News Article on this issue:
Please see the letter to Council below as well:
Dear Mayor Leffingwell, Mayor Pro Tem Cole and Austin City Council Members,
I have to admit I am late to the game on the question of Commercial Short-Term Rentals. Like many, I had previously dismissed this issue as only affecting neighbors with a "bad" CSTR next door.
But when I read through the currently proposed draft ordinance last week, I was shocked to discover the huge potential impacts this would have on affordable housing and public schools citywide. As you may recall, the current draft is not what was recommended by Planning Commission or staff, but was proposed from the dais by Council Member Riley after the public hearing had closed. I have the greatest respect for CM Riley and certainly do not believe he intended the consequences of the current draft, but that is risk when substituting new language without the opportunity for a thorough public review.
For the reasons that follow, I strongly encourage you to postpone the August 2nd action on this ordinance until these critical issues can be addressed.
Realistically, this may be after the budget is finished, but it is preferable to delay than enact the current draft.
As you know, the proposed provisions for Commercial Short-Term Rentals will let private investors buy and operate homes and apartments as "mini-motels" in residential neighborhoods throughout the city. Unlike regular tenants, short-term renters are here for a weekend or a few weeks at a time; between tenants, the house or apartment itself remains permanently off the market for Austin families to rent, buy or live in. Unfortunately, the areas most popular for commercial investors are those where small elementary schools already struggle with declining enrollment.
To be clear, the commercial units are NOT the same as owner-occupied short-term rentals, which include duplexes, granny flats, garage apartments and those who rent out their own homes for special events like ACL or SXSW. I fully support these wonderful accommodations for our Austin visitors, and in fact, these make up at least two-thirds of the short-term rentals currently operating in Austin, as nearly as the city auditor has been able to determine. Scaling back the cap significantly on CSTRs will still leave many fine accommodations for visitors.
As currently drafted, the proposed ordinance:
* Allows the loss of over 5500 single-family homes citywide, including over 3800 in AISD attendance zones. The ordinance allows up to three percent of single-family homes in any zip code to be taken over for Commercial Short-Term Rentals, making them unavailable for Austin families to buy, rent or live in. AISD boundaries currently include over 127,880 single-family homes, meaning a potential loss of over 3800 homes in AISD attendance zones alone. Citywide, the number tops 5500.
* Allows the loss of an unlimited number of apartment units citywide. Over 34,000 AISD students currently live in multifamily housing, according to the district demographer. If even three percent of the 101,400 multifamily units within AISD boundaries were lost to commercial short-term rentals, this could affect over 3,000 families. Yet the current draft provides absolutely no cap on Commercial STRs in multifamily dwellings.
* Drives up housing costs citywide. Experts find that Commercial Short-Term Rentals drive up housing costs citywide. A 2011 white paper by the National Association of Realtors states:
"When property owners elect to rent their homes on a short-term basis rather than renting on a longer-term basis, they essentially squeeze the supply of housing, pushing up the demand, and subsequently, the cost of housing in the community."
With over 60 percent of AISD students already identified as low-income, city policies should be designed to help, not hurt, struggling families.
* Allows commercial uses to cluster in a single school attendance zone, exacerbating enrollment impacts. A recent city auditor's report found that existing commercial short-term rentals in the 78704 zip code alone currently consume over 330 single-family homes. Using AISD's projections of .4 students per single-family home, schools in this area have already lost an estimated 132 students (four elementaries in this area - Becker, Dawson, Zilker and Barton Hills - were targeted for closure or consolidation last year due to falling enrollment). The Austin Planning Commission recommended a minimum distance of 1000' feet between commercial short-term rentals, which would have eased enrollment impacts somewhat, but this provision is not in the current draft.
* Contributes to student mobility. Because high rates of student mobility directly affect student achievement, it is essential that city policies support family stability as much as possible. The current ordinance allows homes and multifamily dwellings to become defacto unregulated hotels, removing housing options for thousands of AISD families. The number of struggling families chasing cheap move-in specials can be expected to rise.
* Lets Commercial STRs avoid compliance with the Americans with Disabilities Acts (ADA) and other health and safety standards. Commercial short-term rentals are a for-profit industry providing accommodations for Austin visitors. Thus CSTRs are, to a large degree, in direct competition with local hotels and motels, which must go to considerable expense to make their facilities accessible to all visitors, as well as complying other critical fire and safety measures. Austin prides itself on welcoming all visitors regardless of color, creed, sexual orientation or physical ability. If we allow Commercial Short-Term Rentals to operate as commercial accommodations in our community, they should be required to meet the same minimum standards for health, safety and accessibility as our city's hotels and motels.
I believe many of the above impacts can be ameliorated with a thoughtfully crafted ordinance, but that will take time and should not be done on the fly on the same packed agenda as SMDs and the budget, especially with so many offices on vacation this month.
For all of these reasons, I strongly encourage you to postpone this item on August 2nd until these critical issues can be addressed.
As always, many thanks for your attention to these complex issues and for representing the interests of Austin families.
Best, Susan Moffat