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HomeMy WebLinkAboutCouncil Minutes -October 10, 2016 Work Meeting.pdf 1 October 10, 2016 Mayor Jerry Merrill Council Members: Christopher Mann Jordan Busby Donna Benfield Tisha Flora Brad Wolfe Sally Smith City Staff: Stephen Zollinger – City Attorney Matt Nielson – Finance Officer John Millar – Public Works Director Val Christensen – Community Development Director Scott Johnson – Economic Development Director Blair Kay – City Clerk 4:00 P.M. City Hall Council Meeting Mayor Merrill gave the Prayer Council Member Mann led the Pledge Roll Call of Council Members: Attending: Council President Smith, Council Member Flora, Council Member Benfield, Council Member Mann, Council Member Busby, and Mayor Merrill. Council Member Wolfe asked to be excused. Steve Oakey and Rory Kunz were in attendance from the Planning and Zoning Commission. Items for Consideration: A. Short term rentals Mayor Merrill thanked everyone for coming to discuss short term rentals. He spent some time searching the Airbnb web site as requested by Marcie Peterson. He found some information on Sacramento’s struggles to allow Airbnb’s by amending two of their ordinances. He provided some handouts to the City Council for their review in deciding whether to make changes to the Development Code or leave the ordinance as it is presently written. If we decide to make some changes to the ordinance, what changes do we propose? Handouts: 1. Airbnb 35 North 1st East Rexburg, ID 83440 Phone: 208.359.3020 x2313 Fax: 208.359.3022 blairk@rexburg.org www.rexburg.org City Council “Work Meeting” Minutes October 10, 2016 2 3 2. Airbnb’s Nondiscrimination Policy: 4 5 6 3. Airbnb’s “New Study” 7 8 9 10 11 12 4. Sacramento Amending their ordinances to allow Airbnb 13 14 5. From: Marcie Smith [mailto:2marciesmith@gmail.com] Sent: Wednesday, September 7, 2016 1:40 PM To: Jerry Merrill <jerry.merrill@rexburg.org> Subject: Airbnb Comments and Questions Dear Mayor Merrill, First I want to thank you for all the work you and the city council do to keep the city a nice place to live in so many ways. I would like this letter read into the minutes of the next council meeting as public comment since I am out of town waiting for my daughter to deliver another grandchild. As I have learned about Airbnb's this last year, I have considered doing it since I have 5 empty rooms and 9 empty beds in my home when my children aren't living with me or visiting. I have been reading all the news articles and comments as I see them, to know many of the issues coming up. These are my concerns, thoughts and comments. 1. Property Values: I think the concern on reducing property values is solved by just making the owner live in the home mandatory during Airbnb reservations . Don't know how you would enforce this except by neighbor's complainants and sending an officer over to check for owner and a hefty fine. 2. Stranger Danger Concern: Well my opinion is strangers are everywhere anyway. Even some of your neighbors friends that visit. If my neighbor wants to invite questionable people to their home to stay, then that is their choice and right. I believe it puts them at the front line for something happening to them and their property. 3. Parking: Not anymore of a concern than your neighbors who have a party or family reunion and friends over all the time. You deal with it for a short time and park on your driveway. They have to be off the street in the winter nights anyway. 4. Questions to consider: Is there anyway to tell if someone is running a business out of there home; besides asking them? Checking Arbnb the only way? Nope. What is the difference between a business and a party? Is it the exchange of money? Can the city fine someone for just advertising a business (IE Arbnb, clothing sales, haircutting) online, even if a service is not performed or goods delivered? Does the city require business licenses for home businesses? Which ones and why or why not? I am thinking Mary Kay, Tupperware, Salon services, Ebay, and Clothing Sales, and Yard Sales. 5. What I have seen and would like to see happen: I have seen that many people run businesses out of their homes already. Some are online and some are selling things from their home thru a postal service or people visiting a room in their residence. I have seen these home businesses by increased traffic when kids are picked up from babysitters homes, and music or dance lessons start and end. They should have adequate off street parking for those businesses that does not include their front yard landscaping. I think this should go for the number of students too. So if 3 Eight year olds are being picked up from dance, there should be 3 off street parking spots to keep the neighborhood streets clear. This last scenario does not happen presently. People that run their business thru the postal service have an increased amount of UPS and Federal Express trucks to their homes everyday as well. I don't 15 believe Arbnb (or whatever the next competitors name is) is any different than other home businesses. I believe if the owner is present, they should be allowed to do business in their home and on their property providing adequate parking. No signs to blight the neighborhood. Prediction: Arbnb will have competition soon and it will be called other things so you cannot rely on just one website to catch all the people who do this out of their homes. There are already KSL Classifieds and Craigslist that have similar formats for finding