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WHY WILMINGTON'S ZONING CODE SHOULD NOT BE CHANGED TO PERMIT SHORT TERM VACATION RENTAL BUSINESSES TO OPERATE IN RESIDENTIAL NEIGHBORHOODS.  
Posted on Mar 14th, 2016

Wilmington residents have reported many problems caused by short term vacation rental businesses to City Code Enforcement and City Council.  Problems include loud weekend parties, too many people in the houses, too many cars on the street, cars illegally parked, and trespass on neighboring properties. Moreover, when the home next to you is purchased and converted from a single family residence to a vacation rental business, you no longer have neighbors who look out for and socialize with you and make a neighborhood what it is. Instead, you have ever changing groups of transient vacationers staying in the house next door. And because the owner of the property is not on site, if there is a problem, your only recourse is to call law enforcement.   

Staff reported to City Council that it has four options: 1) keep the status quo (City will enforce the Code as best it can when a complaint is received); 2) step up enforcement of the existing Code (which will require more personnel); 3) amend the Code to better define where these businesses will be permitted and enforce the amended Code; or 4) amend the Code to exempt short term vacation rentals from regulation and permit them to operate in residential neighborhoods without limitation. 

The money interests that profit from short term vacation rentals are lobbying for option 4, no limitations on where and how they operate. They are operating illegally, and their response, when caught, is that the law should be changed to permit what they are doing. These business owners will attend and be vocal at the upcoming public input meeting. Those of us who wish to protect Wilmington's residential neighborhoods need to attend this meeting as well and let the City know we want residential zoning rules strengthened and enforced.      

II. Position of ROW and Other Neighborhood Groups.  
 
1. Short term vacation rental businesses are the functional equivalents of suites hotels.  Under the Code, such businesses are not, and should not be, permitted in residential neighborhoods.
2.  We do not, however, oppose them in districts zoned business. We recognize that tourism is important to Wilmington’s economy and that tourists want a variety of accommodation options. But it is not necessary to sacrifice our neighborhoods, and the needs and investments of permanent taxpaying residents, to accommodate tourism.  It is necessary to strike the right balance. There are many housing units in districts zoned business and mixed use, like the Central Business, HD-Mixed Use, and the Main Street Districts, that already are being used as short term vacation rentals. Many more could be revitalized by this business use. Business districts like the CBD benefit from short term vacation rental businesses. The neighborhoods do not. With smart zoning and good Code enforcement we can have both: vibrant healthy neighborhoods and a variety of tourist accommodations
3. We do not support any amendment to the Code that would permit in residential neighborhoods on the theory that the nuisance behavior that comes with them can be prevented with regulation. As City staff has recognized, these businesses are difficult to regulate, and many of the owners and their guests have shown they will not abide by regulations. Law and Code enforcement officers should not be forced to become “hotel security” for vacation rental businesses in residential neighborhoods.
4.  We support an amendment to the Code to better define “residential housing” so that it is clear what types of rentals are residential in purpose and thus permitted in residential neighborhoods and what types are vacation rental businesses that should be restricted to districts zoned business. Currently, the Code defines residential “housing unit” as a separate dwelling used by “one family” for “housekeeping” purposes, whether owner or renter occupied, and if rented the rental period must be “weekly or longer.”  The City has found that vacation rental businesses routinely rent for less than a week, and that a weekly rental rule virtually is impossible to enforce. When faced with the same problem, Asheville NC adopted a monthly/30 day rental rule. This is a good model for Wilmington.  A 30 day rule is easier to enforce and anyone renting a house for at least 30 days is more likely using it for residential purposes consistent with the neighborhood. (A 30 day residential rental rule would not apply to vacation rentals in business districts. They could continue to do weekend or nightly rentals.)
5. We do not support “grandfathering” existing short term vacation rental businesses currently doing business in residential neighborhoods. They are in violation of the Code and illegal uses cannot and should not be grandfathered. They were aware of residential zoning when they purchased and they always have the option of doing legal long term residential rentals.  
5.  We do not support changes to the existing B&B regulations. Short term rental businesses, which compete unfairly with B&Bs, have tried to drag the B&B regulations into this discussion. This is a red herring.  B&Bs are primarily residential; the owner is required to live there. They are heavily regulated; for instance, only one B&B is permitted per neighborhood block.  These regulations strike the right balance between the preservation of the residential character of neighborhoods and permitting tourist accommodations in the neighborhoods.  The regulations are working for the neighborhoods, the B&Bs, the tourism industry and the City. There is no need to change them.  

