Michigan Debates New Law Governing Short-Term Rentals

Michigan legislators are in the process of making big decisions when it comes to regulating the short-term rental industry. Michigan House Bill 4503 addresses zoning in residential areas. Specifically, the bill says that short-term rentals such as Airbnb count as a residential use of the property. As a residential use, that means there’s nothing local governments could do in order to restrict or prohibit the rentals. If the bill passes, it means that homeowners could do whatever they wanted to rent their properties without local restrictions. Instead, homeowners would be free to rent their homes on Airbnb as long as they comply with other state laws.

There’s vocal support for the bill as well as significant opposition. Grand Haven City Manager Pat McGinnis says that the City of Grand Haven opposes the bill, because it removes local control from the residents in the community where they live. They say that each local jurisdiction should be able to decide what to do with regulations for short-term rentals in their location. McGinnis says that a Grand Haven resident shouldn’t have to approach state legislators in Lansing in order to address a local housing concern.

Supporters of the bill say that the changes are good for commerce, and that reducing regulations allows each homeowner to use their property in a reasonable way. They say that tourists want to be able to find places to stay when they travel. They say that short-term rentals like Airbnb give travelers more choices in order to find a unique experience when they’re away from home. Supporters also see the bill as a way to increase tax revenue for the State of Michigan. Michigan imposes an occupancy tax, and supporters of the bill say that the new legislation stands to increase revenue and make it easier to collect taxes on existing rentals.

In addition to the bill that’s currently pending in the Michigan House of Representatives, there’s a similar bill that’s pending in the Michigan Senate. For now, the bills sit in their respective committees. Legislators plan to debate the issue before it heads to a vote in the fall legislative session. Some legislators have set up meetings and town hall opportunities, so that residents and government organizations can voice their opinion.

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