Regulated hotel industry must be on equal footing with short-term rentals, Saratoga Springs supervisor says

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SARATOGA SPRINGS – When the movie “Paint” filmed in the city last year with actor Owen Wilson, the production directed most of its lodging dollars toward Airbnb, Supervisor Tara Gaston said with concern.

“There were 36-some-odd Airbnbs that they reserved — not nearly as many nights at a hotel,” said Gaston, who used the movie production’s visit as an example of the need to create equity for the locally taxed and regulated hotel industry in the tourism-centric Spa City. 

Local property owners who rent through Airbnb, VRBO and Home Away are essentially small businesses, Gaston said, that aren’t subject to the same rules relative to occupancy taxes or inspection scrutiny.

“It’s not a fair playing field, especially for those that are doing it more as a commercial enterprise as opposed to renting out some space in their house,” she said. 

To address the topic, Gaston is holding a public forum Feb. 17 at 5:30 p.m. in the City Center.

The forum comes on the heels of Airbnb’s release of annual data that showed its hosts in Saratoga Springs made more than $12 million last year, a staggering increase of 83% from 2019.

Other than the presumed ripple effect of visitors patronizing local restaurants and stores, the city doesn’t get any of that money from occupancy taxes.

Short-term and overnight rentals are exempted from Saratoga County’s 1% countywide occupancy tax that’s imposed on tourist homes, hotels and motels.

On top of that, Saratoga Springs imposes a 5% occupancy tax on tourist homes, hotels and motels.

The exemptions for short-term rentals is due to Saratoga County being one of two counties in New York that’s limited by state law from applying occupancy tax to establishments with three or fewer units, county Treasurer Drew Jarosh said.

The Saratoga Springs City Council last year passed a resolution seeking to have the law changed through home rule, so that it can impose the occupancy taxes on properties with three or fewer units.

Darryl Leggieri, president of Discover Saratoga, who’s also concerned about the impact of short-term rentals on the local hotel industry, said the organization is in favor of a revision to the county’s occupancy tax law that would result in guests using online sharing platforms to pay the same taxes as hotels, motels, and bed-and-breakfasts.

“Requiring short-term rentals to pay the same taxes as the rest of the industry would enhance tourism advancement, as well as supporting local infrastructure and services,” he said. “We can put that money back into our destinations, to attract more visitors. And it’s not a tax on the local owner. It’s a tax on the visiting guests. Sometimes that gets lost.” 

Jarosh said he’s been attune to concerns about short-term rentals for the past six years, when Airbnb began to offer counties a voluntary agreement where the company would collect local occupancy taxes and remit it to the municipalities.

“We realized we couldn’t sign that agreement with Airbnb, because of this state law that limits us from applying occupancy tax to establishments of three or fewer units,” he said. 

The quality-of-life issues that short-term rentals present around safety, security, and accessibility raise yet another layer of concern, Jarosh said.

“Those concepts such as code enforcement are about making sure that these places that are performing overnight rentals are providing a similar service to the hotels — and the hotels are already regulated on everything from smoke detectors and carbon monoxide detectors, to fire extinguishers, ADA (American with Disabilities Act) accessibility,” the county treasurer said. 

“These are the requirements that we put the hotels under in order to operate and serve the public, and so there’s a code enforcement issue saying, ‘Should these overnight rentals also be subjected to the same regulations?'”

Jarosh said all of the things entwined with quality-of-life concerns fall to the city level.

Gaston said quality-of-life concerns have risen to a head the last few years, where there have been complaints about public safety and nuisances at short-term rental properties. 

“I live two houses down from someone who rents out part of their house for Airbnb, and I’ve had no problems,” she said.

But previously, when Gaston rented in another part of the city, she recalled that “the house next door to me, as near as I could tell, was 100% used as an Airbnb, and it was incredibly difficult to sleep because there were parties, constantly.”

She continued: “There’s not a whole lot you can do, especially if they’re there for one night and then they’re gone. Who do you charge with a noise complaint? Is it the owner? But they weren’t the ones actually there.”

Gaston said she wants the Saratoga County Board of Supervisors to provide the treasurer with additional personnel that would be necessary for regulating the safety and registration of short-term rentals. 

“It might require more people in that office, and that’s something that we would need to support,” she said, adding that her colleagues’ primary concern was hearing from the public, which is why she set the public forum.

“Forum is probably a bad word for it,” she said. “We want to hear what people think about this. Do they want us to register them? What problems do they foresee with it? What’s their concern? Why do they think it’s worthwhile?”

Gaston said she’s already heard from bed-and-breakfast operators who have toyed with the idea of deregistering their businesses, to put them on equal footing with short-term rentals.

“They say, I could deregister and do the same thing the short-term rentals are doing and not have to do all the registration, safety requirements, taxes, etcetera, that make short-term rentals less safe and less responsible to the community,” she said.

By anyone’s best estimate, the supervisor said there are upward of 1,000 short-term rentals in the city. 

“I would say that the numbers are significant and growing,” said Leggieri of Discover Saratoga.

“Short-term rental platforms are here to stay,” he said. “We understand that. This is the way that some travelers like to experience a destination.”

“We just want to level the playing field so that all lodging options are contributing sales tax and occupancy tax,” he said.

Jarosh, the county treasurer, said: “I do believe that this market needs to be made on an equal playing field with all of our hospitality industry. It’s a very vital market. The overnight rental market serves a key piece of our market segment – and that is the seasonality.” 

Instead of building hotels, where occupancy rates fluctuate — up during summers and down other times during the year — the overnight market is able to quickly bring supply into the market when it’s most needed, he said.

“That’s a key feature,” Jarosh said. “And I want to make sure, too, that homeowners or property owners who have certain rights and who want to supplement their retirement incomes or their education funds for their kids — that they have the ability to do so. We don’t want to take that away. But we certainly want to make sure that this is safe and secure and fair for everybody.” 

Gov. Kathy Hochul’s $216.3 billion spending plan for 2022-23 would subject non-traditional vacation rentals to state and local sales tax, just like hotels, motels and B&Bs.

In a statement, an Airbnb spokesman said: 

“The Governor’s budget inclusion is an important step forward for the thousands of Airbnb hosts across New York who pay bills sharing their homes, and will bring millions of dollars in new revenue across the state each year. We’re pleased the state has recognized the important role short-term rentals can play in New York’s recovery and are hopeful that 2022 will be the year New York joins dozens of other states in passing sensible short-term rental rules that protect economic opportunity and drive tourism forward.”  

Contact reporter Brian Lee at [email protected] or 518-419-9766.

Categories: Business, News, Saratoga County, Saratoga Springs

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