The right balance of the competing interests delivers a win/win for Wilmington. Residential zoning and Code enforcement strike the right balance. In neighborhoods zoned single family residential, houses should be used for residential purposes. In districts zoned business or mixed use, short term vacation rental businesses should continue to be permitted. Good zoning and good code enforcement are good public policy and good for Wilmington.     
 
There is a lot of misinformation in circulation about this issue. It is not complex, but it is multi-faceted. There are many important public policy reasons why successful modern cities have for decades embraced residential zoning. If residential zoning is eroded, there are many unintended negative consequences (for instance, the loss of much needed affordable/workforce housing.) We hope you will attend the March 17 meeting, and that before you go you will review and consider the information set out in the following paper.
 
Frequently Asked Questions About Short Term Vacation Rental Businesses
 
A. What is a short term vacation rental, sometimes called a VRBO?
These are internet based businesses that offer overnight accommodations to vacationers, tourists and business and other travelers for a fee. The fee paid by the customer is shared between the property owner and an internet marketing/booking company like VRBO (Vacation Rental By Owner). The vacation rentals are furnished and include services typical of hotel stays—towels, linens, toiletries, cleaning. Like suites hotels, they may also include fully provisioned kitchens, coffee makers, microwaves, and the like. The vacation rental may be a whole house, an apartment, a condo or a room within a house.   
Investors and businesses buy properties, including properties that formerly were single family dwellings, and convert them to short term vacation rentals.  These rentals are, for all intents and purposes, hotel and guest accommodations. The business owners typically do not live on the property. They manage the rentals remotely through local agents who also do not live on site. 
Most operators of short term vacation rentals in the residential neighborhoods are investors/businesses as opposed to resident home owners. Because it is a business, the goal is to maximize profit by getting as many “guests” in and out of the property as possible, which often means a different group of vacationers every weekend. As shown below, these businesses are economically incented to violate the City’s Zoning Code and other regulations.   
These are NOT B&Bs.  B&Bs expressly are allowed in the historic neighborhoods, and are subject to many regulations and restrictions. By law, B&B owners MUST live in the house. So, first and foremost, a B&B is primarily a residential use, with a limited ancillary business use (a few rented guest rooms). B&B regulations were carefully designed to prevent them from undermining the residential character of neighborhoods.  For instance, only one B&B per block is permitted. B&B regulations are working and do not need to be changed.
By contrast, short term vacation rentals are more akin to suites hotels, except that typically, neither an owner nor manager lives on site.  They are not subject to and do not abide by the restrictions placed on B&Bs. Thus, they compete unfairly with B&Bs and undermine the City’s carefully balanced B&B regulatory scheme.    
 
B. Do we have short term vacation rentals in Wilmington?
Yes. A City staff report states that they are difficult to identify but estimates there are more than 100 properties being operated as short term vacation rentals both in business districts (like the Central Business District/CBD) and residential neighborhoods. Because they are difficult to identify, this is a conservative estimate. They are in many of Wilmington’s neighborhoods, but they are especially concentrated in the historic neighborhoods (HD-R, HD-5, HD-O) because of proximity to tourist amenities.  We estimate there are over 80 homes in the downtown historic neighborhoods being offered as short term vacation rentals.
One business operates 23 short term vacation rentals, spread over several different properties in Wilmington’s CBD and HD-R districts. Many of these properties were single family dwellings before they were purchased and converted by this investor/business to short term vacation rentals. The business owner says he is the biggest owner of short term vacation rentals in North Carolina. This business’s website for its Wilmington vacation rentals makes clear it is offering hotel accommodations, “getaways” and “suites,” to “visitors.” The rental rate includes hotel type services (towels, linens, soaps, hair dryers).  The website further notes: “Although visitors rarely cook, there is a fully stocked kitchen….”  (Traditional suites hotels also offer kitchens.)  These clearly are not residential rentals under any interpretation of the Code.     
 
