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L18-0045ShortTermRentalRegulationUpdate <br />Page2 <br />homesinmobilehomeparksasshort-termrentals.TheAccessoryDwellingUnitordinanceadoptedby <br />theCouncilprohibitsrentalofADUsforlessthan30days. <br />Tukwila’sResidentialRentalBusinessLicenseandInspectionProgram,codifiedatChapter5.06ofthe <br />TukwilaMunicipalCode(TMC),establishesanannualrentallicensurerequirementforall“units” <br />intendedforrent.Eachdwellingunitmustbeinspectedforlifesafetyissueseveryfouryears,see <br />AttachmentA.Thecodeissilentaboutwhetheritappliestoshort-termrentals;inpractice,theCityhas <br />notreceivedrentallicenseapplicationsforshort-termrentals. <br />OnJune28,2018thePlanningCommissionheldapublichearingontheshort-termrentalissue.They <br />heardpublictestimony(seemeetingminutes)andaskedstafftoreturnwithadditionalinformation <br />relevanttothediscussion.ThisstaffreportbuildsontheinformationincludedintheJunePacket. <br />D ISCUSSION <br />SomeoftheinformationthatthePlanningCommissionrequestediscontainedinthisstaffreportand <br />attachments.Remainingitemsinclude: <br />Citylodgingtaxrevenuefromshorttermrentals–AirBnBistheonlycompanythatremitstax <br />forshorttermrentalssowecannotgiveanexactnumberbutitisaminorpercentageofthe <br />City’slodgingtaxrevenues. <br />Impactofshort-termrentalsonthehotelmarket–Thisisdifficulttodetermine,howeverthere <br />are650hotelroomseitherrecentlyconstructedorinthedevelopmentpipelineinTukwila.This <br />indicatesthatoccupancyratesofexistinghotelsarehighandnewhotelscontinuetobeseenas <br />aprofitableinvestment.ItappearsthatTukwilahasatmostfewdozenshort-termrentals. <br />Caponrentals–Somejurisdictionsplacealimitationonthenumberofshorttermrentalunits <br />anindividualmayoperate,soastorestrictthecommercialoperationofshorttermrentals.City <br />ofSeattle,forexample,requireseachoperatorobtainapermitandthatpermitallowsthe <br />operatortooperatetwodwellingunitsforshort-termrentaluseforthefirstyearofoperations. <br />Afterthefirstyear,theoperatoriseligibletoaddathirdunit,solongasthethirdunitisthe <br />2 <br />operator’sprimaryresidence. <br />Impactstolongtermrentalmarket–TheHarvardLawandPolicyReviewarticlelinkedintheJune <br />packetassertsthatthehigherprofitabilityofshorttermrentalsincentivizesremovalofunitsfrom <br />thelongtermrentalmarketandmayincreaserentsintighthousingmarkets.However,thepublic <br />testimonyatthelastmeetingindicatedthatsomelandlordshavechosenshorttermrentalsfor <br />reasonssuchasflexibilityorintermittentneedforthespaceandwouldbeunlikelytoputthe <br />unitintolongtermrental.Staff’srecommendationtolimitshorttermrentalstopartialunits <br />(bedroomwithinalargeroccupiedhouse)wouldpreventwholeunitsfrombeingremovedfrom <br />thelong-termrentalmarket. <br />2 <br />SeattleCityCouncilOrd.125490(availableat <br />http://seattle.legistar.com/View.ashx?M=F&ID=5707790&GUID=6EE24175-0711-4616-8260-6C0A0116FE1E) <br />1 46 <br /> <br />