Committee moves short-term rental discussion on to Council

Proposed regulations for short-term rentals will be on City Council’s agenda Thursday after a Council committee hearing displayed consensus from members and staff that the city needs to more strictly regulate the short-term rental market.

The committee did not vote to recommend all of the proposals floated at the meeting, but it decided unanimously that Council should address the items, including those that the committee did not discuss on Tuesday.

Those who sit on the Planning and Neighborhoods Committee repeatedly said they wanted new regulations aimed at cracking down on property owners who neighbors have complained are facilitating bad behavior by renting homes to large groups of rowdy partiers. Scores of passionate residents filled the Council chambers, energetically applauding the frequent statements in support of regulation and occasionally jeering at the few statements that expressed skepticism toward proposed regulations.

The Austin Rental Alliance denounced the committee’s decision to forward many of the proposed policies to Council without hearing public testimony.

“This is not representative of transparency or good public policy,” said Alliance board member Bob Easter in a statement released after the committee meeting. “These are complicated policy recommendations, and the Council is acting without hearing from the affected people.” The group has argued that the proposed regulations are a heavy-handed response to a small group of bad actors among the city’s more than 1,000 short-term rental owners.

On a number of issues relating to short-term rentals, it appears there is a variety of opinions among Council members. Much of the discussion at Tuesday’s committee hearing focused on how to enable the city’s code compliance department to enforce occupancy limits. That topic provoked confusion on a number of fronts.

One part of a resolution from Council Member Sheri Gallo proposed defining the occupancy limit for short-term rentals as the lesser of the following: six or four unrelated adults (based on the area of the city) or two adults per bedroom. Mayor Pro Tem Kathie Tovo was surprised that the word “unrelated” was part of the proposed definition.

“A lot of the discussion has been around the fact that ‘unrelated’ makes it difficult for you to enforce the occupancy limit,” Tovo said to Code Compliance Director Carl Smart. “And that removing the term ‘unrelated’ and just looking at the number of adults would allow you to enforce the occupancy limits.”

Smart said that staff had indeed recommended removing the term “unrelated” because it is hard for the city to prove that people in a group are unrelated. However, he suggested that proving such things would not be as big of a concern because of another proposed change offered by Gallo, which would shift occupancy-limit violations from municipal court to an administrative hearing process. Whereas municipal courts require the city to prove beyond a reasonable doubt that a person violated the rules, the administrative hearing process shifts the burden of proof to those who have been slapped with code violations.

Hence, explained city attorney Patricia Link, if there are seven adults identified on a short-term rental property, it will be presumed that they are unrelated. It will be up to the owner to prove otherwise.

Gallo also responded that some consideration should be given to families vacationing with adult children.

“If we were to travel somewhere with our adult children, and we had seven of us together, and we were to rent a short-term rental … we could not do that with our family,” she said. “It’s not the families traveling with adult children that are causing problems. It’s the adults that are not related – it’s the parties and the frat houses and the bachelor parties.”

Tovo remained unconvinced, saying she wanted the term “unrelated” removed from the text and wanted city officials to be able to enforce rules through both the municipal court and the administrative hearing process.

The committee deadlocked, 2-2, on whether to support Tovo’s proposal to remove the term “unrelated” from the resolution, with Council Member Pio Renteria siding with Tovo and Chair Greg Casar siding with Gallo.

Other proposals that were scrutinized by Council members included a provision that required all short-term rental properties to submit to an inspection of the property and septic system.

Council Member Ellen Troxclair, who is not a member of the committee, had come to address that provision specifically, suggesting that the septic inspection was unnecessary. Other regulations proposed in the resolution, she argued, including limiting occupancy to two people per bedroom, would prevent units from housing more people than their septic systems could support.

“I understand that septic systems are designed for a certain number of people, but it seems like when you’re putting a new system in, it’s based on either the square footage or the number of bedrooms,” she said. “If this system works as it is intended to work, you won’t see the problems you’re seeing right now,” she said.

Reyna Holmes, an engineer with the Austin Water utility, said her agency was not suggesting the city require an inspection of every septic system, but rather an evaluation.

Gallo thus suggested replacing the word “inspection” with “evaluation.” Her motion passed unanimously, although members did not appear to understand fully what an “evaluation” would entail. However, Casar said that Council members could more comprehensively examine that matter in future discussions.

Another provision of Gallo’s resolution called for short-term rental owners to acquire liability insurance. Casar said he was not convinced that owners of “Type 1” short-term rentals – those that are owner-occupied – should be burdened with such a requirement. Doing so, he argued, might dissuade such owners, many of whom he said are just trying to make a few bucks during a weekend when they’re out of town, from submitting to regulation at all.

However, suggesting that he could learn more about the issue, Casar abstained from the vote to recommend the insurance provision. Renteria and Gallo voted in favor. Tovo, who had left the meeting, was absent.

Before Tovo left, the four-member committee also voted that a number of proposed changes offered by Tovo be put on Council’s Thursday agenda for discussion, even though the panel did not discuss or vote on her proposals.

Photo by Ed Schipul made available through a Creative Commons 3.0 license.