Senate Committee Votes to Overturn Local Short-term Rental Laws

A Senate committee voted to advance controversial Republican-backed legislation that would overturn a Nashville ordinance set to gradually eliminate certain types of short-term rentals, led by companies such as Airbnb, as well as similar prohibitions in other cities, including Knoxville, reports The Tennessean. The Senate Commerce and Labor Committee voted 7-2 to approve a now-revamped ‘Short Term Rental Unit Act’ introduced by Sen. John Stevens, R-Huntingdon, and Rep. Cameron Sexton, R-Crossville. If passed, the bill will block a Nashville ordinance passed in January to phase out most non-owner-occupied short-term rentals that currently exist in residential neighborhoods over the next three years, as well as a similar prohibition that passed last year in Knoxville. However, the bill allows local municipalities to still prohibit certain types of short-term rentals and require grandfathered short-term rentals to acquire permits. In addition, a local government could revoke a permit for a grandfathered unit if it violates standards on three separate occasions.
 
"Obviously, I'm pleased with the outcome," Stevens said after the bill passed in the committee. "I think it is a very difficult issue, but it's our property and it's a very personal issue. It's a distinction between the property rights and government, even if it is local government." Sen. Steve Dickerson, R-Nashville, who is not a member of the committee, spoke against the measure saying, "If there is a permit that is issued by a local government, there is a mechanism that they might revoke that permit.”
 
"It is my impression that (the amendment) is somewhat too restrictive," Dickerson said. "The bill makes it almost impossible to do that."
 
The Nashville Area Short-Term Rental Association urged approval of the bill in a letter to lawmakers. “We are regular folks working to make a living and want to contribute to our local and state economy,” the short-term rental association’s letter reads. “Please protect the property rights of all. Please vote to pass SB1086 with amendments.” Detractors contend that short-term renting has displaced longtime residents by attracting investors who don’t live in the homes they rent out. 
 
Twenty-seven cities in Tennessee have rules that don't allow non-owner-occupied short-term rentals in residential areas, including Knoxville, Brentwood, Germantown and Smyrna. Local officials say they are just following zoning laws that restrict businesses in residential areas. Some cities have gone further by outlawing all short-term rentals, including owner-occupied types. These include Davidson County's five satellite cities — Belle Meade, Berry Hill, Forest Hills, Goodlettsville and Oak Hill. You can track the legislation using this link.
          | TBA Law Blog