In 2016, Laurie and Mark Kotorman converted a single-family home they owned on Burlington’s King Street into a duplex.
The renovation transformed the couple’s building from a single rental unit into two: a larger one they could continue to rent long-term and a smaller one they planned to use as a short-term rental, the type of accommodation listed on platforms such as Airbnb and Vrbo.
A set of regulations passed by the Burlington City Council last month threatened that system until Democratic Mayor Miro Weinberger vetoed the measure. Early Tuesday morning, the council sustained that veto by a single vote, ending, for now, a two-plus-year legislative process that intended to balance the economic benefits of short-term rentals with their potentially negative effect on the housing market.
Despite the veto, proponents of the axed regulations — which would have made short-term rentals possible only within a host’s primary residence, with some exceptions — still outnumber their opponents on the council, drawing into question whether the body would pass any policies regulating the industry that controls roughly 1% of Burlington’s housing units.
Because of council rules, any movement on the issue could occur only after April 4, when the body starts its new session and welcomes three new councilors to the fold. The 12-member group will also then install its new president, a key role that helps decide the council’s agenda.
In a letter to councilors explaining his veto, Weinberger said he was still game for short-term rental regulations, though he believed the ones before him were too severe.
To defend his position, Weinberger pointed to property owners such as the Kotormans, who added units to a house — and generated tax revenue for the city — without subtracting from the local housing stock, the mayor said.
“Having some management flexibility and the ability to potentially secure additional income from one unit through the (short-term rental) market may make a threshold difference between a project happening or not,” Weinberger wrote in his letter.
Yet Councilor Joan Shannon, D-South District, who sponsored the vetoed regulations, said she was bearish about efforts to restart the regulation crafting process.
“If it increases the number of conversions” from a regular housing unit to a short-term rental, “it’s not something I will support,” Shannon told VTDigger.
Shannon and the council’s six Progressives, who also voted for the regulations, see Burlington’s 200 to 250 short-term rentals as a source the city could tap to somewhat relieve its severe housing shortage.
In the absence of her more restrictive proposal, Shannon has urged officials to adhere more firmly to the city’s current policy of permitting all short-term rentals as bed-and-breakfasts, which require owner occupancy.
“We just need to enforce the law like we enforce all the other laws in our zoning ordinance,” Shannon said.
Under the current model, owners of a multi-unit building can reside in one unit and rent out the other on sites such as Airbnb. Shannon’s proposal would have barred that practice, except when the owner had an equal number of short-term units and long-term units that accept Section 8 housing vouchers.
Whole-unit short-term rentals, such as an entire single-family home operating as an Airbnb, are not eligible for a bed-and-breakfast permit.
Right now, most short-term rentals in the city do not have a bed-and-breakfast permit, which is technically a violation of the zoning code. But because of the ongoing deliberations about short-term rentals over the past two years, officials have enforced the code only when they received complaints about a particular unit.
Even with the mayor’s veto, officials say they’re not keen to crack down on the industry until the incoming council decides whether it wants to enact new restrictions.
“I don’t think between now and then … we’re going to do a 180 and start enforcing any differently than we have,” said Scott Gustin, who manages zoning for the city.
The city is reviewing bids from three companies to monitor its short-term rental industry, but their job will largely consist of providing officials with better data, Gustin said.
The uncertainty around what short-term regulations could look like has left some property owners in the lurch.
“Everybody’s still walking on eggshells because it’s still up in the air,” said Laurie Kotorman, owner of the King Street duplex.
If Shannon’s regulations had gone through, the Kotormans likely would have sold the King Street house and moved out of Burlington, they said. At 400 square feet, the short-term rental side of the duplex would not be large enough to rent out long-term.
“I wouldn’t want to live there as a single person,” Laurie Kotorman said. “I mean, maybe for two months.”
Chances are, the Kotormans would not be alone. According to a survey by the Vermont Short-Term Rental Association, a group that lobbies in support of short-term rental owners, most Burlington short-term rental owners would not convert their units into long-term rentals if the city required owner occupancy.
And while owner occupancy is not being enforced right now, Julie Marks, the association’s executive director, believes the council is not finished trying to regulate the industry.
“I don’t think the issue is going anywhere,” Marks said.
