The Warren Town Council spoke at length about a new ordinance to establish more local control over short-term rental properties during their December meeting, but ultimately wound up tabling the decision to allow Town Manager Kate Michaud more time to refine the rules and procedures that will ultimately define that policy.

The discussion took well over an hour and involved comments from each council member and members of the public, multiple of which already run existing short-term rental properties in town.

The balancing act playing out in real time here involves multiple considerations.

Some spoke of the desire to get out in front of a potential issue seen in nearby communities such as Middletown and Newport — where people have invested in properties with the sole purpose of transforming them into short-term rental units to be rented out throughout the year, which can take away from available housing stock, boost rental rates town-wide, and some worry may cause a variety of quality of life issues, such as noise complaints.

Others, including some of those who currently operate short-term rental businesses in town, argued that short-term rentals provide great economic benefit to the town and that the type of policy being discussed by the Town Council was unnecessarily stringent and premature — and would potentially shut down or hinder existing short-term rental businesses being operated in good faith by Warren residents.

Safety concerns
Council president John Hanley brought up a point that owners of short-term rental properties are not necessarily required to implement safety measures that would otherwise be required if they were opening a boutique hotel — which is what he argues they are doing, in effect, through this business strategy.

Since the issue of short-term rentals first came up a couple months ago, Hanley has been an outspoken proponent of making it a requirement that short-term rental property owners must actually reside in the building where they rent out space, or at least reside in the Town of Warren so they may be more responsible for the property.

“My whole thing for leaning towards owner occupancy is that AirBnB was not designed for corporations to make money. It was designed for homeowners to rent out a bedroom in their house,” he said. “The way that it’s going, it’s circumventing the building code, it’s circumventing the fire code…In hotels they have exit signs, emergency lights, they have sprinklers. Because if you wake up in the middle of the night and you’re immersed in smoke and this is your first night there, you don’t know where you’re going.

“So by these corporations coming in and buying three and four-families and turning them into short-term rentals, they’re turning them into hotels without any of the safety features that anybody else who opens a hotel has to do.”

To cap or not to cap
Another highlight of the discussion revolved around the decision on whether or not to cap the number of short-term rental units in town.
According to the data collected by the state Department of Business Regulation, there are 22 short-term rental units registered in Warren.

However, this number is likely inaccurate and subject to change as short-term rental owners have until Dec. 31 to register. A third-party tracking site for short-term rentals, AirDNA, found that there were 38 active short-term rental units in Warren — 94% of which are rentals where the entire dwelling is rented out to guests, and 92% are listed on AirBnB exclusively or on both the VRBO and AirBnB platforms.

The council spoke about the potential of capping the number of short-term rental units based upon a total percentage of dwelling units in the town, but did not arrive at an acceptable percentage. This was in part due to a concern raised by Councilman Joseph DePasquale challenging the assessed number of total dwelling units in town. The data presented said there were 5,500 dwelling units, and DePasquale thought it was closer to 3,500 actual dwelling units.

Councilwoman Keri Cronin, in discussing a potential cap, proposed the possibility of capping the number of units in any one dwelling that could be utilized as a short-term rental, where you could have a maximum of two units per building or whatever equates to 50% of the total number of units in the building.

“We’re trying to prevent people from coming in and speculating and buying properties for the sole purpose of doing short-term rentals,” she said. “But it shouldn’t prevent someone with an existing property who has an extra bedroom to use the unit for that.”

Theoretically, some members who spoke at public comment took issue with the idea of a cap at all.

“You’re going to have enormous difficulty trying to impose a fair and balanced rule that imposes a restriction on the number of units per building. That’s going to be a very thorny issue for you. It’s being litigated in a number of places now,” said Barry Hawkins, whose spouse owns a rental property in town. “You don’t have a problem that needs that solution yet. You are looking at dropping a nuclear bomb on a problem that does not exist today.”

Councilman Brandt Heckert, later in the discussion, said that maybe it was premature to consider a cap on the number of short-term rental units, but reiterated that finding the right balance should be the goal.

“This is going to proliferate,” he said. “And this is what we’re trying to do, is strike a balance between allowing AirBnBs, which are great for the community — we get that message and we all understand it — but on the other hand there’s the other side, which is that is affects the residential community and you end up with a transient community, and that’s not what we want.”

Parking
One element of the discussion which took center stage a couple months ago when the issue first came up for discussion was parking, and how short-term rentals should be regulated in terms of being forced to offer parking.

The council seemingly came up with a mutually agreed-upon solution to require one off-street parking space per rental unit in order to become actively registered with the town. Should the owner of a property not be able to provide that, they would have the opportunity to apply for a waiver before the Town Council.

Economic angle
Multiple speakers brought up how short-term rentals have provided economic benefits for the town.

“I hope we can look at this industry through an economic development lens,” said Spencer Morris, who operates two short-term rental units on Cole Street. “This industry has brought people into Warren who might have otherwise never thought to come here. And I can speak from our own experience that we get people from all over the world. Many of these people are coming because they’d like to find a place to live here in Warren. So they’re not all transient…One of the people stayed with us three months and wound up buying a business here. It’s complex, let’s just say.”

Barry Hawkins, quoted earlier, added during his comment that making these kind of regulations now would do more harm to existing businesses (regular business and short-term rental businesses alike), than it would do good, and cautioned the council to wait and see if these prospective issues actually came to fruition in Warren before taking action.

“You have the ability to change your regulations in the future if you perceive that’s becoming a problem. You can react to it and you can impose new regulations that meet those problems,” he said. “But to come out at the beginning with a solution that basically puts a lot of people out of business or makes them unable to utilize their existing properties is both unnecessary, unfair, and unwise fiscal policy.”

Councilman DePasquale pointed out his own example of a property at 136 Main St., which had sat vacant for years before becoming a multi-unit short-term rental property and getting fixed up into something that now contributed to the town.

“That’s one example of it being positive,” he said. “I know there are people who have invested large sums in trying to figure out a business opportunity for themselves. And we’re going to directly impact that investment…I’m thinking there could be some potential problems in our solutions.”

Not all were moved by this argument, however.

“I think the economic benefit is pale compared to the detriment it’s going to cause in this town for the complaints, the violations and the loss of the actual housing we have for our workforce,” President Hanley said. “If you want a hotel, buy a hotel.”

The matter will be discussed again with an updated ordinance proposal at the January meeting of the Town Council.