Rockland city councilors took the first step in regulating home-based short-term vacation rentals on Monday, April 11, after more than a year of debate. 

The new ordinance, effective May 11, will require homeowners who live on-site and want to rent a room or half of a duplex on a short-term basis from one night up to one month to get an annual permit from the city code office. Homeowners who want to offer a short-term rental of an entire house, and who do not live on-site, will need to go to the planning board for a one-time review before a permit is issued. The permit cost has not yet been decided, according to Rockland Code Enforcement Officer John Root. 

To offer a vacation rental, owners (or property managers)  must live in Rockland, Thomaston, Owls Head, Rockport, Warren, Camden, Hope, Cushing or St. George. Owners must show proof of valid liability insurance. 

The council, which gave unanimous approval to the ordinance amendments, noted that this was the first step in regulating short-term rentals of less than one month and that it could revisit whether more regulations are needed in the future.

The debate started almost a year and a half ago when the uptick in those renting through online vacation rental sites like Airbnb.com and Homeaway.com rose in the area. Hotels and licensed bed-and-breakfasts, which have to comply with regulations governing lodging, complained that the practice was unregulated and put them at an economic disadvantage. Local residents in some neighborhoods expressed concern that the neighborhood character would fade as temporary residents on vacation came and went from what are zoned as residential neighborhoods — pointing to Rockland’s South End as an example of what can happen when an entire neighborhood is made up of mostly vacation rentals. 

The South End is largely deserted during winter months. Meanwhile, there is a shortage of rental housing in Rockland, overall, particularly for low-wage income earners who typically work in the service economy.

Others who rent out rooms or their homes in the short-term rental market argue that vacation rental income allows them to pay their property taxes in a city with a high tax burden.

But, clearly, vacation rentals is big business on a global scale, and the national debate over regulating casual vacation rentals is playing out in cities and towns across the country, just as the folksy meet-your-host feel of online vacation rentals has turned into corporate warfare.

Expedia, the online travel behemoth that has gobbled up online travel sites like Orbitz and Travelocity, bought out Homeaway, the parent company for VacationRentals.com, VRBO, and other online vacation rental sites last year, and now is in a controversial push to damp down Airbnb, which has an estimated worth of $25 billion. Homeaway/VRBO’s new approach is to charge renters an additional fee on every rental of up to 10 percent. In simple math, that cranks up a nightly rental of $142 a night to $157 (or $1,000 a week to $1,100). And the company already charges owners up to $1,300 a year for advertising on the site. Maine State lodging tax adds another 9 percent to renter’s total. Add in housekeeping fees, if charged, and what started out looking like a bargain can be anything but.

Guests and hosts are not enamored of the new fees. Guests are looking elsewhere and some hosts have sued Homeaway.

Airbnb has always imposed a guest service fee of 6% to 12% on every rental before the lodging tax. Unlike Homeaway and VRBO, Airbnb advertises nights in VW camper vans, yurts and the spare hammock as well as whole vacation houses. Vans, yurts, sheds, and tiny houses will not be allowed as rental units in Rockland. Like Homeaway, Airbnb also charges the vacation rental owner for bookings.

The cutthroat competition between the two online vacation rental giants appears to be slowing demand for short-term rentals nationwide, according to the Chicago Tribune, the Detroit Free Press, and the Los Angeles Times. 

With the additional fees, which are not always obvious to the traveler and tend to come across as a rate hike imposed by the rental owner, lodgers may start turning back to what is becoming a cheaper and more predictable alternative: motels, hotels, and old-fashioned B&Bs.

Other Council Action —

• The council gave unanimous preliminary approval to a just-completed ordinance establishing regulations for power plant development in the city. The council agreed last December to impose a six-month moratorium on power generation facility proposals in order to prepare an ordinance addressing such development. A public hearing and possible final vote on the ordinance is set for Monday, May 9, at 6 p.m. The council said they might seek an opinion about the ordinance from the Conservation Law Foundation before that meeting. 

• Approved an increase in the cost of an annual dump sticker from $95 to $125, as of May 1. Commercial hauling fees will go from $120 per ton to $130. Per-bag fees remain the same.

• Approved 250 Main Hotel’s request to permit roof-deck alcohol service at the soon-to-open new hotel.