The City Council is moving proposed amendments to the Short Term Vacation Rental ordinance on to committee, though several sticky points remain.
Councilman Chip Henderson is proposing:
- Adding an administrative hearing officer (AHO) to rule on STVR violations
- Forming a seven-member board to rule on STVR issues, such as permitting. Three would be named by the City Council and four by the mayor.
- Allowing holders of STVR permits to transfer them to others
- Setting up a buffer so that a new STVR could not be closer than 500 feet to an existing rental
- Setting a new fee arrangement.
The "overlay" would remain in which no STVRs are allowed in the districts of four council members who oppose them in their districts. Councilman Henderson said he favors keeping the overlay, though the Kelly administration wants to make the STVRs available in all nine districts.
Several Council members said if the city can demonstrate that it can enforce the STVR requirements, then it may be possible to move to allow them throughout the city.
Councilwoman Jenny Hill said she wanted to add a section that would require STVR owners at the time they get a permit or renew it to pay an extra fee that would go in the city's affordable housing fund. She said for absentee owners the fee would be $250 upon getting a permit and upon renewal. The regular fee for absentee is set under the Henderson measure at $1,000 when obtaining a permit and $500 yearly.
Councilwoman Hill also proposed a $1,000 affordable housing fee be added to each permit transfer.
Dallas Rucker, who oversees the city enforcement department, said he is currently without a city zoning inspector. He said two left for other jobs and a third retired. He said one new inspector is due to come on board on Friday.
Chris Anderson, senior advisor to the mayor, said the administrative hearing officer should be in place by March. He said the city is having to get a budget amendment that will shift $300,000 from the hotel/motel tax receipts to a budget for the AHO. The AHO would be able to assess penalties of up to $250 per day, while City Court is limited to $50 per day, it was stated. Mr. Anderson said a number of attorneys are interested in the post.
Councilman Henderson said he spoke to Mayor Tim Kelly on the issue, and they agreed that those who have been operating rentals without getting permits should have a path "in the front of the line" to become legal. Council Vice Chairwoman Raquetta Dotley disagreed, saying they knew from the start they were operating illegally. She said, "If anything they should be fined."
Chairman Darrin Ledford said STVR is "a viable industry," but he said residents in his East Brainerd district have continually told him they do not want STVR's in their area.
He said he has concerns about allowing permits to be transferred, saying that would lead to "a subgroup involved in buying and selling permits" with no interest in actually operating them.
Chairman Ledford also said STVRs are businesses, but the houses remain taxed at the 25 percent residential rate rather than the 40 percent commercial rate.
In a brief time for those in the audience to comment, one speaker questioned the fairness of STVR owners having to pay affordable housing fees and other groups not.
A speaker said adding more STVRs further reduces the availability of the local housing stock.
Another said if the rentals are going to be allowed in some districts, it is only fair that they be in all.
Tiffany Rankin said her Lincoln Park neighborhood is seeing more and more STVRs, and others are waiting to build more there.
A realtor said an over-saturation of STVRs "is causing us to lose our neighborhoods."
Another speaker said her neighborhood was "overrun" with STVRs, while "we are frantically trying to find a place for people just to live."
One STVR owner asked how anyone would know if a potential rental house was 500 feet from an existing rental.
Joe DeGaetano, who owns rentals, said the 500-foot ruling would significantly limit the number of possible STVRs, especially in his North Chattanooga neighborhood. He said he envisions "people scratching and clawing" for parcels that would qualify. He suggested the city having auctions so they could go "to the highest bidder."
Attorney Art Grisham said he sees a number of potential legal problems with the STVR measure, including restraint of trade.
The issue will arise again on Jan. 17 at a meeting of the council's Legislative Committee.
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January 11, 2023 at 03:20AM
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City Council Sends STVR Measure To Committee, Though Sticky Issues Remain - The Chattanoogan
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