State senator proposes bill limiting local governments’ power over Airbnb and Vrbo rentals

Editor’s note Feb. 1, 2022: Sen. Bill DeSteph moved to withdraw his bill that would have gutted the City of Virginia Beach’s regulations on short-term rentals like Airbnb and Vrbo. He said the reason for the move was “too many pending lawsuits.” The bill will not proceed through the legislature.

VIRGINIA BEACH, Va. (WAVY) — Local governments could lose some of their powers to regulate short-term rentals if a state senator’s bill makes it through the Virginia General Assembly.

In Senate Bill 602, State Sen. Bill DeSteph (R-Virginia Beach) proposes doing away with the ability for cities, counties and towns to tell property owners renting on platforms such as Airbnb and Vrbo how many parking spaces they must have, occupancy limits they must abide by, and where they must own property to be able to rent.

All are currently part of the regulations the City of Virginia Beach imposes on short-term rental operators. Those rules came about after more than six years of extended meetings and passionate debates over how to best accommodate the growing use of home-sharing platforms while also maintaining the character of traditional owner-occupied neighborhoods.

But it’s no longer just an issue in Virginia Beach. In the majority of the seven cities in Hampton Roads, short-term rentals are not even currently considered “permitted uses.” Yet in Chesapeake, Newport News, Portsmouth and Suffolk, you will find rooms and homes for rent daily.

Some owners are tired of operating in the gray area and want to see the state implement more overarching guidelines for all.

“We would love to propose really good regulations to the city that support people paying taxes … that support maintaining good relationships between neighbors and Airbnb owners,” Dana Robbins, a real estate agent who owns multiple Airbnbs, said.

Robbins got into the business of owning Airbnb rentals on a whim. The most recent property she bought in Newport News’ Hilton Village neighborhood was a 103-year-old duplex that another buyer wanted to turn into a long-term rental.

“The reason I wanted to put an Airbnb here versus the potential long-term tenant was that I could maintain this home far better and keep it in much better condition than a typical long-term rental would,” Robbins said. “I keep my house as nice as I possibly can because I am trying to attract people to choose my home.”

She doesn’t live in either home, and with the demand for space, she doesn’t believe she could anyway.

“Between October and December, I only had three days of vacancy,” Robbins said. Aside from Newport News Shipbuilding being nearby, Robbins said she hears from guests that the location being central to tourist areas in both Williamsburg and Virginia Beach is an attraction.

“It’s just fun to help people enjoy their vacation or help them out in a time of need,” Robbins said.

She touts how her rentals are good for other small businesses, such as restaurants.

What frustrates her is that she thinks too many cities haven’t harnessed the positive aspects of the growing short-term rental industry. She said even figuring out how to pay taxes on her rentals has been a difficult process.

“The platform of the city at this point so far is that Airbnbs are not allowed,” Robbins said. “Here we are and here are hundreds across the city.”

A spokesperson for Newport News said while draft regulations were presented to City Council back in 2019, no action was ever taken on them.

Robbins wants to get in front of the issue, to avoid regulations similar to those implemented in Virginia Beach.

“Those property owners’ rights have been stripped away,” Robbins said. “I absolutely don’t want that to happen in my city.”

The Virginia Association of Realtors, the Hampton Roads Realtors Association and two Virginia Beach citizens are suing Virginia Beach in hopes of overturning the latest set of regulations short-term rentals must follow. Attorney’s argue the City Council “exceeded its authority” and made rules “unreasonable, arbitrary and capricious,” for property owners.

“It’s stifling the kind of economy and the kind of community we want to have, to attract young people,” Greg Garrett, CEO of Newport News-based Garrett Realty Partners, said. “It is the best way for [a] young early entrepreneur to get a foothold into becoming an investor. That’s the magic of short-term rentals.”

Garrett and Robbins have joined together to form the Peninsula STR Alliance. Their main goal is to advocate for the amendment of current statewide enabling legislation that allows for short-term rentals in communities.

Garrett believes the Virginia General Assembly needs to prohibit cities and counties from over restricting the industry.

“With the ordinances that are popping up, like the one in Virginia Beach, will spread to other cities and counties,” Garrett said.

Complaints from those against short-term rentals have typically come from neighbors. Stories of parking nightmares, out-of-control parties that end in violence and an overall disruption to traditional owner-occupied neighborhoods have led to the formation of some of the rules in Virginia Beach.

Virginia Beach Planning Director Bobby Tajan said he has seen firsthand people can still operate Airbnb and Vrbo rentals if they follow the rules.

Between June and October 2021, the city’s planning department issued more than 100 violation notices to properties in Virginia Beach.

“They have not come request either a conditional use permit, or provided their information to us to let them know they are legally operating,” Tajan said. “We do get a lot of phone calls once we do send the violations, you know, ‘How can I comply?’ You know, ‘What do I need to do?’ It’s 50/50 on what we actually get back in paperwork.”

Virginia Beach City Council’s most recent budget allowed for Tajan to hire five new employees strictly to help enforce short-term rental regulations. He said several property owners have been taken through the civil penalty process.

Those found not operating “legally” can face a fine of up to $200 for the first offense and $500 for any additional.

“We are going to start ramping up a little right now, right before we get people booking those key times,” Tajan said. “Thankful for those that move forward and work with us. We’re hopeful that we can get everyone who can legally operate to that point.”

Virginia Beach City Council directed their lobbyist to express concern over DeSteph’s bill.

“We have a short-term rental scheme in place in this city that we have spent months and months and had many public hearings on. To let it be overrun by state action without defense of it is unacceptable as far as I am concerned,” Councilman Guy Tower said Tuesday.

DeSteph was not immediately available for comment.

However, Tajan believes there remains a role for local governments in the issue.

“I think that each locality should have an opportunity to regulate the short-term rentals because it impacts a locality differently,” Tajan said.