LAKE PLACID — The Lake Placid Village Board of Trustees on Tuesday started discussing possible directions the board might take to regulate short-term vacation rentals in the village.
The Lake Placid-North Elba Land Use Code Committee, which has been discussing STR regulations for years, held a public information session and two public feedback sessions last month to share its ideas on how STRs could be regulated here — including by possibly prohibiting unhosted STRs in densely-packed residential areas. The committee is in the process of evaluating survey responses with public feedback about the committee’s ideas, and the committee plans to present its final recommendations on STR regulations to town and village boards by July. The village’s current moratorium on issuing new STR permits ends at the beginning of September; that would give the town and village boards a couple of months to hash out new regulations on the rentals that are informed by the committee’s recommendations.
Village Mayor Art Devlin said Tuesday that he wanted the board members to start looking for “common ground” on STR regulations.
A commercial enterprise
Trustee Marc Galvin said he thinks the village board should have labeled STRs as a “commercial enterprise” a decade or so ago. Short-term vacation rentals aren’t recognized as a commercial business under state law, according to Code Enforcement Officer Mike Orticelle.
Galvin said he thought the local land use code exists because municipalities should have a say over how local land is used, and he thought the local code superceded state code. Trustee Jackie Kelly said the board had discussed listing STRs as a commercial use in the land use code in the past, but she thought the idea was scrapped because it would ultimately be considered unfair “spot zoning.”
Galvin, who’s the co-owner of Bookstore Plus on Main Street, said he has three apartments on the bookstore property — he rents one as an STR and the other two are long-term rentals. He said he’s able to charge his long-term tenants less than $1,000 a month because of the revenue the STR brings in.
“It’s a business,” Galvin said, adding that he started a corporation specifically for that STR.
The board discussed at length what members called a “balance” between residential housing preservation and the village’s tourism-based economy. Devlin asked board members if they were thinking of keeping STRs out of residential neighborhoods.
Trustee Jason Leon said he wanted to wait on the presentation from the land use code committee before making decisions. Leon said several times throughout the meeting that he wanted to make decisions about STR regulations based on the data the land use committee compiles and presents to the board, which committee chair Dean Dietrich said would include an in-depth look at public feedback. Leon said that he wants to preserve what the village has while managing development for the future.
Kelly asked Leon to explain what he thought the village “has.” He mentioned the concept of community, asking Kelly and Trustee Peter Holderied if they thought the sense of community in Lake Placid is stronger now than when they were growing up here.
“Is that a trick question?” Holderied said. He said there’s much less sense of community now, but he said people have come to, and left, the village for as long as he can remember.
Leon said he wasn’t blaming STRs for a lack of community here, but he said they’re a “contributing factor.”
Devlin asked the board if it agreed there should be areas in the village where unhosted rentals aren’t allowed. Devlin was in support of letting full-time residents in the village rent out a portion of their homes to supplement their incomes. Leon agreed, but he thought some STR owners were investors that hired people to live in their properties so they could qualify as hosted — he wanted to see data that identified which hosted rentals are actually occupied by residents.
Kelly said she thought there was a perception from the public that the village board wants to completely dissolve STRs in the village. She said STRs are also an integral part of the community, and she thinks the community needs them. Leon and Galvin said they agreed.
Leon said that he sees STRs as being like Uber or DoorDash — “just an evolution of what people do.”
“Managing it responsibly is what we’re doing,” he said. “I don’t think anyone on the board is intentionally trying to eradicate STRs as a whole.”
Devlin agreed, adding that he is “very much against” STRs being in residential neighborhoods. Leon agreed.
Holderied said people expect STRs in the tourism market now. He agreed that commercial and residential districts should be treated differently when it comes to STRs.
Devlin reminded the board that members were spokespeople for the village, and he said the village has the right to decide its “own destiny” with STRs. He said most of the old-time residents he talks to in the village are “disgusted that they’re losing their village.”
“I get 90, 80% of those people coming up at you and looking you in the eye and asking, ‘What are you going to do, finally?’” Devlin said.
“Preach,” Leon said.
In response to Devlin’s anecdote about this perception from old-time village residents, Kelly said she thought people wanted to return to a past that the village would never have again.
“We have to manage change,” she said.
Devlin asked Kelly if she was saying to just forget about regulating STRs altogether. She said no, and she reiterated the need for “balance.”
