Hoover council to consider restrictions, licensing for short-term rental homes

The Hoover City Council on Monday night is scheduled to consider an ordinance that would prohibit rental of properties for less than 30 days in single-family residential neighborhoods unless the rental is for a special event in the city and for seven days or less in a calendar year.

Hoover Mayor Frank Brocato said the goal of the ordinance is to protect residential neighborhoods from problems that sometimes come with short-term rentals, such as loud parties, excessive numbers of vehicles, and high turnover of unfamiliar people coming into neighborhoods.

Many short-term rentals are listed on websites such as Airbnb and Vrbo [Vacation Rental By Owner], but some are rented out in other ways.

While some people may rent out their personal residence or a part of it on occasion, some houses are used exclusively for short-term rentals. What has happened is that investors have bought homes and essentially turned them into hotels in the middle of a neighborhood, Brocato said.

“The house is not being used as a house. It’s being used like a hotel would be used,” he said. “Many people have told us that it shouldn’t be allowed.”

When people buy homes in a single-family residential neighborhood, it’s an investment they made with the understanding that the neighborhood is designed for residential use, the mayor said. But with many short-term rental properties, “it’s clear that it’s grown into a business.”

The ordinance on Monday night’s City Council agenda would prohibit rental of properties for less than 30 days in single-family residential neighborhoods unless the rental is for a special event in the city and for seven days or less in a calendar year.

Short-term rentals would be allowed on property zoned for multifamily use such as apartments or condominiums unless a homeowners association does not allow them. Short-term rentals also would be allowed in commercial areas such as general business districts, community business districts, neighborhood shopping districts, preferred commercial districts and special use districts.

In areas where short-term rental properties are allowed, property owners would have to get a business license and short-term rental permit for $150. If the short-term rental were in a single-family residential district for a special event, the permit fee would be $300.

Short-term rental properties would have to have smoke detectors and carbon monoxide alarms and post emergency contact information and floor plan diagrams that include fire exits and escape routes, as well as an insurance policy with a minimum of $1 million worth of liability and personal injury coverage.

An earlier draft of the ordinance included a requirement for fire suppression sprinklers, but that requirement was later removed at the request of council members.

No more than two people would be allowed per bedroom, and no parking would be allowed on the street.

If three valid and substantiated complaints were received by police within 12 months, the short-term rental permit would be suspended for at least six months. If a second suspension were to occur within two consecutive years, the second suspension would last 12 months. If a third suspension were to occur within three years, the permit would be revoked.

If a property owner failed to take recommended corrective action to remedy violations of the ordinance, the owner could be forced to appear in Hoover Municipal Court for maintaining a public nuisance and be subject to fine, imprisonment or both.

Council members have different opinions about the ordinance.

Council President John Lyda said this ordinance has been under discussion for about four years and said it’s applying zoning laws to a new business model. Short-term rental businesses will face regulations about where they can and can’t go just like other businesses do, he said.

Councilman Casey Middlebrooks said he supports the ordinance as well.

“These are private businesses. I don’t view them the same as residential houses,” Middlebrooks said. “Most people don’t want these right smack dab in the middle of residential properties. These are business properties, and the city zones businesses all the time.”

Councilman Steve McClinton said he wouldn’t want a party house next to him either, but he doesn’t think short-term rental properties are as big of a problem as some people make them out to be.

City Planner Mac Martin estimated there could be 100 to 200 short-term rental properties in the city based on reviews of some of the online short-term rental platforms. Brocato said he’s heard maybe 15 complaints over the past five years.

McClinton said the ordinance is a “draconian measure when 95% of the properties are doing it right.”

He is in favor of requiring short-term rental permits and business licenses, but banning them from single-family neighborhoods is going overboard, he said. Platforms such as Airbnb and Vrbo have procedures in place to remove properties from their websites if there are significant problems, he said.

Plus, it’s hypocritical for the city to say it wants to be a sports tourism destination city but not allow visitors to stay in single-family residential properties as short-term rentals, McClinton said. There is a lot of demand for that, he said.

