LOUISVILLE, Ky. (WDRB) — Some Louisville Metro Council members are eyeing a temporary pause on new registrations for short-term rentals as the city considers a permanent overhaul of its rules around homes rented by the night on platforms like Airbnb and VRBO.
The proposed moratorium started last month as a measure that would affect only certain near-downtown neighborhoods: Phoenix Hill, Butchertown and Clifton Heights. But it will likely expand to entire council districts depending on the preferences of each council member, said council member Jecorey Arthur, a Democrat who represents District 4.
Arthur, who first proposed the moratorium, said neighborhoods like Phoenix Hill have become “overrun” with homes rented on Airbnb while Louisville experiences a “housing crisis.”
“It's absolutely not working for my constituents, so I'm trying to do something about it,” Arthur told WDRB News. “And in the meantime, (let’s) put a pause on bringing in any new ones until we figure out what the hell to do about the fact that we can't keep up with the ones we already have.”
Metro Council member Ben Reno-Weber, a Democrat, said a moratorium would be appropriate at least for portions of his Highlands-area district, if not for the whole district.
He said a pause on new registrations would allow a debate on permanent changes to short-term rental rules over the next few months.
“What I am afraid of is that if we continue to allow registrations to come in while we are trying to sort that out and get citizen input, we’re going to get a whole backlog of people that might be grandfathered into a system that’s not working for our neighborhoods,” Reno-Weber said.
Metro Council member Jennifer Chappell expressed interest in adding neighborhoods in her district, such as Germantown and Schnitzelburg, to the proposed moratorium.
A little more than 1,000 residences in Jefferson County are registered as short-term rentals, with about two-thirds of the registrations indicating that the house or apartment unit isn’t occupied by the host of the listing — the person who owns or rents the unit.
The moratorium wouldn’t affect properties that are already registered; it would only suspend approval of new registrations.
The council’s Planning & Zoning Committee tabled Arthur’s ordinance amid technical questions at its meeting last week, meaning the soonest a moratorium could reach the Metro Council for approval is June.
Metro Council member Madonna Flood, who chairs the Planning & Zoning Committee, said the moratorium will be considered again at the committee’s meeting May 23.
The proposal has gotten the attention of San Francisco-based Airbnb, which built a webpage allowing Louisville residents to email their Metro Council member with form language calling the moratorium “unwanted and unnecessary.”
“Please protect our property rights and ability to share our homes in order to supplement our income and boost the economic activity in our community,” the Airbnb message template says.
In a statement, Airbnb said "the vast majority of hosts share just one home on a part time basis to help afford to stay in their homes" and cautioned against overreach.
"Airbnb and our Host community want to continue working together with the city on fair rules, and urge councilmembers to refrain from extensive restrictions that would negatively impact Louisville residents and small businesses who depend on citizen-led tourism and home sharing for their livelihood,” the company said.
Louisville first adopted rules around short-term rentals in 2015. In 2019, the Metro Council overhauled the rules, introducing a distinction between homes that are occupied by the person who hosts the short-term rental and those that — like hotel rooms — are not someone’s fulltime home.
In general, hosts who live in the house or apartment are not required to get a special permit to operate a short-term rental; they simple file a registration, pay the $100 annual fee and pay hotel taxes on the income.
The 2019 overhaul also introduced a “600-foot rule” that aims to keep non-occupied rentals from being clustered on the same street, but critics say the rule is often overlooked or disregarded by exception.
“It just seems like there is all these loopholes they have figured out. We think that it’s getting abused,” Lisa Santos, the head of the Irish Hill Neighborhood Association.
Santos said the proliferation of non-occupied short-term rentals is driving up housing prices and putting urban neighborhoods with small, shotgun homes out of reach for starter homeowners.
“Nobody can afford to live there now when people come in with cash offers on these houses,” she said.
But Dawn Moretz, an Airbnb “super host” who lives in Okolona, said the extra income she makes renting her 1,800-square-foot house usually covers her mortgage, helping her to afford her home.
Moretz said she sometimes rents just a portion of the home while staying with the guest, and sometimes the entire home, but she has never caused a problem for her neighbors.
“I get stable quiet, regular kinds of people who are coming in for work or taking classes or visiting family,” Moretz said.
While a moratorium wouldn’t affect Moretz, she worries about a “slippery slope” to regulations that might restrict her extra income.
Permanent changes coming
Louisville Metro’s professional planning staff, part of Mayor Greenberg’s administration, is working on proposed changes to the city’s short-term rental rules.
Caitlin Bowling, spokeswoman for the planning staff, said the proposal will be unveiled later this week. The Planning Commission, a mayoral-appointed body, will consider the changes in the coming months and make a recommendation to the Metro Council, she said.
Planning & Design Manager Joe Haberman described some of the proposed changes at the Planning & Zoning Committee meeting on May 2:
-Requiring a Kentucky identification card as part of proving residency to host a short-term rental
-Requiring the more complicated permitting process for anyone who wants to host a short-term rental at a home they do not own. This would mean that renters who want to host a short-term rental would have to get a permit, regardless of whether they live in the home. Only homeowners would be able to register without getting a permit.
-Limiting the discretion of the Board of Zoning Adjustment to grant exceptions to the “600-foot rule.” In areas where the entirety of the 600-foot buffer is zoned residential, there would be no exceptions.
-Reducing the maximum number of guests allowed at short-term rental, which is determined by the number of bedrooms
-Raising the annual registration fee from its current $100 to an unspecified amount
