There’s been a lot of talk lately about potential lawsuits between the city and short-term rental operators who will be put out of business by new restrictions that were approved by voters in November.
Exactly who might file the first claim remains to be seen.
As city officials prepare to enforce the contentious regulations starting Jan. 1, some operators still appeared to be offering whole-house stays in the coming year that would violate a ban on unhosted, or non-owner-occupied, short-term rentals in residential districts.
On the Airbnb website Monday, about 50 “entire place” rentals were available for booking in the coming year, concentrated in residential waterfront neighborhoods such as Ferry Village, Willard Beach and Pleasantdale, just over the Casco Bay Bridge from Portland’s popular Old Port district.
One theory is that operators who have been renting out whole houses or apartments that will become illegal under the ban are continuing to take reservations in 2019 so they can show lost income and other damages if they challenge the new rules in court.
“That’s the rumor,” said Joshua Reny, assistant city manager. “We have no confirmation of that.”
Reny declined to say whether city officials are prepared to file a lawsuit against any operators who might be found noncompliant by the code enforcement officer. Any decision to go to court over the short-term rental regulations would rest with the city council.
“We are fully prepared to enforce the ordinances,” Reny said.
John Murphy, a leader of short-term rental operators who opposed the regulations, said he was unaware of any organized effort to file a lawsuit against the city or to otherwise fight the ordinances once they go into effect.
“I’m just waiting for the city to make some kind of an announcement about where to go to register and pay fees,” said Murphy, who operates a short-term rental in an apartment in his house on Willard Beach.
There’s a link on the city’s homepage to a 10-page short-term rental registration application packet, which contains information and forms needed to operate legally after Dec. 31. Licenses cost $200 for hosted rentals and $400 for unhosted rentals, plus a $100 fire safety inspection fee and a $20 processing fee. Fines for violations range from $500 to $1,500 per day, which would be recovered by the city filing a lawsuit.
In November,city residents voted 6,375 to 5,378 in favor of the zoning and licensing ordinances that the council approved in July to regulate home rentals promoted on websites such as Airbnb and HomeAway. Supporters said the rules would stop homes from being converted into mini hotels, while opponents said they infringed on property rights.
Hosted short-term rentals – where the owner lives on the premises – will be allowed in residential areas under certain conditions.
Under the new rules, all short-term rentals must be inspected, insured and licensed by the city.
The referendum capped a yearlong struggle over short-term rentals, an issue that is causing similar disputes in communities across the nation, including neighboring Portland, where the City Council last month amended short-term rental rules approved last year to address the trend of renting private homes and apartments through services like Airbnb.
Under the modified regulations, hosted short-term rentals are allowed two adult guests per bedroom, with a maximum of six guests per house. The original ordinance capped the total number of guests at two adults.
Owners of two- or three-unit buildings in residential zones may operate one unit as a short-term rental, as long as they live in one of the other units; owners of four-unit buildings may operate two apartments as short-term rentals if they live on the premises.
The council also dropped an initial ban on homeowners renting out their houses while on vacation. Owners of detached single-family homes could rent their houses for up to 14 days per year when they are away.

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