C. Why should we be concerned about short term vacation rentals in residential neighborhoods?   
1. The Zoning Code properly prohibits these businesses in residential neighborhoods because of important, well established public policy goals.  
Wilmington’s Land Use Development Code does not permit businesses in districts zoned residential. It is important to stay focused on why Wilmington and other successful modern cities have for decades adopted this public policy.  Residential zoning supports stable, healthy, livable neighborhoods; protects residential property values; encourages investment in residential housing; and ensures we have sufficient varied, quality and affordable residential housing. If we permit short term vacation rental businesses to operate in residential neighborhoods, we undermine all of these policy goals.  If we permit one type of business in a single family residential district, we increase the risk other businesses will encroach and be permitted and ultimately increase the risk that the district will be rezoned.
2.  Short term vacation rental businesses are detrimental to residential neighborhoods. .  
Short term rental business owners claim their guests are affluent travelers who want an option other than a hotel and who quietly enjoy their stay in our neighborhoods. But this is only one type of short term rental customer.  There are many others who rent a house instead of hotel rooms because they plan to engage in activities that a hotel would not tolerate: too many people in the rooms, loud music, late night parties, lots of alcohol, and worse.  In short, some customers of short term renters are there for a “party weekend” with a large group of friends. There are numerous short term rental businesses operating in our neighborhoods ready to accommodate this market. Even the more responsible owners sometimes unknowingly rent to weekend partiers, because the owners are not on site. 
One long time downtown resident, a respected real estate business owner, recently wrote to the City eloquently describing the horrors of living between two vacation rental businesses that routinely rent to large groups on weekends.  She describes “partying,” noise at all hours, overcrowding (as many as 20 people at a time in the house and on the porch), too many vehicles on the street and in her shared driveway, and encroachments on her easement. She stated that she “moved into a Residential zoned neighborhood and [is] now living in a Hotel District.”
There is no owner on site. When she has asked the guests to please reduce the noise, she has been told “we are paying for this house and we will make as much noise as we like.”  Her only recourse is to call law enforcement. In fact, that is the solution urged by some short term vacation rental owners.  They argue their short term vacation rental businesses should be allowed in residential neighborhoods and if there are problems, the neighbors can call the police or Code Enforcement.   
That is the worst possible solution.  Law enforcement has far more important things to do than act as “hotel security” for vacation rentals in neighborhoods. The City’s taxpayers have far more important priorities. And Code enforcement agrees it is nearly impossible for it to make these businesses comply with the Code. The better answer is to continue to prohibit these businesses in neighborhoods. 
Even the short term vacation rental businesses that try not to rent to partiers undermine the residential character of residential neighborhoods:    
 a) Because they are businesses, they set the neighborhoods on a slippery slope towards loss of residential zoning. If short term rental businesses are permitted, how do you stop the next group of businesses (event and wedding venues, yoga studios, hair salons, antique businesses) from operating in neighborhoods?  
b) They bring in a revolving door of strangers in the houses around us.
c) There is no owner or manager on site so there is always the risk of problem guests.
d) They bring extra cars into neighborhoods already congested with too many cars parked on the streets. (In fact, the City recently discovered that one short term vacation business owner has been creating fake parking permit hang tags for his guests so that they could park illegally in restricted areas designated for residents.) 
e) They may bring more noise, litter, and pet poop.   
f)  Neighborhoods are less safe because residents no longer know the people on their streets.
g)  We no longer have neighbors who socialize with, support and look out, for each other;  who invest in Wilmington, volunteer with its schools and non-profits, and make contributions to its arts and charities; and who support the City’s businesses year round.
For all these reasons, short term vacation rental businesses adversely effect residential neighborhoods. 
               3.  Short term vacation rentals reduce the amount of affordable and workforce housing, already in short supply in Wilmington.  
Numerous studies show that when housing units are purchased by businesses and converted to short term vacation rentals, the inventory of single family homes is reduced. This hurts those looking for affordable housing---students, hospitality and other lower wage workers, young professionals, young families, and the elderly.  
As an example, a 2015 study prepared by land use experts and economists for Sonoma County CA acknowledged that short term vacation rentals benefit tourism and provide additional income for the “hosts.” It also found, however, that these benefits come at great costs:
On the “cost” side…short term rentals: 1) shift existing scarce local resident housing to the lodging sector, 2) encourage tenant evictions if a landlord concludes [he] can make more money from short term rentals than a long-term tenant, 3) violate local zoning and noise ordinances, 4) negatively affect the quality of life in residential areas due to nuisances caused by visitors; and 5) can cause loss of household population in given neighborhoods….  (See EPS Report, www.sonoma-county.org/prmd/docs/vacrent/eps-report, p. 8)
The study found that a significant number of housing units in Sonoma County had been lost to vacation rentals and that housing costs had risen 30%. It concluded that the work force/affordable housing shortage was exacerbated by short term vacation rentals. The study’s number one recommendation was that short term vacation rentals be “prohibited” in “urban residential zones” and permitted but regulated elsewhere. (EPS Report,  p. 18) 
Interestingly a study of the San Francisco housing market conducted for Airbnb also found that short term rentals reduced housing supply and increased costs:  “the introduction of Airbnb in San Francisco increased the price of a one-bedroom unit by $19 per month” and “if most Airbnb postings are by investors rather than residents, the rental price effect could actually be as high as an increase of $76 per month.” (See Airbnb study quoted at www.dailycal.org/2015/06/08/protect-housing).  There are many more studies and reports that make similar findings in other cities.
These reports are specific to the communities studied, but the parallels with Wilmington are obvious. We too have a significant number of residential housing units being converted to short term vacation rentals. We too have insufficient workforce and affordable housing. In fact, the City recently empaneled a joint task force with the County to work on the problem. The City document that sets out the need for the task force states: “An adequate supply of workforce/affordable housing is an emerging and perplexing challenge for our region… [I]t is critical to the continued economic and quality of life in the area.” Wilmington’s zoning Code expressly states that a major purpose of residential zoning laws is to “provide within specified areas of the City…sufficient land for single-family and other residences….” (Code, sec. 18-189).  If the Code is changed to permit short term vacation rentals to operate in residential neighborhoods, it will exacerbate Wilmington’s housing problem.
4. The presence of short term vacation rentals in residential neighborhoods also hurts hotel development. The City needs hotel development in the CBD to support the Convention Center and downtown businesses. Short term vacation rentals in neighborhoods reduce hotel room occupancy in the CBD, undermine hotel profitability and discourage future hotel investment. Yes, there are several downtown hotel projects in the pipeline, but most have yet to secure financing. Because short term vacation rentals in neighborhoods are siphoning off guests, hotel financing will be more difficult to get. Moreover, associations that are considering having their conventions in Wilmington count how many hotel rooms there are near the Convention Center; they do not count short term vacation rentals in the residential neighborhoods. 
 
