Towns grapple with short-term rental market
NEWFANE — Depending on what town you live in, if you're thinking about renting a room in your place through Airbnb, you might need a permit.
In Newfane, Zoning Administrator Merle Tessier has been tasked with identifying folks renting rooms and asking that they come before the Development Review Board to receive a permit.
"In the first round, I found 17, but I know there's more. Probably 50 or 60," Tessier said.
This issue first came to his attention when a town resident asked him if she needed a permit to rent a room.
"According to the rules, I said, 'Yes, you do,'" he told the Reformer. "She went through the whole process, took about a month or two, and then asked how all the other people in town are doing it."
Tessier logged on to Airbnb's website and identified the first batch of people to notify them that they were not complying with the town's zoning ordinance. Some of them showed up and some didn't, he said.
Tessier said he doesn't want people to think the town is trying to prevent them from making some extra money by renting a room now and then, but they do have to apply for a permit and attend a Development Review Board meeting to answer questions. He also noted that people offering short-term rentals need to abide by certain safety regulations, such as having smoke and carbon monoxide detectors and the rooms have to have easy access and egress.
If the rental period is shorter than 30 days, there is the 9 percent rooms and meals tax that needs to be collected and, in some towns, such as Wilmington, the 1 percent local option tax.
Douglas Farnham, the economist and director of policy, outreach and legislative affairs for the Department of Taxes, said Airbnb is responsible for collecting the taxes and forwarding them to the state.
"It's a nice thing for people who operate through Airbnb that they don't have to collect the rooms and meals tax," Farnham said. "However, they do have to claim any income they receive from renting a room."
Farnham said short-term rentals through Airbnb have provided significant tax revenue to the state.
"The short-term rental market provides a large chunk of those tax receipts, more than 10 percent," he said. "There has been some increased economic activity due to Airbnb."
Farnham said the state currently doesn't have any sort of registry for short-term rentals, but it is reviewing its options and whether it should regulate them.
"The commissioner of tourism is commissioning a study to analyze the short-term rental industry, how many properties are in each town and the impact on tourism and our existing lodging industry," he said.
And while Airbnb does collect taxes on short-term rentals, he said, there are other online platforms that don't do so. Farnham said the Legislature is working on how to address that shortfall. Vermonters who are not utilizing Airbnb to collect the rooms and meals tax should realize they can be held liable to do so themselves, he said.
According to Vermont state law, lodging accommodations are subject to the rooms and meals tax if those rentals total 15 or more days in any one calendar year. However, "If you rent your room or other type of lodging to the same person for 30 or more consecutive days, the person is then considered to be a permanent resident, and different rules apply."
The short-term rental law covers a house or a room in a house, a cabin, cottage, condominium or ski lodge, and a barn, bunkhouse, tree house, camper or tent.
"If your rental falls within the provisions of the law, then you must charge your guests the 9 percent Vermont meals and rooms tax," according to the Department of Taxes website. "In addition, if you are providing meals to your guests and billing them separately, those meals are also subject to tax."
This includes the 1 percent option tax, according to the website. And if you're making a little change on the side by selling soap or maple syrup or cheese, you also need to collect the state's 6 percent sales tax, the website states.
In Stratton, which has a number of properties available for short-term rental, there is no zoning regulation covering them, said Town Clerk Kent Young.
"It's kind of a gray area," he said.
And while it's come up for discussion around town, he said there is no serious effort underway to amend the zoning regulations to deal with short-term rentals.
The same can be said for Wilmington, said Zoning Administrator Craig Ohlson.
"As far as I know, they are all going under the radar," he said, though he has heard from the owners of more traditional lodging accommodations that Airbnb and other platforms are hurting their businesses.
"The town of Dummerston regulates short-term rentals as conditional uses," Dummerston Zoning Administrator Roger Jasaitis said. "This means that property owners need zoning permits to conduct this type of commercial activity."
All conditional use permits are reviewed by the Development Review Board, he said, a process that allows for more input from the neighborhood and gives the town more control in certain situations, such as parking.
Like Tessier, Jasaitis surveys the online booking platforms to see who in Dummerston is renting a room or two but hasn't applied for and received a permit.
"Most of the time, property owners do not know about the zoning requirements and, after finding out, are willing to come into compliance," he said.
Tessier said that while it's not the zoning administrator's responsibility to make sure property owners maintain the appropriate liability insurance for their rentals, it's in their best interest to make sure they do have coverage. He also said no one in town government is trying to put anyone out of business. He said town officials just want to make sure property owners are operating in a safe manner, are doing their best to take care of their own interests and are paying their taxes.
"We're trying to make it as easy as possible for these people," he said. "I can't tell you how to run your own business, but ..."
Sue Fillion, Brattleboro Planning Director, said the town does not regulate short-term rentals. A couple of years ago, town officials discussed taxation of short-term rentals, she said, but since then, there has been no further discussion on the subject.
Bob Audette can be contacted at 802-254-2311, ext. 151, or firstname.lastname@example.org.
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