Short rentals like Airbnb land in labyrinth of rules

Article Courtesy of The Sarasota Herald

By Zach Murdock

Published April 19, 2017


As travel and short-term rental sites such as Airbnb grow in popularity and in number of participating hosts, sorting out just what is allowed and where for those renting their properties is a labyrinth of local rules.

Despite a new deal between Sarasota County and Airbnb to streamline collections of the local tourist development tax, ensuring that the right taxes are paid and zoning rules adhered to remains a tall order that is only getting more daunting.

Highlighting the site’s popularity, Sarasota was among the top markets in the state for Airbnb rentals during this year’s spring training season, attracting thousands of visitors to the area while the Baltimore Orioles were in town at Ed Smith Stadium.

More than 6,660 guests stayed with about 700 local hosts during the five-week stretch of spring training games, earning those hosts more than $1.86 million in rental income, according to a report issued by the company this week.

The surge in guests represented a 91 percent spike in guests over the weeks before spring training and an almost 250 percent spike in guests visiting from Maryland, which broke into the top-five most common guest origin areas, according to the report.

Sarasota’s guest totals rank behind only 9,600 Airbnb bookings in Tampa, where the New York Yankees train, and an enormous 37,447 bookings in Kissimmee, where the Atlanta Braves train before they are expected to move to North Port in 2019.

Bradenton, where the Pittsburgh Pirates train, attracted just shy of 1,700 guests during the Grapefruit League’s schedule this year, according to the report. About 300 Airbnb guests in that area earned $380,000 from those rentals, and guests most often came from Pennsylvania.

The home-sharing and short-term rental company touted the report as proof the service is “a foundational component of the local economies” of the spring training cities as the company’s footprint grows across the state and country.

But it also serves as a glimpse into the growing popularity of online, mostly short-term rental services like Airbnb and several competitors in Sarasota and Manatee, even as local officials grapple with a smorgasbord of differing local rules.

Until the county’s new Airbnb agreement takes effect May 1, it has been incumbent on those renting their homes to know whether they must pay the tourist development tax and calculate it themselves to cut a check for that amount to the county every month, said Assistant Tax Collector Sherri Smith.

That system inevitably misses some people, either by accident or because they’re dodging the tax, and the new agreement will fix that, she and Tax Collector Barbara Ford-Coates have said.

In 2016 alone, Airbnb would have collected $355,000 in tourist development tax for renters and the county, the company has said.

Complicated rules

But even with the new agreement, local short-term rental rules are much more complicated than meets the eye, Smith warned.

“What’s beautiful going forward is the county is going to get all those TDT revenues from everybody who hosts or rents through Airbnb,” Smith said. “But remember, that’s not all we’re talking about. There’s also VRBO, FlipKey, Craigslist or just listing it in the newspaper.”

Hosts offering rentals through those other sites will still have to calculate and submit tourist tax to the county, which also collects the tax for the municipalities, Smith said. They also likely need to sign up to pay the county and municipal — if within one of the city’s boundaries — business tax, she added.

But area planning officials warn it gets even more complicated because certain short-term rentals are only allowed in certain zoning areas.

Sarasota County technically only allows rentals of fewer than 30 days in multi-family residential areas on the barrier islands, such as a condo on Siesta Key, for example, county spokesman Jason Bartolone said. Anywhere else in unincorporated areas and rentals must be longer than a month, he said.

Similar 30-day rules apply on Longboat Key and in Venice, but Venice also “grandfathered” existing short-term rental units into its rules and the individual condominium associations can be even more strict in their deed restrictions, officials from both municipalities explained.

The City of Sarasota allows rentals of all or part of single-family homes, the way many Airbnb-style rentals are offered, for no less than a week at a time, said Tim Litchet, director of the city’s Neighborhood and Development Services.

North Port has no such restrictions, but is considering looking at the topic in an upcoming zoning code update, spokesman Josh Taylor said.

Homesteaders beware

On top of those varying areas and rental limits, owners sharing a portion of their home with renters must also be wary of losing their homestead tax exemption, Property Appraiser Bill Furst warns.

Renting all or part of your home for more than 30 days per year could jeopardize its exemption and could carry a 50 percent penalty and 15 percent interest for any year or years the property was rented within the past decade, a recent news release from Furst’s office explained.

The hodgepodge of rules makes for a difficult enforcement task.

County officials from code enforcement to the tax collector to the property appraiser’s offices all collaborate when a new short-term rental host comes forward, Smith said. They and officials in several of the cities also try to police each of the websites to identify obvious rule breakers to attempt to bring them in line with whichever rules apply, they said.

For example, Sarasota city officials work directly with Airbnb when a complaint arises, usually from a neighbor, to try to get that particular rental listing into compliance, Litchet said.

“It hasn’t been the problem here as it has been in other communities,” Litchet said. “I’ve certainly read some stories that make you shiver a little bit.”

The few complaints the city has received were related to rentals in the Laurel Park neighborhood, which staff now monitor closely for new rentals that don’t meet the rules, he added.

“If you know somebody that’s renting, give us a tip; everybody that’s renting should be paying their fair share,” Smith said. “It’s a lot about education. Since the whole Airbnb thing came out and it was really on the radar, when we have someone come forward, we talk them through all the steps and rules.”

“... Let them do the research if this is something you really want to do or not.”