BOONE — So many citizens appeared before the Boone Town Council June 27 to air their opinions on amortization and short-term rentals that the mayor asked attendees to leave after speaking — the crowd was exceeding the room’s maximum occupancy, according to the fire marshal.
The council had invited input on short-term rentals (such as Airbnb, VRBO, etc.) and the proposed amortization, or phasing out, of non-conforming uses in low-density residential zones at a public hearing that lasted three hours and drew several dozen speakers, with dozens more there to listen.
Town Manager John Ward explained that the growth of short-term rentals and their impacts, including a decrease in owner-occupied dwellings, is a national issue, and one that town leaders wanted to seek community input on before exploring potential regulation. Town attorney Allison Meade noted that under the town’s current ordinance, short-term rentals are “technically illegal,” but that the town’s planning department has not been enforcing it.
Many speakers spoke about the benefits of short-term rentals and told the council they are valuable to the town. For one, they said, the extra income helps residents afford to live in an expensive housing market.
Jordan Sellers bought a duplex in downtown Boone; he lives in one unit and rents the other through Airbnb, which has allowed him to make his way as an entrepreneur.
“I couldn’t do it without Airbnb,” he said, adding that in Boone, there are “limited opportunities to make it. You work for the university or you work for the hospital or you’re a waiter.”
Liz Bowman, of Water Street, said she has never had a complaint from her owner-occupied Airbnb, and since her husband died, it is an essential asset.
“If you take this away from me, I will need to sell my house, and then who will own it?” Bowman said.
Others noted that Airbnb does collect the 6 percent local occupancy tax and remits that money to the town of Boone. Two-thirds of town occupancy tax revenues are allocated to the Boone Tourism Development Authority for tourism marketing efforts, and the town retains one-third for tourism-related expenses, such as capital projects.
Wright Tilley, executive director of the Boone and Watauga County Tourism Development Authority, noted that the Airbnb model of collecting the occupancy tax on the front end when rentals are booked is preferable, rather than those of other short-term rental services, which place the tax burden on the property owner.
Tilley said he did not have figures for Boone, but for the county, he was shocked to learn that online rental companies now account for 30 to 31 percent of occupancy tax revenue.
“While you say it’s 'technically illegal,' you accept the occupancy tax remittances, so therefore I think the acceptance of the occupancy tax overrides any idea that this is illegal,” said Cheryl Claassen of Boone.
Claassen also noted that short-term rental hosts serve as ambassadors for the Boone area, sharing visitor materials and information with guests about local businesses.
Several speakers spoke of the value of opening up their homes and welcoming visitors from around the world.
“We are severely lacking in trust in our communities, and this is a perfect opportunity to experience it, to share it,” said Catherine McClennon. Claassen added that serving as a host provides a socializing opportunity for older individuals who don’t get out very much.
But Kenneth Beam described a “disaster” scenario. Impacts from the short-term rental next door to him included people driving through his yard, loud parties, people on his property and a visitor knocking on his door late at night thinking his home was the rental property, he said.
“I bought in a zoned area to not have this next door to me,” Beam said. “It has lowered my property value, and as long as it continues, I may be forced to sell my home.”
The council then turned to public comments on a proposal to phase out non-conforming uses in single-family neighborhoods. The council first directed town attorney Allison Meade to develop recommendations on amortization in January of this year, and Meade reported on the issue in February.
The proposal has evolved since February, when council directed Meade to develop an ordinance that would have a three-year phase-out program in low-density residential zones, with an option of 20 years for those who could prove their property was in use before town zoning was implemented, or legal, grandfathered non-conforming uses. Property owners also had the option to seek conditional rezoning with waived fees, under that proposal.
The proposal, presented again in April, then changed slightly to a three-year phase-out for buildings originally constructed as single-family dwellings or accessory dwellings, and 20 years for buildings originally constructed as multi-family dwellings (duplexes, triplexes, small apartment buildings) that aren’t in compliance with their zoning.
At the June 18 meeting, however, council members discussed limiting the amortization plan to illegal non-conforming uses only. The council also reached consensus not to include structures originally built as multi-family buildings in single-family neighborhoods, Meade said.
Ham Wilson, a Boone attorney who said he was representing an undisclosed client, said the proposed ordinance would take away vested rights from property owners without any compensation.
“Don’t micromanage with these ordinances. Don’t make this a regulation nation that chokes development,” Wilson said.
Others said the move would decrease the supply of affordable housing for young professionals, low-income families and the disabled in an already challenging housing market.
“I would just ask that you not put any burdens on these people,” said Ron Henries, a school board member and board member for Watauga Opportunities.
Carol Norris said her home has been rented to college students since the 1950s, and as a disabled widow, she relies on that income.
Ari Bargil of the Washington, D.C.-based Institute for Justice spoke on the issue, noting that his organization represents business owners and property owners against “government overreach.” He described amortization as “back door eminent domain.”
Amortization was not without its defenders.
“What about my property rights? I purchased that home believing that I was in an R-1 neighborhood and that R-1 status would be protected. It has not,” said Michael Krenn. “What I heard a lot tonight is the right to make some money off of renting. That’s great. But not in R-1 neighborhoods. You want to rent in an R-1 neighborhood? Rent to a single family.”
Edie and Stuart Tugman said they’ve made considerable investments in their downtown Boone home, but that other homes in their neighborhood that are rented to college students create negative impacts. They said they did not think it would be too difficult for the town to distinguish between legal and illegal non-conforming uses.
“It may take a year, it may take two years to get it done, but get it done,” Stuart Tugman said.
The hearing was held for input only and the council did not take action.