Bangor is nearly finished with a set of rules that would legalize and regulate the more than 100 illegal short-term rental properties, like Airbnbs, currently operating in the city.
Bangor city councilors reviewed the latest version of the city’s proposed rules for short-term rentals during a Business and Economic Development Committee meeting on Monday, nearly two months after city staff first pitched loose rules for short-term rentals to the public. City staff then adjusted the first draft of the ordinance based on the public’s questions and concerns.
Bangor does not yet have a policy on short-term rentals, which means they aren’t allowed anywhere in the city. Despite this, city staff found 129 short-term rentals in Bangor, 52 of which are non-hosted, 28 are hosted and 49 are unknown.
Those 129 short-term rentals is a steep increase from the 87 illegal short-term rentals a study by the consulting firm Granicus found operating in the city in 2021.
While the number of rentals hasn’t yet become problematic or influenced the area’s housing market, Bangor wants to get ahead of potential problems other Maine tourist destinations have faced in recent years, Anne Krieg, Bangor’s economic development director, said. Those challenges usually center around short-term rentals cutting into a community’s housing stock and raising rent and purchase costs, which have grown increasingly unaffordable in recent years.
In its proposed rules, the city defines a short-term rental as renting up to two bedrooms or an entire dwelling unit, such as an apartment, for fewer than 28 days. The 28-day limit is designed to exclude any housing for temporary workers, like traveling nurses.
Other businesses like hotels, motels, inns, bed-and-breakfasts and boarding houses would not be subjected to the city’s rules.
The proposed rules also differentiate between hosted and non-hosted short-term rentals, but allow both types anywhere in the city. That allowance is a deviation from the first version of the rules, which proposed only allowing non-hosted units in the downtown and waterfront districts, while hosted rentals could be established in residential neighborhoods and some commercial areas.
That clause of the rules received some questions and criticism from residents, many of whom operate short-term rentals and felt the guidelines were too stingy.
Hosted rentals indicate the property owner or operator is on the premises where the short-term rental unit is located during any period when the unit is occupied. An example would be someone who rents a room in a home, or an accessory dwelling unit when the owner lives in the attached home.
A non-hosted could include an entire apartment that’s available for rent, but the owner does not live there.
The proposed rules also cap the number of non-hosted whole house short-term rentals that can be active in the city in a calendar year at 153, as that makes up one percent of all housing units in the city, according to the U.S. Census.
That cap may also increase by five percent each year, though city staff haven’t yet finalized that provision.
According to the proposed rules, all short-term rental owners would need to obtain a license for each unit they rent, effective April 11, 2024. Those licenses must be renewed annually and cost $250 a year. If the unit doesn’t need to be inspected to be renewed, the renewal fee is lowered to $100.
Short-term rental units must also be inspected by a city code enforcement officer every three years to ensure they meet life safety standards. Each inspection also carries a $100 fee.
Councilors asked city staff to issue licenses on a first come first served basis, but those with existing licenses may keep their spot as long as they continue to offer a short-term rental, get their license renewed annually and follow the city’s rules.
When building Bangor’s proposed rules, city staff looked to other Maine communities, including Portland, Kittery and Bar Harbor, that have similar, but slightly different regulations for short-term rentals. Those communities also cap the number of short-term rentals allowed, and issue licenses on a first come, first served basis.
Bangor is also looking to cap how many short-term rentals can be in a multi-unit property, if it’s owned by one person or company, at 50 percent to preserve permanent housing. This means if a person buys a building with four apartments, only two can become short-term rentals.
The rules also state that a person or entity may not hold a license to operate more than five short-term rental units in the city in any calendar year.
If a license holder sells a property they were renting as an Airbnb, the license cannot transfer to the new owner.
The proposed guidelines also give the city the power to issue a fine or suspend or revoke someone’s license if they don’t follow the rules, or if their short-term rental becomes a disruptive property.
The proposed short-term rental ordinance will head to the Bangor planning board for a vote on October 3.
City staff anticipate bringing the final version of the short-term rental rules back to the city council for final approval on October 11.
