Dissatisfied with one aspect of the City Planning Commission’s position on how short-term rentals should be regulated in New Orleans, Mayor Mitch Landrieu wants the City Council to tell the commission to stick to a plan that would legalize the conversion of thousands of whole homes into miniature hotels.
A measure on the agenda for Thursday’s council meeting, drafted by the Landrieu administration, essentially calls on the Planning Commission to reverse its January recommendation to prohibit whole-home rentals in residential areas of the city.
The motion is listed as being sponsored by Council President Jason Williams and Councilwoman Stacy Head, the two at-large members of the body, but it was put on the agenda at the request of the administration.
It’s not uncommon for council members to put forward legislation as a courtesy to the administration, and it remains unclear whether Williams and Head support the measure — or whether the council as a whole is ready to vote on the matter this week.
Some council members’ offices were not briefed about the item before it showed up on Thursday’s agenda and were apparently surprised at its contents.
At issue is a divergence between a study drafted by the city’s planning staff, with significant input from the administration, and the Planning Commission’s recommendations on how short-term rentals should be regulated.
Both the planners and their bosses on the commission agreed that the city should allow short-term rentals in a wide range of circumstances: single rooms in a home; half-doubles when the landlord lives in the adjoining unit; temporary permits for those who would offer their space for rent only a few times a year; and relatively unrestricted rentals in non-residential areas.
But the Planning Commission balked at a provision in the staff’s study that would allow residents to rent whole properties in residential areas, though with limits on how many such operations would be permitted per block. The commissioners eliminated that provision from their final recommendations to the council on a 5-2 vote.
Landrieu has not publicly discussed what kind of regulations he favors for short-term rentals, and a spokesman did not respond when asked about the mayor’s position on whole-home rentals. However, the administration has repeatedly said that the planning staff’s original study “struck a good balance.”
Beyond the arguments over how short-term rentals affect the neighborhoods where they operate, city officials have another reason to be interested in the debate: money. The Legislature passed a law during this year’s special session that would allow the city to collect sales tax on short-term rentals.
That’s an attractive proposition, particularly for an administration looking for cash after the recent failure of a property tax increase that was intended to fund an expansion of the New Orleans Police Department and cover a $75 million settlement with firefighters.
But since most short-term rentals in New Orleans in today’s basically unregulated market are in fact of whole homes in residential areas, any attempt by the city to turn the rentals into a major revenue source would require legalizing such operations.
After the Planning Commission’s vote, several City Council members raised concerns during a committee meeting about allowing short-term rentals of whole houses in residential neighborhoods throughout the year. At the time, it appeared the council was planning on taking its time on the issue.
“We will continue to have meetings on the matter until the issue is resolved,” Councilwoman LaToya Cantrell said at the time. “This is a priority for the City Council, and I think we’ve heard heavily this is a priority for the public.”
The motion proposed by the administration would, if passed, move that debate past the council, for now. It instructs the planning staff to come up with specific regulations for short-term rental properties and to hold hearings to gather public input. But it specifies that those regulations should be based on the original study and not the Planning Commission’s recommendations.
Follow Jeff Adelson on Twitter, @jadelson.