2021 | Government

Rockville considering whether to allow short-term residential rentals

Some residents decry possibility of ‘hotels’

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Rockville is considering whether to allow short-term residential rentals, such as Airbnb, and how they could be regulated.

Some residents who are opposed say they don’t want residential buildings turned into “hotels.”

During a public hearing on Monday, a handful of residents said most condominium associations and common ownership communities already have rules that prohibit short-term rentals.

Short-term rentals can bring problems such as parking availability, security, noise, parties and insurance, the residents said.

There are no current or proposed laws in Rockville addressing short-term residential rentals — a period of usually less than 30 consecutive days.

According to a staff report, the city allows owners to rent, without a license, to up to two people unrelated to the owner. But because no license is required, city officials don’t know the length of stay or other terms in place.

Rentals of entire homes on a short-term basis, when the owner is not there, is prohibited.

“Short-term residential rental units are likely operating legally, but outside of the city’s regulatory structure (when the homes are owner-occupied), or out of compliance with city requirements (when the entire home is rented for a period of less than one year),” the staff report said.

Montgomery County has regulated short-term rentals since October 2017. Gaithersburg has been regulating them since October 2019.

As of early November, there were 118 homes offered as short-term residential rentals in Rockville on multiple platforms, for a total of 163 listings.

According to the staff report, the number is likely larger since the private firm that provided the data could not get data on how many rentals might already be occupied or reserved.

Staff members identified the pros and cons of allowing short-term residential rentals in the city.

Benefits include potential visitors to the city, an additional type of lodging, supplemental income for homeowners, and an increase of lodging taxes, permits and business licenses paid to the city.

The cons list is larger and includes:
● Potential decrease in the availability of long-term residential rental housing
● Additional noise and trash pollution
● Additional on-street parking that reduces availability for existing residents
● Safety and security risks
● The potential for illegal activities at a site
● Potential decrease in quality of life and changes to the character of the surrounding neighborhood
● Disruption, through increased competition, of the traditional lodging industry
● Increased city expenses because of a potential need for additional code enforcement, inspection and administrative services
● Elimination of affordable homes that could otherwise have been renovated or improved to remain permanent single-family residential units

John Becker, a resident and board member of Americana Centre Condominiums in Rockville, told the council that it would be a “complete nightmare” for a condominium building to try to manage short-term rentals.

“It would turn us into a hotel and even then, we’d have to hire a lot of staff and support functions and expenses to try to do something like that,” he said. “It would just be overly burdensome. For that purpose only, as a resident and homeowner, I would prefer not to have this allowed in a place like Americana Centre.”

Janet Wilson, president of Americana Centre’s board of directors, said short-term rentals are not an option for condominium owners because of its bylaws.

The cost of adding the option would increase the association’s insurance premiums, which would only benefit owners who participate in short-term rentals even though all owners would pay into the added cost, and create an “undue liability” for the association, Wilson said.

About 32% of the association’s condominiums are currently used as long-term rentals, but if all of the owners turned their condos into short-term rentals, it would turn the condominiums into a “de facto hotel,” Wilson said.

“This is definitely not a scenario that long-term owners and owners who plan to retire and age in place signed up for,” she said, adding that security would also be an issue with keys constantly changing hands.

Alexandra Dace Denito, president of the Lincoln Park Civic Association, said people are divided on the issue. Some might need the temporary lodging for themselves during renovations or for extended family. Others might have to deal with parking problems or parties next door.

“With the COVID-19 pandemic, where people have lost their jobs from no fault of their own, it would be useful to have affordable lodging options and an alternative source of revenue for struggling families,” she said.

Dace Denito suggested that the city inspect short-term rentals before allowing them to operate and provide a public list of the rental units.

Council members assured the speakers that they did not want an ordinance that took precedence over any HOA or other associations’ rules.

“We are potentially making an ordinance for a portion of the city,” Mayor Bridget Donnell Newton said. “For those of you who don’t live in an HOA or neighborhood that has covenants, we are reliant upon the city’s zoning and enforcement.”

Council Member Monique Ashton said a licensure process ensures that there’s safety.

“The rental license process helps to ensure that there are at least 13 specific safety-related issues,” she said. “Right now, as a city, we have potentially — we don’t know what the situation is.”

She asked staff members to look into an interim solution to regulate rentals.

“I have concerns that there are so many operating right now without licenses,” she said, adding that the Landlord-Tenant Affairs Commission should provide feedback, as well.

A clause could require owners to live in the property for a certain period each year, Ashton said.

The council expects to discuss short-term residential rentals during a work session in late February.

Council Member David Myles said he lives in a community with an HOA. He has lived in other places where people were priced out of their apartments because neighbors would use units for Airbnb rental and rates would increase.

The city would need to regulate the rentals and consider the liability issues, he said.

“I don’t see this as a revenue-generating vehicle for the city. I think there will probably be some nominal fees,” Myles said. “But if there is revenue to be generated, I would certainly support it going to a fund that would offset — improve support for housing affordability throughout the city.”

Briana Adhikusuma can be reached at briana.adhikusuma@bethesdamagazine.com.