Short-term rentals were at the center of Park City’s opposition to a piece of state legislation aimed at tackling the state’s affordable housing problem.
House Bill 82 was passed by the Utah Legislature on the closing days of the general session earlier in March and was signed into law by Governor Spencer Cox on March 16th.
In short, the bill is intended to allow for more accessory dwelling units in single family homes like basement apartments or mother-in-law units. The idea is those units would then become an affordable rental option for people looking for housing, but are not in a financial position to buy a house of their own.
Park City initially came out in opposition to the bill, not because they were against the legislation’s intent, but because there was nothing to prevent these units from instead becoming short-term rentals like those found on listing sites like Airbnb and VRBO -- something the city claimed would only make Park City’s shortage of affordable workforce housing worse.
Through the legislative process, amendments were added that allow a municipality or county to punish individuals who offer certain units as short-term rentals. Critics of the bill, including those in Park City, said the legislation is a one-size fits all approach that does not take into account the unique circumstances of a major tourist destination like the greater Park City area is.
The hard part, says Park City Economic Development Director Jonathan Weidenhamer, will be finding those illegal units. He says unless an illegal rental is complained about or obviously listed on a rental website, they can largely fly under the radar.
“I think, to a degree, it’s unclear what that means, but the way one could read that is to say that if no one ever applies and we don’t have the ability to find them through internet advertising, short of a series of complaints about noise, parking, or garbage, it’s gonna be hard for us to ever find them,” says Weidenhamer. "They won’t be visible, they won’t be apparent to us.”
The city has said there are roughly 5,000 short-term rentals in Park City and 2,000 units considered to be illegal. Weidenhamer says the city gets to that number through a surprisingly simple method: cross referencing rental listings on websites like Airbnb and Craigslist with the city’s list of businesses registered as short-term rentals.
Short-term rentals can be a big money maker for property owners. Nightly rentals in Park City are regularly listed for $100 or more per night and giving that income up or reducing it in favor of a long-term rental could be a hard pill to swallow.
So, will HB 82 make an impact in Park City? Right now, that’s still a little uncertain.
The language of HB 82 leaves “punishment” largely up to interpretation. Weidenhamer says, currently, the city sends a letter to a property owner operating an illegal rental encouraging them to obtain a business license, which costs a few hundred dollars.
Registered rentals are taxed just like any other lodging business in Park City, collecting sales tax and transient room tax, which is charged to any overnight stay under 30 consecutive days.
There are also benefits to becoming a registered rental, including access to the resources of the Park City Chamber/Bureau. CEO Jennifer Wesselhoff says registered rentals could make more money and tourism throughout the area would become a better experience for renters and locals.
“We would ultimately like to communicate with those hosts in order to help provide them resources for their guests, whether those are visitor guides or maps,” says Wesselhoff Part of sustainable tourism is really about influencing visitor behavior once they’re in the area so the more we can touch and communicate and educate our visitors once they’re here, the better visitor visitor behavior I think we can expect.”
Weidenhamer adds that one part of the bill Park City was pleased about was requiring these new units to be part of an owner-occupied residence.
For example, a homeowner in Park City would be allowed to rent their basement apartment out for the year. Weidenhamer says this will help prevent second homes in the city from turning into nightly rentals.
“We understand nightly rentals are very lucrative, but we also understand that oftentimes, the people who are accountable for that maybe don’t live in town or they live in another state or whatever and it can be difficult [to regulate],” he says. One of the important things that was kept in HB 82 was the requirement that these additional dwelling units be owner-occupied. That was a big game changer, we’re very happy about that.”
With Governor Cox signing HB 82 earlier this month, the bill is now law in Utah. A link to obtain a business license in Park City can be found here.