Planning Commission To Ask Council To Enforce State Rental Law

Planning Commission To Ask Council To Enforce State Rental Law Featured

By / Local News / Wednesday, 08 April 2015 04:00

By WILLARD KILLOUGH III
Managing Editor

KURE BEACH - The Kure Beach Planning and Zoning Commission voted at their April 1st, meeting not to recommend a controversial proposed vacation rentals ordinance to the Town Council. Instead, the commission recommended the Town enforce a state law already on the books that allows Towns to regulate rental properties that have a number of violations. The commission also discussed the issue of vacation rental properties and collection of Room Occupancy Taxes. The concern is that not all properties are collecting those taxes per state law. The commission will also seek guidance from the Council later this month on how to address issues with excess parking issues at vacation rental properties.
The proposed vacation rental ordinance got the attention of property management companies, the Wilmington Regional Association of Realtors and property owners who turned out in large numbers at the Commission's March 4th, meeting.
The Commission delayed taking action on the ordinance during their March meeting. The commission held a special hearing prior to that meeting where many spoke out against the ordinance.
Chairman Craig Galbraith spoke to the Town Council at their June 20th, meeting regarding managing the impacts of privately owned rental properties through a certification process. The council indicated they wanted the Planning Commission to continue to look into the details of having a rental home certification requirement.
Galbraith said parking is a major concern where large groups of 20 or 30 people show up at a beach house rented for a week and there's no adequate parking which leads to negative impacts on neighboring properties as well as safety concerns.
Galbraith said many local governments have a limitation and don't try to stop people from renting properties but, "What they are concerned about is when you get 20 or 30 people in a single house."
He said it's typical for four families to rent a four or five bedroom house and that some cities have limited the number of persons per bedroom and "posting of proper behavior" covering when the trash is picked up, noise ordinances and other rules.
Galbraith said another concern is the collection of Room Occupancy Taxes. He said, "Almost every city does have some sort of room tax process. Generally if the property is under contract with a rental agency that will get paid with the process but there are a lot of properties that are not under contract that are individually rented out and they probably don't pay some sort of room tax."
In New Hanover County short term vacation accommodations must charge a Room Occupancy Tax that is used to fund beach nourishment, tourism promotion and tourism related events that help to draw more people to the area.
A portion of the proposed ordinance stated, "Any person intending to engage in a vacation rental shall, prior to engaging in any such rentals, file an application and obtain a permit from the Town Clerk".
The section concerning "Permit Conditions" stated:
All permits issued under this chapter are expressly subject to the following conditions:
(a) Vacation home owners and their agents shall expressly provide in their rental agreements that the maximum number of overnight occupants in a vacation home shall be limited to the maximum number of overnight occupants set forth in the permit, said number not to exceed two (2) adult persons per bedroom plus four (4) additional adult persons per residence; provided that, however, a studio rental shall be limited to a maximum of four (4) adults. For purposes of this section, minors under eighteen (18) years of age shall not be counted as adults.
(b) Vacation home owners and their agents shall expressly provide in their rental agreements that a vacation home shall not be used by tenants to engage in commercial activities including, without limitation, weddings, receptions, and large parties.
(c) Vacation home owners and their agents shall expressly provide in their rental agreements that tenants shall not violate federal, state, or local laws, ordinances, rules, or regulations; engage in disorderly or illegal conduct; engage in activities or conduct creating or resulting in unreasonable noise, disturbances, and public nuisances; allow an unreasonable amount of garbage, refuse, and rubbish to accumulate on the property; illegally park vehicles in conjunction with their use of the vacation home; and overcrowd the vacation home premises.
(d) Vacation home owners and their agents shall expressly provide in the rental agreements that a material breach of the express provisions required under sub-sections (a)-(c) above shall result in a termination of the rental agreement.
(e) Vacation homeowners and their agents shall take reasonable steps to ensure the tenants’ compliance with the express provisions required under subsections (a)-(c) above. As used herein, the term “reasonable steps” shall be construed to include, without limitation, the following: 1) posting a copy of the vacation home rental permit and these permit conditions in a conspicuous place within the vacation home; 2) promptly contacting tenants when notified of violations of the permit conditions and requesting the tenants to cease and desist from such violations; 3) contacting law enforcement when a reasonable person would deem the assistance of law enforcement to be necessary under conditions then prevailing on the premises; and 4) when applicable and reasonable, commencing expedited eviction procedures against the tenants as provided for in Article 4 of Chapter 42A, Vacation Rental Act, of the North Carolina General Statutes.
During the March 4th, hearing representatives of local property management companies filled the meeting room to standing-room-only.
Ea Ruth, an owner at Palm Air Realty in Kure Beach and also Local Political Coordinator for the Wilmington Regional Association of Realtors, said she was there representing 128 members located in Carolina Beach and Kure Beach and was there to speak in opposition to the ordinance.
She provided the commission with a copy of an analysis of the proposed ordinance by prepared by the Association.
The analysis questioned, "The Town's authority to impose a permit requirement upon vacation rental owners in light of Section 160A-424(c) of the North Carolina General Statutes, which appears to prohibit North Carolina cities and towns from requiring rental property owners to obtain a permit or permission except under limited circumstances. It then argues that the Town has not provided a compelling factual justification for the Vacation Rental Ordinance."
North Carolina General Statute 160A-424(c) states, "In no event may a city do any of the following: (i) adopt or enforce any ordinance that would require any owner or manager of rental property to obtain any permit or permission from the city to lease or rent residential real property, except for those properties that have more than three verified violations in a 12-month period or upon the property being identified within the top 10% of properties with crime or disorder problems as set forth in a local ordinance; (ii) require that an owner or manager of residential rental property enroll or participate in any governmental program as a condition of obtaining a certificate of occupancy; or (iii) except as provided in subsection (d) of this section, levy a special fee or tax on residential rental property that is not also levied against other commercial and residential properties."
During the Council's April 1st meeting, Galbraith explained, "I could communicate to Council the data collection issue. I don't think it's an ordinance but could communicate that as a second issue and identify there is already within the state statutes - under the permitting discussion - the right to have a permit for the worse 15% violators but we have to collect the proper data and the general feeling is we don't really collect that data yet."
That data would include offenses such as parking, trash and noise ordinance violations. Those properties that had repeat offenses could be required to adhere to stricter permitting and inspections criteria under existing state law.
One resident said she has had issues with a neighboring property that is often rented to large groups causing parking problems in the area with far more vehicles than available parking at the property. Sometimes parking on adjacent properties.
She mentioned other issues such as partying, beer cans and chicken bones tossed on her property and other nuisances.
The commission agreed that Galbraith will make that presentation to Council at their next meeting on April 21st.

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