July 19, 2005
Neighbor vrs. Neighbor
Dear City Council,
Thank you for your kind attention to my presentation last evening concerning the onerous and expensive regulations that legitimate (zoned and licensed) transient lodging must meet, contrasted to the unregulated residential rentals in town.
I know it's a complicated issue and I appreciate a search for a solution that respects everyone.
I must add that it was distressing to hear Larry King, in his final comments, compare the historic Jewish resorts, now extinct, to South Haven's current B&Bs. Things change, he tells us. He called it "ridiculous" to expect a city to protect its businesses or to expect property owners NOT to rent their homes, even though these rentals are illegal in their zoning and unlicensed, unregulated and untaxed for the revenue they collect. Considering that Mr. King is also Director of the Chamber of Commerce, this comment is particularly bizarre.
Here is an interesting solution to the problem. In this case the town has decided on a fascinating compromise.
I am not saying that this is "the answer", just suggesting a possibility. I hope you will continue to discuss this.
Neighbor vs. neighbor at packed hearing on B&Bs
http://the.honoluluadvertiser.com/article/2005/Jun/29/bz/bz02p.html
Sincerely, Elaine
Posted by Elaine at July 19, 2005 08:00 AM
Comments
Elaine,
If you're going to paraphrase me, please do it correctly.
The Catskills of the Midwest exhibit and the loss of the large resorts is an example of changing market conditions. No matter what laws a government may pass declaring a certain type of business to be preferred, it is the free market that ultimately determines survival.
In terms of the renting of homes, that is a private property owner right. One that I consider sacred. I would not support and do not support efforts to take that away from private property owners - no matter what business any such action might be designed to protect.
Posted by: Larry at July 19, 2005 02:08 PM
Larry,
What a bunch of malarky. You are simply warmed and
beholden to the Chamber memberships of 50+ private homes and the Board of Directors that employ you that represent real estate sellers, bankers and insurers.
You seem so blinded by this loyalty that you cannot open your mind to the inequity of the burden placed on legitimate commercial businesses competing for the same tourist dollar. You also don't seem to understand that current zoning ordinances, parking requirements and sign ordinances are not being enforced in the residential neighborhoods. Laws are laws.
If someone wanted to open a barbershop, appliance repair shop or restaurant next door to your home, and put a permanent year-round sign announcing it in their front yard....would that also be fine by you as long as they paid their Chamber of Commerce membership? How about if you had a legitimate barbershop of your own downtown and invested far more and met the codes? How would the Board of Directors feel about banks, real estate and insurance offices in the R1 residential neighborhoods?
Your slip is showing. Maybe because your nose is straight up the backsides of real estate profiteers.
But don't try to pass it off as marketing genious,
property rights or wisdom about what is "sacred".
That's just smokescreen.
Posted by: Elaine at July 20, 2005 08:18 AM
This is an interesting debate, but I think an important element is missing.
Property owners do have the right to rent their property within the law, but with that right comes responsibility. The consumer has rights too. When they rent a cottage or house or condo for their vacation, they have the right to assume that all codes for safety are met.
The City has a responsibility to make sure the code is written to ensure that rentals meet the safety standards that are required for transient rentals and that the code can be enforced.
I would take it one step further to say that the Chamber of Commerce and the Visitors Bureau have a responsibility to list only cottages, condos, or houses that have been certified to meet fire and other safety standards.
No matter what your opinion is, it’s time to review the rental code, not to protect individual businesses, but to protect the welfare of the public. The review would best be done by those who are not involved in the rental business thus a disclosure of interest in rental properties should take place before the review begins.
Just to be completely open on this topic, we have a long history of owning rental properties in South Haven. We found many of the restrictions to be too cumbersome and we got out of the rental business.
Posted by: Dorothy Appleyard at July 20, 2005 09:47 AM
Dorothy, I completely agree. And I made it clear that I am not specifically looking for any kind of special protection for my business, just a fair and equitable playing field.
I especially like your idea about the code being fashioned by persons without a rental interest. I just don't know how you'd find anybody like that in this town. :-)
Thanks for participating! Elaine
Posted by: Elaine at July 20, 2005 10:06 AM
I also own a business in town and have outsiders coming in and conducting the same line of business I do. It was my decission to locate my business in this town and hopefully I do it well enough so my competition is limited by demand that I can't keep up with. My playing field is not level, I pay more in taxes and my overhead is much higher than the outsiders have. However, I embrace competition because I know I cannot nor have the capability to serve all the demand for my type of business in South Haven. It is the customer that supports all the businesses in South Haven that enables all of us to make a living here. The more reasons for people to come here, the more chances there are for them to tell others and hopefully if I run my business properly I can gain new customers as they arrive. It is competition that forces quality and in return it is quality that gains market share.
Posted by: Steve at July 20, 2005 11:05 AM
Elaine,
You may recall that at the conclusion of your comments to council I suggested you encourage both the visitors bureau and the chamber of commerce to request a revisit of the rental housing ordinance.
This ordinace was first looked at back in the early 90's. At that time quite a number of the B&B, Hotel and weekly rental owners vehemently opposed the idea so council dropped it. Its time to revisit it and I think you might find more support for such a review from those groups.
The sign ordinance has been under review by the planning commission for at least a year. That needs to get completed. Staff has a hard time with enforcement when the ordinance is likely to change and in comparision with other code enforcement issues in the community that aren't under review.
Stricter enforcement of the 48 hour provision of the ordinance may be possible. But beyond what staff does now on enforcement wouldn't achieve the equity you seek.
So it comes back around to a rental housing ordinance. If the issue is to get revisited, then it makes some sense to rally up some support for the review. A rental housing ordinance has a number of positive benefits including life safety issues, neighborhood tranquility and qualifications for more housing related grants. It also has a cost, how do you develop the additional staff time to do the enforcement and who pays for those additional resources?
