A bill proposing statewide taxes and regulations on short-term rentals was delivered to Gov. Kathy Hochul Thursday, after having passed both houses of the legislature in June. Hochul has 10 days to decide to veto or pass the bill.

The bill would require STRs across the state to register with the Department of State and would establish penalties for unregistered STRs. It would also require all STR hosts to collect sales tax, which supporters of the bill say would help put rentals on even footing with hotels.

The bill was sponsored as S885B by Democrat Michelle Hinchey in the Senate and A4130A in the Assembly by Democrat Patricia Fahy. It came before the Senate and the Assembly twice, dying in the Assembly in early January on its previous round through the legislature.

Essex County Treasurer Michael Diskin said he thinks it is unlikely that Hochul will pass the bill, based on what he has been hearing from the New York State Association of Counties. NYSAC hosted a press conference in August urging Hochul to sign the bill as soon as possible.

Mark LaVigne, the deputy director at NYSAC, said that it is difficult to predict what will happen with the bill.

“It’s a crystal ball at this point,” LaVigne said.

However, he said NYSAC has been advocating for the passage of the bill to the governor’s office and that the office has heard their request. He said the governor has concerns and that if the bill does pass, it is likely that there will be chapter amendments. If this happens, the amended bill would have to be approved by the legislature when it returns in January.

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Details of the bill

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If the bill passes, no local government would be able to create their own, new STR registries — like the ones in Lake Placid, North Elba and Saranac Lake — once the bill takes effect. Communities with existing registries would be allowed to continue operating and enforcing their own registration systems and policies. The state registration would be valid for two years and could be revoked if the host violates any requirement at least three times in two years, according to the text of the bill. Application and renewal fees would be determined by the state.

The bill also requires STR hosts to maintain a two-year record of information related to stays, which would then need to be shared with the DoS on an annual basis. The state would also make the statewide registry available to local governments, according to the bill.

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A potential revenue source

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Diskin said the bill would mean more revenue for the county, although it is hard to say how much. The county already collects a 5% occupancy tax on STRs, as of a 2015 change in county tax law. However, the sales tax provided by the bill would be an additional revenue stream for the county, Diskin said.

The other half of the bill, which requires all STRs to be registered through the state, might help to identify additional rentals that haven’t been registered locally, Diskin said. This could boost the amount of occupancy taxes collected by the county as well.

Emily Kilburn Politi, a member of the North Elba Town Council who has been active on committees related to housing, said the sales tax would be a “huge” help to towns and villages. She said she supports this bill and wants to see hotels and STRs treated more equally. The state registry would also be helpful to local communities, Kilburn Politi said, even for communities like North Elba and Lake Placid that have existing STR registries.

“If anything, I think it’s one more tool to make sure everyone’s hopefully playing by the same rules,” she said.

On the other hand, the statewide registry raises alarm bells for some. Shaun Gillilland, chairman of the Essex County Board of Supervisors, said he supports putting STRs and hotels on an “even playing field” by requiring both to collect sales tax. However, he thinks maintaining a two-year record of all stays will be, at best, inconvenient for hosts and, at worst, an example of intrusive government overreach.

“Why? What does the state need to know that information for?” Gillilland said.

For transparency, Gillilland mentioned that his family owns an STR, which is run through a hosting service. At this point, he’s hoping Hochul vetos the bill.

“I hope the governor vetos it and something comes back better the next time,” he said.

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Taming the “wild, wild west”

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Andrew Weibrecht is the operations manager at Mirror Lake Inn in Lake Placid. He believes that it is only fair to regulate rentals in the same way that hotels are regulated, and hopes that transparency and accountability within the STR industry will increase. He says that local regulations, while a step in the right direction, fall short on enforcement and rely too much on residents to report potential violations.

“I think anything that you can do to move away from the wild, wild west that we were at a few years ago,” Weibrecht said.

Weibrecht, who has lived in the area his whole life, said that while he cares about putting STRs and hotels on even footing, he is even more concerned about the housing crisis affecting their employees.

“Competition within the business doesn’t bother me nearly as much as just how much housing it takes away from the workforce,” Weibrecht said, adding that many people simply can’t afford to live here anymore.

STRs are often anecdotally tied to the housing crisis in the Adirondacks, although it is hard to make a definite causal link. A community housing needs assessment commissioned by the town of North Elba in 2020 linked the rise in STR’s popularity to aspects of the housing crisis.

During 28 months between 2017 and 2019, the number of STRs increased by 41%, the study found. The study concluded that while STRs were not the root cause of a lack of workforce housing, they do contribute to a lack of year-round rental availability.

“There is virtually no financial rationale for a property owner to provide long-term rental units in North Elba or Lake Placid,” the study reads, citing dramatic differences in yearly revenue between short- and long-term rentals.

STRs are also frequently listed as a source of annoyance for residents. Bill Wonderlin is a part-time resident of Wilmington who has voiced his concerns about STRs in numerous ways, including an October 2022 guest commentary in the Enterprise (“The economic benefits of STRs, revisited.”)

Wonderlin and his wife have been visiting the Adirondacks regularly since 1999 and he remembers how hard it was to find rentals at the time. They bought their property in Wilmington in 2012 and have been living there for a large portion of the year since retiring in 2020.

Around 2016, two STRs opened adjacent to Wonderlin’s property on Hardy Road, a scenic area with convenient access to nearby mountain bike trails. Wonderlin has a lot of concerns about STRs — including their broader impact on the housing market and taxes — but the thing that disrupts their life the most is that STRs are often “party houses” that don’t make very nice neighbors.

“We’re not foaming at the mouth, anti-STR,” Wonderlin said. “We just want something that is an appropriate balance.”

The simplest answer to this particular complaint, Wonderlin said, are things like noise ordinances and more strict occupancy rules. However, Wilmington doesn’t have a local police force to enforce something like that. In general, he supports statewide regulation of STRs because some local governments can’t, or won’t, make or enforce their own rules.

“In the absence of the community taking really solid action and providing local laws that fairly balance the rights of the property owners and rights of the neighbors, we’ve been hopeful that the state would do something, that they’d help out,” Wonderlin said.