The economic landscape for many industries these days is being transformed by the emergence of new technologies and online service-based platforms that have fundamentally challenged how we traditionally have done certain things in certain ways.
For Canmore, the emergence of easy, convenient and competitively priced online visitor accommodation offerings through websites like Airbnb and VRBO has, over the past year, triggered the municipal government to invest time and money into better understanding and enforcing the issue.
The town is not isolated or alone in its struggle. Banff has a proactive enforcement policy, for example, and other jurisdictions including Toronto, Victoria, Saskatoon, Kelowna, Revelstoke, and Whistler have all wrestled with the issue of how the use of traditionally considered residential properties for overnight vacation rentals has affected communities.
There is no clear consensus, however, on what would be the best way to manage the newly emerged type of visitor accommodation into the future. But for now, Canmore council is looking at a $50,000 review in its 2018 capital budget to delve into the conversation.
That’s good news for those earning a living in the visitor economy that would like to have a comprehensive conversation around what it means for the overall economy when considering regulating short-term vacation rentals further.
Rockies Rentals has an inventory of units available for visitors to Canmore to book for their stay, but vacation rentals manager Charla Tomlinson said the company has invested in legally zoned tourist homes and visitor accommodation units for its portfolio.
The properties are assessed and taxed commercially, and Tomlinson said the increasing presence of units available for vacation rentals that are residentially zoned creates an inequality for her business model.
“From my perspective, we have licenced vacation rentals, so there is an inequality in how the taxes are split up,” she said. “In essence, we are paying a higher tax rate and it kind of comes across as being punished for doing the right thing.”
The municipality stepped up its enforcement in 2017, and began issuing stop orders and $2,500 tickets to illegal short-term rental properties they have received the most complaints about in the past. Five homeowners filed appeals to the enforcement action and were set to appear in front of the Subdivision and Development Appeal Board, but withdrew their applications.
“To date, we have had 100 per cent compliance on those we have found and issued stop use orders and tickets,” said manager of planning and development Lee Prevost. “What we want to do now is increase our presence to ensure those we have not caught understand this is an illegal activity that should not be occurring.”
Compliance included signing a statutory declaration to no longer list their home for nightly rentals and, as a result, homeowners who received the $2,500 ticket saw them withdrawn.
Wade Graham is one of those Canmore homeowners who received a ticket and has since chosen to comply with the bylaws in relation to his residential property while the municipality undertakes efforts to create a better regulatory framework.
“I turned my Airbnb off in the meantime with the understanding there is going to be a conversation happening in the near future about how we do this,” he said. “I want to see all interested parties sit down together and discuss meaningful solutions.
“Short-term rentals are not the big bad wolf that everybody makes them out to be.”
Graham said he believes there is room to find rules and regulations that work for the municipality, the community, homeowners and businesses. He said some homeowners are renting a room on Airbnb to pay the mortgage (in the most expensive place in Alberta to live, he added) and others only want to rent their home out while they go away on vacation themselves.
Tomlinson recently held a meeting open to homeowners who wanted to pursue the conversation around changing the regulations. She said for some people, renting out their property as a vacation rental really does come down to an affordability issue for them, or in other words, the revenue helps them afford to live in Canmore.
To say the use of those homes in that way is undermining the rental housing market, Tomlinson said, would be an oversimplification of the situation facing Canmore’s overall housing market.
Second-home owners, or weekenders, who rent their units out through Airbnb when they aren’t using them, have pointed out they are not removing rental stock from the market, for example.
“It was an interesting meeting and a lot of interesting and good ideas came out if it,” she said.
The outcomes were that homeowners were able to collectively voice their concerns and expectations for the future, and Tomlinson said by the end of the meeting everyone was prepared to engage with the municipality in that conversation, which they can expect to do over the next year.
One thing is for sure; Tomlinson said the Town of Canmore needs better data around this issue and how it affects the community. She said the global visitor economy has made it clear; there are travellers who seek out and want this particular kind of experience.
“The Town needs data,” she said. “Realistically, they need data around room nights, numbers of guests and demands.
“Without good data, it is hard to make good decisions.”
While the Town of Canmore is undertaking a process to better understand visitor accommodation overall, enforcement is also expected to continue.
Earlier this year, council approved hiring a contract position in the planning department to focus on land use enforcement – with a particular focus on this issue.
During conversations around the 2018 operational budget, manager of financial services Katherine Van Keimpema said administration recommends making the part time position full time, and extend the contract beyond 2017 to include next year.
“We suspect we will continue to do that work, so we are proposing to keep that person on for another year,” she said.
The increased budget – $75,000 – would provide a one-year extension of the position and be funded from general operating reserves. Van Keimpema told council that administration intends to recommend part of the surplus from 2017’s budget in the planning department be used to replace the funds used for the budget approval.
General manager of municipal infrastructure Michael Fark said when council considers the 2019 budget and beyond, it can expect to discuss whether or not the contract position becomes permanent.
“Council had priorities in planning it wanted to achieve and provided additional resources to achieve that,” Fark said. “We brought in this position to focus specifically on enforcement, as it has become a big conversation throughout the year and we fully expect that the enforcement workload will not go down next year.
“This focus would provide better information and help us plan further with council what steps to keep taking.”
But conversations round vacation rentals in Canmore go beyond what is happening in residential neighbourhoods and include tourist homes and visitor accommodation units.
The $50,000 visitor accommodation review was proposed for the 2017 capital budget, but never initiated, to examine regulations around the specific type of zoning. Condo hotel developments along Kananaskis Way, for example, are considered visitor accommodation, and were heavily developed in the mid-2000s.
In order to ensure units would be used for short term stays, the title of the property contains a restricted length of occupancy for the unit of 28 days. The global economic downturn resulted in banking practice changes after 2008 that created challenges for those wishing to purchase this type of property to obtain financing.
That resulted in pressure on council by developers and owners of these units to change zoning, and removal of the restricted length of stay from title. Council has in the past rejected proposed rezoning applications related to this issue, which would have removed the time restriction.
Development planner Audrey Rogers briefed council on the results of consultations with owners of visitor accommodation units in 2017 on the issue.
They expressed concerns around the restrictions, but also around illegal visitor accommodation in the community and how it is being enforced, Rogers said.
“From the perspective of the municipality, there are some limitations to what we can and cannot do,” she said about possible changes for visitor accommodation.
Many in the community have argued that removing the time restriction would open more units up for affordable residential rental accommodation. However, councils of the past have been hesitant to turn large numbers of accommodation into residential without understanding the impacts for the future.
There is clearly overlap between issues concerning visitor accommodation and unauthorized vacation rentals in residential neighbourhoods and, as a result, administration recommended changing the scope of the 2017 project and moving it to 2018.
“With the uptake of tourism homes and short term rentals in residential areas we would like to include that in this review, therefore we are asking to move it to 2018,” Fark said. “What we are clarifying (in this budget) is the money that can be used to address a wider conversation that includes Airbnb and vacation rentals because they are interrelated.”