Village Council — New restrictions, fees, for Airbnbs

• By Megan Bachman
• Published: May 15, 2021

• No Comments

Those wanting to operate an Airbnb on a property where they don’t live can no longer do so.

And those who already have an Airbnb where they don’t live will be subject to annual fees of $2,000 and regular background checks.

After months of discussion by both Village Council and Planning Commission, Council passed two pieces of legislation on Monday, May 3, to discourage some types  of Airbnbs here.

At the virtual meeting, Council unanimously passed a zoning code change and, in a 4–1 vote, passed a change to the Village’s lodging excise tax, with Council Member Laura Curliss voting against the latter. They take effect in 30 days.

In both measures, Council took aim at those who operate Airbnbs, officially called transient guest lodging establishments, or TGLs, on properties where they don’t live.

In their strongest stance to date, Council effectively created a moratorium on new permits for those “non-operator occupied” TGLs. In the zoning code change, all those now wanting to run an Airbnb have to show the property is their primary residence, which means they live there at least 51% of the year.

Village Council President Brian Housh said the measures were designed to keep people from turning houses that “could be long-term rentals or family homes” into Airbnbs, impacting both the availability and affordability of housing in town.

“This is aimed at a very specific scenario which is pulling houses off of the market,” Housh said.

Meanwhile, changes to the Village’s lodging excise tax ordinance target the existing non-operator occupied TGLs. The eight TGLs in that situation are grandfathered in, but now face steep fees, including a $500 annual certificate fee and a $1,500 annual “affordable housing mitigation fee,” which will go into a newly created Village affordable housing fund.

Some changes to the lodging excise tax ordinance also affect the other TGLs, including five hotels/bed & breakfasts and 35 Airbnbs at private residences around town. Those operators will now have to pay a $100 annual certification fee on top of the 3% Village lodging tax.

In other approved zoning code changes that affect future TGL applicants, no more than one TGL permit will be granted per property or per owner. Village Planning and Zoning Administrator Denise Swinger explained that change, which was recommended by Planning Commission.

“You’re not going to use your house and your accessory dwelling unit [for a TGL]. It will be one or the other,” she said. “That is something that is coming up more often.”

“If you have two properties, you are only going to be able to do one TGL,” she added.

Finally, Planning Commission now can consider the impact a TGL will have on affordable housing in determining whether to approve or deny a new permit. Previously, the commission could only consider whether there were other permitted TGLs nearby to avoid a concentration of them in a neighborhood, along with neighbor complaints.

Since TGLs became a conditional use in August 2019, Planning Commission has approved eight permits and denied none. Four TGL permits are slated to be heard at Planning Commission’s next meeting on May 11, but the commission must review them using the prior guidelines. If approved, however, they would be subject to the new fees.

Council comments

Council members were mostly supportive of the new TGL legislation, while raising concerns and other issues.

Curliss, the sole Council member to vote against the lodging excise tax changes, said she found the legislation “very penalizing for all TGL owners,” arguing that the new $100 annual certificate fee was not connected to estimates of Village costs to collect TGL taxes. She also opposed the affordable housing mitigation fee, saying it might create a dependence on that funding source, and against background checks, which she said can be “burdensome.”

“I don’t like this approach. I want to stop. I’m going to vote against it,” she said of the lodging tax changes.

Curliss, however, supported the zoning code changes, adding several amendments, including one requiring an off-street parking spot for every two-person TGL unit and requiring the zoning administrator to send information on non-operator occupied TGLs to the Greene County Auditor, who she said might consider the property a commercial establishment and subject to additional taxes.

Finally, Curliss opposed the new affordable housing fund, voting against its creation, saying that it moves the Village closer to creating an “affordable housing department.” The rest of Council voted for it.

In response to Curliss’ comments, Village staff defended the $100 fee as necessary to track down those who don’t pay their lodging tax on time, shared that background checks can be done within days and are only needed every three years, and said that the Village would consider affordable housing grants from the fund on a “project-by-project basis.”

Council Member Lisa Kreeger said she was in favor of limiting non-operator TGLs, and that the fees were a good way to do so.

