KANSAS CITY, Mo. — The day after passing ordinances placing two questions on April’s ballot asking voters to impose fees and taxes on short-term rentals, Kansas City, Missouri, leaders held a press conference where they pledged to do more to protect neighborhoods.
Short-term rentals are properties, or rooms within properties, which owners list for rent for fewer than 30 days at a time; typically using vacation rental sites like Airbnb and Vrbo to advertise the rental.
Kansas City requires property owners to get a permit to operate a short-term rental and pay a permitting fee.
A city audit however revealed only about 10% of operators are properly permitted, resulting in a loss of about $1.1 million in permitting fees since the program began in 2018.
Those fees fund enforcement and other regulatory functions related to short-term rentals.
Currently, the city does not collect a convention and tourism tax, nor a lodging fee from short-term rentals like it does from hotels and motels, even though the two entities provide basically the same services.
The two initiatives which will appear on April’s municipal election ask voters to approve the city’s plan to collect the 7.5 percent convention and tourism tax on short-term rentals.
Voters will also give approval for the city to raise its lodging fee from $1.50 per bedroom, per occupied night to a maximum of $3. Hotels and motels would also collect the increased lodging fee, which has not seen an increase since 2004.
The lodging fee and tourism tax are passed on to guests, and operators do not pay those taxes.
City staff estimates the two changes would generate $13 million for the city in over five years. The money from it would go toward marketing and tourism efforts as well as enforcing regulations on short-term rentals.
“The city has to take the lead on making the rules and ordinances happen for us,” said Amy Johnson, who lives in the Columbus Park neighborhood of Kansas City.
This week, The Columbus Park Community Council sent a letter to the city asking it to ramp up its regulation and enforcement efforts. It suggests stopping all short-term rentals from operating until the city can change its rules. City council member Eric Bunch hasn’t ruled out the idea.
“What I think a moratorium does do is it sends a message we need to pump the brakes on the program just a little bit just to ensure we can get our ducks in a row to ensure the policy is right,” Bunch said.
He and other council members are working on new ordinances to punish short-term rental owners for listing their properties on vacation rental sites unless they have a permit with the city.
Another recommendation the city is exploring is how to establish communication with vacation rental sites to prevent them from listing properties which don’t have the appropriate permits.
With the NFL Draft coming to Kansas City in April, demand for short-term rentals will be high. Mayor Quinton Lucas said the city will not lose track of residents in the process.
“As we look at big events like the NFL Draft, like the World Cup, we’re also looking at every day neighborhood concerns,” Lucas said.
Voters will head to the polls April 4, 2023. The city council will decide when the new rules should take effect if voters approve the ballot measures.
