The Austin Chronicle

Late-Night STR Debate

Lengthy committee hearing deliberates Type 2 STRs

By Natalia Ciolko, August 21, 2015, News

The City Council's Planning and Neigh­bor­hoods Committee takes two steps forward and one step back on regulating the city's short-term rentals (STRs), as fundamental disputes about how to achieve the city's affordable housing goals remain unresolved. Chairman Greg Casar, Vice Chair Pio Renteria, Mayor Pro Tem Kathie Tovo, and Council Member Sheri Gallo stayed on the dais past 2:30am Monday night to hammer out a resolution on STRs to bring before the full Council today (Thursday, Aug. 20).

This resolution includes the removal of a provision to advertise an STR before obtaining a license, an official occupancy maximum of six adults per unit, and increased penalties for operating illegally. Meanwhile, more controversial pieces of the proposal, including a requirement for inspection, commercial property insurance requirements, and a 1,000-foot minimum between licensed Type 2 rentals, were tabled for further research and discussion in September.

Conversation began at 4pm with deliberation on relaxing the rules governing the construction and use of accessory dwelling units (ADUs). Residents wearing T-shirts reading "I Love Granny Flats" testified that building these units in the urban core would help relieve the housing shortage in the central city and alleviate affordability woes.

Not everyone agrees unreservedly. "I don't want to relax rules on accessory dwelling units just to find that they're all being turned into STRs," said Tovo to the applause of reformers in the chamber's front rows.

Four hours into the meeting agenda, STRs were finally up to the plate. Carl Smart of Austin Code presented his findings from the recent pilot enhanced-enforcement program, which resulted in 146 violations found and cost $5,831. Smart estimated that supporting this pilot into the future would cost an estimated $69,970 annually.

Before describing the department's ordinance update recommendations, Smart spoke to the various barriers blocking effective enforcement of the existing law, which included the inability to inspect offending units and the high burden of proof to legally proceed in shutting down noncompliant owners. Smart also spoke to one of the prevailing themes of the night: over-­occu­pancy and how to manage it without the ability to inspect STR units. Referring to the Code Department's recommendation of a maximum of six adults per unit: "Yes, many of the houses can accommodate more," he said. "But should they?"

Next came citizen testimony. With 200 people signed up to speak, Chairman Casar initially suggested that only 60 speakers, at just two minutes apiece, should testify, to help wrap up the meeting before midnight. CM Gallo demurred, saying everyone who wanted to speak should get their full three minutes.

The air conditioning was turned off around 11pm, and citizen stakeholders fanned themselves with protest signs as the committee worked its way through a list of those signed up to speak. Drawing huge cheers and occasional outrage, both reformers and supporters claimed affordability for their side as they took their turns on the microphone, occasionally finding common ground. That included wide support of Type 1 STRs to relieve the financial strain of increasing property taxes, as well as admonishment of "bad actors" ad nauseam.

The arguments were heated and at times emotional. John Williams, a longtime Austinite who says he can no longer afford to live in the house he built himself without income from short-term renting, held up a handful of guestbooks filled with grateful messages from his rental guests. "This whole adversarial relationship is completely wrong. I wish y'all would stop holding up those signs," he said. "Why don't we all just get together? We're all citizens."

Repeatedly, the refrain from STR supporters was that the current ordinance just needs to be enforced. But those wary of Type 2 STRs say that just isn't possible with the current loopholes and weaknesses. "This ordinance does need to be strengthened," said David King, vice president of the Austin Neighborhoods Council. "The definition of insanity is to not change anything and expect to get different results."

The impassioned testimony went on until after midnight. After the last constituent had spoken, the committee began deliberation on the resolution to present to the full Council on Thursday. It approved several recommendations from Gallo's June 18 proposal, tabled others for more discussion next month, and incorporated several recommendations from the Code Department, notably the removal of the "testing the waters" provision.

At 2:30am, once the recommendations were approved, Tovo began to offer her four major amendments to the resolution, including an immediate freeze on any new Type 2 licenses until the current ordinance is enforceable, and a move toward shutting Type 2 STRs out of all noncommercial zones and neighborhoods with exceptions for a conditional-use permit process.

The deliberations broke down as half of the committee cited exhaustion and an early morning work session the following day. Council Member Gallo asked for all discussion of these new items to be tabled until the September committee meeting. The new resolution, as updated by meeting's end, will be presented before the full Council for approval on Thursday, while the bigger questions of inspection and more will be saved for the next round of negotiations in September.

City Council will consider revising the STR regulations as agenda Item 2 at today's (Aug. 20) Council meeting. The next meeting of the Planning and Neighborhoods Committee is Monday, Sept. 21.

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