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Nothing Flagler Can Do About Divisive Vacation Rentals, Attorney General Bondi Confirms

| October 24, 2013

Depending on your perspective, many of the homes like these in the Hammock that are used as vacation rentals are either a boon to the economy or a nuisance to permanent residents. Either way, absent a change in law, they're here to stay.

Depending on your perspective, many of the homes like these in the Hammock that are used as vacation rentals are either a boon to the economy or a nuisance to permanent residents. Either way, absent a change in law, they’re here to stay.

Attorney General Pam Bondi on Tuesday confirmed what Flagler County government has been telling residents of the Hammock for two years: there’s little to nothing the county can do to regulate vacation rental properties. State law prevents local governments from interfering. Displeased residents will simply have to put up with the fact—and the law. Bondi reached her conclusion in an expedited opinion resulting from a county request four weeks ago.

The county filed that request as conflict has deepened in the Hammock between residents opposed to what they see as the disruptiveness of vacation rentals, and property owners—and businesses—who see profits and the ability to hold on to “under-water” properties by converting them to vacation rentals. Absent a change in state law, however, those who support vacation rentals will continue to have a clear advantage.

Last week, Sen. John Thrasher and Rep. Travis Hutson, whose districts include all of Flagler, agreed before a large crowd of Hammock residents at a meeting in Bunnell to file companion bills in the Legislature this spring to amend the 2011 law that pre-empted county regulation. Thrasher was among the senators who voted unanimously in 2011 to pass that law. Legislators supported it in part because they wanted to stem the tide of property owners going into foreclosure.

Many property owners had bought houses they could not afford during the housing boom. The law was changed to make it easier to convert homes into vacation rentals and enable property owners to generate the cash that would presumably help them hold on to their houses, and lower the number of foreclosures. But numerous businesses jumped on the occasion to cash in, and what had begun as a salve to individual property owners has turned into a big business mostly profiting short-term rental companies whose stake-holders have no connection to the communities affected.

Thrasher now agrees that the law went too far, creating unintended consequences and conflicts that cannot be resolved through mediation. A legal fix is in order, he says. But the chances of such a fix passing the Legislature are very slim: the vacation-rental lobby is a powerful adjunct of Florida’s tourism industry, and lawmakers are reluctant to diminish a potential generator of tourism jobs and additional revenue from visitors. One supporter of the law claimed in that meeting in Bunnell last week that 43,000 vacation renters stayed in Flagler County in one calendar year, though the figure cannot be verified.

The law in contention took effect in June 2011. Flagler County asked the attorney general whether local government could intercede to stop vacation rentals in private homes zoned before that date—keeping in mind that Flagler County had no zoning regulations controlling vacation rentals in place at the time. That silence in Flagler’s books, a reflection of an absence of foresight on the county commission’s part proved key.

“In Sum,” Bondi wrote, “absent the existence of a local ordinance on or before June 1, 2011, regulating the rental of vacation homes in Flagler County, section 509.032(7), Florida statute preempts local regulation of lodging establishments and public food establishments to the state and precludes a local ordinance and regulation enacted after June 1, 2011 restricting the use of vacation rentals, prohibiting vacation rentals, or regulating vacation rentals based solely on their classification, use, or occupancy.”

Vacation rentals include one-family, two-family, three-family, or four-family houses (essentially, any house that beds up to 25 people) rented more than three times a year for less than one month each time. That’s the sort of property used to the purpose in the Hammock.

The Attorney General’s office “agrees with the county’s conclusion that a local zoning ordinance for single-family homes existing on or before June 1, 2011, that did not restrict the rental of such property as a vacation rental, cannot now be interpreted to do so.”

The county wanted to convey the impression to Hammock residents that it was responsive to their concerns. At the same time, the county is benefiting greatly from the bed tax revenue generated by the rentals: that revenue has been increasing steadily (now topping $1.5 million a year), enabling the County Commission through its Tourist Development Council to subsidize special events and steer the county’s tourism economy. Though it may not declare it overtly, the county, in other words, shares the Hammock residents’ pains all the way to the bank.

That means permanent Hammock residents like Jeffrey Southmayd are not only out of luck. Their complaints about vacation renters have no recourse. Southmayd, a resident of 4 Ocean Ridge Boulevard South, had filed a code violation complaint with Flagler County in April. The story he told is emblematic of the problems permanent residents of the area are contending with. It was included in the materials the county attorney sent to Bondi.

Southmayd’s subdivision was platted and zoned for single-family houses in 1996. But the house to his immediate north, at 1 Ocean Ridge, looks out of compliance. Thomas and Jane O’Hara bought that lot in 2005 for $730,000. They built a house and got a certificate of occupancy for a single-family residence in 2008, and used it as such. In July 2011, they sold the house to Mark and Brenda Voss for $825,000. The Voss’ are residents of Missouri. They converted the house into a vacation rental. The 5,100 square foot rental is now offered by a vacation rental company as providing room for 15 people—10 adults and five children, on a nightly, weekly or monthly basis.

“We purchased our lot and built our home on Ocean Ridge Boulevard with the expectation the street and subdivision would consist exclusively, and in accordance with the county’s zoning, of single family homes thereby resulting in a ‘homogeneous, traditional single-family neighborhood,’  Southmayd wrote the county, citing legal precedents for his definition of single-family homes. “The Voss’ purchased the property at 1 Ocean Ridge North with the constructive knowledge that all homes in the subdivision and on Ocean Ridge Boulevard were zoned as ‘single family residences.’ Thus, they had no rational basis for believing a commercial, transient rental residence would be in conformity with the zoning on the street and in the subdivision. Moreover, their utilization of that property as a commercial, transient rental residence has impinged on our rights to live in a ‘homogeneous, traditional single-family neighborhood.’”

