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By: Staff Reporter

 A large crowd attended the Niagara Falls planning board meeting of July 22, to participate in an open forum concerning Mayor Robert Restaino’s proposed amendment of the city’s short-term rental ordinance {STR].

 Restaino wants to change the way the city regulates short-term rentals of houses, establish licensing regulations and limiting the use of STR properties to the downtown area of the city.

 Short term rentals permit homeowners to rent properties similarly to the way a hotel does. Visitors can rent for a day, or days or a week or longer, as opposed to normal residential tenancies which are month to month.

 STRs often represent a fundamental change in neighborhoods from residential, with long-term residents to one where there is a constant influx of strangers.  In this economically depressed city, with nearly the highest property tax rates in the USA, many homeowners seek to make additional income.

 Restaino’s plan has garnered controversy primarily because he seeks to limit what was once a city wide opportunity to one where new STRs can only be offered downtown, in proximity to the Niagara Falls State Park and the traditional tourist area.

Previously existing short-term rentals are grandfathered in. Restaino’s proposal still has to pass the council.

Niagara Falls Mayor Robert M. Restaino.

Restaino argues that limiting STRs to downtown “will limit the spread of STRs into more remote parts of the City and hopefully create a ‘critical mass’ in the lodging and hospitality industry in our downtown tourist zone.”

A new feature in the proposed amendment is the creation of an annual licensing requirement of $250 for single unit dwellings and $400 for two-unit rental dwellings.

Under the proposed amendment, owners will be required to register with Airbnb, the online platform that connects hosts renting out space in their homes with guests seeking lodging. The owner will  pay Airbnb all required taxes and fees, including Occupancy Taxes. Thus, STRs will now be required to pay sales taxes and bed taxes like hotels do for providing lodging services.

Critics of the proposal argue that mandating all homeowners to use Airbnb is unconstitutional and wrong. There are other online companies that compete with Airbnb such as 9Flats, Booking, Casamundo, Flipkey, HomeAway, HouseTrip, Kid & Coe and One Fine Stay.  The idea that only one commercial company is mandated may not stand legal muster since other companies might be able to provide as good or better services and opportunities for better, more lucrative rentals.

Part of Restaino’s proposal mandates that owners of STRs will be held responsible for nuisance violations at their property and must ensure that occupants refrain from making disturbing, offensive or excessive noise between the hours of 10 p.m. and 7 a.m.   The owner must designate a local contact who shall be available 24 hours per day, seven days per week with the ability to respond to any complaints.

At the July 22 planning board meeting some 20 speakers offered their viewpoint. All but one was against the proposal as written. 

The highlighted area is that of the proposed zone for short-term rentals.

Restaino told the Reporter that he recognized that the amendment may need to be tweaked and was open to positive and constructive suggestions.

Some concerns expressed by residents are listed:

– How the boundaries were chosen for the STR rental zone downtown. 

-What will happen to some 40 applications for STR permits submitted outside the boundaries?

-Why the administration would want to subject visitors to Niagara Falls exclusively to downtown, which some say is one of the most run-down and dangerous areas of the city? 

-Why there is not a process for people outside of the downtown zone to get their property approved. 

-How this ordinance inspires people to stay in Niagara Falls rather than leaving and operating a business somewhere else. 

-Why the present ordinance regarding STR is not sufficient. 

Councilmember Ken Tompkins weighed in with his concerns in a statement to the Reporter: 

 Tompkins said, “When the current ordinance was presented a couple of years ago; I was opposed to it for its lack of penalty and enforcement for the bad players that feel they don’t need to follow the procedure that were established.

 “As this one has been rolled out; I have questions: 

Niagara Falls City Councilman Ken Tompkins

Enforcement is the biggest issue. I have been told there may be almost 200 short term rentals operating illegally here in our city. Any new changes must find a way to take these off the market. It’ not fair to the legal operators. I’m wondering if we could base the fee we charge for the special use permit to fund a code enforcement specialist to work on making sure only legitimate, inspected and approved STR are operating.

Inspections of STRs are different than a hotel or motel as you basically have the entire house or apartment including a kitchen. We must ensure that the visitor is in a safe, clean and sanitary environment.

Limiting the geographical area you can have STR is a tough decision. I can see both sides of this. I know of quite a few STRs outside the proposed boundaries that seem to be operating without any harm to a neighborhood. I have one next door to one of my properties and another three doors away. They seem to have no issues and normally have quiet visitors. The big question is… are we better to lump them together or let them spread to every area of the city?  It’s worth debating.

Will folks that started the process but don’t have final permits be allowed to finish the process if they are outside the new zone? Some may have put a lot of money and effort in based on current regulations. Will there be a “grandfathered in” clause?

Can the city dictate that a person must advertise on the Airbnb platform when there are other commercial competitors. An answer from our Corporate Counsel is needed.

“I know that many hours were spent on trying to improve the ordinance on the books. Enforcement appears to be the biggest challenge and issue going forward. We need to find a way to embrace this new and booming industry but still keep it on the up and up. I support STR but have questions that need to be answered.”

Stay tuned on this subject as the Reporter continues to provide in depth coverage as the amendment winds its way before the council where it will either pass as written, be modified or rejected. 

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