Short Term Rental Accommodation Review

Short Term Rental Accommodation

The Township of Minden Hills is currently developing regulatory mechanisms for Short-Term Rental (STR) accommodations. Like many municipalities across Ontario, the recent popularity of online platforms such as Airbnb, VRBO, and other rental accommodation websites, has led to an evolution in the way in which many residential properties are being used within the Township of Minden Hills, and most particularly within the Township’s waterfront areas.

In an effort to minimize land use conflicts and ensure responsible environmental stewardship, while recognizing the rights of private land owners and the valuable contribution of Short Term Rental Accommodation on the local economy and property values, the Township will be soliciting the public’s input throughout this process.

What are Short-Term Rental (STR) Accommodations?

The term “Short Term Rental” or “Short Term Accommodation” typically describes residential dwellings which are rented over a short period of time (e.g. less than 30 days) for monetary gain. It is recognized that the use of a dwelling for a STR can take many forms ranging from a resident of the property who, from time to time, rent out the dwelling while on holiday themselves, to owners of property who continually rent the property out as an investment income.

While traditional ‘Bed and Breakfasts’ establishments have long been recognized, and permitted, within the Township’s residential areas, including along the waterfront areas within Minden Hills, these establishments are characterized by the caretaker being on-site, and limited to three guest rooms.

Why is the Township Undertaking this Review?

The proliferation of Short Term Accommodation, is a relatively recent phenomenon. In their 2017 Second Home Study, the District of Muskoka identified that 7.3% of owners of second homes rented their property out with the average property being rented for 6.4 weeks per year. However, despite the popularity and general acceptance of STRs, the Township’s Zoning By-law does not permit this land use. Further, given concerns for water quality the Township wishes to ensure that septic systems are being used in accordance with their designed capacity.

What would be the Benefit to Regulatory By-laws?

Regulatory By-laws specific to STRs could come in two forms: Zoning By-laws authorized under the Planning Act, and Licensing By-laws authorized under the Municipal Act.

Zoning By-laws can be used to permit or restrict the use of land for STRs to certain areas, which could be permitted subject to certain restriction on lot frontage, lot area, parking requirements, and certain other criteria. A Zoning By-law would allow for as-of-right permission for all individuals to engage in a specific use where it is permitted; however it can not be used to establish performance criteria (e.g., to require fire extinguishers, to require emergency contact information be provided, etc.).

Licensing By-laws can be used to require a business to obtain a license to undertake a specific activity. Issuance of a license can be made conditional upon certain criteria (e.g., septic review, electrical inspection, etc.) and can require the license holder to adhere to certain performance standards (e.g., maximum occupancy, availability of a contact person, etc.). Licensing By-laws can be used to incentivise orderly conduct as a system of demerit points leading to license suspension could be incorporated into the licensing system.

While a licensing By-law may require fees associated with the license, the fees charged would be limited to the cost of administering and enforcing the licensing regime. The municipality has no ability to change the tax rate of properties used as STRs, however a Transient Accommodation Tax (often referred to as a Hotel Tax) may be applied to such rental accommodation. The legislation which enables this tax requires 50% of the revenue from the tax to be shared with one or more eligible tourism entities to be used for the exclusive purpose of promoting tourism.

Past Events

Short Term Rental Accommodation Questionnaire –  Friday, September 14 to Tuesday, October 16, 2018

Open House – Saturday, July 21, 2018