A majority of Manhattan city commissioners are interested in regulating and taxing short-term rentals.
Short-term rentals (STRs), sometimes called vacation rentals, are places people stay for less than 30 days. They often use companies such as Airbnb or Vrbo to rent a space or an entire residence to people.
Commissioner Linda Morse said at Tuesday’s meeting she would like to keep the process of regulating and taxing STRs “as simple as possible.”
“I don’t want to add complications to it,” Morse said. “I hope some city has a good model we can follow, so we don’t have to recreate the wheel.”
At a commission meeting earlier this month, Morse urged city staff members to work on a plan in taxing these rentals. Right now, STRs do not collect transient guest tax or any other taxes, while vacation rental websites like Airbnb send the state of Kansas a portion of rental revenue.
City attorney Katie Jackson offered a brief proposal to commissioners on a potential STR license or permit component. Jackson proposed a one-year ordinance and $120 fee for anyone wishing to license their home or residential building as an STR property. Jackson said the yearly ordinance is on par with other cities in Kansas, while the fee is equivalent to the fee when applying for a conditional use permit.
The proposed rules would limit STR properties to single family occupancy and prohibit spaces from being used as event venues. Jackson said STRs are fully banned in Wichita following a fatal shooting at such a residence in April, where a home was used as a party venue. Overland Park officials are also tightening regulations on STRs after shooting incidents at properties there.
Jackson said Manhattan has anywhere from 75 to 125 short-term rentals available at any given time, making it “on the higher end” for cities with STRs in Kansas. Manhattan is also the only first-class city in the state which has not yet adopted any official licensing or permitting rules for STRs.
First class cities in Kansas are defined as having a population of more than 15,000 people.
Lawrence and some Kansas City-area municipalities have lower numbers of short-term rentals mostly because of a higher amount of homeowners’ associations, which regulate what property owners can do with their homes. Jackson said a short-term rental is considered different from a bed and breakfast, in that meals are provided to guests staying in a B&B but not for guests at an STR.
As of right now, Jackson said STRs are not addressed by city zoning or building codes, however they are labeled as commercial-use properties within residential districts. Jackson said some of the drawbacks to having so many short-term rentals in Manhattan is potential impacts on affordable housing, stress on infrastructure, and less tax revenue.
Morse told Jackson she would like to see the transient guest tax charged for short-term rental use. She said she does not see STRs as “being any more special than a bed and breakfast.”
Commissioner Usha Reddi said she supports looking into “some type of ordinance” regulating STRs. She said her goal would be to give people plenty of options on where they can stay “for a night, a week, and a month,” with some added regulation involved.
Commissioner Mark Hatesohl said he would like to “keep looking” at ways to add the transient guest tax to the proposed regulation.
Mayor Wynn Butler said he would like to learn more about whether STRs potentially “disrupt neighborhoods,” but he did not elaborate on what that meant.
Manhattan city commissioner Aaron Estabrook said he is “a smidgen above not interested” in developing policies regulating and taxing short-term rentals (STR) in the city.
During the city commission meeting Tuesday, Estabrook said commissioners and city officials “have a lot of things that I think will take staff time and money to do” that would come ahead of creating STR regulations.