Jordan Masaeid-Hosey, the CEO of a Hoover-based short-term rental company called Game On BnB that manages 37 properties in the metro area, said it would be a big mistake for the city to pass this ordinance.

There is a huge appetite for short-term rentals in neighborhoods in today’s market, and if Hoover doesn’t offer people the type of accommodations they are seeking, they’ll go to neighboring cities such as Vestavia Hills or Pelham and spend money at restaurants, gas stations and retail stores in those cities instead of in Hoover, Masaeid-Hosey said.

“I think that it’s very short-sighted,” she said.

Short-term rentals are a new income opportunity for a lot of people, and to forbid people from renting out their home would be a violation of property rights, she said. She also thinks it’s unfair to allow people to rent out an apartment for a short time but not a home in a single-family neighborhood.

And the city has made no “grandfathering” provisions for people who have already invested money in properties for the sole purpose of short-term rentals, she said. The city also did not involve the owners, property managers or short-term property platforms such as Airbnb or Vrbo in the drafting of the ordinance, she said.

Nia Brown, the public policy manager for Airbnb in the Southeastern United States, said in an email to McClinton that the people who offer their homes in Hoover for short-term rentals are doing so to supplement their incomes, build wealth and share Hoover with the world.

“Hosting is one tool many families use to stay afloat after layoffs and in times of economic distress — like we are living in now,” she wrote. “Depriving people of this income risks these families’ financial stability.”

Plus, “the vast majority of STR operators never have any issues and cause no disturbances,” Brown wrote. “Please do not punish them by banning STRs in residential zones.”

Brown said she knows party houses are a concern for Hoover council members and said Airbnb already has taken numerous steps to try to prevent parties, including a party ban put in place in June of last year.

Neighbors or community members also can contact Airbnb directly to report disturbances or concerns so they can be resolved, and Airbnb uses artificial intelligence to screen potential bookings for potential party risks, she wrote.

Airbnb supports reasonable short-term rental regulations and permitting ordinances because they ensure trust between operators, local governments and community members, Brown said. She asked for the council to work with hosts to develop a more reasonable ordinance.

Councilman Sam Swiney said he was leaning in favor of the ordinance, particularly since the sprinkler requirement was removed. “I don’t think it’s an unreasonable ordinance,” he said.

However, he wants to listen to what people have to say at Monday night’s public hearing before making up his mind, he said.

The council meeting is at 6 p.m. at Hoover City Hall.

$3 MILLION ROAD, DAM REPAIR

Another item on the agenda is an agreement for the city of Hoover to perform an estimated $3 million worth of repairs to Lake Forest Circle and the land and dam underneath the road in the Riverchase community, even though the land and dam beneath the road are owned by the Riverchase Country Club.

The country club can’t afford to repair the dam and was considering draining the lake adjacent to it to reduce pressure on the dam, according to the proposed agreement. Draining the lake would leave the area swampy and potentially impact Riverchase residents who own lakefront property, the agreement said.

Under the terms of the agreement, the Riverchase Residential Association would contribute $150,000 toward repairs, and the country club would agree to have its property annexed into the city and begin paying property taxes on its 192 acres, sales taxes, business license fees and other taxes. The city would be responsible for the balance of the repair costs. The estimated valued of the taxes and fees that would come from annexing the country club property was not included in the agreement.

FIREFIGHTER CHALLENGE

The council also on Monday night is scheduled to consider an agreement to bring the 2023 United States National Firefighter Challenge Championship to Hoover on Sept. 5-10.

The city would pay a host fee of $25,000 to have the games in the lower parking lot at Hoover Metropolitan Stadium, and the World Police & Fire Games would contribute a similar amount as a sponsor, Hoover Parks and Recreation Director Erin Colbaugh said.

The event is expected to draw up to 300 competitors from 125 fire departments in 19 states and two firefighters from Ukraine, Colbaugh said. The firefighters compete in slightly modified versions of training drills common at firefighter training centers.

See the complete meeting agenda and accompanying information here.