Revelstoke hoteliers want crackdown on Airbnb-style illegal vacation rentals

The Revelstoke Accommodation Association (RAA) is seeking a ‘level playing field’ for hoteliers to compete against the rise of illegal vacation rentals, many of which are not registered with the city.

In a letter to city council, the local accommodation association lobby group says illegal rentals have an unfair advantage because they dodge commercial taxes and other fees that legal hotels are forced to pay.

According to the RAA, there are about 65 illegal vacation rentals operating in Revelstoke. The City of Revelstoke did a public consultation in 2012 and 2013 regarding vacation rentals and also found about 65 vacation rental types were operating in town. Those included rentals using Airbnb and other online listing services.

The hoteliers argue that through fines and forced compliance, the city could be generating significant revenue.

However, the City of Revelstoke’s development services manager doesn’t think that stepped up enforcement would lead to revenues for the city.

In an interview with the Mountaineer, Development Services manager Dean Strachan disputes the RAA’s claim that the city is losing $140,000 per year on a theoretical four-room home rental.

“Property taxes and utility taxes are not impacted,” he said. “So it’s not [a loss of] $140,000. It’s a single family dwelling in the term of occupancy and it’s not an additional user, so you don’t have the ability to increase the utility charges.”

The RAA also states the city council’s position of enforcing illegal vacation rentals on a complaints basis only is not enough.

“Without enforcement, there is no urgency to obey the bylaws,” they write.

Strachan says the $220 maximum a year received on registering vacation rentals goes into business administration and would not pay for legal enforcement, which is a costly venture.

“The business licensing revenue would never cover the cost of pursuing those businesses,” he said. “It would be a cost to taxpayers. Council’s saying it’s on a complaint basis means, yes we will pursue [them] if they are causing a problem in the community.

“In my experience on bylaw enforcement, if you are pursing instead of participating [with] a user group, the fees and fines you collect will never cover the cost of pursuit.

“It’s similar to what we did with building permits. It is far better to create program for people to participate, instead of chase them with a big sick. The carrot is cheaper.”

In the last year, six vacation rentals have become legal and 12, who were pursued after complaints, indicated they would switch to bed and breakfast operations or shut down altogether.

“In the winter of 2013, bylaw enforcement had ten formal complaints on vacation rentals,” Strachan said. “During the winter season of 2014 there has been one.”

Strachan also says vacation rental users have been identified as a group that will not necessarily take a hotel room.

“The accommodation industry has recognized there is a small niche market that don’t want to rent a hotel they want to rent a home and if they can’t, they will go to Sunshine or Golden,” he said. “It’s not a user that will adjust; they will just go somewhere else and it becomes a lost opportunity for the community.”

Strachan states that to date BC Assessment has not recognized BC vacation rentals as a commercial venture. A report on vacation rentals in Revelstoke’s state of affairs will be presented to council in August.