In terms of who should do the review. I disagree wholeheartedly with you and Ms. Appleyard. If you believe all citizens are equal, then everyone should have an opportunity for input on the ordinance, not just those that meet your criteria.
Or are some more equal than others?
Posted by: Larry at July 20, 2005 11:29 AM
The future can be the future. Write new laws. Involve everyone, Whatever.
But we have zoning and ordinances in place, and that's the playing field I signed in on and that I expect to play on.
Otherwise, the wise developer would, could, and will build whatever they want, wherever, however. No ADA compliance, no fire code met, no parking, no taxes, no nuthin. Just hang a sign and rake in the cash.
More equal than others? No. I just want the law enforced.
Posted by: Elaine at July 20, 2005 11:48 AM
Of course all people are equal. They are also capable of bias. It was not my intention to imply that there should be no input from those involved in the rental business, but a final decision should not be made on the basis of their feedback alone. The impact on the community is too great to be decided by those who have a vested interest only.
Posted by: Dorothy Appleyard at July 20, 2005 11:51 AM
I can't help wondering who the "outsiders" who have low overhead and low taxes are?
Posted by: Dorothy Appleyard at July 20, 2005 12:02 PM
Dorothy, the only competitors to local marinas that I can think of is the city's own transient docks. Perhaps Steve can clarify. Steve, nice to hear your voice in this discussion, thanks.
Posted by: Elaine at July 20, 2005 12:18 PM
By the way, I sat in on all the meetings trying to hammer out a rental ordinance back in the 90s. I remember vividly where the opposition came from: realtors and property owners with sub-standard electrical service, among other deficiencies in their properties. A rental standard would put them out of business because they were unwilling to upgrade.
As I said Monday evening in response to Larry's suggestion for a rental ordinance: you won't find the will for it in the public forum. Courageous leadership from the City is what will be needed.
Posted by: Elaine at July 20, 2005 12:24 PM
Elaine,
Marina operations cover more than just slip rentals. Stuff like in/out service, storage, parts/service, etc.
"Outside" competition can come in many forms, in the case of local marinas in the city of south haven you have that competition coming from businesses in other taxing jurisdictions (townships/other cities), businesses that operate out of mobile units (no fixed taxable structure), and individuals that put up or have large pole barns on their residential property that they make available for storage.
All businesses face some level of unfair competition. It isn't right, but it is reality. And in fact, history shows that businesses have more than on one occassion utilized the creation of government rules to stifle competition.
Courageous leadership from council or not, you are a member of the transient lodging industry. If that industry feels there are fringe operators that negatively impact the industry and create public safety/nuissance issues, then you need to speak up as a group. Talk to your peers, I think you will find more support for a revisit of the rental housing ordinance than what you think.
I few words of caution though: Don't try to understand, define or tell people what their motivation may be, just listen to what they are saying. And, avoid personal attacks when you think you hear something with which you might disagree. Personal attacks create negativity and detract from the discussions at hand.
Afterall, my nose goes many places. Where it goes isn't worthy of a public discussion board and how its trips impact my decisions is only relevant in the fact that it is my nose and there's so much more to me than that.
Posted by: Larry at July 20, 2005 01:18 PM
Fair enough. I'll get *my* nose back into joint here and try to heed that advice. Thanks for your input.
Posted by: Elaine at July 20, 2005 02:45 PM
Yes, I was refering to outside mobil service units, outside of town storage units, etc. they pay lower taxes, lower insurance, etc. I was told to check this website out and have been reading it as I have time. I didn't realize some of the issues that have been brought up in the past and wish I'd known about this site earlier because I would have commented on some of the concerns regarding development. However, now that I have found it I'll try to check in once in a while.
Posted by: Steve at July 20, 2005 03:12 PM
People email me. Guess they don't want to reveal their names here...can't blame them. They say:
If I recall correctly, Headlee caps tax revenue. New construction and homestead sales are ratcheted up to their SEV. Since the government is not allowed a revenue windfall from appreciating property values, somebody else's taxes have to go down. This means that one road to lower taxes is to be so obnoxious your neighbors will sell out and move, but not so obnoxious their property values will plummet.
Another writes:
I presume that Headlee bumps taxes up if an existing house is torn down and replaced by a more expensive one. That is happening, one residential lot at a time. I'm not fond of the trend, but at least it doesn't make a huge difference in traffic or utility demand.
Does Headlee allow additional tax revenue for property change of use; specifically, conversion of residences into weekly rental units?
We have friends that moved out of South Haven after their residential neighborhood on the south side was almost entirely converted into summer homes. They valued long-time neighbors and no longer had any.
Another writes:
If purported homesteads are actually being used as rental properties, they should be redefined on the tax rolls. Then their owners will have the opportunity to pay higher taxes, and the rest of us will realize a little benefit come tax time. This fits into your discussion with Larry on weekly rentals. The law needs to be clear enough to easily define revenue-generating property.
Posted by: Elaine at July 28, 2005 01:32 PM
In terms of tearing down a home and rebuilding another in its place, Headlee wouldn't be the law/thing that would increase the taxes for that home. I think (and may be wrong), but if your'e not changing the footprint or sqaure footage, then your taxes shouldn't go up.
I believe the Mathew/Gast act allows homeowners to do maintenance/replacement projects (roofs,siding, paint, remodel, etc) without an increase in taxable value. It only increases through Proposal A formula(s) or adding living space. I think the act also applies to business.
In terms of homestead property being rented out, that action automatically disqualifies the homestead exemption. And, the state/county/city have been known to review community (chamber,cvb, newspaper, etc), and rental websites to check against homestead records.
Larry
Posted by: Larry King at July 28, 2005 02:09 PM