ORDINANCE NO. BL2016-492

SUBSTITUTE ORDINANCE NO. BL2016-492

An ordinance to amend Titles 6 and 17 of the Metropolitan Code, Zoning Regulations, pertaining to Short Term Rental Properties (Proposal No. 2016Z-023TX-001).

WHEREAS, short-term rental of homes can provide a flexible housing stock that allows travelers a safe accommodation while contributing to the local economy; and

WHEREAS, short-term rental of homes can provide homeowners an opportunity to hold property in difficult economic circumstances or as an investment; and

WHEREAS, hotel taxes from short term rental of homes can be used to promote travel and tourism and to support the local tourism industry; and

WHEREAS, the needs of long-term residents should be balanced with the allowance of short-term rentals.

NOW, THEREFORE, BE IT ENACTED BY THE COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:

Section 1. That Title 6 of the Metropolitan Code is hereby amended by deleting Section 6.28.030 in its entirety.

Section 2. That Section 17.04.060 of the Metropolitan Code is hereby amended by deleting the definition of “Short Term Rental Property (STRP)” and by replacing it with the following new definition:

“Short term rental property (STRP)” means a residential dwelling unit containing not more than four sleeping rooms that is used and/or advertised through an online marketplace for rent for transient occupancy by guests.

Section 3. That Section 17.04.060 of the Metropolitan Code is hereby amended by adding the following new definitions:

“Commercial establishment” means an establishment used for the conduct of a business.

"Hotel" means any commercial establishment, or any portion of such establishment, (A) whose principal use provides that such structure is occupied or intended or designed for occupancy by transients for lodging or sleeping purposes within the area of the jurisdiction of the metropolitan government, and includes any hotel, inn, tourist court, tourist camp, tourist cabin, motel or any place meeting this definition, and (B) accepts on-site reservations for accommodations.

"Owner-occupied" means the owner of the property permanently resides in the STRP or in the principal residential unit with which the STRP is associated on the same lot.

Section 4. That Section 17.04.060 of the Metropolitan Code is hereby amended by deleting the definition of “bed and breakfast inn” and “boarding house” and by replacing it with the following new definitions:

"Bed and breakfast inn" means a commercial establishment with four through ten furnished guest rooms whose principal use is for paid accommodation to guests. Bed and breakfast inns shall be occupied by the owner-occupant and/or a full-time live-in manager. Meals may be provided to overnight guests. The maximum stay for any guest shall be fourteen consecutive days.

“Boarding house" means a residential facility or a portion of a residential dwelling unit for the temporary accommodation of persons or families in a rooming unit, whether for compensation or not, who are in need of shared lodging and personal services, supervision, or rehabilitative services.

Section 5. That Section 17.16.250 of the Metropolitan Code is hereby amended by deleting subsection E. in its entirety and substituting with the following new subsection E:

E. Short Term Rental Property (STRP). A STRP is permitted as an accessory use in all zoning districts that allow residential use provided a permit has been issued for operation of the property as a STRP pursuant to this Section. In IWD, IR and IG, STRP is permitted as an accessory use to a multi-family use associated with Manufacturing, Artisan use.

1. Permit required.
a. No person or entity shall operate a STRP or advertise a residential property for use as a STRP without the owner of the property first having obtained a STRP permit issued by the department of codes administration in accordance with the provisions of this chapter. Any advertising or description of a STRP on any internet website must: (a) prominently display the permit number for the STRP unit; or (b) include an image of the permit, or a link to an image of the permit, in which the permit number is legible.
b. Types of permits and quantities.
i. STRP permit holders shall obtain a use permit from the zoning administrator as an accessory use to the primary residential use pursuant to section 17.16.250.E. of the Metropolitan Code.
ii. There shall be three types of permits issued as follows:
(1) Type 1 (Owner-Occupied): A Type 1 permit is available only for an owner-occupied STRP.
(2) Type 2 (Not Owner-Occupied): A Type 2 permit is available for units that are in: (i) single-family, two-family, and nonconforming multi-family units in Single-Family and One and Two-Family zoning districts; and (ii) not owner-occupied.
(3) Type 3 (Not Owner-Occupied Multifamily): A Type 3 permit is available for units that are: (i) multifamily apartments or condominiums; and (ii) not owner-occupied.
iii. Limits on quantities: No more than three percent of the single-family or two-family residential units within each census tract shall be permitted as Type 2 non-owner-occupied short-term rental use.
iv. Only one permit shall be issued per lot in Single-Family and One and Two-Family zoning districts.

