‘Watered down’ short-term rentals bill moves to Senate floor

The Utah House in session during the 2017 legislative session, Salt Lake City, Utah, Feb. 27, 2017 | Photo courtesy of the Utah Legislature, St George News

ST. GEORGE – A bill originally designed to curtail a city’s ability to ban certain short-term rentals passed the Utah House and a Senate committee this week. However, initial supporters of the bill are calling the current version a “watered down” one.

The version of 2017’s House Bill 253, Short-Term Rental Amendments, that passed the House floor Monday and Senate Economic Development and Workforce Services Committee Wednesday was a substitute version. In the official second substitute version of the bill, the proposed legislation that would have prohibited cities from banning owner-occupied short-term rentals was removed.

There was a lot of misunderstanding of what owner-occupied really means,” Rep. John Knotwell, R-Herriman, said to St. George News Thursday. That misunderstanding and a general opposition from other legislators led to the removal of language related to short-term rentals, he said.

Short-term rentals are generally homes listed on online vacation rental sites like Airbnb and Homeaway.com Inc.’s VRBO that allow homeowners to rent out their homes in whole or in part to guests. For many it can be an inexpensive alternative to hotels.

Owner-occupied short-term rentals are arrangements where a homeowner lives in the home, yet rents out part of his or her home, like a room or a basement, to guests.

Rep. John Knotwell, R-Herriman, speaks to the House floor concerning the changes to his short-term rental amendments bill, Salt Lake City, Utah, Feb. 27, 2017 | Photo courtesy of the Utah Legislature, St George News

Part of the opposition to Knotwell’s bill came from St. George city officials who were averse to the idea of the state taking away a municipality’s ability to regulate aspects of short-term rentals, such as disallowing them in preexisting neighborhoods.

“We feel like local government governs best, the government closest to the people governs best,” Cameron Diehl, of the Utah League of Cities and Towns, said to the House Business and Labor Committee Feb. 13.

The original version of the bill passed the House committee in a 13-1 vote. The only hold out was Rep. Jon Stanard, R-St. George, who said he opposed the bill as a show of support for St. George City officials.

So what part of the bill survived if the primary portion that caused municipal officials and others heartburn was taken out?

Political subdivisions like counties and cities cannot enact ordinances or the like prohibiting someone from listing their home on a vacation rental website, Knotwell said, as it is considered a free speech issue.

“The (substitute) bill sees putting a home on a website as advertising and as such is not an illegal activity,” Knotwell told the House floor Monday, adding that a city can’t go after someone using their home as a short-term rental based off an online listing. They must have other evidence that an ordinance has been breached.

The change was one the Utah League of Cities and Towns, as well as St. George City officials, could live with and support.

File photo: While St. George Mayor Jon Pike said that while he and other members of the City Council support the idea of short-term rentals, the possibility of having local authority to regulate said rentals taken away by the state via 2017’s House Bill 253 was not an appealing prospect, St. George, Utah, Feb. 16, 2017 | Photo by Austin Peck, St. George News

“We’re fine with the change because what it ultimately does is leave the authority in the hands of the local government to regulate short-term rentals,” St. George Mayor Jon Pike said Wednesday. “That’s really what our concern was from the beginning.”

Pike has previously said that no one on the City Council is against short-term rentals. However, they strongly believe that the city should be able to dictate where a short-term rental, owner-occupied or not, should be allowed to operate and where it should not.

“We hear it, we see it, we run into people everyday who are discussing this issue like so many others,” Pike said.

St. George does allow short-term rentals in designated parts of the city, as well as in cases of incoming residential developments where the City Council deems it appropriate.

Still, some believe cities like St. George are violating a homeowner’s personal property rights by dictating for what they can and cannot use their home.

In a text to St. George News Thursday, Connor Boyack, president of Libertas Institute, a libertarian think tank based in Utah, said the following:

Utahns around the state are going to continue to have their property rights violated because the legislature watered down this bill, due primarily to persistent lobbying from the St. George mayor and city attorney, who have been at the Capitol pressuring other city officials and legislators to oppose home owners being able to share their home.

In a Facebook post Monday following the House floor vote, Boyack praised Knotwell for “carrying the torch” and said that the substitute bill is possibly “all that can be done in the Legislature for now.”

The Airbnb website displaying short-term rental around the St. George area. | Image courtesy Airbnb.com, St. George News

“When it comes to use of someone’s private property while they are there, it’s not something we should be afraid of,” Knotwell said about owner-occupied short-term rentals Thursday. “This is a property rights issue.”

Part of Utah’s economy is based on tourism, Knotwell said, and short-term rentals play an increasing part in that.

According to a report from KSL.com published Tuesday, Airbnb users spent $35.6 million in Utah during 2015. Thanks to an agreement made between Airbnb and Utah last October, Airbnb hosts who list their homes online in Utah pay sales tax, transient room tax and other applicable taxes.

Jasmine Mora, an Airbnb representative, told KSL that Utah has been able to generate over $2 million in tax revenue since the agreement was made.

The next step for the substitute bill is the Senate floor.

The Utah house passed the short-term rentals bill Monday in a 71-1 vote. Each of Southern Utah’s representatives voted in favor of the bill. The substitute bill also passed the Senate committee with a unanimous vote.

Resources

Read more: See all St. George News reports on Utah Legislature 2017 issues

Email: mkessler@stgnews.com

Twitter: @MoriKessler

Copyright St. George News, SaintGeorgeUtah.com LLC, 2017, all rights reserved.

 

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1 Comment

  • utahdiablo March 3, 2017 at 10:00 pm

    If I wanted to live next door to a hotel, I would have bought a home next door to a hotel, …* with daily rentals in neighborhoods…
    Ed. ellipsis: …*

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