C. Is there merit to the claim of short term vacation rentals businesses that they should be permitted to operate in the historic residential neighborhoods because they are necessary to the preservation and maintenance of heritage homes?
Short term rental owners claim they are making significant investments in historic homes that are in disrepair. They argue they maintain them better than do owners of long term rentals so that affluent vacationers will stay in them. They conclude based on this argument that they should be permitted to operate in historic residential neighborhoods.
This argument includes inaccurate assumptions and overlooks important facts. Some short term vacation rental businesses maintain their properties. But some do not.  More importantly, resident homeowners are the best stewards of historic homes. In fact, if short term vacation rental businesses are permitted in the historic neighborhoods, it will be a set-back for preservation in those neighborhoods.    
First, the argument is based on a false contrast limited to long term versus short term rentals. It overlooks the fact that the real preservationists, and the ones who best maintain a property, are residents who actually live in the homes. For decades, residents have been purchasing derelict heritage homes in the historic districts, investing far more in them than they will ever be worth because they are creating a special home to live in.  Because it is a labor of love, they spend far more than makes business sense.  These residents not only rescued historic homes but they also turned blighted areas into lovely neighborhoods that now provide the City with a substantial property tax base. (It is estimated that the property values in ROW’s area total close to $1 billion.)
Short term vacation businesses have arrived very recently and now demand Code changes so that they may operate in these historic neighborhoods. In short, they wish to cash in on what the residents created. But this would be grossly unfair to the residents who have done the real preservation work, and bad for Wilmington’s preservation movement. 
The residents relied on the existence of single family residential zoning when they made significant investments in historic homes. For decades, in large part because of residential zoning, there has been a strong trend in historic neighborhoods towards owner occupied homes. That trend is good for preservation. If the City changes the Code to permit short term vacation rental businesses to operate in these neighborhoods, this trend may well reverse. Most people do not want to invest their life savings and live in a home surrounded by short term rental businesses. Structures in a vacation rental district will not be as well preserved and maintained as those in a single family residential district. Bottom line oriented businesses will not invest what house proud homeowners will.    
Second, the argument erroneously assumes ALL short term vacation rental owners invest in and properly maintain their properties and NO owners of long term rentals do so. Those of us who live in the neighborhoods know these assumptions are incorrect. There are many houses leased to long term residential rental tenants that are beautifully maintained by the property owners and/or their tenants. And there are many short term rental business owners who have poorly maintained properties. As noted above, not all customers of short term rentals are quiet affluent vacationers. The group of people who rent a house for a weekend party are not too concerned about appearance and maintenance, so the short term rental businesses catering to this market are not incented to take good care of their properties.
Finally, we see few instances, if any, where a short term rental owner has purchased and rescued a truly derelict, at risk, heritage home. Typically, these businesses buy up the smaller, more affordable, move in ready townhomes, condos, and smaller houses in the neighborhood, and do very little to the home before they begin renting it out short term. The neighborhood loses a resident family and the home is no better maintained than it was when the family lived in it. Moreover, if the investor had not bought it, it likely would have been purchased by another resident homeowner.
In summary, the truly at risk historic homes have been rescued and are being well maintained by resident homeowners, not short term vacation rental businesses. If the Code is changed to permit short term rentals in the neighborhoods, these homeowners may leave and future residential homeowner investment will be discouraged.  In short, if we make weekend party houses legal in the historic residential neighborhoods, there will be fewer resident homeowners in the neighborhood and Wilmington’s preservation movement will suffer. History proves this to be true.
 
