States Looking to Prevent Municipalities from Regulating Short-Term Rentals

In response to efforts by municipalities to regulate Short-Term Rentals (STRs), states are increasingly looking at preemptive legislation to prevent the creation of a patchwork of local rules and requirements.

STRs, also known as vacation rentals, are rentals generally lasting less than 30 days, often as part of the sharing economy and dominated by firms such as Airbnb that provide a mediating website for individuals to post and search for rental offers outside of existing hotel infrastructure.

Short-Term Rentals Legislation Varies Across States

Some states, such as Florida, have existing laws in place to prevent municipalities from restricting STRs, while others, such as Mississippi, Hawaii Tennessee, and Oregon, allow cities and local regulations to set the standard.

In states as diverse as Missouri, Arizona, Virginia, and Utah, efforts are under way, supported by Airbnb and Expedia, to restrict the ability of local governments to regulate STRs. Additionally, Idaho is considering a measure to prevent home owner associations from enacting any STR regulations or restrictions, and there is movement in Oklahoma and Texas to pass similar laws, and in Wisconsin to limit regulation of STRs that last longer than a week. In total, legislation affecting STRs is pending or planned in fourteen states, has failed in Maine and Oregon, and has passed in seven states.

A key issue in state policy arguments over the correct regulatory approach center centers on whether some owners of STR properties continue to live in the locations that they are offering for rent and whether or not such arrangements are run as businesses that are structured to evade existing hotel regulations. Additionally, due to the relatively new status of the sharing economy and STRs in particular, most existing laws and regulations have not been updated to take STRs into account, nor where they crafted with STRs in mind.

APA Supports Local Regulatory Standards

APA has long supported the ability of municipalities to set their own regulatory standards for community issues that directly impact them. At the same time, many planners have raised concerns about a conflicting or confusing patchwork of local regulations that could have overly negative impacts on the sharing economy. APA will continue to work to encourage cooperation between relevant stakeholders to try and accommodate the needs of the existing sharing economy and balance the needs of STRs with the concerns of local government. Work is underway in collaboration with the National League of Cities on identifying best practices related to local regulation of the sharing economy and evaluating state legislation related to STRs.

Top image: Photo by Flickr user Christopher (CC BY-NC 2.0).

About the Author
Jeff Bates is APA's State Government Affairs Coordinator.


March 22, 2016

By Jeffrey Bates