recommendation is not needed. 28 18. Increase public transparency about STR complaints, enforcement activities, and compliant properties. Study Area:Enforcement Recognition for Compliance Action by: Planning Department Rationale:To improve accountability and transparency with concerned residents and facilitate enforcement. To promote self-service for the public to find information about complaints and enforcement, reducing the burden on staff to respond to requests for this information. To provide recognition for compliant properties. A.PLANNING DEPARTMENT ACTION: •Use Host Compliance to automatically notify complainants with the complaint record number and website link to track action on their complaint. •Provide information about how to use Accela to view STR complaints and enforcement actions. •Provide information about how to use Accela to view compliant properties. 29 19. Provide public outreach to STR guests on how to be a good neighbor. Study Area:Registration & Renewal Action by: Planning Department Rationale:To reduce neighbor dissatisfaction by educating STR guests on neighborliness and local laws. A.PLANNING DEPARTMENT ACTION: Provide information about noise ordinances, trash schedules, parking, etc. 30 20. Increase public outreach to STR owners and operators, property managers, and real estate agents. Study Area:Registration & Renewal Enforcement Action by: Planning Department Rationale:To increase compliance by reducing misinformation and confusion about ordinance requirements. A.PLANNING DEPARTMENT ACTION: Provide suggestions on how to encourage owner and guest compliance with City ordinances and house rules. Provide information about what is and is not permissible under the STR ordinance. Dissent:While supportive of this recommendation, the dissent wanted it to include additional educational outreach. The City should also suggest legal topics owners and operators should seek legal counsel for or consider addressing in their rental agreements. Including these topics in rental agreements helps get guests to comply. An example would be listing charges that may be applied if guests do not follow trash rules or a clause addressing eviction if the renter does not vacate the property. 31 STR Program Updates 32 •Short Term Rental Manager, Sherri Yanev, began leading the STR team on August 8, 2024 •Current Numbers (as of Jan 8, 2025) •1872 Total STR Units Identified •711 NON-permitted STR Units •1161 Permitted STR Units •428 Grandfathered Properties •316 STR Permitted •34 STR Permits Pending CALL TO ACTION for City Council •Direct Staff to Draft Recommended Ordinance Changes for Council Action •Add Recommended Planning Staff •Pursue Recommended Legislative Agenda Items •Direct the Planning Department to Proceed with Recommended Actions 33 Questions? 34