E. If we prohibit short term vacation rentals in our neighborhoods will we lose tourists?
There is no evidence that this is true. We agree tourists want a choice of accommodations; some do not wish to stay in hotels preferring self-catered type accommodations. Some wish to stay in an historic residential neighborhood.  We agree that Wilmington’s regulations should permit a variety of tourist accommodations, including short term vacation rentals. It is not necessary, however, to sacrifice our residential neighborhoods to achieve this goal.
Short term vacation rentals are, and should be, permitted in business and mixed use districts. Wilmington has many housing units in businesses and mixed use districts well suited to vacation rentals. There are historic homes around the edges of the Central Business, Main Street Business and Historic Theater Districts adjacent to residential neighborhoods. There are many condos above retail in the CBD, and numerous townhomes along the riverfront. Many of these properties need revitalization. If vacation rental businesses are prohibited in residential neighborhoods, they will re-locate to, and revitalize properties in, these business and mixed use districts. This would a win/win for Wilmington: tourists would have a choice of accommodation; the residential neighborhoods would not be sacrificed, and under-utilized properties in the business districts would be revitalized.
Protection of the residential character of the historic neighborhoods through good residential zoning is, in fact, good for tourism. Tourists come to see our beautifully restored historic neighborhoods. They are charmed by the fact that the neighborhoods have restored to their historic single family residential character. Tourists will not be so charmed by a district overwhelmed with vacation term rental properties.  
It also is worth noting that numerous other cities have prohibited short term vacation rentals in residential neighborhoods without damaging their tourist industry.
 
F. Is there merit to the claim of short term vacation rental business owners that they generate large Room Occupancy Taxes for the City and should be permitted to operate in residential neighborhoods for that reason?
Some short term vacation rental business owners make the claim short term vacation rentals “generated $2.859,516 in Room Occupancy Taxes in 2015….27.7% of the county’s bed tax income.”  They claim this figure comes from New Hanover County. This claim is inaccurate and misleading. 
First, the County does not maintain data on the amount of ROT paid by “short term rental businesses.” The County keeps data by geographic area and by two property categories: 1) hotels/motels/inns and 2) “other.” Presumably short term vacation rentals are included in the “other” category, but this category also includes B&Bs, guest houses, and all other property types. So, the County could not be the source of the exaggerated ROT number touted by short term vacation rental businesses.  
Second, a ROT figure for all of New Hanover County is not very helpful in making residential zoning policy decisions for the City of Wilmington. The County includes all the beach communities, which have a disproportionate number of second homes and short and long term vacation rental units. Second home communities’ housing and zoning priorities are different from of single family residential/primary residence communities.  
Third, in fact, short term vacation rentals in the City of Wilmington contribute very little ROT. According to New Hanover County, “other properties,” which include short term rentals, B&Bs, guest houses, and other types of properties, in the City of Wilmington (excluding the rest of New Hanover County and the special Convention Center ROT area) paid a total of only $28,544.32 in Room Occupancy Taxes for the most recent reported period (7/1/14 to 6/30/15).   By comparison, hotels, motels and inns in Wilmington generated over $3.8 million in ROT in the same period.  Compare that to the estimated nearly $1 billion property value in ROW’s area.     
 