But for all his reasoned arguments, Southmayd’s rights were supplanted by the 2011 law and reinforced by the absence of local regulation, according to Bondi. Southmayd had requested an investigation of the neighboring property. The county, now with Bondi’s opinion in hand, can simply say—as it did even before the option was rendered—that it’s out of its hands.

Al Hadeed, the county attorney, added this perspective in a news release the county issued late Thursday: “Legislature has gradually, with support from the Governors in office, withdrawn state control over local land use.  The Department of Community Affairs was dismantled, and comprehensive plan requirements for local governments have been lessened. The role of  Regional Planning Councils in local planning review also was nearly eliminated. So this taking away of local control over vacation rentals is going in the exact opposite direction.”

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10 Responses for “Nothing Flagler Can Do About Divisive Vacation Rentals, Attorney General Bondi Confirms”

  1. Genie says:

    If I were Jeffrey Southmayd, I’d get another opinion. I believe there is room for a lawsuit against the county for doing nothing about this.

    I would imagine there is a law firm somewhere in the country who would love to represent the residents of Hammock Dunes against the County of Flagler in this zoning dispute.

    A rental unit is a business and I’ve yet to see a home business be allowed to legally operate in Palm Coast that wasn’t zoned that way in the first place.

    Any other opinions?

  2. Had Enough says:

    “A rental unit is a business and I’ve yet to see a home business be allowed to legally operate in Palm Coast that wasn’t zoned that way in the first place.”………………………….Really, I got NEWS for you. Just on my street there are 9 people running businesses out of their homes. Multiply that by the number of streets in Palm Coast and I would say there are THOUSANDS of people running businesses out of their homes. I got a neighbor who so damn blatant about it he has deliveries made once a week of BIG items like Hot Water heaters EVERY WEEK. On top of that, this JERK is a renter who plays LOUD MUSIC everynight in his garage with the damn door open until 10 or sometimes 11. Code enforcement will get you for not cutting your grass if its more then 3 inches high, but its OK to run a PLUMBERS business out of a RENTAL HOUSE !!!

  3. grb says:

    Ewww, icky tourists getting into our gated community…..waaaa. Some of them probably aren’t even Republicans! OMG. The problems of the wealthy.

  4. Born "n" raised Flagler says:

    Get a grip, who cares!

  5. NortonSmitty says:

    Attorney General Barbie will not dare interfere because many of the short term rentals are owned by her masters in the banking industry who foreclosed on them for a fraction of their real value and rent them to pay upkeep until the market recovers and they can bundle and sell them for a very healthy profit.

  6. Anonymous says:

    I agree with Pam Bondi and support her opinion. This is the land of the free. If you want to live in a communist country, then go! Now let’s move on..

  7. confidential says:

    Sincerely sorry for the single family permanent residents like Mr. Jeffrey S., enduring such an unfair situation. Many of us in Palm Coast had been affected by the unilateral changes in the original land development codes and laws that we are still battling against. Is not a problem of the rich property owners only, it can happen to a modest single family home as well if they quietly decide to change the land code or law and approve a commercial enterprise next to yours. No more peace, quiet and safe.

  8. I/M/O says:

    If I was Jeffrey Southmayd I would immediately report to the Internal Revenue Service that Mark and Brenda Voss are renting their property as a commercial enterprise and the IRS should make sure they are reporting and paying the taxes on their rental income and not hiding the rental thru the vacation rental company and not taking home owner deductions but strictly reporting the use of the property as a Time Share commercial business property.

    Then I would make sure I notified Zillow and Trulia that the Voss property has been rezoned into a time share commercial business and that they are providing rooms for 15 people—10 adults and five children, on a nightly, weekly or monthly basis. Both the Zillow and Trulia real estate websites still have this property listed as a single family home and not a time share rental hotel. Future perspective buyers of that property should know this about the property.

    Then Jeffrey Southmayd should investigate that when a home is rezoned into a commercial rental prosperity where up to 15 people could be in the residence are their codes as to having a resident manager present 24 hours a day, are signs required in front o the building that identify it as a “Hotel”, “Mote”, “Time Share Property, etc. are sprinkler systems required to be installed, or fire extinguishers mounted throughout the building, lighted exit signs in case of fire, commercial sanitation company has been hired or any other town or county regulations that must be complied with to run a commercial rental property.

  9. Nigel Worrall says:

    These arguments have done the rounds over the last 25 years in various areas of Florida. The main problem is when vacation rental homes aren’t professionally managed and home owners try and do it all themselves. That often means they cut corners and do not operate professionally or legally.

    If a home is professionally managed it will always have its pool and lawn maintained. It will help keep values up in an area where often, residents operate on a deferred maintenance plan.

    Further, some counties in Florida generate a great deal of money from vacation rentals. First, there is the tourist development tax (Osceola County collects 58% of its revenue from vacation rentals / Polk County over 50% to name but two) and this tax is then used to improve the whole county for locals. The second benefit is the additional tax that is collected from activities renting to people staying in vacation homes. For that think restaurants, gas stations, tourist attractions etc.

    Also, vacation home owners are required by Florida State Law to be licensed under Chapter 509 of Florida Statutes. They have to submit tax returns on all rentals and they have to file their yearly tax returns.

    There is so much false information given about vacation rentals but when managed correctly, they can be an enormous attribute to any county. And, what’s the worse case? If you don’t like your neighbors for a few days, they’ll soon be gone.

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