The search for solutions to R.I.’s short-term rental challenges
By Rep. Lauren H. Carson
For the last year and a half, a House commission I have led has been studying the economic and social effects of the short-term rental industry in Rhode Island. We have met with state and municipal leaders who grapple with tax, housing and safety issues, leaders in the tourism and hospitality industries and property owners who list rooms or homes on short-term rental platforms.
We have collected written and verbal testimony from more than 200 members of the public, with opinions on virtually every facet of the industry, including state and municipal regulation of it, its effects on the housing market and neighborhoods and its opportunities for property owners.
Over the course of our work, the commission has identified a lack of coordination between the state’s registration system for short-term rental properties and the 17 separate registration systems operated by municipalities around the state, as well as a lack of transparency in the way short-term rental platforms remit the hotel, sales and municipal taxes they collect and submit on behalf of property owners. The commission has also identified a number of safety concerns like how to ensure individual adherence to fire and building codes.
One of the issues that our commission has encountered over the course of studying the short-term rental industry in Rhode Island is the matter of jurisdiction – whether the state, municipalities or both can or should be in charge of regulation.
That issue is at the heart of three lawsuits currently pending in state courts challenging the legality of ordinances passed in Newport, Narragansett and Exeter to regulate and ensure the safety of short-term rentals. The courts have ruled in favor of the municipalities in the Exeter in Newport cases, which are being appealed; Narragansett’s ordinances have been stayed since October while a ruling is awaited in that case.
I am eager to address this matter legislatively so that we have robust protections that ensure safety of renters, property owners, neighborhoods and our housing supply, as well as systems that ensure the proper, equitable collection and distribution of taxes revenue generated by this industry.
However, the prudent action is to see how these cases are decided by the courts before we forge ahead with new legislation. It’s unfortunate, since there are pressing public safety concerns and effects on our dire housing crisis, but we need to create a lasting, well-crafted path forward with this industry, and it does us no good to pass a law that could well face a its own legal challenge within months.
Rep. Lauren H. Carson
As someone who has been been working on legislative efforts related to short-term rentals for the entire decade I’ve spent in the House, and a representative of heavily affected Newport, I am disappointed that we cannot feasibly address this issue legislatively before the current legislative session ends in the coming weeks. However, I am hopeful that our commission will be able to move quickly once these cases are resolved, which is likely to happen by fall. It’s my intention that we will then issue our report and that I will then propose legislation informed by it.
I am very grateful to all the members of our commission for their effort and dedication throughout this process, and to the 200+ members of the public who have contributed their testimony. I remain determined to develop solutions that enable Rhode Islanders to generate income through the short-term rental industry while also protecting public safety, residential neighborhoods, economic equity and the housing supply Rhode Islanders desperately need, I am hopeful this summer brings a successful tourism season for Newport and the whole state.