G.  What does Wilmington’s zoning Code say about short term vacation rentals?    
Because they are businesses, the Code prohibits short term vacation rentals in districts zoned single family residential. The following provisions from the Code section for the Historic District Residential neighborhoods (HD-R) are illustrative. The Code sections for the other residential districts have similar language.    
1.  Section 18-189 provides that the purpose of the HD-R is “single family and other residences.” The “uses permitted by right” are single family residences (detached, duplex and accessory apartment) and a few listed non-residential uses that do not undermine the residential purpose and character of the HD-R (neighborhood recreational facilities, historic foundation offices, and one B&B per block with owner living on site.) The Code clearly states that business uses, not expressly listed, are prohibited. Short term vacation rentals, hotels and other guest lodgings, are not listed and thus are prohibited.   
2.  Section 18-10 states: “No interpretation [of the Code] shall be effective to change the character of a district in comparison with the purpose of such district and other allowed uses.”  The stated purpose and character of the HD-R is single family residential. Short term vacation rental businesses change that character and purpose. Thus, they may not be permitted by interpretation.
3. Section 18-173(g) provides that “all uses that are not listed in this article, even given the liberal interpretation mandated in this section, are prohibited. This article SHALL NOT be interpreted to allow a use in one zoning district when the use in question is MORE CLOSELY RELATED TO another specified use that is permissible in other zoning districts.” (Emphasis added.) Short term vacation rental businesses are “more closely related to” hotels, suites hotels, and other tourist and traveler accommodations, which are expressly listed as permitted uses in districts zoned business. They are not listed and thus are prohibited in the HD-R and other districts zoned residential. Section 18-173(g) mandates that short term vacation rentals SHALL NOT be permitted in the HD-R by interpretation.  
Short term vacation business owners argue that the Code permits short term vacation rentals in residential neighborhoods so long as the rental agreement with the guest is “weekly or more.” They cite Code section 18-812, which defines single family residences as “a separate independent housekeeping establishment for owner occupancy or rental/lease on a weekly or longer basis for …not more than one family.” 
This argument ignores the fact that the definition has two important parts: 1) a permitted residential use (housekeeping by one family) and 2) if the house is rented, the lease period must be “weekly or more.”   Use for “housekeeping” is the threshold requirement.  If the rental is not for “housekeeping,” the duration is irrelevant.  
An example illustrates the point: A business may not legally rent a house in the HD-R for more than a week for use as a business call center and claim it is permitted by the weekly rental provision. This is because it is a prohibited business, not permitted residential, use. The weekly rental provision does not make legal an otherwise prohibited business use.  Similarly, renting a house to vacationers for a fee is, in effect, operating a suites hotel.  Hotels are not permitted in the HD-R, and a hotel would not become legal in the HD-R if it required its guests to stay a week. 
In fact, businesses operating short term vacation rentals typically do not rent for a week. Many boldly advertise nightly and weekend rentals. The more savvy ones have guests sign a week long contract, but the contract provides the vacationer may leave after less than a week and get charged a pro rata nightly rate. Thus, these businesses either ignore the so-called weekly rental rule or they try to cleverly evade it with contract language. The City agrees. It stated in the recent staff report that the MAJORITY of these businesses are renting for less than a week in violation of the Code. Staff further conceded that it is virtually impossible to enforce a weekly rental rule (even assuming this is a correct reading of the Code).       
 