2. Application.
a. STRP permit applications shall be valid for ninety (90) calendar days from the date filed and shall expire if the application process has not been completed within that time.”
b. The STRP permit application shall verify by affidavit that all of the information being provided is true and accurate and the application shall include the following information:
i. The name, telephone number, address, and email address of the owner and of a person or business ("responsible party") residing or located within twenty-five miles of the STRP that is responsible for addressing all maintenance and safety concerns;
ii. Proof of insurance evidencing homeowner's fire, hazard, and liability insurance. Liability coverage shall have limits of not less than one million dollars per occurrence.
iii. Proof of written notification to the owner of each adjacent property prior to filing the application. For each such adjacent property, proof of written notification shall be: (a) a signature of an owner; (b) a signed receipt of U.S. registered or certified mail addressed to an owner; or (c) notice from the U.S. Postal Service that registered or certified mail to an owner was refused or not timely accepted.
iv. For owners applying for an owner-occupied permit, two documents giving proof of owner occupation shall be provided. Acceptable documentation includes Tennessee Driver’s license, other valid State of Tennessee identification card, Davidson County voter registration card, utility bills, paycheck/check stub, work ID or badge, Internal Revenue Service tax reporting W-2 form, or a bank statement, each current and showing the owner’s name and address matching that of the property to be utilized for short term rental.
v. A statement that that the applicant has confirmed that operating the proposed STRP would not violate any Home Owners Association agreement or bylaws, Condominium Agreement, Covenants, Codes and Restrictions or any other agreement governing and limiting the use of the proposed STRP property.
vi. Proof of payment of all taxes due, including property taxes and, for permit renewals, all applicable room, occupancy, and sales taxes required by state law or the Metropolitan Code.

3. Signage. Any sign, as defined in Section 17.32.030.B of this Zoning Code, on a property used for a STRP shall be governed by the provision of Chapter 17.32, Sign Regulations, of this Zoning Code.