“I do think that fees are a way to discourage the growth of these and I’m not hearing another solution put forward at this point that achieves the desire to limit this type of transient guest lodging in the village,” she said.

Council member Kevin Stokes expressed his support for the measures, but proposed offering a “break” in fees to non-operator occupied TGLs owners who live elsewhere in Yellow Springs.

“Would it be legal and not considered exclusionary to favor residents?” he asked.

In response to his question, Village Solicitor Breanne Parcels said that it might, but that either way it was a “substantive alteration” and would keep the legislation from being finalized at the meeting. The idea will be considered at a later time, Council members said.

Council Vice President Marianne MacQueen said she was “tired of talking about the measure,” and hopes Council does more to increase affordable housing in town beyond limiting TGLs.

“The issue about affordable housing is not going to be solved by this. The issue with affordable housing and moderate-rate housing is going to be solved by building more,” she said. Later, MacQueen specified that the village needs 200 or 300 more rental units.

Housh added that Council is going to continue to work on the issue of affordable housing, and how Airbnbs affect it.

“Big cities are dealing with this, small cities need to deal with this as well,” he said. “We are looking at all of the strategies needed to deal with this.”

Resident, TGL owner comments

Residents and TGL owners spoke on both sides of the issue during public hearings via Zoom.

TGL owners Keith Grzelak and Thea Tremain spoke in opposition to the measures. They run two Airbnbs at their property downtown, where they also live. Since they already have their TGL permits, Grzelak and Tremain would be grandfathered in. They would, however, be subject to new certificate fees of $100 per TGL.

Grzelak argued that their TGLs should be regulated differently since they are in the Central Business District and not a residential area. He added that if he turned his spaces into commercial uses, “he wouldn’t be penalized,” as he would if he were a new TGL applicant.

“If we were to make stores out of these or shops, they would be rentals off the market,” he said.

Tremain argued a local housing shortage has been a “long term problem” and that running an Airbnb has helped her and her family afford to live in Yellow Springs.

Eric Clark, who runs an Airbnb out of an accessory dwelling unit at his property, argued that TGLs are in a “symbiotic relationship” with the village, serving an important function for visitors who patronize local shops and visit family in town. He added that these visitors are now being blamed for “ruining the village.”

April Li, who recently received a second TGL permit for a property she owns with Mark Davenport, also spoke against the measures. The couple does not live at the property, so would be subject to the $2,000 in annual fees for each TGL.

Li introduced herself as a “first-generation immigrant” who indentifies with “what this town stands for, which is inclusion and equality.” She said the Airbnbs help them fund their mortgage, taxes and utilities and that they hope to someday live in the village. Li added that the new legislation “creates grounds for unfair competition” and she doesn’t believe that Airbnbs are leading to a housing shortage here.

“To blame Airbnb is to oversimplify the situation,” Li said.

Resident Jessica Thomas-Raska argued in favor of the measures and stricter limits, saying that, in contrast to some claims by TGL operators, Airbnbs do negatively impact affordable housing, including in the village.

“I also know people in Yellow Springs who have been evicted or their leases have not been renewed because their landlord was looking to turn their house or their home into a TGL, so I think it is dishonest to say that it doesn’t affect housing in Yellow Springs,” Thomas-Raska said.

Thomas-Raska added that properties now being used for TGLs could instead house people who want to live here permanently, including young families whose children might attend local schools.

“If we don’t have young families moving into the village, we won’t be able to fill that school,” she said of a potential new school facility.

Reilly Dixon made similar arguments, pointing to studies showing that TGLs are linked to rising rental and housing costs. He wants the Village to cap the number of TGLs at its present level, and for the Village to focus more on the needs of young people like himself and his partner, who will soon be looking for a home in which to start their families.

“We hear a lot from Airbnb owners. What about the rest of us who don’t own property, who aren’t capitalizing on the ballooning rates of tourism every weekend?” he said.

Kate Hamilton also said she thought the measures didn’t go far enough, and wants a cap on the number of TGLs. Too many TGLs, she added, could ruin the close-knit aspects of the community that bring people to town in the first place.

“Having TGLs is pretty much how you ruin a town,” Hamilton said.

Other items from Council’s May 3 agenda will be in next week’s News.

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