H. What are other tourist destination cities doing about this problem?
These virtual short term vacation rental businesses are a new phenomenon and they aggressively push the limits of zoning restrictions. Many local governments are struggling to determine how they fit into local zoning rules. The recent City staff report found that every municipality has unique circumstances and thus there is no uniform approach. However, the staff report and our research show that many other cities have banned short term vacation rentals in residential neighborhoods. 
Asheville has a 30 day rental rule for housing rentals in its residential districts. A 30 day rule is more clear cut, harder to evade, and easier to enforce. Someone who rents for 30 days is more apt to be renting for residential purposes. It outlaws the party weekend rental and prevents much of the bad behavior that comes with shorter vacation rentals. Asheville recently updated its Code to back up this rule with severe fines. Revenue from the fines is used to fund enforcement. This is a model for Wilmington to consider.
 
I. What is ROW’s position? 
As a representative of many downtown resident stakeholders, the City has invited ROW and its members to give input on the issue. ROW members will attend the March 17 input meeting and will share their view.  ROW members have spent a great deal of time researching the Code, researching what other cities are doing, and gathering the facts. They also have shared facts and research with other neighborhood groups. The ROW Board has requested and received input from its members. A vote was taken at a well-attended ROW member meeting. The vote was unanimous; ROW members do not want short term vacation rentals in their neighborhoods. With few exceptions, our members are united on the issue.   
ROW does not oppose short term vacation rentals in the CBD and other business districts. The Code permits them there, and they are good additions to districts zoned business.  We recognize that tourism is important to the City and that tourism is one of the competing interests that must be balanced in any policy decisions on this issue. We believe the proper balance is to prohibit short term vacation rentals in residential neighborhoods but to permit them, subject to sensible regulation, in the CBD and other business and mixed use districts.  We have not developed an opinion as to what that sensible regulation would be because our focus is on the residential neighborhoods where short term vacation rental businesses are, and should be, prohibited. 
ROW does not support any amendment to the Code that would permit short term vacation rentals in the neighborhoods on the theory that the nuisances and risks they create can be prevented by regulation. As City staff has conceded, these businesses are very difficult to regulate, and the City lacks the resources to do so. They are difficult for the City to identify. They are owned, operated, and managed off-site, by virtual internet based businesses that most often are not located in Wilmington.  The short term renters causing the problems are often gone by the time Code Enforcement is able to respond to a complaint.  And most of these businesses have shown themselves to be unwilling to abide by regulations. They ignore, evade and flout the very weekly rental provision they claim justifies their operations in residential neighborhoods.  As the City reports notes, the MAJORITY are in violation of the Code. And it is not a solution to turn our law and code enforcement officers into hotel security for vacation rentals embedded in neighborhoods. The better, indeed only solution, is to prohibit short term vacation rentals in residential neighborhoods. A prohibition is much easier for the City to enforce than the misinterpreted weekly rental provision.  
ROW would support an amendment to the Code that closes loopholes, clarifies the law, and makes it easier to enforce the Code.  A 30 day rental rule for residential housing, like Asheville’s, would clearly define what residential rental housing permitted in residential neighborhoods, would be much easier to enforce and would close a loophole being claimed by for what are in effect illegal hotels. 
Further, some argue that any new regulation of short term vacation rentals requires a re-examination of the limitations on B&Bs. This is not the case. B&Bs are very different, including because the owner must live on site. A B&B is, in effect, a single family residential property with a very limited business use. The B&B rules are working and should not be changed.  
J. What can you do to protect your neighborhood?  
First, get the facts and stay informed. Attend the City’s public input meeting on short term vacation rentals on March 17, 6 to 7:30 pm, at Forest Hills Elementary School. Let the City know you want strong residential zoning to protect Wilmington’s neighborhoods, historic districts, and supply of affordable and workforce housing. Let the City know we do not have to sacrifice our neighborhoods and residential housing for tourism. With sensible zoning, that permits short term rentals in business districts but prohibits them in residential neighborhoods, we can have vibrant neighborhoods, investment in affordable housing, and accommodation options for tourists.
For more information, follow this issue on the City’s website, www.wilmingtonnc.gov, and on the website of Residents of Old Wilmington, www.rowilmington.org.
 
This paper was prepared and is presented by Residents of old Wilmington.   
 
 
 
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