rental properties and vacation spots to stay. And then there is word of mouth and other advertising. I also believe that Arbnb's will decrease when adequate hotels have been built in Rexburg which will drive down the prices of the expensive hotels making Arbnb's less attractive. People often prefer safety and privacy but are willing to give it up for a price. That price is the difference between the hotel costs and the Arbnb cost. Thank you for hearing my thoughts and observations. Please share this with the City Council. Marcie A Smith Rexburg Idaho Council President Smith indicated to Mayor Merrill that the whole City Council has done a lot of studying of the rental issues. She talked to residents in other areas of the City. She said that if the practice were allowed to go City wide, it would cause a lot of contention in many neighborhoods. The feeling she gets from the residents is “Please, Please, Don’t Consider this”. We are not Sacramento; we do not want to be. People really value their neighborhoods here. Mayor Merrill asked if Council President Smith did not think Sacramento residents valued their neighborhoods. She did not think Sacramento residents lived in the same type of environment that we do. We live in a different environment. She again expressed her feelings that this was not the correct move because “why would we want to do something that is not working in a lot of areas?” Our police and many people are not in favor of it. Economically, it may be a mistake because we are a small town. We would like to have another hotel or two. She expressed the need to see how the City Council felt on the issue; so, she asked to make a motion at this time. Council President Smith moved to clarify the definitions (Bed & Breakfast Rentals and Boarding House Rentals) in the Development Code and to unify the application process for MDR and HDR Zones as it relates to short term residential rentals; Council Member Benfield seconded the motion; Discussion: Council Member Mann was concerned with making local laws based on discrimination. He said the current restrictions do not allow Airbnb or any other type of short term rentals in the Low Density Residential 1 Zone. He recommended having the neighborhoods put forth recommendations for their neighborhood. Let the people who want the change present to their neighbors and then bring it forward to Planning and Zonning to make the change in their neighborhood. Community Development Director Christensen recommended an overlay to reduce the changes to the code. Council Member Flora presented a compromise to have the requestor for an Airbnb fill out a form. The form would have to be signed by a percentage of the neighbors on the street; if the neighbors approve then an anonymous survey would be sent to the residents in the neighborhood. After the survey is completed, the requestor would go to City Hall and fill out a business registration form. The business would go through the City’s registration approval process, which includes an inspection of the premises, etc. Upon completion of all of the steps required, the requestor would be allowed to have an Airbnb. She asked the City Council Members if this type of compromise would work. Council President Smith said it would require a new definition of a home occupation in the City code. 16 Community Development Director Christensen said he favors the anonymous aspect of the compromise. Council Member Mann expressed his concern with the possibility of favoritism between neighbors and what it could do to the neighborhoods. Mayor Merrill said this type of compromise would be too complicated. He said it is the City Council’s job to uphold the Constitution of United States. He read the portion of the City’s Development code that reads “protecting property rights and enhance the value of the property”. He indicated these two principals have been interpreted in many different ways; however, he believes in protecting private property rights and in enhancing the value of the property in the most basic way possible and with as much freedom as possible. Mayor Merrill referred to restrictive covenants and zoning laws in general, they protect the possibility of someone or something causing the devaluation of one’s property. He is ok with chickens or pigs if they don’t bother him; He is for freedom of using one’s property as one see fits as long as it does not bother our neighbors. He is aware of those concerned with keeping the neighborhoods as is with the current code. When looking at the risk factors, he thinks the risk factors are low. He wants to show people all over the world what we have in Rexburg. From a protection and safety point of view, hotel people may have more risk of doing harm to the City than those using room rentals in the neighborhoods. He referred to a conversation he had with a neighbor on the hill; he asked the neighbor if he would be upset if a change was made to allow short term rentals in the Low Density Residential 1 Zone. The neighbor said that he would understand if it was changed. Rory Kunz said the City is going to grow because of the growth of BYU-Idaho University. He is in favor of property rights and ownership; before purchasing his home, he looked for a home that was not in a Home Owner’s Association or under covenants to give him the freedom he was looking for. The neighborhoods that have a Home Owner’s Association are there for the intent of having the people live within the bounds of the HOA. He explained the neighborhoods that do