Coralville moves to regulate short-term rentals

Owners who use services like Airbnb would need rental permits

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CORALVILLE — Homeowners in Coralville soon may have more restrictions when they rent out their spaces to visitors who use services like Airbnb.

The Coralville City Council voted 5-0 Tuesday night on the first of three considerations of an ordinance that regulates short-term rentals, which is considered anything less than 90 days. If anyone chooses to rent out homes, apartments or bedrooms for the short term, the property would need to be owner-occupied, the owner would have to stay with the renters and the home would need to pass a rental inspection.

City Attorney Kevin Olson said that if owners violate any of these proposed restrictions, they could be fined $750 on the first night and $1,000 for any night after.

The city did not add a requirement for a hotel/motel tax, Olson said. However, a lack of the tax is a concern of the Iowa City/Coralville Area Convention and Visitors Bureau.

Josh Schamberger, its president, said hotel representatives want short-term renters to be on an equal playing field.

“They’re not subject and haven’t been subject to sales and excise tax collections as hotels are required,” he said.

City Administrator Kelly Hayworth told the council that the city chose not to include such a tax because it is often difficult to enforce.

The visitors bureau staff counted about a dozen rooms or homes in the area available for rent during a typical University of Iowa football weekend. Schamberger said, however, this is a larger issue because the question of short-term rental regulation goes beyond just Coralville.

“I think a lot of this is just kind of growing pains between communities and the new sharing economy,” he said.

Ben Breit, a representative for Airbnb, said in a statement that the company provides extra income for owners and additional capacity during busy weekends.

“We continue to have productive conversations with policy makers across the United States and around the globe to create clear, fair home sharing rules,” Breit said in the statement.

Numerous Coralville residents expressed concern that these short-term rentals could become party houses if left unregulated. Mayor John Lundell said the city has similar concerns.

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