After having their questions answered by Highlands town attorney Jay Coward, the town planning board decided to reject the two proposed short term rental regulations sent to them by the board of commissioners and thus come up with their own recommendation.
A follow-up meeting will be held at 5:30 p.m. on Tuesday, Aug. 9 to hammer out the details of the planning board’s proposal, which the board agreed will look similar to their initial submission to the commissioners.
“I would make a motion that we eliminate both proposals sent to us by the town board,” planning board member Helene Siegel said before a unanimous vote was cast to do so. “I would make a second motion to resubmit our previous proposal to the commissioners, with a seven day minimum stay requirement added in R1 and R2 zones.”
Siegel’s second motion passed by a 4-1 vote, with Wendell Willard being the dissenter.
The meeting began with Coward answering several questions from planning board members. Board chair Darren Whatley asked Coward if the planning board was protected legally, should any property owner choose to sue the Town of Highlands over the regulation of short term rentals.
“Yes, your board is protected, or no one would ever serve,” Coward said. “You are a volunteer advisory board, meaning that the town board has the option to take action on whatever recommendation you make if they choose to. If the town were to be sued it would be in civil court and a judge would throw out any actions taken against you all.”
After looking at the two proposed regulations given to the planning board by commissioners, board member Chris Wilkes had several questions related to amortization of short term rentals as a permitted use in residential zones.
The first proposed regulation would simply eliminate all short term rentals in residentially zoned areas. The second would amortize the use of short term rentals in those zones after a two year period.
“Is there any scenario in either of these two proposals that would not be setting the legal precedent for the state of North Carolina,” Wilkes asked. “And to follow up on that, has amortization ever been applied to short term rentals, either in this state or any other state?”
Coward answered that both proposals would set a precedent if taken to court and that to his knowledge short term rentals have not been amortized in any other municipality, county or state.
The planning board came to a consensus that amortization was not the right path to take with STRs. Board member Nick McCall noted that the point of amortization, as it is applied to other interests such as billboards and other non-permitted uses, is to allow the owner to recoup their investment before the use is banned.
“When we are taking about million dollar homes, even if you have been making say $50,000 a year renting it as an STR, two years just isn’t going to cut it,” McCall said. “If nothing else, that time period would need to be much longer.”
The board then turned its attention back to its original recommendation to the town commissioners, which was made earlier this year. In the original proposal the STR minimum stay requirement in R1 and R2 zones was 14 days.
“I don’t think people have a problem with the tradition in Highlands of families renting a home for part of the summer and coming up for two weeks or more,” Willard said. “What we have seen in the past few years, as the wedding industry has become a growth industry for Highlands, is the two and three day rentals where people come in, rent a home in a residential neighborhood, have parties, cause problems, take no ownership in the property itself, and leave.”
A motion to reinstate the 14-day minimum stay requirement to the planning board’s original proposal was voted down 3-2. With Willard and Seigel being the dissenters.
“When I go on vacation, I don’t go for two weeks, and I don’t know many people who do this day and age,” Whatley said. “I would be more comfortable with a seven day minimum stay.”
The board ultimately agreed to the seven day minimum stay requirement aimed at stopping the two and three night “weekend” rentals.
Wilkes added that the enforcement of current town ordinances is a critical piece of the puzzle that the town must address regardless of what, if any, regulation related to STRs passes.
“When you look at places that have curbed short term rentals, they have all done it through enforcement,” Wilkes said. “New Orleans, Charleston, these much larger cities, have all stepped up their enforcement efforts related to noise, traffic, sanitation, etc. and seen results. I don’t know how much fighting a lawsuit will cost the town, but I would imagine its more than what adding another police officer to enforce the laws we already have on the books will cost.”
“The question I have for everyone on both sides of the issue is, ‘Do you want your side of the argument to win? Or do you want an ordinance that works?’”
Seigel noted that no matter the planning board, or the board of commissioners ultimate decision, there will be unhappy property owners. Willard added that talks of compromise between the two sides has been popular but not effective.
“Everyone talks about compromise, and says let’s get everyone to compromise, but then when we propose a compromise, the reaction is ‘No, no, not that compromise,’” Willard said. “There is no option that will make everyone happy.”