Homestay vote looms large for May 17 meeting of City Council

Since announcing in December last year that it would consider expanding a type of short-term rental known as a homestay to include separate living units, Asheville City Council has gathered virtual mountains of additional data and comment, including scores of emails from various interests, reports from city staff and the opinions of several city advisory boards. All that input notwithstanding, no clear consensus has emerged from the arguments for and against the change leading up to Council’s vote on the issue on May 17. And while five members of Council have made their voting plans known, two others haven’t yet declared their positions.

Considering that previous discussions and votes on short-term rental issues have drawn large and passionate crowds, it’s a safe bet that getting a seat in Council chambers for Tuesday’s meeting will require arriving well in advance of the 5 p.m. start time. Other major items on the agenda include a hearing on the city budget for the upcoming year, an expansion project at the Asheville Outlets on Brevard Road and approval of a plan to request $20 million over seven years from the Buncombe County Tourism Development Authority for improvements on the South Slope, including a multi-use building with structured parking.

Following along with the discussion of the homestay issue requires a knowledge of some specialized city nomenclature. Short-term rentals, often called STRs, are lodging rentals of fewer than 30 days. Legal STRs include hotels and bed and breakfasts, as well as a type of lodging known as a homestay, in which a homeowner or long-term resident rents no more than two bedrooms in their primary residence to guests. The resident must be present during the rental. City Council expanded the homestay program on Nov. 15 last year to make it available to a larger number of city residents.

Renting out a whole house or a separate living unit on a short-term basis is not permitted in the city. Violators face fines of up to $500 per day.

In response to STR advocates, Council agreed to reconsider the prohibition on using a separate living unit as a homestay on Dec. 8 last year. The separate units are known as Accessory Dwelling Units, or ADUs, and may include housing types such as a backyard cottage, a garage or basement apartment or an in-law suite. A vote on June 23 last year increased the allowed size of ADUs while reducing barriers to building ADUs in all parts of the city. At the time the new ADU rules went into effect, STR opponents point out, Council justified the change as a measure to increase the number of housing units in the city, especially smaller and more affordable units. Allowing these units to be used as STRs defeats the supposed purpose of expanding the ADU ordinance to ease the city’s affordable housing crisis, opponents, including local architect Jane Mathews, argue.

Other concerns raised by those who oppose extending the homestay program to ADUs include a loss of neighborhood character by introducing a large number of transient guests into residential areas, parking, noise, disruption and the possibility of large property owners purchasing houses for use as homestays, thereby driving up property values and further reducing housing availability.

STR advocates say that expanding homestays to ADUs would meet the needs of both Asheville residents and visitors without negatively affecting the overall quality of life in the city or significantly reducing the supply of affordable housing. Many homeowners who have ADUs, the advocates say, use them to accommodate visiting friends and family and would not consider renting the units on a long-term basis. The high costs of developing a new ADU mean that the units will not be affordable to most long-term renters, others have argued.  Those wishing to operate an ADU as a homestay say they ought to be able to use their property to take part in the financial benefits of Asheville’s busy tourism economy.

A city staff memo characterizes the apparent impasse between the perceived benefits and negative impacts of the proposed expansion:

This proposal appears to support some goals but may not support others. Prioritizing community goals is a policy decision and is best deferred to the appropriate decision makers. The supplemental research is informational, but not conclusive.

Councilmembers Julie Mayfield, Gordon Smith and Gwen Wisler make up the city’s Housing and Community Development Committee, which voted unanimously to recommend rejecting the expansion of the homestay program to ADUs to the larger Council.

Councilmember Cecil Bothwell has long argued that regulating or prohibiting STRs is impossible; he is expected to vote in favor of the expansion.

Brian Haynes and Keith Young, who were seated on City Council on Dec. 8 last year (along with Mayfield), were both viewed as advocates for STRs during their campaigns. Haynes has continued to express strong support for allowing all forms of STRs, while Young has maintained some flexibility in his position. During the campaign, Young told Xpress: “I believe homeowners should be allowed to use their property as they wish. However, we cannot completely rule out the city’s ability to regulate these rentals in a way that will strive to keep the harmony of our neighborhoods intact and not obstruct or cause an encumbrance with the ability to make a profit.”

Asheville Mayor Esther Manheimer noted at the Dec. 8 meeting of Council last year that she had gone on the record in support of exploring the use of ADUs as homestays. Manheimer’s current position on the expansion of the homestay program is not known.

Thus, with three clear “no” votes (Mayfield, Smith and Wisler) and two clear supporters (Bothwell and Haynes) and two undecided (Manheimer and Young), the outcome of the vote is difficult to predict.

City Council will meet at 5 p.m. in Council chambers on the second floor of City Hall. The homestay issue is the third of three public hearings scheduled for the meeting.

The city’s full meeting agenda, along with supporting documents, is available online.