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31 short-term rentals can continue

By MIKE DONILA
Published April 21, 2007

CLEARWATER - In a ruling that upset neighbors and city officials, a state judge ruled Friday that a select group of homeowners in an affluent beach neighborhood can keep renting their properties short-term to vacationers.

Pinellas-Pasco Circuit Judge Nelly Khouzam ruled that the city had forfeited its right to enforce a short-term rental ban on the owners of 31 properties because before 2003 the ban had not been clearly defined or enforced.

The ruling was a big win for the 21 plaintiffs, several of whom own multiple properties in the north Clearwater Beach neighborhood, where home prices start at $500,000.

Despite the explosion of short-term rentals in Florida's beach communities - prompting complaints of noise and traffic from permanent residents - Friday's ruling isn't expected to have broad implications for disputes elsewhere. Khouzam closely tailored her ruling to the specific properties in question, not to the broader issue.

The judge's ruling let stand the city's 2003 ordinance, which prohibits rental periods of less than 31 days in residential neighborhoods. During the legal wrangling, the city did not enforce the ordinance on the plaintiffs. But inspectors did go after others, taking 11 to the code board and placing liens on two properties, one up to $22,000.

"I'm glad the judge agreed with us to let us keep doing what we're doing," said David Allbritton, a plaintiff who leases two homes in the neighborhood.

Mayor Frank Hibbard said the city's legal department is looking at its options, including appealing the ruling. He said he's "disappointed for the residents who were negatively impacted" by the rentals.

And the president of the Clearwater Beach Association, a neighborhood group, made clear he and his neighbors would expect the city to continue to fight. They have complained for years that the short-term renters create noise, trash and traffic in their neighborhoods.

"Our followup action and spread of information will increase tenfold," said Jerry Murphy, 73, who has submitted pictures of short-term rental violations to city code officials. "We'll develop a major strategy to work from here on out."

Clearwater contends it outlawed short-term rentals in the residential neighborhoods decades ago, but acknowledged that it didn't define "short-term" in its ordinances until April 2003.

But the court sided with the plaintiffs, who argued the city never enforced the ban until around 2003 and that they should be grandfathered under the ordinance. They argue that the short-term rentals have been a way of beach life for decades and are important for an area rapidly losing hotel rooms.

Khouzam ruled that the plaintiffs' 31 properties could continue operating as short-term rentals but would lose the exemption if they rented for longer periods of time or were destroyed.

The short-term rentals have particularly blossomed since 2000, as insurance rates and property taxes increased, and big development started gobbling up beach hotels. Adding to the trend was the Internet and the ease it brought to advertising properties.

As tourists were looking for a place to stay, some second homeowners were looking for a way to raise more income to pay for the escalating costs.

Instead of charging $1,200 to $2,000 for a month's rent, property owners found they could charge the same price per week.

[Last modified April 20, 2007, 21:16:08]