As enforcement for short-term rentals gears up, how much could council change the rules?

Short-term rental regulations in Springfield have been around since 2019 and have become a continuous point of discussion for city leaders. With enforcement finally gearing up around the city, the current policy is being examined for possible changes.

The main focus is on Type 2 Short-Term Rentals — those most commonly used for vacation stays where the owner does not reside in the rental and which are rented for less than 30 days. Operators of these short-term rentals in the city have to fill out an application, hold a neighborhood meeting and attempt to gather signatures from at least 55% of the adjacent property owners. If that threshold is not met, the application goes before Springfield City Council for approval. There are also density limitations to short-term rentals. According to city code, there cannot be more than one short-term rental on one of side of the street per every eight houses in a block face.

These short-term rentals are also now subject to a hotel/motel 5% sales tax, so ensuring the rentals operate as licensed and registered is vital for the city to receive the additional revenue.

Enforcement gets underway

Initial enforcement efforts began at the end of March after the city was finally able to secure software that allows them to track rentals listed on platforms such as Airbnb and Vrbo that are not licensed and those that are not paying their taxes.

Packets, consisting of cease and desist letters and tax coupons, were mailed to 98 properties identified as unlicensed. Some admitted to operating illegally, others said short-term rentals were not taking place currently and 68 have not responded to licensing, though they may have reached out to the Planning Department. Two are now licensed and in compliance and eight have paid back-taxes.

All who have not responded by April 22 will receive a 10-day "failure to obtain" letter. If the operator of the rental still does not respond within the 10 days, tickets will be submitted to municipal court for operating without a business license and not paying taxes.

Quincy Coovert, licensing supervisor for the city, said the licensing department is working with the prosecutor to ensure they have the necessary evidence to bring a case to court if it comes to it. Because Rentalscape, the software used to identify unlicensed rentals, is a third party, it may be more challenging to secure direct evidence.

This information was presented on Wednesday to the Plans and Policies Committee, which has been tasked with considering any changes to the current policy.

Changes unlikely to be substantial

Wednesday was the second time the committee has looked at the policy. Several ideas were thrown out in the period between the two meetings, largely by by Councilman Craig Hosmer, who has been the most vocal critic of short-term rentals. The proposals have gained little traction among committee members, however, and Hosmer expressed his frustration with how long the enforcement process has taken.

Councilman Abe McGull said the approval process is the part in need of change, particularly because appeals usually come before council when the owner is not able to gather the necessary signatures of neighboring property owners. He suggested a provision that would give nearby renters the ability to be a part of the signature process, as a frequent factor when there are insufficient signatures is the inability to locate property owners. This would be similar to a recently proposed new liquor license protest process that gives renters a say if a nearby business applies to serve liquor. Roughly 60% of residents rent in Springfield.

But Councilwoman Callie Carroll said seeing those who stay at short-term rentals as bad actors is unfair and long-term rentals can actually pose larger problems than those staying at a vacation rental.

"I think that we just need to reprogram our minds of who these renters are, first of all, and I don't think it's very fair, you know, if someone who's renting a house, doing illegal activity in their house is like, 'well, you know, I don't want the short-term rental next to me,'" she said.

In the past year, 20 short-term rentals had more than one police call for service, while 56 had one call, according to a memo from City Manager Jason Gage to the committee. Most of these calls however were for the area around the location, not specific to an issue at the property.

Hosmer, however, said that perhaps the whole appeal process should be done away with. If the applicant cannot secure the needed signatures, the rental should not go forward, he said. While these concerns and ideas were raised, they did not garner much further discussion nor a consensus to pursue ordinance changes.

"If we can make some changes to make it work better, it'd be working better for neighborhoods, it would be working better for people that have short-term rentals because they're competing against people that aren't licensed," he said.

Taking cues from Kansas City

Some parts of Springfield's short-term rental policy were modeled after that in Kansas City. But Kansas City adjusted its policy last May, including one of the most drastic changes — prohibiting additional non-occupant short-term rentals in areas zoned as residential. They also require booking platforms to remove listings that are operating without a license.

Coovert said platforms such as Airbnb currently remit the state sales taxes to the state. While the city had approached Airbnb with doing the same for Springfield, the platform ultimately did not want to enter into an agreement, despite doing so in other cities.

More: Springfield's short-term rental policy has issues. Here's how it stacks up to others in MO

Hosmer proposed adding a provision where a license can be revoked if a short-term rental is not bringing in any sales tax revenue, meaning they are not being booked, for a certain amount of time. Because of density requirements, Hosmer said an inactive licensed rental could preclude another one, actually aimed at operating, to move in. Current regulations allow for licenses to be revoked for up to one year if a rental is not compliant.

He also noted that taking these cases to court is not effective, rather the focus should be on the platforms and ensuring the industry can regulate itself.

The committee asked for city staff to look into how Springfield's ordinance could make platforms more receptive to collect the city's tax and delist non-compliant properties from their sites for its next monthly meeting. In the meantime, most council members on the committee expressed hope with the progress made and wanted to await more information as the enforcement process progresses before considering any more drastic adjustments.

Marta Mieze covers local government at the News-Leader. Have feedback, tips or story ideas? Contact her at mmieze@news-leader.com.

This article originally appeared on Springfield News-Leader: Enforcement of Springfield short-term rental regulations gains speed