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Planning Commission OKs further revisions to short-term rental ordinance

Thursday, May 2, 2013 by Elizabeth Pagano

Proving time may heal some wounds, discussion about proposed changes to the city’s short-term rental ordinance was civilized and subdued at the Planning Commission last week.


The short-term rental ordinance was passed last August. In October, City Council promptly passed a resolution that asked staff to look at ways of improving the ordinance, which was done. Then, in February, Council asked that the ordinance be tweaked further. Those changes are now ready, and the Planning Commission reviewed them last week.


One of the most significant changes is that owners of unlicensed short-term rentals will face up to $2,000 per day in fines, and the operation of an unlicensed short-term rental will be treated as a zoning violation. This change gives some weight to the regulations, which should be easier to catch with another proposed change in place: a requirement that all advertisements for short-term rentals, or STRs, must include the issued short-term rental license number.


The city’s Code Compliance Department proposed this change, which would make advertisements without a license number, and advertising short-term rentals as licensed when they are not, offenses under city code.


David King, who is a resident of the Zilker Neighborhood, pushed for more draconian measures, saying that any violations of short-term rental regulations should result in a lifetime ban from operating an STR.


The proposed changes would also allow rentals of less than an entire structure (for example, a bedroom) when the owner is present. Planning and Development Review’s Jerry Rusthoven explained that this new category would be “kind of a Type 1a rental,” that would allow the owner to be present, but would also limit the rental to a single party.


“We didn’t want any kind of confusion between one of these types of rentals and a rooming house, boarding house, or bed and breakfast,” said Rusthoven. “We’re working with the law department on trying to find a better word than ‘party,’ but I think we all know what Council intended was ‘party’ as in number of people, not ‘party’ as in ‘whoo-hoo’.”


The proposed code revisions would also create a Type III short-term rental for multifamily structures, with identical notification requirements as the other types of rentals. Though short-term rentals are already currently permitted in multifamily structures, there is not a license requirement.


Nor is there a cap within multifamily. That would change if the code amendments pass. The city would put a 3 percent limit on short-term rentals in a single building, and a  3 percent cap for each property, though one short-term rental would be (technically) allowed per building, at a minimum.


“We don’t want there to be any confusion between a hotel and an apartment building,” said Rusthoven.


In addition to these Council-directed changes, staff has come up with a few suggestions of their own. They propose that short-term rentals be allowed in Planned Unit Developments, like the Mueller development. Rusthoven called the omission “inadvertent.” Staff also asks that one short-term rental be allowed per census tract. (Though there is a 3 percent cap in place, some tracts do not have enough residences to permit one short-term rental under that calculation.)


Some of the changes don’t require a change to the code, and are already under way. For one, the city will soon be adding neighborhood associations to the list of people that will be alerted, via email, to newly registered short-term rentals. 


Though staff is also working on creating a publically-available database and map of short-term rentals, that process is being worked out as a stakeholder group works through security and privacy concerns with staff.


Finally, Rusthoven said that shifting registration and payment online would most likely be done by the end of the year.


The commission voted 8-1 in favor of staff’s recommendations, with Commissioner James Nortey voting in opposition.

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