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Home My WebLink About2016-02-23 CC Packet Enclosure Oak Park Heights Request for Council Action Meeting Date February23rd, 2016 Time Required: 10 Minutes Agenda Item Title: Consider the AirB&B Agenda Placement New Business Originating Department/Requestor Council member Mike Runk Requester's Signature Action Requested Discussion,Possible Action Background/Justification(Please indicate if any previous action has been taken or if other public bodies have advised): I would like the City Council to discuss the items known as"AirB&Bs"—which are essentially short term lodging rentals for single family homes to determine if these operations align with City Ordinances as they are currently written(relative to lodging taxes,public safety and/or home occupations)and/or if the Council would like to investigate this matter further.If the Council would like to review this matter I would like to ask that the City Staff provide some details and analysis for a future meeting not later than April 2016 Enclosures: Similar Action/Resolution by the City of St.Paul Excerpts from the MN Dept.of Revenue. Star Tribune Article—City of Eagan,MN for 5-23-15 Page 153 of 158 trr ''4.�J City of Saint Paul City Hall and Court House 15 West Kellogg Boulevard J.° e itfr y Phone:651-266-8560 neg 't Legislation Details (With Text) File#: RES 16-181 Version: 1 Name: Type: Resolution Status: Mayor's Office In control: City Council Final action: 2/3/2016 Title: Asking the Department of Safety and Inspections and the Department of Planning and Economic Development to study AirBnB and similar companies and how their operations align with current city ordinances. Sponsors: Chris Tolbert Indexes: Code sections: Attachments: Date Ver. Action By Action Result 2/3/2016 1 City Council Asking the Department of Safety and Inspections and the Department of Planning and Economic Development to study AirBnB and similar companies and how their operations align with current city ordinances. WHEREAS companies like AirBnB which allow individuals to rent out a room or residence to guests for short periods of time are expanding in the City of Saint Paul; and WHEREAS the growth of these economies has been seen to increase visitors and tourism; and WHEREAS the City Council encourages all people from around the globe to come and visit the fine City of Saint Paul; and WHEREAS the City Council recognizes its responsibility to ensure guests'safety while visiting in Saint Paul; and WHEREAS other municipalities have studied AirBnB and how they work or do not work with current city and state lodging, building and zoning codes; and therefore BE IT RESOLVED that the City Council asks the Department of Safety and Inspections and the Department of Planning and Economic Development ("Departments") to study AirBnB and similar companies and how their operations align with current city ordinances. In addition, the Council asks that the Departments evaluate whether current codes ensure that visitors, landlords, AirBnB neighbors and private property are safe and protected. The Departments shall ensure that the appropriate taxes are being collected from these sorts of properties and uses. The Council asks that the Departments bring forward a report of their findings and any suggested ordinance changes, if needed, by June 1, 2016. City of Saint Paul Page 1 of 1 Printed on 2/4/2016 Page 164 of 158 MINNESOTA- REVENUE www.taxes.state.mn.us Hotels and Lodging Facilities 141 Sales Tax Fact Sheet What's New in 2015 We clarified the information about complimentary services versus package deals. Lodging facilities must charge sales tax on short-term Lodging facilities include(but are not limited to): lodging and certain related services. This may also in- • bed and breakfasts chide local sales taxes or city lodging taxes. For more • hotels information,see fact sheets: • campgrounds • 164, Local Sales and Use Taxes • motels • 164S,Special Local Taxes • resorts Lodging is the rental of a room or rooms for a temporary • rooming houses place to stay or live.Charge sales tax on lodging and • trailer camps lodging-related services furnished for periods of: • vacation home rentals • less than 30 days;and • 30 days or more if there is no enforceable writ- ten lease agreement that requires the customer to give prior notice of their intention to terminate Lodging-related services Charges for services provided within a guest room are • in-room safes taxable. • laundry and dry cleaning services Examples: • pay-per-view movies and video games • cots,cribs,refrigerators,roll-away beds,and ex- • room service or room delivery,including man- ercise equipment datory tips and gratuities • food or liquor from mini-bars and refrigerators • telephone access charges in guest rooms Complimentary services versus package deals Supplies to provide complimentary services are taxed Note: A complimentary breakfast is when the customer differently than supplies used to provide package deals. has access to breakfast and the charge for their room is not affected if they eat the meal or not. Complimentary services Complimentary services(or items)are those given to the When complimentary services are provided,hotels and customer as a courtesy with no additional charge. lodging facilities must pay sales tax when they buy in- puts to those services.This includes disposable items Examples: such as plates,napkins,silverware.etc. • Complimentary breakfast • Free birthday dessert Hotels or lodging facilities providing complimentary • Free drink in response to a customer complaint items must pay sales tax on the purchase of those items. • Shampoo,conditioner,and soap Sales and Use Tax Division-Mail Station 6330-St.Paul,MN 55146-6330 This fact sheet