STRs and the economy
Kelly said she thought STRs have diminished the availability of long-term rentals, but that she doesn’t believe STRs have driven the cost of homeownership up in the village.
Galvin disagreed. He told a story about how he and his family tried to purchase a property that had a lot of STR rental history. Galvin offered over $100,000 more than the property’s assessed value, but his offer wasn’t considered because someone with short-term rental history offered almost $300,000 over market value. He told Kelly that was a specific example of how short-term renting was used to drive up the price of the house. Kelly said she thought that was just the economy and the village being a resort community.
Kelly said it’s “the perfect storm,” because she’s heard of landlords who’ve had bad experiences with long-term tenants who have switched to STRs. Devlin said many people are “insistent” on renting short-term over long-term because they can make “triple” the amount of money.
That money-making venture is what brings some investors to the village to purchase homes and convert them to STRs, according to town Assessor Todd Anthony, who said last month that STRs did play a part in increasing home assessments this past year. Leon expressed concern that the continuation of those investment activities could dissolve the sense of community here.
“Then we have what you (Devlin) refer to as ‘Disneyworld,’” Leon said, “and we’re dangerously close to that.”
Kelly said the village couldn’t change what it is — “a resort community.” Leon countered that the village could preserve what it has.
“No you can’t,” Kelly said. “We’re trying, and it’s not being very successful.”
Devlin asked Kelly if she thought the village would lose its economy if it doesn’t allow “triple the amount of STRs we have now.” She said yes; she thought the “traveling public” is spending more time here because STRs are more affordable.
Earlier in the meeting, Kelly said she thought it was important to keep neighborhood homes affordable so that homeownership is attainable for local residents. Board members noted that village properties are out of reach for people who aren’t making six figures a year.
Devlin said a house behind his went on the market a couple of years ago, listed at $180,000. Devlin encouraged his handyman, who was newly married, to buy the place. He said he couldn’t because it was too expensive — Devlin said the house ended up selling for $360,000 to someone who converted the home into a short-term rental.
“There’s a reason that the house just jumped out of sight for another person that wanted to live here,” he said. “And everyone says there’s no proof of it — I’m witnessing that. I think that’s proof right there.”
The board discussed a “sunset” clause on STRs in residential neighborhoods, or giving STR permit-holders a certain amount of time to continue using their property as an STR before their permit is no longer valid. The sunset on STRs could happen in a couple of ways, according to the board’s discussion. Devlin floated the idea of instituting a five-year sunset clause that would allow permit holders to continue renting for that time period to make a return on their investment before losing their permit.
Leon said he thought that was “kicking the can,” and he said the STR owners might just revisit the issue after five years and try to appeal for a renewal.
“No, we set a law and that’s what happens,” Devlin said.
Leon said he’d support that, but he wanted to wait on the land use code committee’s recommendations.
Another way a sunset clause could play out is by allowing people to continue renting their properties as STRs as long as they maintain ownership of the property, according to Devlin. Once the old owner sells, the new owner couldn’t get an STR permit. STR permits currently aren’t transferable between new and old property owners.
Room nights and enforcement
The board also discussed occupancy caps, or the maximum number of nights an STR can be rented per year. In some residential areas in the village, an STR owner can currently rent their unit out up to 90 nights per year.
Leon was concerned that the village’s occupancy cap isn’t properly enforced. Leon said he wasn’t questioning the quality of work by the Building and Planning Department, but he said its up to Devlin and North Elba town Supervisor Derek Doty to request that staff there develop a plan for policing enforcement.
Kelly said she thinks the village should increase the fees for permits. Leon agreed, adding that fines should be increased to make monetary consequences for disregarding regulations more “meaningful.”
Galvin said he thought the board should cap the number of STR permits instead of the number of nights rented — he thought that would be easier to enforce.
The board talked about whether it wanted to take the same approach as the town when it comes to regulating STRs. The town and village are allowed to take separate actions when regulating STRs, per the town-village joint land use code. Kelly said she wanted to see a “unified front” from both boards. She said STRs are a “community problem.”
Leon said that he wanted to take the same direction “within reason.” He indicated that if there’s an obvious disconnect between what the town and village boards wants, he’d consider going in different directions.
Devlin said the board would see if the town council agreed on “the word” on neighborhoods, or limiting STRs in residential areas. He said that when all was “said and done,” there’d be some type of compromise not just with the town board, but among the five members of the village board.