not have a HOA and are in the same zone as the one that do. The City is restricting the neighborhoods as if they were in a HOA, by not allowing them the freedoms that they have by not living in a HOA. He believes it is a Home Owners Association’s duty to restrict nightly rentals. Rory Kunz mentioned there are many invalid reasons for why short term rentals should be and should not be allowed. He explained a long term rental is defined as renting the property for more than 30 days and it is allowed in Low Density Residential 1 Zone. Steve Oakey said any change in the code to allow short term rentals in LDR1 Zone should be simple, fair and equitable. He thought the proposed changes were not simple, fair or equitable. The current code that governs a Bed and Breakfast or Boarding House within the City limits is simple. One of the stipulations for a Bed and Breakfast or Boarding House is for the owner to live on the premises. He stated keeping the code as it stands is simply not fair for those wanting to rent their home short term. Steve Oakey said in order to understand the thought process of the people against short term rentals. He used the rezone request made by Council President Smith last week at the Planning and Zoning Meeting, as an example. He explained Council President Smith stated at that meeting, she had purchase the property on Main Street thirty years ago for the intention of selling the property as an investment. The residents during the public hearing section of that meeting expressed the same concerns with rezoning the property as with short term rentals. There were seven concerns mentioned by the residents. The two main concerns were traffic and property value. He said the Planning and Zoning Commission denied that rezone request, because of the traffic concerns. Steve Oakey said he simple doesn’t understand from the stand point of being fair to those people who want to operate their homes as they see fit and benefits them; how it’s being fair that they are denied their right, while on the other side of the coin we are somehow protecting the other people. There seem to be a contradiction to him. He asked Council President Smith what the difference between short term rentals and her rezone request. 17 Council Member Smith replied the difference in her opinion; is first, she requested a zone change because the rezone fit within the Comprehensive Plan Map. Her rezone request and the people requesting short term rentals in Low Density Residential 1 Zone is not the same. They are not requesting a zone change or a Comprehensive Plan Map change. Steve Oakey asked again about the rights of the neighbors in both cases; why are they different. Council Member Benfield explained the Indian Hill’s neighborhood changed the zone form LDR2 to LDR1 to protect the neighborhood from rentals. Steve Oakey said regardless of the reason; it is not equitable because it simple denies the ability for all property owners to do what they want to do with their property. We are treating two different bodies differently. It does not affect the neighborhoods any different than any other activity. Council Member Benfield mentioned the neighbors renting out their homes as short term rentals are asking for something that is not allowed in the first place. They are going against what is already established before they purchased their home. Steve Oakey explained this is one of the down falls of zoning and government behavior because it lags so far behind any innovative economic activities. People with innovative ideas that are risk takers, they create disruptive activities that years hence benefit everyone; however, in order for them to get those economic activities running there is always opposition. He said looking 10 to 20 years ahead there would be a different economic value for the current requests. Airbnb is allowing homeowners to enhance their property value and make extra income. They have been doing Airbnb for several years. If the owner were on-site, it would solve all of the Airbnb problems. Community Development Director Christensen asked Mr. Oakey for his opinion regarding the following example; of a group of people requesting to have only single-family homes in a particular area and establish a subdivision, where the people who purchased a lot were aware that it’s for single- family homes only, if it would be considered a property right. Mr. Oakey replied yes, he would consider that type of situation a property right. Community Development Director Christensen questioned the reason why it is ok in Mr. Oakey’s opinion for the residents to make this type of request and not ok for the government. Community Development Director Christensen explained in order for the residents to make a person comply with the rules they have to go back to the government in litigation that is the only way they can govern their own subdivisions. He said zoning is much kinder to everyone in the long run because the rules are already in place in a particular zone; violations can be resolved by following zoning verses litigation. Council President Smith reminded the group that planning and zoning is the key to these issues. Planning comes first before the zoning; one cannot exist without the other. When she purchased the property on West Main Street, she thought it was a changing neighborhood. Mayor Merrill agreed to have Planning and Zoning with less restrictions. He also agrees in protecting property rights and in enhancing property value. Anything that is not bothering