March 7, 2023
Dear Neighbors,
The Urban County Council will consider draft Ordinances at 1:00 pm today in the General Government and Planning Committee in the Urban County Government Building, 200 E. Main, 2nd Floor Council Chamber. The draft proposes a huge change in the number of rental occupants allowed in a house or apartment (as many as 12), and in the length and frequency of rental stays permitted (new guest groups allowed each night). These changes threaten the stability of all our residential neighborhoods. Long-term renters and homeowners in the city’s most central, attractive or moderately-priced areas may be the most vulnerable to displacement and injury. We love our homes and neighborhoods; we’re in danger of seeing them “loved to death” by investors and their higher-paying transient guests.
OCCUPANCY
A short-term rental under state law is a residence for rent for stays less than 30 days like Airbnb and VRBO. The maximum occupancy for most single-family and duplex neighborhoods under current Ordinances is one family of any size, or up to four (4) unrelated renters. The proposed Ordinance would allow a group of two (2) renters per bedroom plus four (4) more, capped at 12 per house (including any long-term residents) unless the Board of Adjustment authorizes more. That’s triple what is allowed today in a four-bedroom house. In addition, any “hosted” house in a residential zone could have a separate short-term rental adding two more in an Accessory Dwelling Unit (a second apartment or backyard house).
HOSTED VS. UNHOSTED
If a property has an on-site host, its owner can use it for short-term rental without getting a Board of Adjustment permit (though an occupational license is required). This host is not necessarily the homeowner next door. The host can be the property owner, or the operator of the short-term rental, or indeed “anyone who . . .consents to be an agent of the owner or operator”….Investors and corporations are buying houses in Lexington for short-term rentals (STRs) and converting them from single family homes to STRs. Your next neighbor could be a profitable guest house offering transient lodging like a hotel.
ACCESSORY VS. CONDITIONAL USE
Does converting a single family home into a busy STR need a public hearing and a vote? By the new draft, a “hosted STR” does not: the proposed ordinances rate it an “accessory” use belonging to the property by right. It is a use of the land that is customarily subordinate and incidental, like a home occupation or office. The principal use here would be “single-family dwelling unit.” Everyone is allowed such accessory uses by right (and even certain accessory structures like sheds or garages, too). One doesn’t have to go to the Board for them, just follow the steps required.
Conditional uses are another story. An unhosted STR needs a conditional use permit from the Board of Adjustment for that. The BOA must decide if the use is right for the location and context, and may attach conditions to make it fit better– like restricting the number of occupants or requiring party activities only during certain hours of the day. Our neighboring city of Covington, KY considers all STRs to be Conditional uses. Should any STRs in one-family and duplex zoning be rated accessory and permitted by right? –With occupancy as many as twelve per dwelling unit, and term of stay as short as one night? Conditional uses have to provide mailed notice to neighbors and a hearing. The BOA must consider requiring conditions, and may deny the use altogether, if warranted.
As proposed for Lexington, then, hosted STRs in single-family zoning would not have to go to the Board of Adjustment; but unhosted STRs, as the principal use on the lot, would require a conditional use permit.
DENSITY
The City of Louisville prohibits STRs from being within 600 feet of each other, property line to property line. The proposed Lexington Ordinance merely asks the Board of Adjustment to “consider” how many STRs exist within 1,000 feet of a proposed STR. The 600 foot rule gives a definite standard to better protect neighborhoods (though extraordinary circumstances may require the BOA to grant a variance — cut the owner some slack — to relieve a special hardship in following the hard-and-fast rule). The BOA also is to “consider” the occupancy rate of surrounding STRS; whether nearby STRs have been cited as nuisances (in our experience, citations and notices of violation are extremely rare in Lexington, though complaints may be numerous); and the Applicant’s record of compliance. Compliance entails filing proper records, giving correct and complete information in advertising, paying taxes, and a good many other things that could greatly benefit neighborhoods but currently seem unenforceable or unenforced, including following the zoning regulations.
ENFORCEMENT
A primary reason for the problems Lexington is having with short-term rentals is that STR owners have been allowed to violate city ordinances regarding occupancy standards and duration or frequency of stays. Citizen complaints have been ignored. We have an STR in the Kenwick neighborhood that advertises that it hosts up to 20 short-term renters at a time. A neighbor in southwest Lexington knows of three (3) STRs in the vicinity of her home, all of which exceed the occupancy limit of four (4) unrelated renters. When she reported the fact, the response she received from the LFUCG was, “We cannot do anything about that.” She asked if she could take pictures, look at license plates, etc. and the response was “no;” an enforcement officer would have to be present to gather valid evidence.
The solution for the enforcement problem should not be to raise occupancy limits and shorten the minimum stay permitted to the dwelling unit on the theory that if restrictions are removed or grossly relaxed, the violations will be few. A better course would be to lengthen the minimum term of stay allowed to residential land use. How can anyone count and document occupancy in a period of two or three days at most? The frequent changes of occupancy are a nuisance in themselves, not conducive to neighborhood safety, stability, and the quiet enjoyment of one’s home. Neighbors are constantly called upon to assist and patrol the transient land uses nearby — unpaid concierge, security officer, and cleanup crew together.
Opening the door wide to accommodate transient guests is an intensive commercial use in residential zoning. The rapid proliferation of STRs through advertising platforms puts rental housing for modest wage-earners out of reach. Such use is not, nor does it pretend to be, long-term housing; if this transient and commercial use is permitted to engulf our neighborhoods, we will see still more long-term residents injured and displaced.
GENTRIFICATION AND AFFORDABLE HOUSING
Between 1,100 and 1,400 residences in Lexington are documented STRs, and the number is growing rapidly. Investors buying houses for STR conversion compete in the marketplace for permanent housing, decrease the number of houses on the market, and increase housing prices. Investors frequently look for less expensive housing to adapt and improve in order to increase profits, leading to an increase in gentrification.
Possibly the worst amendment to the ordinance in its most recent draft struck the clause requiring that any conditional use permit for short-term rental be null and void when the property transfers or the use ceases. Removing the sunset clause ensures that any short-term rental, once established by an investor may remain forever as a commercial venture serving transients never returning to the permanent housing stock so badly needed at all levels and in all areas of Lexington.
Converting precious land from homes to hotels is the reverse of the regulatory incentive that our community needs today. With one hand, the Council is increasing budget allocations to foster and support affordable housing (another $2 million just last week). Council, with the other hand, should not adopt regulatory incentives to increase the activity of STR investors and remove permanent long-term housing opportunities in equal or greater measure!
You may contact council members (councilmembers), or attend the meeting at 1:00 today. We will let you know what the Urban County Council does today. Contact FCNC at fayetteneighborhoods if you have any questions.
Walt Gaffield, President
Fayette County Neighborhood Council, Inc.
Sent by Janet Cabaniss, FCNC secretary
jcabaniss