Short-term rentals: Community leaders struggle to find that regulation sweet spot

As increasing numbers of tourists flock to the area to enjoy the lakes, mountains and other amenities unique to this region, short term rentals have become more prevalent. With a dearth of hotel options nearby, short-term rental owners and operators have stepped in to fill that need. Many municipalities have stepped in to shore up their regulations.

Who is it?

To preserve a sense of community, some towns are insisting that landlords of short-term rentals provide identifying information about themselves. Corporate ownership of short-term rental units has raised concerns among municipal leaders.

The town of Warwick, N.Y., changed its short-term rental code in July to require any landlord who owns a stake in a short-term rental property as part of a partnership or corporation to disclose identifying information (including names, social security numbers and legal addresses) of all officers and general interest partners involved. In addition, landlords who do not reside onsite must be an actual person, as opposed to an LLC, for example.

“The Town Board understands the need for short-term rentals. We certainly want to have them. There aren’t very many hotels in the town of Warwick, and our tourism industry is booming here,” said Warwick Town Supervisor Jesse Dwyer, during the July 11 town board meeting. “We understand the benefit to both homeowners as well as businesses in the community that rely on short-term rentals. We just want to make sure that the laws are being followed.”

The village of Warwick has also discussed how to address corporate ownership of short-term rentals. The village has been drafting its own short-term regulation, suggesting that any person with a 10% or more stake in a property should be required to disclose their identity.

Closing the door on short-term rentals

Sparta Township in N.J. closed the door on short term rentals, approving an ordinance prohibiting the rental of properties for less than 28 days.

Sparta Mayor Neill Clark said the decision to prohibit short-term rentals was made after months of meetings and receiving feedback from owners and residents. He noted that the law will go into effect in January 2025 to allow for previous bookings to be fulfilled and for the township to have time to create the appropriate forms for identifying renters.

“Personally, I like short-term rentals, but I’m not here to do what I want to do personally,” said Clark, who also acknowledged that allowing short-term rentals could exacerbate the housing problem and that his community wants people to live their long-term. He added that with Sparta no longer a seasonal community, testimony from landlords showed that rentals of 28 days or more were a large part of their business.

Lafayette, N.J., remains firm in its stance against short-term rentals. Mayor Alan Henderson said there is no push for short-term rentals as there’s little to no demand.

Trying to make it work

In Vernon Township, short-term rentals are an important part of local tourism. Local authorities want short-term rentals to remain compliant with the rules.

“We are a short-term friendly tourist town,” according to Mindy Martin, short-term rental liaison for Vernon Township. “We work with communities hand in hand.” She mentioned working with the town fire marshal, the homeowners associations and lake communities to foster open communication and stay ahead of any rentals that are not compliant.

Vernon’s efforts to monitor short-term rentals and shut down those that are not abiding by town regulations is helped by a third-party system that alerts properties using short-term rentals marketing sites that they are in violation of town code.

In Pike County, Pa., the borough of Milford allows short-term rentals in limited districts, not including residential areas. This regulation is in accordance with a Pennsylvania Supreme Court ruling that prohibits short-term rentals in residential zoning districts. The town has four short-term rentals within permitted districts that are subject to inspections and regulations, said Milford Borough President Joseph Dooley.

To monitor potential unlawful rental, the borough checks listings on rental sites. Dooley noted that there has not been a significant issue of illegal short-term rental operators, and most are fine with current regulations.

He did note that some operators of long-term rentals in residential areas have shared their interest in operating short-term rentals out of those properties.

Increasing fees

West Milford Township responded to the boom in short-term rental usage by increasing registration fees from $500 to $750 on July 17. The increase, which is not yet in effect, will be paid yearly as part of the application renewal process.

West Milford Township Council President Marilyn Lichtenberg said the increase was necessary because “more employees” are needed “to manage the rentals.”

Staying on top of violations

In Monroe, N.Y., at a town board meeting in May, a resident called on the board to better enforce the town’s code. Monroe Town Councilwoman Dorey Houle said she spoke with several town supervisors about how best to enforce short-term rental regulations and raised the idea of having a designated individual to take on that role. Councilwoman Maureen Richardson suggested that fees generated as part of the enforcement process could be put toward preservation and other town needs. The board agreed that it would need their attorney to review short-term rental taxes and research what other towns have done in terms of fees.

Some municipalities are unsure what path to follow

“We will probably do something, but not sure when that will be,” said Sussex Boro Mayor Robert Holowach. “When it happens, we’ll look at who’s done something.”

The town of Goshen is close to putting together a local law, according to Supervisor Joseph Betro. “There is no way to disallow it,” said Betro, citing New York State law. “We want to look at how we can regulate it.”

Goshen is considering taxing short-term rentals as commercial businesses.

“A lot of residents are getting aggravated, but we are doing what we can,” said the supervisor in response to complaints about noise and partying at local short-term rentals.

In Chester, village Mayor Christopher Battiato has come out against allowing short-term rentals in his community.

Milford Mayor Dooley said he appreciates short-term rentals as an individual, but wouldn’t want to live next to one. “I use Airbnb all the time when I travel. Frankly I wouldn’t want one next to my house. It doesn’t foster community.”