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Ducey having second thoughts about vacation rental legislation

Gov. Doug Ducey wants to take a new look at legislation he signed three years ago that stripped cities of much of their ability to regulate vacation rentals. (Adobe stock)

Gov. Doug Ducey wants to take a new look at legislation he signed three years ago that stripped cities of much of their ability to regulate vacation rentals. (Adobe stock)

TUCSON — Acknowledging it hasn’t quite worked as promoted, Gov. Doug Ducey wants to take a new look at legislation he signed three years ago that pretty much stripped cities of their ability to regulate vacation rentals.

The governor said Aug. 22 he still believes in the rights of individuals to be able to rent out rooms in their homes — and their whole homes for special events like the Phoenix open — to earn some extra money.

But Ducey conceded that the 2016 law may be being used in ways that were not intended and have been disruptive.’’ And that may include the practice of real estate speculators buying up homes in neighborhoods for the sole purpose of turning them into short-term rentals.

The comments come on the heels of complaints from some communities, particularly tourist destinations where much of what had been the residential rental stock has been turned into short-term rentals, reducing the supply of affordable housing.

Senate President Karen Fann, R-Prescott, said some developers are constructing homes with eight bedroom suites for the specific purpose of renting them out to tourists.

“So this is now people circumventing all the zoning regulations and everything else that hotels and motels have to go through,’’ Fann said. “They’ve found a loophole that they are now building, if you will, mini hotels and motels in residential neighborhoods.

In signing the original 2016 law, Ducey proclaimed himself an unabashed supporter of the concept of unregulated vacation rentals.

The law, however, did more than keep cities from telling people they cannot rent out a bedroom or their home. There is no limit on the number of properties an investor can buy and days a home could be rented out, potentially turning a neighborhood into a vacation rental zone.

Ducey at the time brushed aside the question of whether that could change the character of neighborhoods.

“The markets adjust,’’ the governor continued. “Somehow we survive people making entrepreneurial decisions, and innovative apps like this provide convenience and cost-sharing opportunities.’’

On Aug. 22, Ducey acknowledged that perhaps the law he signed didn’t quite work out the way he had envisioned.

“I think there were some unintended consequences in a law that had the best of intentions,’’ he said, something he said is “not unusual’’ in the legislative process.

“It does appear in the situation of Airbnb and other organizations that we have some people out there that are doing some things that are disruptive to communities,’’ Ducey said.

“I do think there are some things we can address in terms of public policy,’’ the governor said. “And we’re going to be doing that in the upcoming legislative session.’’

Fann was more direct. She said what lawmakers voted for in 2016 was not what they got, with the measure promoted as helping elderly homeowners keep their homes.

Rep. Noel Campbell, R-Prescott, said his ideal solution would be to pretty much scrap the whole 2016 law.

Rep. John Kavanagh, R-Fountain Hills, also continues to try to restore more local control. But he’s not convinced that outright repeal is politically possible.

“My ideal solution would be to ban them from residential zones,’’ he said.

But Ducey, for his part, appears more interested in minor tinkering.

“It’s really digging in to where the specifics are and how we fix it without wholesale change,’’ the governor said, which protects “individual rights.’’

Ducey said that’s why he agreed to sign the legislation this year on the issue of party houses.

One hurdle to major alternations could prove political.

During the debate on Kavanagh’s legislation earlier this year, Rep. Jay Lawrence, R-Scottsdale, said he also is a foe of what he said are abuses of vacation rentals, particularly for party houses. But he said there’s another factor at work in making changes.

“Let me point out that real estate agents are a very powerful entity within this body,’’ Lawrence said.

Ducey did sign a measure earlier this year to curb what was seen as one of the more blatant abuses, with single-family homes being turned into weekend party houses.’

That new law, which took effect Aug. 27, spells out that homes cannot be used for parties, restaurants, sales or other non-residential purposes. And it requires owners to provide a point of contact for police to call if there are problems.

Kavanagh contends the problems are far deeper — and worse.

He sought to restrict the number of occupants to not more than two adults per bedroom and to limit visiting hours for guests. And Kavanagh even wanted to require that owners actually install cameras and noise sensors to detect what is going on.

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