Short-term rentals are back in the news, with high program costs, serious enforcement struggles and declining hotel occupancy tax revenue for the city. Is anyone surprised?
In June 2023, the Dallas City Council passed a ban on short-term rentals in single-family neighborhoods, potentially putting more than 90% of all Dallas STRs out of business. That action was met with a lawsuit, subsequent injunction and appeal by the city. Meanwhile, STRs continue operating. What went wrong on our way to eliminating the few nuisance STRs that are out there?
The City Council approved a ban that was not supported by factual data nor by city staff. City-provided data in a 2021 report titled, “Short-Term Rental Data Analysis: An Analysis of the Impact of Short-term Rental Properties in the City of Dallas,” and two subsequent reports titled “Short Term Rental Impact Analysis Updates” show that 80% of short-term rentals have zero 311 or 911 calls, that “nuisance STRs are outliers” and that there is “no evidence of a city-wide impact”. City staff testified at City Council meetings against the ban.
Years of STR task forces had already produced a fair and sensible registration ordinance including full funding of the registration program for night and weekend enforcement by STR owners, and serious consequences for nuisance properties. We were on our way to addressing real issues.
But it didn’t last. Opponents of STRs are a vocal minority. Many also oppose ForwardDallas 2.0 and other city policy initiatives that would improve quality of life and affordability. They won the day in June 2023, but what did their advocacy accomplish?
It cost Dallas taxpayers $1.3 million to set up the STR code compliance program and it continues to cost them $650,000 annually to run it, according to testimony from Code Compliance Services Director Christopher Christian. Plus, there’s the cost of the lawsuit. Yet enforcement is no better than before the ban.
The number of STRs has increased slightly over the last year from 3,250 to 3,512, according to city staff briefings, but hotel occupancy tax revenue has dropped from $3.8 million last year to $2.7 million through this July.
How do we get things back on track? The ban is obviously not working. Dallas should get rid of it. Reinstate the original registration ordinance without amendments and negotiate agreements with STR platforms for direct collection of hotel occupancy taxes.
Short-term rentals aren’t going away. They are the preferred hospitality choice for travelers seeking an affordable, authentic experience. The FIFA World Cup is coming to Dallas in 2026. Where will guests stay while they generate millions of dollars of income for our city?
A small but vocal minority of naysayers should not be allowed to dictate city policy. Dallas has always been welcoming of entrepreneurs and diversity. Let’s get back to some fair and easy-to-enforce rules so we can get the few bad apples in line and allow the 80% of responsible STR owners to continue.
Lisa Sievers is a short-term rental owner and member of the Dallas Short-term Rental Alliance.
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