is intended to help you become more familiar with Minnesota tax Phone:651-296-6181 or toll-free I-800-657-3777 laws and your rights and responsibilities under the laws.Nothing in this fact sheet supersedes.alters,or otherwise changes any provisions of the tax law,administrative rules.court decisions.or revenue notices. Alternative formats available upon naluest. Stock No.2800141.Revised June 2015 Minnesota Revenue.Hotels and Lodging Facilities Page 155 of 158 SOUTH METRO Eagan considers short-term house rentals through sites like Airbnb By TODD NELSON,SPECIAL TO THE STAR TRIBUNE May 23, 2015- 12:37 AM An Eagan couple's desire to rent their basement to guests through online lodging service Airbnb has riled neighbors and prompted a discussion of whether the city should allow such short-term rentals. Homeowners Tyson and Stephanie Bramer began renting the walkout basement of their Pinecrest Court house, which overlooks Fish Lake, last fall. But they stopped in November, after learning that the city doesn't allow short-term rentals — considered a commercial use like a hotel or motel— in residential areas. When the couple's attorney appeared before the Eagan City Council recently to ask for a special permit to continue "home sharing," neighbors countered with a petition in opposition and council members said they needed more time to consider the issue. "This changes the fundamental character of [a single-family] neighborhood because you've got a steady stream of people coming in that you don't know," Council Member Paul Bakken said. "If it was my neighborhood, I wouldn't like it." In renting out part of their home, the Bramers joined hundreds of other Twin Cities homeowners, including others in Eagan, who use websites including the popular Airbnb platform to market their homes to travelers. The site has hundreds of Twin Cities listings, among more than 800,000 worldwide. Some Minnesota cities, including Stillwater and New Prague, allow homeowners to operate bed-and-breakfast lodging in single-family residential areas, according to Eagan city planners. But Lakeville approved limits on residential boarding in 2014 in response to some residents' complaints about short-term rentals. Burnsville plans to revise its code to make clear that its prohibition on motels in residential areas includes bed-and- breakfasts or short-ter fir WINTE , SHOP NOW Page 156 of 158 New 2016 VW Turbocharged Passat S Automatic A _ 36-month lease r, 2; ,) �� mo $1,999 due at signing IMos ulliDtileprpnloid ll till ImsudAft ppm nolMrr.Cagsspnmpcgar appageprs mut a as,eelrea.Orealoavrndreupgisa aica+rea 1174IL Volkswagen tbhwaaen Wesnslde of Highway IOQ 1/2 Mk So of 394 M Sc.Louis Park 45 2.3 77.4100 MORE OFFERS+DETAN t5 Test case? The Bramers have asked the Eagan City Council to approve an interim-use permit that would allow them to host short-term rentals in their home for three years or until the city modifies its code to allow such lodging in residential areas. Stephanie Bramer told planning commission members in April that their home would be "the best possible test case to help guide Eagan as it develops specific regulations on home sharing." "It is obvious that our activities and those of our guests will be closely monitored by our neighbors and any problems will be immediately reported to the city," she said. The permit could be reviewed annually and come with a number of requirements, including a provisions that one homeowner be present overnight while a short-term renter is staying at the house and that renters park their cars in the driveway. Bramer said she believed the conditions would adequately address neighbors' concerns. Fifteen of the 16 other homeowners on the cul-de-sac where the Bramers live, however, have signed a petition opposing the bid to resume short-term rentals. Neighbors' concerns included the effect of a short-term rental property on their property values, extra traffic on a cul-de-sac and wariness of strangers coming and going. "Their decision last fall to prepare for and operate a bed-and-breakfast in their home without the city's approval can serve as a test case," Robert Barth, a neighbor, told council members. "They demonstrated what a negative impact this operation can have on neighbors and how difficult this may be for a city to control." Future decision Mayor Mike Maguire said the city needed more time to consider the issues that allowing short-term rentals in residential areas raised. The council will discuss short- Page 157 of 158 term rentals at a workshop in August and consider the Bramer's request for an interim use permit in September. "There is a sharing economy that is emerging ... and it puts regulation in a gray area," Maguire said. "I'm not sure it's going to go away as a trend." The Bramers told city staff that they received their first booking less than 24 hours after listing their home on Airbnb and had since had more than 20 reservations. "We were surprised to see how many people wanted to stay with us," Tyson Bramer said. Besides additional income, which Bramer said the couple had invested in improving and equipping their basement for future renters, he said they had enjoyed social benefits from playing host to people of different backgrounds. They also refer renters to local restaurants and the Twin Cities Premium Outlets mall. Todd Nelson is a freelance writer in Woodbury. His e-mail is todd_nelson@mac.com. • Comments NEXT IN LOCAL Downtown East light-rail station to be renamed U.S. Bank Stadium Station Article by JANET MOORE• February 15, 2016 - 11.32 PM 'Be the help.' Coon Rapids cop teaches CPR in Heart Safe campaign Article by SHANNON PRATHER . February 15, 2016 - 9:04 PM Hamline adjunct instructors ratify their first-ever contract Page 158 of 158