Council addresses short term rentals

“Obviously this is the ‘sausage making’ of local legislation,” said Turner Townsend after asking fellow council members for their thoughts on the governance of short term rentals in the City of Progress.

Townsend is Enterprise City Council President and at the council meeting Nov. 16, he asked the council for their opinions about the issue that has been discussed at city council meetings since Oct. 19.

An ordinance regulating short term rentals—or the lack of one—was first brought to the council at the meeting Oct. 19 when the council heard from a home owner whose home is listed as a short term rental on Airbnb, an online marketplace for short term lodgings, and from neighbors complaining about that particular Airbnb.

Whether short term rentals should be allowed in all residential parts of Enterprise was the subject of several differing citizen opinions during the Oct. 19, Nov. 2 and Nov. 16 council meetings.

At the city Planning Commission meeting held Oct. 26, Assistant City Engineer Staci Hayes told the commission that the issue of short term rentals had been brought to the council. She said she has been working with other city staff to research existing ordinances and will present them with a proposed ordinance draft by the December planning commission meeting.

At the Nov. 2 council meeting a citizen asked the council what homeowners currently operating short term rentals within city limits should do about paying lodging tax pending the city’s decision on the mater. “What we don’t want is any legal ramifications between now and said time when the council makes the decision on what to do and how we are to handle (lodging) tax,” Charles Miller said to the council.

At that meeting Enterprise Chief Financial Officer LeeAnn Swartz said that there are several lodging taxes that apply to short term rentals, which are rentals of 179 days or less, in place. Some organizations such as Airbnb, have an agreement with the state to withhold and submit the lodging tax for the state. However, Airbnb does not currently do the same for city and county 6 and 4 percent lodging tax, respectively.

“Anyone who is already doing a short term rental is already subject to those taxes and should be withholding them and submitting them to the city,” she explained at that time.

At the Nov. 16 council meeting, Swartz further clarified the lodging tax issue. “From an accounting standpoint, in order for us to receive any lodging taxes someone would have to have an account with us for us to set that up in the system,” she said. “The way they do that is by getting a business license.

“So part of our problem right now is that my hands are tied on issuing a business license because these homes are located in areas that because of the existing zoning they can’t operate certain businesses in.”

Hayes agreed. “Currently we don’t have anything in place that regulates short term rentals. There is no ordinance in place.”

Townsend said that the council had been provided several sample short term rental ordinances. “I think you all agree, it’s time to be trying to head towards an ordinance on this if we’re going to do anything about it,” he said. “So I just wanted to ask y’all to state your position plainly on these categories.”

Hayes outlined the existing procedure in place required for each of the short term rental owner’s application for a business license. There are currently more than 100 short term rentals already operating in the city. “The initial onboarding of this initial backlog will look different the first few months than it will 10 years from now,” said Townsend.

After discussion the council reached a consensus that a person should be required to have a business license for each short term rental. “If I had two plumbing businesses in town, I’d have to have a license for each of them,” said Councilman Eugene Goolsby.

Calling it “nitpicking,” Councilwoman Sonya Rich questioned the need for the council to construct an ordinance that is too detailed. “Unless I am missing something, I haven’t heard about a single problem with short term rentals except of that one dwelling—that there was no police report filed in,” Rich said. “So I’m wondering how much we need to get involved with this if we have ordinances already in place.

“We have a noise ordinance and last I checked, drugs are still illegal here,” Rich added. “I’m not against putting something in place that will make everybody feel comfortable but to put this much energy into this one incident…. I think I heard there are more than 120 something Airbnb homes in Enterprise.

“What I’m saying is how big of a problem is this, at this juncture?” Rich asked. “I know some residents are highly upset that this landed on their street, but if you’ve got loud music going on at all times of the night, we’ve got noise ordinances. Call the police.

“I don’t want to hear a whole bunch of noise on my street either. But I call the police,” Rich said. “We can’t talk out of both sides of our mouths. We say we want to be a progressive city and we don’t want to be a hindrance for people doing business in Enterprise, and then we sit here and want to do that essentially.”

The council reached a consensus that any short term rental ordinance should contain a minimum night stay clause. Councilman Scotty Johnson suggested that any city ordinance should contain provisions such as fire code compliance.

“I am not in favor of banning Airbnb properties in Enterprise,” Rich said. “This is kind of rubbing me wrong is because I’m not hearing that this is a major problem in Enterprise. I was alarmed to hear that we had as many Airbnb homes as we do in Enterprise.

“So it sounds to me like we are just picking and choosing how we zone certain areas in the city. I’ve heard people come up here and say, ‘I don’t have a problem with Airbnbs in Enterprise, I just don’t want it on my street or in my neighborhood,” Rich said. “So, it’s cool to have Airbnbs in Whispering Pines but it’s not okay cool in Tartan Pines?

“I know I’ve said a lot tonight,” Rich added. “But as we go forward with hopes of some resolve to this short term rental issue, my goal is to put something in place that people wanting to do business as an Airbnb can do with just common sense and and consideration of their neighbors.”

“I understand where Sonya (Rich) is coming from. We really value private property rights in this country for good reason. They were taken away from our founders and they wanted to make sure that we preserve them,” said City Attorney Rainer Cotter. “I know that this council, whether for more regulation or not, all agree with that.

“The idea is to put together reasonable regulations that protect property rights but also protects neighbors.

There are certainly areas that need to be addressed,” Cotter added. “It is not our intention to abrogate existing of covenants or rules and regulations of a homeowner’s association.

“I think (the city) needs stronger regulations. I don’t mean more restrictive necessarily. I just think we need to address more specifics,” Cotter added. “I have to think in terms of what will be upheld in a court of law and I would feel more comfortable if we were more specific.”

In unrelated business, Swartz told the council that the water department had become aware of a “glitch in the accounting system” and that there are errors in some 7,000 customer bills. “We have someone who is right now actively working to reverse those bills and get new bills sent out to those customers.

“There’s already approximately 100 customers who have already paid those bills and we’re working to get those refunded to them,” she said. “And we’re also working with our IT people to make sure that the glitch that has been in the system is resolved and will be taken care of by the next billing cycle at the end of the month.”

The next meeting of the Enterprise City Council is Tuesday, Dec. 7, in the Enterprise City Hall Council Chambers. A work session begins at 5 p.m. A voting meeting begins at 6 p.m. Both meetings are open to the public.

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