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Miami Beach's Airbnb Crackdown Might Not Be Legal Under State Law, Opponents Argue

Miami Beach's Airbnb Crackdown Might Not Be Legal Under State Law, Opponents Argue

Postby smix » Sun Sep 11, 2016 9:20 pm

Miami Beach's Airbnb Crackdown Might Not Be Legal Under State Law, Opponents Argue
Miami New Times

URL: http://www.miaminewtimes.com/news/miami ... ue-8722454
Category: Politics
Published: August 26, 2016

Description: Miami Beach's crackdown on Airbnb and other short-term renters has been swift and brutal. In March, the city changed its rules to levy $20,000 fines on anyone who rents out a space for less than six months, and since then has handed out $1.6 million in fines. But was that crackdown legal? That's what Ross Milroy, a luxury property broker in Miami Beach, wonders. He points to a 2011 bill passed in Tallahassee that banned local governments from restricting the time or duration of short-term vacation rentals in any form. "They dramatically ratcheted things up when they did that in 2016," Milroy says, who adds that "this needs a class-action lawsuit" to find out if the city's new fees are actually permissible. "I think they pushed the envelope too far." But Miami Beach Commissioner Michael Grieco, who holds a law degree, calls the allegation "nonsense." "I had a team of lawyers to work with me," he says. "This was a fully vetted issue. We were just tweaking the fine schedule and tweaking the enforcement policy." Long before March's tweak to the rules, Miami Beach had a law banning rentals shorter than six months and one day. So even after Florida's state law went into effect in 2011, the local ban in Miami Beach was grandfathered in. In March, the city greatly increased the fines for breaking that short-term rental law. The fees jumped from $500 to $20,000 for first-time violators in residential areas of town. Previously, the maximum fine was $7,500 for renters caught flouting the code four times in 12 months. The max fine is now set at $100,000. (It appears the code was amended in 2014 to prohibit short-term rental advertising as well.) But according to state Statute 509.032(7)(b): A local law, ordinance, or regulation may not prohibit vacation rentals or regulate the duration or frequency of rental of vacation rentals. This paragraph does not apply to any local law, ordinance, or regulation adopted on or before June 1, 2011. Milroy says he and a small group of brokers and lawyers in town believe the new fines might not be legal under state law. "I underlined all the new changes, and I think they are extremely onerous," Milroy, who used to work as a hotel broker before starting his luxury rental business, says. "Is it OK now that in 2016 you can add all that, when the state said in 2011 you cannot?" Milroy says he's surprised that the city would work so hard to crack down on short-term renters in a city where significant numbers of residents are transient tourists. "People are buying real estate in a tourist city and saying, 'Well, why can't I rent to tourists?'" he says. "I've lost business because of this. There have been people I've spent months and months with, and I have to tell them: 'Sorry, since March, the city will fine you if you rent your property for less than six months and one day." Thus, he says, possible real-estate buyers are looking elsewhere. "Some people are spending 100,000 a year in property taxes, but if you want to rent your home for a month of that time, the city says, 'Screw you, you can’t.'" But simply being dissatisfied with a law does not make it illegal, and Commissioner Grieco tells New Times that he and the city's legal team worked diligently to ensure the fee changes abided by state law. "For every one person who gives me a passive-aggressive comment about it, there are 50 who tell me they're happy we're finally taking a stand against the proliferation of illegal short-term rentals," Grieco says. "There's a big difference between having a home-based business and your home being a business." He says that, rather than protecting the hotel lobby, the city is fighting for the residents who do live on the Beach year-round. Grieco adds that the city should have begun policing vacation rentals years ago, but it's "taken us a few years to get caught up. Now that we're there, people are just unhappy that we’re finally enforcing the law. The market will adjust."

Miami Beach Has Fined Airbnb-Style Landlords $1.6 Million Since March
Miami New Times

URL: http://www.miaminewtimes.com/news/miami ... ch-8712957
Category: Politics
Published: August 24, 2016

Description: In Miami Beach, it's no secret that the hotel industry is the city's biggest economic engine. City Hall certainly knows who pays the bills. This past March, the city voted to begin fining Airbnb-like short-term renters a whopping $20,000 a pop. Hoteliers say the new fines protect the tourism industry from unregulated renters who can offer cheaper rooms without paying employees or taxes. But short-term renters — including one who spoke anonymously to New Times out of fear that the city government would fine him — argue that the law just protects deep-pocketed luxury hotels from competition. One thing that is not in dispute: The city has not been shy about handing out the new fines, which can go to anyone renting a space for less than six months and one day. According to a memo that City Manager Jimmy Morales sent to the city commission last week, Miami Beach has levied $1.59 million in fines against short-term landlords since the new fines have been in place. In the August 17 memo, Morales writes that the city has issued 106 fines since March 9. Four of those fines, totaling $80,000, went to Airbnb, Inc. It's also illegal to advertise a short-term rental in Miami Beach, and the city says it caught Airbnb advertising in town on three occasions and renting out an "apartment/townhome" on 14th Street. The city says it issued penalties to Airbnb, Booking.com, and Homeaway.com a total of 18 times for advertising in the city. The memo also says that in 31 cases, the city called the police department and had short-term renters evicted onsite. Elsewhere, a few individual landlords appear to have racked up more than $100,000 in fines. SoBeautiful Lifestyle LLC, a company managed by Jamey Kolka, has had $240,000 in fines levied against a property at 244 W. Rivo Alto Dr. At least three of the fines apparently stemmed from advertisements the city says the LLC had been running. Another property, at 2232 Alton Rd., which the city says was related to Gleason Properties LLC, Miami World Rental LLC, and Airbnb, was fined at least $225,000. The crackdown has hit an industry that once operated with relative impunity on the Beach. One short-term-property owner tells New Times that although multimonth or single-week rentals have long been illegal in the city, code compliance didn't begin citing him until Mayor Philip Levine was elected in 2013. After that, the landlord says, code-compliance officers began knocking on his doors at all hours and harassing his tenants. "They would threaten to shut off the power or turn my water off," he says. Before March, the landlord says, it made economic sense for landlords like him to continue renting properties illegally and rack up fines because they could charge enough in rent to cover the penalties. "It was definitely worth the price of business," he says. "Now there is a $20,000 violation for renting your property less than six months and a day." The property owner argues that the city's strict rule has the unintended consequence of forcing out anyone who's staying longer than a typical hotel stay but too short for a full half-year rental. "If you've got a family coming in from Paris for the summer, or a celebrity filming here who wants to stay in a house instead of a hotel, or a Saudi prince coming for two months who needs more privacy than the top floor of the Setai [a luxury oceanfront hotel in South Beach] can give, you can't do anything," he says. Though hotel owners — and the city government — view the new rule positively, the landlord says the city's six-months-and-one-day time limit makes no sense. "I'd understand if they wanted to ban weekend rentals," he says, "but this is completely unreasonable. It's just so over-the-top. It just shows the hotel lobby has a much stronger hold on this administration."
Update 8/25: Airbnb spokesperson Ben Breit provided this statement to New Times via email:
Miami Beach is one the world's greatest destinations and our host community serves as global ambassadors. Airbnb and our peers are very small but unique parts of Miami Beach's tourism ecosystem. We are working to voluntarily pay our fair share of county transient occupancy taxes, and we have been paying the state tourist and sales taxes since December 2015. We look forward to working with community leaders and stakeholders in the coming months to create fair rules for home sharing.
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