LACONIA — A proposal to regulate and limit short-term rentals in the city received initial City Council approval on Monday.

Councilor David Bownes and Henry Lipman were in opposition.

The regulatory scheme will be subject to a Dec. 9 public hearing and a final council vote.

One controversial element of the regulation would allow short-term rentals only in owner-occupied residences in most of the city. Those living in The Weirs would face no such restriction.

Councilors approved an amendment to define a short-term rental as housing that is rented for stays of between one and 14 consecutive nights. Under the previous wording, anything under 90 days would be considered a short-term rental.

They also amended the proposed ordinance to require registration of properties every two years, instead of annually.

Bownes said the ordinance recommended by the Planning Department was much less restrictive.

“Now we’re looking at only one scenario in which we allow short-term rentals and that’s owner occupied and that’s simply too restrictive and too narrow, it excludes too many people who are good decent people, who are being respectful to their property.”

Lipman said the ordinance also fails to deal with concerns expressed by Neil Pankhurst, founder of the Winnipesaukee Playhouse. He owns a house in Laconia which is used by actors during the playhouse season and is rented short term the rest of the year to defray expenses.

It is not owner occupied, so this present use could not be continued, and Pankhurst said it would have a harmful effect on his business.

“Why do we want to make it harder for the Winni Playhouse to stay in business?” Lipman asked.

He urged a slow approach “in terms of taking away people’s property rights that they have used for years and years and years.

“It’s similar to road issues. People rely on the ability to do things for decades and then to go and snatch it out from under them is not right.”

Ultimately, the council agreed to have the Planning Department work on a waiver to deal with situations like the one faced by the playhouse.

Councilor Bruce Cheney said the council must consider the rights of neighbors who sometimes complain about short-term rentals.

“There is a group of people on the other side of this issue,” he said, “and that is those people who feel their property rights are trampled on by 22 people in a house with three bedrooms, 20 cars in the yard and people climbing their fence to use their dock.”

Planning Director Dean Trefethen sent an email to the City Council, saying the proposed regulations could unduly restrict problem-free rentals, drive these businesses underground and benefit wealthier neighborhoods at the expense of middle-income areas.

He suggested limiting the number of times a house could be rented on a short-term basis, perhaps somewhere from 12 to 18, rather than require owner-occupancy.

Most short-term lodging establishments operate without problem, including some that have been rented among friends for decades. The city embarked on the regulatory scheme after complaints were made over a couple of problematic short-term rental homes.

Mayor Ed Engler has said he favors an owner-occupancy requirement as a way to try to keep residential areas intact for families and new residents, rather than simply providing properties for out-of-town investors to offer for rental.

Present zoning ordinances prohibit short-term rentals in most of the city, but this prohibition has generally not been enforced. A year ago, the City Council agreed to require enforcement if neighbors complain. 

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