Port Townsend City Council members and city staff talked about short-term rental regulations at an April 11 workshop, focusing on whether or not to begin allowing – and thereby regulating – non-owner-occupied short-term rentals.

It's the latest round of discussions that go back for years concerning city codes that allow certain types of short-term rentals for guest accommodations, and how those rules are often flaunted by property owners filling the demand for overnight guest accommodations in a popular tourist town.

Websites such as Airbnb.com and Vrbo.com make it easy for homeowners to advertise houses, apartments or rooms to rent. Short-term rentals can be more financially lucrative than long-term, especially in places like Port Townsend that are popular tourist destinations.

"Short-term rental" means an accommodation rented for fewer than 30 days. That includes "tourist homes" – properties occupied by owners who rent one or more rooms to tourists on a short-term basis. Short-term rentals are also known as "transient accommodations" and "vacation rentals."

With a permit and a business license, it's currently legal in Port Townsend to offer short-term rentals of a room in one's house if the owner lives on the premises. The city currently has issued permits to 53 short-term rentals, according to Lance Bailey, planning director.

It is currently illegal in the city for accommodations to be offered on a short-term basis if the owner does not reside on the premises.

CODE REVISIONS

At the workshop, council members and staff discussed revisions to the municipal code intended to clarify and consolidate rules. They also talked about requiring purveyors of short-term rentals to include their business license number on all advertising, which would help code enforcement officers to locate those operating illegally.

Council and staff are considering a three-year pilot program allowing short-term rental by a property owner who does not live on the premises (non-owner occupied), mainly because they see it's already happening.

The city is in the process of hiring a code enforcement officer; interviews are scheduled this week, said City Manager David Timmons.

Council member Michelle Sandoval said that in the past four years of discussing this issue, the Community Development and Land Use Committee (CDLU) has chosen not to discuss allowing non-owner-occupied short-term rentals as a possible option.

But "people are already doing it," Sandoval said, adding that many of the people don't know it's illegal. She knows of several people who rent "second homes" on a short-term basis, hiring a local person as manager. "I can name five right now," she said.

If non-owner-occupied short-term rentals are going to be allowed, the number of licenses is likely to be limited, either by a citywide cap (Sandoval recommended 25) or on a per-block basis.

Council members and staff discussed requiring contact information for owners and/or property managers, and requiring a property manager to be within a half-hour's drive of the rental property, as part of possible rules governing non-owner-occupied short-term rentals.

Timmons noted that some property-management companies buy properties solely to operate as short-term rentals. "It's more of a commercial use of property."

The market for rental housing in Port Townsend and Jefferson County – duplexes, apartments, cottages, houses – has grown increasingly tight in 2016 as the real estate market recovers from the Great Recession that hit here in 2008. The rise in housing values is leading some property owners to end rental agreements and put properties up for sale, while others are turning to short-term rentals as an opportunity to increase revenue.

POTENTIAL IMPACTS

Council members are concerned about impacts of allowing non-owner-occupied short-term rentals. It could affect the community atmosphere of neighborhoods; it could reduce availability of long-term rental housing.

"This is a topic of conversation going on all over the country," Bailey said.

Council member Catharine Robinson said, "I am not inclined to go down the road of non-owner-occupied [short term rentals] for several reasons. One is our rental market," which is in "dire straits." She likened PT to an individual, saying people need to develop more than one aspect of themselves to be well-rounded, and PT needs to develop more than its tourism.

"For a number of years, this town has been marketed as a tourist destination. ... Do we want to continue?" Robinson said. "We need to develop various aspects of our town. ... We need to improve education."

Council member Bob Gray noted, "We don't have enough room nights during the visitor season," so short-term rentals help the local economy by providing visitors with places to stay. He said the impact on affordable housing may be less than it is perceived to be. "The people that own these second homes, they're ... not going to rent them" long term at affordable prices, he said.

Council member Pam Adams noted there are three "beautiful ADUs not being rented" in her neighborhood that would make lovely homes for local couples, but the owners "don't want to bother."

"There is no way to go back in time," Adams said. "This is a tourist town. ... Even if we stopped advertising, people would still want to come visit and stay. Without regulations, it's going to be harder to enforce. It does bug me that there are people that are deliberately disobeying" the rule against short-term rental of non-owner-occupied houses.

WHO GETS PERMITS?

Sandoval said people would continue to illegally rent houses for the short term. "The reason why I'm almost inclined to [allow non-owner-occupied short-term rentals] is so people who are already advertising" will need to post their business license number with their advertisements online. "I think we'll have a better chance of catching the people that are doing it illegally," she said.

"I feel so seriously that if we were going to allow it, it should be for locals, people who live here," Sandoval said. "If it's going to be an economic business for someone, I want a true local, not a second-home [owner], but a true local to benefit."

The group discussed requiring permit seekers to state whether they had already engaged in short-term renting. Lying could result in not getting a permit. Sandoval said the committee "felt, given there was going to be a limited number, the people that were already doing it [renting houses short-term], they should go to the back of the line."

Whether a homeowner is a resident is difficult to determine, said City Attorney Steve Gross. "If an owner physically resides on the property for a certain number of days, then it's owner occupied."

Voter registration records and driver's licenses could help city code enforcement staff determine if a given address is a person's primary residence, he said.

"Many cities are finding it near to impossible to enforce across the board" the regulations of short-term rentals, Timmons said. "You have the ad, but did they [rent the place]? To check that a person is not actually living there when they're supposed to be living there ... it's very difficult to prove."

No decisions were made at the April 11 workshop. Code revisions regarding short-term rentals next go to the city planning commission, and the issue of allowing non-owner-occupied rentals undergoes further discussion by the City Council, likely on May 2. Public comments are welcome at council business meetings; comments may also be emailed to citycouncil@cityofpt.us. For more information, visit cityofpt.us/council or speakuppt.us.