New Orleans City Council Advances Vacation Rental Ban

Earlier today, the New Orleans city council voted unanimously to advance a proposed ordinance to restrict short-term rentals outside of commercial zones to owner-occupied properties, effectively banning the traditional vacation rental in most of the city. This vote was the first of four required to codify the restrictions.

Put forth by council member Kristin Gisleson Palmer with co-sponsorship from council members Joseph Giarrusso, Jay Banks, and Helena Moreno, the proposed ordinance distinguishes two categories for short-term rental permitting: residential permits that would be valid in residential areas but limited to those in which the owner lives on site, up to three licenses per lot, and up to three rooms and six total guests per unit; and commercial permits valid in mixed-use zones and limited to license and occupancy caps based on unit counts.

The approved motion directs the city planning commission to draft amendments to the comprehensive zoning ordinance based on the proposal. It also asks the commission to provide a number of recommendations for commercial short-term rentals on safety, security, density, and other requirements, as well as provisions to create affordable housing based on research from an inclusionary zoning financial feasibility study that is already underway.

The council also voted unanimously to approve a resolution for code amendments to include a “substantial increase” of licensing and nightly fees to support the Neighborhood Housing Improvement Fund (NHIF), for the chief administrative officer of the city to examine the feasibility of a standalone short-term rental enforcement office, and for the department of safety and permits to provide recommendations on improved platform accountability on items like data sharing, registration, and tax and fee collection.

Furthermore, the council considered a motion to direct the city planning commission to conduct a study on the possibility of special programs or conditions to allow permit holders more than one residential short-term license in limited areas to incentivize economic development in those areas. Though multiple council members expressed significant reservations about the motion, the council voted 7 – 0 to approve it.

“Local residents who have—for decades—responsibly opened their doors to travelers deserve a policy that includes them. Unfortunately, this deeply flawed ban will harm homeowners who’ve played by the rules and the small businesses that rely upon them,” Philip Minardi, director of policy communications for Expedia and HomeAway, said in a statement. “While we’re extremely disappointed that council continues to move in the wrong direction, we’re hopeful New Orleans will find a path forward that addresses housing concerns while protecting the long-standing vacation rental community.”