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  • 17 Sep 2014

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Portland must rein in area's outlaw B&Bs

My View: Websites make it too easy for short-term rentals to dodge regulations


Portland is not alone.

From Manhattan to Maui, from beach towns to ski resorts, from small towns to major destinations, cities across the country are wrestling with how to regulate the exploding number of vacation rentals fueled by the major vacation rental websites — VRBO, Homeaway, Airbnb, Flipkey and Craigslist.

These websites promote paid vacation rental listings and make a huge a profit in doing so, but they make no effort to ensure that their advertised properties conform to local zoning, health, safety or lodging tax regulations. They create the problem and then expect each city to pay for enforcement.

In Portland’s case, there are estimated to be upwards of 1,000 unlicensed vacation rentals. If you Google “unlicensed vacation rentals” many pages of articles pop up about problems with rapidly expanding numbers of unlicensed vacation rentals all across the country.

In Portland, this is not just about retirees offering a spare bedroom in their homes for $50 a night. A quick scan of Portland listings in vrbo.com and homeaway.com include daily and weekly rentals at more than $300 per night in houses and condos throughout Portland.

Here are some examples:

High Style in Portlands “Beverly Hills” - Private Home - 3BR/3BA - Sleeps 6 $319 per night.

Buckman House: Far from Ordinary, Close to Downtown - Private Home - 4BR+/2BA - Sleeps 2-9 $225 per night.

Beautiful Home in Prestigious Irvington Neighborhood - Private Home - 3BR / 1BA, Sleeps 6 $205 per night.

When Only the Very Best Will Do-Luxury in the Pearl! - WINTER DISCOUNT - Condo - 1BR / 2BA, Sleeps 4 $215 - $357 (6 night minimum).

Riverfront: 2 Floors with Stunning River Views and 200 sq. ft. Private Patio - Condo - 2BR / 2BA, Sleeps 4 $350 per night.

Amazing Downtown Location, Near Pioneer Square, PSU, Steps from it All! - Condo - 2BR+/2BA - Sleeps 6 $149-309 Daily / $1150-1900 Weekly.

Book Our One Bed Condo Early for Summer and Save! Pearl District - Condo - 2BR+/2BA - Sleeps 6 $176 - $209 per night.

Vacation rentals in residential zones are “illegal” in Portland unless licensed as a bed & breakfast (and most are not licensed). It costs more than $3,000 to become licensed as a B&B. And once licensed you are required to have fire and health inspections, business licenses, liability insurance, an on-site manager and are required to collect and pay lodging tax to the city, county and state.

Many vacation rentals owners don’t live in their property and therefore are unable to supervise the number or behavior of their paid guests. They are ducking lodging tax and hoping their neighbors don’t notice the impact on noise, parking, safety and security — God forbid there is a fire or a shooting.

In the case of condo rentals, keys and building access codes are constantly being given to dozens of unsupervised transient guests with no connection to the private condo buildings that were never intended as vacation rentals. Meanwhile, the city is losing upwards of $1 million per year of lodging tax and license fee revenue.

Ignoring a growing problem

The current system also is grossly unfair to licensed B&Bs who do play by the rules. It does not have to be this way. Many other communities have found it more effective to implement new licensing programs that are less complicated, less expensive and that recognize different types of vacation rentals. The taxes and license revenue generated are used to pay for enforcement of the programs. These programs are pro-growth and pro-community.

In Oregon, the cities of Ashland, Bandon, Cannon Beach, Depot Bay, Gold Beach, Lincoln City and Yachats, to name a few, all have specific ordinances licensing and regulating vacation rentals. This is a win-win for property owners, neighborhoods and cities.

So far, Portland agencies (such as the Bureau of Development Services) have just buried their heads in the sand, ignoring the growing problem, the potential dangers, the lost revenue and the advantages of implementing a new system. The City Council should mandate a multi-agency task force to address the issue of unlicensed vacation rentals that includes representatives from BDS, the revenue department (licenses and lodging tax), the health department and the fire marshal.

Also, the city attorney should write letters to the major websites requesting that they require advertisers to mark specific check boxes verifying they have the necessary licenses and are collecting lodging tax collection before accepting an advertisement.

It is time for Portland to join dozens of other cities all across the country that have regulated vacation rentals in a positive manner.

Steve Unger is the owner/innkeeper of Lion and the Rose Bed & Breakfast in Northeast Portland.