4. Regulations.
a. All STRP occupants shall abide by all applicable noise restrictions and regulations regarding the public peace and welfare contained in the Metropolitan Code, and all applicable waste management provisions of Chapter 10.20 of the Metropolitan Code.
b. The STRP shall meet all applicable requirements of the state and local building and fire safety codes, including, but not limited to, having approved smoke alarms meeting Underwriters Laboratory (UL) 217 standards installed as follows:
i. In all sleeping areas.
ii. In every room in the path of the means of egress from the sleeping area to the door leading from the sleeping unit.
iii. In each story within the sleeping unit, including basements.
c. Parking shall be provided as required by Section 17.20.030. No recreational vehicles, buses, or trailers shall be visible on the street or property in conjunction with the STRP use.
d. No food shall be prepared for or served to the transient by the permit holder.
e. The principal renter of a STRP unit shall be at least twenty-one years of age.
f. Maximum occupancy. The maximum number of occupants permitted on a STRP property at any one time shall not exceed more than twice the number of sleeping rooms plus four. Simultaneous rental to more than one party under separate contracts shall not be allowed. The occupancy maximum shall be conspicuously posted within the STRP unit. Advertising a STRP for more occupants than allowed by this regulation shall be grounds for revocation of the permit.
g. The STRP owner shall not receive any compensation or remuneration to permit occupancy of a STRP for a period of less than twenty-four hours. The maximum stay for any guest shall be thirty consecutive days.
h. The name and telephone number of the local responsible party shall be conspicuously posted within the STRP unit. The responsible party shall answer calls twenty-four hours a day, seven days a week for the duration of each short term rental period to address problems associated with the STRP.
i. Expiration and renewal of permit.
i. A STRP permit shall expire three hundred sixty-five days after it is issued unless it is renewed prior to its expiration.
ii. For STRP units that have received no documented complaints to Metro Codes, Police, or Public Works during the most recent permit period, a renewal application may be submitted by mail, online, or in person according to regulations promulgated by the Metro Codes Department. All such renewal applications shall include:
(1) the payment of a fifty dollar renewal fee; and
(2) a statement verified by affidavit that:
(a) includes all of the information required in an application under Section 17.16.250.E.2; and
(b) the STRP continues to be in full compliance with all applicable laws, including the payment of all applicable taxes.
iii. For an STRP that has received no documented complaints to Metro Codes, Police, or Public Works during the most recent permit period, a 30 calendar day grace period for renewal after the expiration of the STRP permit may be allowed by the zoning administrator upon a showing by the owner of a reasonable explanation other than neglect or mistake for the delay.
iv. For an STRP with documented complaints to Metro Codes, Police, or Public Works during the most recent permit period, no grace period shall be allowed and all permit renewal applications shall be submitted timely. The permit may be renewed upon the payment of a fifty dollar renewal fee, and the submission of a statement verified by affidavit that includes all of the information required in an application under Section 17.16.250.E.2.
j. The permit holder shall be responsible for collecting and remitting all applicable room, occupancy, and sales taxes required by state law or the Metropolitan Code.
k. A STRP permit shall not be transferred or assigned to another individual, person, entity, or address, nor shall the permit authorize any person, other than the person named therein, to operate a STRP on the property.
l. Denial or Revocation of Permit.
i. Upon the filing of a complaint regarding a STRP permit, the department of codes administration shall notify the permit holder in writing or by e-mail of such complaint.
ii. If the Zoning Administrator determines, based on reasonably reliable information that the Zoning Administrator has obtained including without limitation public records or reports, records of regularly conducted activity, or a direct or online statement against a person's own interest, that three violations of this section or other Code sections referenced in this section have occurred within a 12 month period, the permit to operate a STRP may be revoked.
iii. Before revoking any permit, the department of codes administration shall give the permit holder fifteen days written notice of the alleged violation(s) against him/her.
iv. Any denial or revocation of a STRP permit may be appealed to the board of zoning appeals as an administrative appeal pursuant to Section 17.40.180.A. of the Metropolitan Zoning Code.
v. Once a STRP permit has been revoked, no new permit shall be issued to the applicant for the same property for a period of one year.
vi. The penalty for operating a short term rental property without a permit shall be:
(1) A fifty dollar fine as imposed by a court of competent jurisdiction. Each day of operation without a permit shall constitute a separate offense.
(2) Upon a finding by the Board of Zoning Appeals that a short term rental property has operated without a permit, there shall be a waiting period of up to one year from the date of such finding for the property to become eligible for a STRP permit, as determined by the BZA. Properties that have been denied a permit by the Board of Zoning Appeals and made subject to the one (1) year waiting period prior to October 4, 2016 may re-appeal to the Board of Zoning Appeals with no payment of an appeal fee. The length of the waiting period shall be based upon whether the operator was aware or unaware of the requirement that the STRP have a permit. Evidence to be evaluated in making this decision may include but is not limited to:
(a) the testimony of the STRP operator;
(b) the testimony of neighbors or others with knowledge of the STRP operation;
(c) evidence that the operator was informed of the requirement and disregarded this information;
(d) evidence that the operator had looked into requirements and misunderstood them;
(e) prior or repeat offenses by the operator under this section; and
(f) whether the operator, upon being informed of the requirement, obtained or attempted to obtain a permit before renting the STRP again.
(3) Upon a finding of a court of competent jurisdiction that a short term rental property has operated without a permit, in addition to any other relief granted, there shall be a waiting period of three years from the date of such finding for the property to become eligible for a STRP permit.

Section 6. This Ordinance shall take effect immediately after its passage and such change be published in a newspaper of general circulation, the welfare of The Metropolitan Government of Nashville and Davidson County requiring it.

LEGISLATIVE HISTORY
Introduced:	November 15, 2016
Passed First Reading:	November 15, 2016
Referred to:	Planning Commission - Approved with Substitute (7-1-1) Codes, Fair, and Farmers Market Committee Convention, Tourism and Public Entertainment Facilities Committee Planning, Zoning, & Historical Committee
Public Hearing Scheduled For:	January 3, 2017
Substitute Introduced:	January 3, 2017
Deferred to February 7, 2017:	January 3, 2017
Passed Second Reading:	February 7, 2017 - Roll Call Vote
Amended:	February 21, 2017
Passed Third Reading:	February 21, 2017
Approved:	February 22, 2017
By:
Effective:	February 24, 2017