Short-Term Rental Operators Have Unanswered Questions As Enforcement Deadline Looms

Dallas short-term rental operators were told in June that enforcement of a residential ban would begin at the end of the year, but confusion abounds and a lawsuit is likely on the horizon. 

City Manager T.C. Broadnax revealed his recommended budget Aug. 4, proposing nine code enforcement positions and $1.4 million for a new short-term rental registration and inspection program. The controller’s office will continue to monitor the collection of hotel occupancy taxes, city officials said. 

The City of Dallas posted a resource page in early July that includes answers to frequently asked questions, links to council briefings on the subject, and relevant code ordinances. 

They’ve also reached out to STR owners about how to identify what zoning district they’re in, effectively determining whether their STRs are operating illegally. 

STR operators are in the dark, however, on whether they should continue paying HOT taxes if their rentals have already been deemed illegal. They don’t know if they’ll be fined retroactively if they’re renting out their homes while the city is installing tracking software and staffing up enforcement. It does not appear those answers are on the FAQ page. 

Complicated Guidelines for Short-Term Rentals

While the “Keep It Simple Solution” adopted in June has been widely referred to as a residential ban on STRs, it really hinges on how the property is zoned. 

“The zoning regulations are based on the zoning district a property is located in, not the type of structure,” according to the city’s FAQ page. “Each property’s eligibility will be determined based on the specific zoning district the property is located in, not what types of properties are on the same street.”

Additionally, homes can be rented in residential neighborhoods if they have guests staying for more than 30 days. Multifamily STRs are allowed by right but some will have to shut down because of density requirements. 

Lisa Sievers, a spokesperson for the Dallas Short-Term Rental Alliance and a District 2 STR operator since 2019, told CandysDirt.com this week there’s not much she can say about the matter. 

“We will have more information coming for you soon and I will make sure that you get it as quickly as possible,” she said. 

A federal judge ruled earlier this month that Austin was unlawfully prohibiting off-site operators from leasing  STRs, according to Austin news station KXAN. 

Dallas STR supporters posted the story with a reminder that legal action is expected locally. The city is in for a lengthy, expensive legal battle, some council members acknowledged when the Dallas ordinance passed in June. 

However, District 12 Councilwoman Cara Mendelsohn responded to the Austin story by saying Austin’s ordinance is different than the one adopted by the Dallas City Council this summer.

“This doesn’t apply to the Dallas situation,” Mendelsohn posted. “Ours is modeled after the City of Arlington, which has already survived judicial review.” 

The council member went on to say there has never been an issue that has united voters like STRs. 

“People want real neighborhoods not empty homes, schools with neighborhood kids, vibrant local businesses, not all the code compliance [problems],” she wrote. 

City Communication With STR Operators

Chief Financial Officer Jack Ireland issued a letter to registered STR operators on Aug. 4. Again, it doesn’t say much but provides links to codes and city websites. 

Communication from the city has not been useful, Dallas STR operators told CandysDirt.com. 

Dear Property Owner/Manager,

On June 14, 2023, City Council defined short-term rentals (STRs) as land use and voted to restrict STRs to a list of allowable zoning districts, with enforcement commencing December 2023. Please review the new city ordinances and other resource information below to determine how these changes may impact your STR.

For a copy of ordinance number 32473 related to Regulations, please click on the following link: http://citysecretary2.dallascityhall.com/resolutions/2023/06-14-23/23-0833.pdf

For a copy of ordinance number 32482 related to Zoning, please click on the following link: http://citysecretary2.dallascityhall.com/resolutions/2023/06-14-23/23-0844.pdf

To determine the zoning district your property lies within, please visit the zoning map by clicking on the following link: https://developmentweb.dallascityhall.com/publiczoningweb/.

You will need to turn on base zoning layers and type in your property address for the zoning district of the property. For a zoning map tutorial, please visit: https://youtu.be/cQ5nHwj0dRU

For answers to questions regarding property uses, zoning interpretations and regulations, development regulations, build sites, permit processes, or inspections, please contact Development Services’ Zoning Consultation Team within Building Inspection at 214-948-4480 or in-person at 320 E Jefferson Blvd, Room 118, Dallas, Texas 75203.”

Jack Ireland, Dallas chief financial officer

City budget hearings will continue through mid-September, and council members already have asked for more information on the budgeting breakdown and how enforcement will work. Ireland told council members during a Wednesday briefing they can expect answers to their questions by memo in the coming days.