Carefree Truth
Issue #525, November 4, 2016
Planning Director Stacey Bridge-Denzak expressed her pleasure in working for and with the outgoing Council members, and helping to support the accomplishments that have taken place. She is looking forward to working with the incoming members.
Senate Bill (SB) 1350 was signed into law on May 12, 2016, requiring municipalities to amend their zoning ordinance with respect to vacation rentals. There would be only one reading of this amendment at the Council level, as the first public hearing was held at the October Planning and Zoning Commission (P&Z) meeting.
In 2005, Carefree adopted a zoning ordinance prohibiting rentals for less than 30 days. The State directed the Town to reverse this ordinance. SB 1350 prohibits municipalities from banning short term vacation rentals. The State will collect the bed tax on behalf municipalities and will distribute them back accordingly. SB 1350 covers all residential uses including single family, multi family, condominium, cooperative and timeshare units. Municipalities may regulate issues in regard to protecting public health and safety, and may prohibit illegal and illicit uses. Carefree has ordinances in place to address any nuisances that might arise.
Adoption of this amendment is required by the end of the calendar year. A P&Z public workshop was held in September, and the text amendment was discussed at the regular October P&Z meeting, where 5 members of the public attended and posed questions. The 2 issues questioned involved the rights of Homeowners' Associations (HOAs), and if there would be a legal review. HOA CC&Rs are a 3rd party contractual agreement which may be more, but not less, restrictive than municipal ordinances. Because CC&Rs are contractual agreements, HOA CC&Rs may restrict short term rentals that municipalities are not permitted to legislatively prohibit. All ordinance text amendments are reviewed by the Town Attorney. The proposed text amendment withstood the test of scrutiny. The legally required newspaper notifications and postings have been done.
Gary Neiss clarified that HOAs are responsible for enforcing their CC&Rs. The Town does not get involved in that. Councilman Glenn Miller suggested that the Town should contact the HOAs. Mrs. Bridge-Denzak pointed out that some HOAs might be open to allowing short term rentals, but agreed that contacting them all to insure they were aware of the ordinance change was possible to do. Mayor Les Peterson offered to meet with representatives of HOAs to answer questions about their rights.
Councilman Mike Farrar noted that HOAs are under no State regulations to change their CC&Rs to comply with SB 1350. Councilwoman Melissa Price pointed out that some HOAs rely on Carefree's Transient Code to support disallowing short term rentals, and now that option is being removed.
Mr. Miller asked how the Town would know if short term rentals were taking place. Mrs. Bridge-Denzak replied that this is a good reason to have the legislation because now another body will oversee this. The Mayor added that Tempe wanted to be able to receive the taxes because 70% of their residential housing stock is rented due to Arizona State University.
Vice Mayor John Crane asked if casita rentals not restricted by HOAs could be rented under this law. Mrs. Bridge-Denzak replied that they could not. Carefree interprets the ordinance as applying to the primary use of the property. Councilman Gene Orrico said he could see a lot of taxes slipping through the cracks. Mayor Peterson said organizations like AirBnB are required to report the rentals but it is more difficult to monitor if done by individual homeowners. Mrs. Bridge-Denzak responded that this law was passed to help crack down on rentals-by-owner because bigger organizations will step in to support property owners in this regard and property owners will know they must comply.
John Traynor felt the issue of HOAs is still nebulous. As of now, CC&Rs will take precedence but until there is a court challenge it won't be decided. As a member of the HOA board in Velvet Shadows, he received a complaint previously about a rental of less than 30 days that involved 8 cars being parked in the cul de sac. This seemed to be a commercial use of the property. He said that CC&Rs must include the term "residential use". Mrs. Bridge-Denzak replied that this Town Code amendment does not make residential properties eligible for commercial use. These rentals are not considered a commercial use in residential districts. They are classified like any other rentals. Mr. Traynor said HOAs can change their CC&Rs to disallow short term rentals if that is not already included. The Council agreed it was a good idea to notify the HOAs to make them aware of their options.
The motion to amend the Town ordinance to comply with SB 1350 was approved 7-0.
https://vimeo.com/190130714
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list. Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.
Issue #525, November 4, 2016
Planning Director Stacey Bridge-Denzak expressed her pleasure in working for and with the outgoing Council members, and helping to support the accomplishments that have taken place. She is looking forward to working with the incoming members.