these two things should be allowed. Council Member Flora said the people living in the Low Density Residential 1 Zone are the most dissatisfied with allowing short term rentals. Mayor Merrill clarified there are other zones that allow short term rentals that are experiencing problems with residents allowing a short term rental in their neighborhood. Steve Oakey indicated when reviewing the City Codes regarding Boarding Houses and Bed and Breakfast. The city does not have the tools needed to govern in a Medium Density Residential Zone. Community Development Director Christensen asked for ways to regulate these businesses when 18 the owner is not on-site. The short term rental problems have come from units that do not have an owner on-site. Mr. Oakey said a compromise would be to simple have an owner on-site Council Member Mann referred to a request to do nothing to the City Code; he did not think Airbnb was a high risk factor. Mr. Oakey said neighborhoods with covenants are voluntary. The government has the power to follow the majority. Mr. Oakey was opposed to the government having a law to impose rule over everyone. Community Development Director Christensen said rules are established to protect the neighborhoods. Covenants, Conditions & Restrictions (CC&Rs) can only be governed with litigation. He referred to meetings in his sub-division where they went to LDR1 from LDR2. He was precluded from having an apartment in the future. One option was to re-write the covenants or change the zone to LDR1; thus, keeping the issue out of the courts. Discussion: on following the law or CC&Rs in a neighborhood. Mayor Merrill referred to the 20% rule for home businesses; if they use more than 20% of the home for their business will the City shut them down. Why should we police room rentals; just change the nighttime restriction. He said there are ordinances already in place that would take care of any nuisance. Discussion on simplifying the home occupation definition. A single-family definition is noted in LDR1, LDR2, MDR1, etc. Community Development Director Christensen said we would have to change the definition of a single-family. In the single-family, the definition states for non-profit. Steve Oakey said there are always exceptions and when exceptions are thought of, more rules are created; for example, if you have a dance hall in your basement, that is breaking the law. What if his daughter brought someone to stay with them that is not part of the family? He is concerned that by adding more and more rules, they will get out of hand. He is in favor of keeping the laws simple. Council Member Benfield said the Indian Hills neighborhood has been a test case of having short term rentals in Low Density Residential 1 Zone; are we prepared to have the problems that they have experienced throughout the city. Mayor Merrill asked if the Indian Hills neighborhood has been a test case, what problems did the neighborhood experienced. There were several problems mentioned including playing music loud at night, people on the roof, etc. Council Member Benfield said there was a case where the house was rented out to six people; however, 35 people showed up and caused problems. Steve Oakey asked if the short term rentals required the site to be owner occupied, if that would be a compromise. Council Member Mann questioned what is considered owner occupied for example; if he purchases a home and his son or another renter lives in the home and they starting renting it out as a short term rental, is it still considered owner occupied. He said no matter how simple the law is there will still be regulations and who is going to monitor these regulations, will the City need to hire additional personal. He gave a scenario of a neighbor who is upset about his neighbor’s short term rental so he calls the police and the short term rental is shut down. The owner of the short term rental gets upset because he believes the claims against his rental are arbitrary and decides to sue the City. Short and simple laws cannot always be short and simple because of nuances. Community Development Director Christensen said the building code in a change of occupancy requires a building permit. Changing a house into a short-term rental requires a building permit. Council Member Busby questioned if the Indian Hills Sub-division implemented CC&Rs, when the sub-division was established. He questioned how binding the CC&Rs are in the neighborhoods that have them. City Attorney replied they are as binding as the HOA wants them to be. 19 Council Member Busby said there has been discussion amongst the Indian Hills Sub-division residents that they have not met or paid dues to the HOA. City Attorney Zollinger said HOA’s are not required to collect dues; however, they are required to hold annual meetings. In the State of Idaho HOA’s are required to be registered. Discussion regarding the neighborhoods that have HOA’s and CC&Rs. City Attorney Zollinger said CC&Rs are recorded in the property’s deed. CC&Rs are always forcible; however, they do not always prevail in litigation. CC&Rs can get past the first stage of a lawsuit because they are recorded against the properties deed. Council Member Busby said there are many residents expressing their concerns with allowing short term rentals in the Low Density Residential 1 Zone. One of their concerns is that the City might not be prepared to handle the issues, which will arise by allowing short term rentals. Mayor Merrill referred to the city of Sacramento