Commission reins in proposal to legalize Airbnb-style rentals

Posted on: January 26 2016 | Posted in: Latest News

By Robert McClendon, NOLA.com | The Times-Picayune

New Orleans should embrace small-time Airbnb-style rentals, but the legalization of outright vacation rentals is a bridge too far, the City Planning Commission said Tuesday (Jan. 26), voting to downsize a legalization regime proposed by the commission's staff.

The vote is not binding on the City Council, which has ultimate authority on the matter, but the commission's decision will nonetheless come as a blow to property owners who had hoped to cash in on the tourism rush without fear of reprisal.

Short-term rentals are currently banned in most New Orleans neighborhoods, but that hasn't stopped thousands of owners from listing them.

The Planning Commission's staff had originally drafted recommendations that would have legalized all kinds of short-term rentals, including what it called "principal residential" rentals, investor properties in residential neighborhoods that are rented to tourists full time.

Principal-residential properties can cause headaches for neighbors and exacerbate affordable housing shortages by taking units off the rental market, the staff had said, so they should be subject to tighter scrutiny and restrictions on how many can operate in certain neighborhoods. Nevertheless, the city should put in place a framework to legalize and regulate them, the staff had recommended.

Led by Commissioner Kelly Brown, the commissioners voted overwhelmingly in favor of scrapping that recommendation. The staff billed its recommendations as coming from a study of "best practices," but Brown said she wasn't convinced.

"There's no such thing as best practices," she said, noting that other cities that have legalized short-term rentals have struggled to achieve compliance.

In Portland, Oregon, compliance remains in the single digits.

The commission approved the remainder of the staff report and recommendations without major changes.

Those recommendations would allow:

  • Unlimited owner-occupied rentals in residential neighborhoods. This would include owners of doubles that would rent out the half they don't live in. 
  • Unlimited, full-time vacation rentals in commercial districts.
  • Temporary rentals for special events like Jazz Fest and Mardi Gras. Owners would be capped at four rental periods per year for a maximum of 30 days.

All short-term rental operators would be required to obtain a license.Tenants could operate rentals with the landlord's approval.

The decision was a win for many of the resident groups who spoke at Tuesday's meeting and others. Calvin Lopez told the commission not to recommend legalization because the city wouldn't do anything to enforce the rules.

"The city has not shown, by past experience, that they care to enforce anything," he said.

Proponents of legalization, though, said the recommendations were too strict on the so-called "principal residential" owners.

Jim Uschold, a lawyer for the Alliance for Neighborhood Prosperity, said that they should be presumed to be legal in most cases. If density restrictions become an issue, only then should they need special permission, he said.

The commission's vote is merely the first step in a long legislative process. The final step of which — approval by the City Council — likely won't come for more than a month.