City leaders looking to crack down on who can operate short-term rentals in Louisville

LOUISVILLE, Ky. (WDRB) -- City leaders are looking to crack down on who can operate short-term rentals in Louisville.

Metro Council is considering a permanent overhaul of the city's rules surrounding homes and apartments rented nightly on Airbnb, VRBO and other platforms.

The proposed changes, which passed the council's Planning & Zoning Committee on Tuesday, Aug. 29, could be approved by the full council at its Sept. 14 meeting.

Residents of some of the city's neighborhoods worry about the impact investors leave by buying up homes and turning them into short-term rentals. Those areas include Irish Hill, Phoenix Hill, Butchertown and the Highlands.

However, others are concerned it'll drive away tourists who are looking to save money and enjoy a more authentic Louisville experience.

Dawn Moretz is a "superhost" who does not live in one of the expected Airbnb destinations. Her home is in Okolona, but she said the location does have an advantage.

"I think it's because it's quiet," said Moretz. "I think they like to have that home environment because it makes them feel secure and safe."

Moretz is the type of short-term rental host Metro Councilman Ben Reno-Weber said won't be impacted by an updated ordinance because she hosts out of her full-time home.

Some Metro Council members said there's a loophole in the current ordinance that allows some property owners to operate rentals without a permit.

"An investment property, non-owner, occupied Airbnb is essentially a hotel," said Reno-Weber, D-8.

Lisa Santos, with the Irish Hill Neighborhood Association, said short-term rentals have caused values to skyrocket.

"We're crying for people to be able to afford a place, and they can't buy or rent a shotgun house," said Santos.

The updated ordinance will raise the annual registration fee and require rentals that are not owner-occupied to get a permit.

But Santos said that doesn't go far enough.

"We want them to be owner-occupied," she said.

In fact, Santos was part of a coalition that sent a letter to Metro Council objecting to the changes.

"Dear Metro Leader,

Metro Council will be voting next week on much needed changes to our Short Term Rental regulations. We support this move but object to a recent amendment passed at the Committee level.

We believe that permitting ‘Host-Occupied’ rentals will lead to the abuse that we are seeing in the current code. Neighbor after neighbor has reported to us the falsehoods perpetuated by absentee owners advising that their cleaner, child, or real estate manager is the ‘Host’ of the property. We believe that even with new residency requirements that this arrangement opens a loophole that citizens have asked their government to close. We do not relish the time that will be consumed by residency monitoring and the subsequent hearing attendance. We encourage long term renters whom this amendment is purported to assist to open their home to other long term renters.

Stop regulation abuse, strengthen protections for neighborhoods, and provide ample long-term housing options.

Respectfully submitted by Citizen Coalition for Land Development Code Reform"

Reno-Weber said he reviewed the letter, and said that they are still considering changes to the ordinance, so there's a chance their concerns are addressed.

He said the goal is to eliminate "bad actors," but leave room for some non-owner hosts.

"We want to be able to support the equity issue of people who are legitimate, long-term rentals in a space, that want to rent out their apartment with their landlord's permission for Derby," he said.

Moretz hopes that whatever changes are made, they don't take away someone's authentic Louisville experience.

"It gives you a chance to get a taste of all the different communities and neighborhoods before you settle down yourself to decide where you want to be," she said. "And I would hate for that opportunity to be missing."

The one "no" vote on the proposed changes in council's Planning & Zoning Committee was Councilman Khalil Batshon. He said he's concerned the ordinance is not ready and that it adds more bureaucracy to the process.

He'd rather see if there's a way to spread out approved Airbnbs across other districts.

"Now that gives you opportunity to these other areas that are lacking as far as economical growth and infrastructure growth to attract maybe more destinations, or entertainment districts or anything of that nature, for parts of the community that are striving for," Batshon said. "I think we need to get on this trajectory to move forward in growth and help small businesses and continue to grow as a city rather than go backwards and nobody wanting to do business or develop in our communities."

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City leaders looking to crack down on who can operate short-term rentals in Louisville