What the state's new short-term rental law means for Berkshire homeowners


Now that Gov. Charlie Baker has signed a first-in-the-nation state law to tax and regulate the short-term housing rental market, officials in Lenox, Stockbridge and Richmond are assessing the impact. The three towns had more than 600 properties listed on Airbnb and other sites during the summer 2018 tourism season.

The new regulations, going into effect on July 1, require every short-stay rental host to sign up with the state for an online registry listing the property owners' town and street, though not the specific address. However, cities and towns could choose to list complete street addresses.

Homeowners renting out their properties for less than 30 days will be required to impose the 5.7 percent state lodging tax, the same as required from hotels and innkeepers. Towns and cities can choose to add a local tax of up to 6 percent, just as many of them impose on commercial lodging establishments. Hosts renting out multiple properties would be subject to additional state taxes.

The short-stay hosts will be required to carry appropriate insurance for a rental property.

But the bill approved by the House and Senate and signed by Baker included the governor's request to exempt homeowners who rent to short-stay visitors 14 or fewer nights a year from the registration, taxation and additional insurance requirements.

A chief negotiator for the House said the goal is to register short-term rental hosts by September, except for those exempted.

Local officials have welcomed the new state law to help craft or revise their own bylaws to regulate the booming vacation rental market on Airbnb, VRBO, HomeAway and other online sites.

"This is really great news," said Pam Kueber, chairwoman of the Lenox Planning Board. "This legislation was very carefully considered over the course of several years, so kudos to our state legislators and the governor's office for collaborating on a final bill and getting it done by the end of the 2018 session."

At a Nov. 1 special town meeting attended by nearly 500 Lenox voters, a zoning proposal to regulate short-term rentals was turned back to the planners for revisions.

"One of the things we clearly heard from many voters at the town meeting was that they wanted to see this state legislation in place before making any decisions on new zoning for short-term rentals," Kueber told The Eagle on Monday. "The Planning Board will review the final state law and discuss next steps at our next meeting on Jan. 8."

However, she cautioned that the "timing would be very tight" to prepare a new proposal for the annual town meeting on May 2. Kueber pointed out there are only four Planning Board meetings ahead of a March 10 deadline to submit final zoning proposals to the Select Board for review and potential endorsement.

During its upcoming meetings, the planners will focus on a revised bylaw proposal for adult-use recreational marijuana businesses in Lenox. Kueber called that "an urgent priority," since the town's extended moratorium on marijuana shops and other facilities expires on June 30.

In Stockbridge, Finance Committee member Marie Raftery presented a survey of town sentiment on short-stay rentals to the Select Board in late November. Her bottom-line recommendation was to await passage of the state law before crafting local regulations. The selectmen are expected to begin exploring potential local bylaws during the next few months.At their annual town meeting in May, Richmond voters approved regulations requiring absentee owners or investor-owners who are non-residents to seek a special permit from the zoning board in order to rent rooms or an entire dwelling for 30 nights or fewer. Resident families who rent rooms or properties were not affected by the new bylaw. Select Board Chairman Neal Pilson said Monday the town's existing bylaw complies with the new state regulations, and that the town may ask voters to approve the local 6 percent tax option.Airbnb reacts to law

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Statewide reaction to the law signed by Baker last Friday ranged from enthusiasm by lodging operators to deep disdain by Airbnb.

"Massachusetts has chosen a pathway here that nobody else in the country has chosen," said Andrew Kalloch, the online company's head of public policy for the region. "Sometimes first in the nation is bad because it means ... what you have chosen to pass is a flawed measure."

He also criticized the tax provisions as overly complicated and "layered," and warned it could hinder the platform's ability to accurately collect the levies.

Kalloch couldn't say whether Airbnb would challenge the new state law in court, as it has for new regulations previously approved in Boston. Airbnb contends those rules, which take effect Tuesday, require the company and its online competitors to police their listings and share user information with the city, allegedly a violation of state and federal laws.

In a statement released shortly after Baker signed the legislation, Massachusetts Lodging Association President and CEO Paul Sacco said: "We are pleased and gratified that the governor and legislative leaders came together in a bipartisan way to advance this critical measure into law. This is a tremendous victory for municipal leaders and the people of Massachusetts who have been waiting for years while Airbnb rentals have exploded, resulting in skyrocketing housing costs and disruptions in local neighborhoods.

"By adopting a more level playing field between short-term rentals and traditional lodgers, lawmakers made great strides toward a more fair and sensible system."

Although cities such as New York and San Francisco require short-term rental hosts to register, the law signed by Baker makes Massachusetts the first state to require host registration. The lodging industry and community housing advocates wanted a comprehensive registry so residents could see whether neighbors were involved in short-term rentals of houses or apartments.

"Our administration has long supported leveling the playing field for short-term rental operators who use their properties as de facto hotels," Baker stated after he signed the bill last Friday. "I appreciate the Legislature's work to reach a compromise on this bill that adopts our proposal to avoid placing undue burdens on occasional renters."

It took Beacon Hill lawmakers several years to craft a bill. In July, they approved a measure, but Baker declined to sign it, contending that the rules placed too great a burden on homeowners who rent short-term only a few nights a year.

Facing an end of the year deadline to get their bill signed into law, the House and Senate legislators approved a compromise on Dec. 20, agreeing to Baker's proposal to exempt hosts who rent 14 or fewer nights in a calendar year.

The complete text of the new law can be found at malegislature.gov/Laws/SessionLaws/Acts/2018/Chapter337

Information from State House News Service and the Boston Globe was included in this report.

Clarence Fanto can be reached at cfanto@yahoo.com, on Twitter @BE_cfanto or at 413-637-2551.


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