and the changes they are making to their ordinance. Discussion regarding the experience in staying in an Airbnb. Council Member Flora indicated she would like to protect the property rights of the people who want to rent their home out as a short term rental. She believes a compromise should be reached by both views. Council President Smith clarified law enforcement is not in favor of short term rentals in Low Density Residential 1 Zones. There are people that are hiding from law enforcement using Airbnb because the Airbnbs do not have the same security measures as hotels and motels. Rory Kunz suggested short term rentals be added to the same zones that a boarding house, bed and breakfasts, are allowed and leave them out of Low Density Residential 1 Zones. The boarding houses, bed and breakfasts are allowed in Medium Density Residential Zone and above. Council Member Mann explained he agrees with Mr. Kunz; however, that is not the issue. The issue is whether to allow short term rentals in the Low Density Residential 1 Zones. Mayor Merrill said the requests are coming from the citizens. They are asking the City to come up with a compromise between those in favor and those opposed to allowing short term rentals in the LDR1 Zone. Mayor Merrill mentioned there is a motion on the table to clarify the definitions of (Bed & Breakfast Rentals and Boarding House Rentals) in the Development Code and to unify the application process for MDR and HDR Zones as it relates to short term residential rentals City Attorney Zollinger explained clarifications to the definition of “Short Term Rentals” and a standardization of the owner on-site requirement in the Medium Density Residential and High Density Residential need to be made to the code. He used Mr. Hebdon’s request for a Conditional Use Permit to allow a “Boarding House” (i.e. nightly rentals; short-term rentals) in a Medium Density Residential 1 Zone as an example of why the definitions need to be clarified. City Attorney Zollinger mentioned the definitions of a boarding house, bed and breakfast need to be consolidated into “Short Term Rentals”. The City of Sacramento went through the process of consolidating all of their definitions into short term rentals instead of trying to differentiate between the different forms of short term rentals. City Attorney Zollinger clarified any action taken tonight by City Council would be in a form of a directive because in order to amend the current code requires Planning and Zoning to hold a public hearing and make a recommendation to City Council. The recommendation from Planning and Zoning would include substantive changes to clarify the language as to what constitutes a short term rental and owner occupied. 20 Council Member Flora questioned the result of voting yes or no on the motion before them. Mayor Merrill indicated by voting yes City Council is giving Planning and Zoning the directive of clarifying the definitions of boarding houses, short term rentals, bed and breakfasts in the Development Code. He said if they vote no than Planning and Zoning would not make any changes to the definitions. City Attorney Zollinger clarified there are two pending request in which both are in the Medium Density Residential 1 Zone; neither one of whom want to comply with the boarding houses definition. The City is at a standstill for those wanting short term rentals in the MDR 1 Zone and the only ones that are going forward are those in the High Density Residential Zone. Mayor Merrill asked if a proposal should be developed for short term rentals for requestors. Home Occupations could be in any zone with a home occupation. Council Member Mann said the neighborhoods have a right to request changes to their zone and submit their request to the Planning and Zoning Commission. Mayor Merrill suggested putting some suggestion forward from people who have requested short term rentals in their neighborhoods to Planning and Zoning for the Low Density Residential 1 Zones. Council Member Busby asked how many city residents a still advertising on the Airbnb web site. City Attorney Zollinger said to his knowledge the residents that received the letter informing them short term rentals are not allowed in the LDR1 Zone have stopped advertising. Discussion regarding enforcement of short term rentals. Mayor Merrill mentioned several home occupations that are more disruptive than short term rentals. City Attorney Zollinger indicated there is a distinguishing characteristic between the home occupations mentioned and Airbnb’s; one depends on local cliental the other is for a transient customer. The reason why Airbnb’s have come under fire in all of the United States is due to the transient nature of the customer. City Attonery Zollinger reiterated the montion before City Council. Council President Smith moved to clarify the definitions (Bed & Breakfast Rentals and Boarding House Rentals) in the Development Code and to unify the application process for MDR and HDR Zones as it relates to short term residential rentals; Council Member Benfield seconded the motion; Mayor Merrill asked for a vote: Those voting aye Those voting nay Council President Smith None Council Member Flora Council Member Benfield Council Member Mann The motion carried Written Input: 1. Kristine Bennion 21 2. Sharon and Jim DeMordaunt (3rd Letter) 22 3. Craig and Virginia Porter Adjourned at 5:40 P.M. APPROVED: ____________________________ Jerry Merrill, Mayor Attest: _______________________________ Blair D. Kay, City Clerk