Senate Bill (SB) 1350 was signed into law on May 12, 2016, requiring municipalities to amend their zoning ordinance with respect to vacation rentals. There would be only one reading of this amendment at the Council level, as the first public hearing was held at the October Planning and Zoning Commission (P&Z) meeting.
In 2005, Carefree adopted a zoning ordinance prohibiting rentals for less than 30 days. The State directed the Town to reverse this ordinance. SB 1350 prohibits municipalities from banning short term vacation rentals. The State will collect the bed tax on behalf municipalities and will distribute them back accordingly. SB 1350 covers all residential uses including single family, multi family, condominium, cooperative and timeshare units. Municipalities may regulate issues in regard to protecting public health and safety, and may prohibit illegal and illicit uses. Carefree has ordinances in place to address any nuisances that might arise.
Adoption of this amendment is required by the end of the calendar year. A P&Z public workshop was held in September, and the text amendment was discussed at the regular October P&Z meeting, where 5 members of the public attended and posed questions. The 2 issues questioned involved the rights of Homeowners' Associations (HOAs), and if there would be a legal review. HOA CC&Rs are a 3rd party contractual agreement which may be more, but not less, restrictive than municipal ordinances. Because CC&Rs are contractual agreements, HOA CC&Rs may restrict short term rentals that municipalities are not permitted to legislatively prohibit. All ordinance text amendments are reviewed by the Town Attorney. The proposed text amendment withstood the test of scrutiny. The legally required newspaper notifications and postings have been done.
Gary Neiss clarified that HOAs are responsible for enforcing their CC&Rs. The Town does not get involved in that. Councilman Glenn Miller suggested that the Town should contact the HOAs. Mrs. Bridge-Denzak pointed out that some HOAs might be open to allowing short term rentals, but agreed that contacting them all to insure they were aware of the ordinance change was possible to do. Mayor Les Peterson offered to meet with representatives of HOAs to answer questions about their rights.
Councilman Mike Farrar noted that HOAs are under no State regulations to change their CC&Rs to comply with SB 1350. Councilwoman Melissa Price pointed out that some HOAs rely on Carefree's Transient Code to support disallowing short term rentals, and now that option is being removed.
Mr. Miller asked how the Town would know if short term rentals were taking place. Mrs. Bridge-Denzak replied that this is a good reason to have the legislation because now another body will oversee this. The Mayor added that Tempe wanted to be able to receive the taxes because 70% of their residential housing stock is rented due to Arizona State University.
Vice Mayor John Crane asked if casita rentals not restricted by HOAs could be rented under this law. Mrs. Bridge-Denzak replied that they could not. Carefree interprets the ordinance as applying to the primary use of the property. Councilman Gene Orrico said he could see a lot of taxes slipping through the cracks. Mayor Peterson said organizations like AirBnB are required to report the rentals but it is more difficult to monitor if done by individual homeowners. Mrs. Bridge-Denzak responded that this law was passed to help crack down on rentals-by-owner because bigger organizations will step in to support property owners in this regard and property owners will know they must comply.
John Traynor felt the issue of HOAs is still nebulous. As of now, CC&Rs will take precedence but until there is a court challenge it won't be decided. As a member of the HOA board in Velvet Shadows, he received a complaint previously about a rental of less than 30 days that involved 8 cars being parked in the cul de sac. This seemed to be a commercial use of the property. He said that CC&Rs must include the term "residential use". Mrs. Bridge-Denzak replied that this Town Code amendment does not make residential properties eligible for commercial use. These rentals are not considered a commercial use in residential districts. They are classified like any other rentals. Mr. Traynor said HOAs can change their CC&Rs to disallow short term rentals if that is not already included. The Council agreed it was a good idea to notify the HOAs to make them aware of their options.
The motion to amend the Town ordinance to comply with SB 1350 was approved 7-0.
https://vimeo.com/190130714
Lyn Hitchon
Prepared by Carefree Truth
Visit our website at www.carefreetruth2.com If you know anyone who would like to be added to the Carefree Truth email list, please have them contact me. Feel free to share Carefree Truth with others on your list. Visit www.carefreeazbusinesses.com to see more info about businesses in Carefree. Please support our merchants.