Southold Town Okays Short-Term Rentals In Commercial Zones

SOUTHOLD, NY — The town board voted Tuesday to amend Southold's transient rental code to allow for short-term rentals in commercial properties, including in areas zoned for residential office, hamlet business, and general business use.

A public hearing on the issue was held after a need arose for for additional options for accommodations for tourists, visitors and residents in Southold, officials said.

"The code change regarding transient rentals simply excludes commercial zones from the short-term rental prohibition," Southold Town Supervisor Scott Russell said.

The Southold Town board voted 4 to 1 on August 25, 2015 to adopt the short-term rental legislation.

The vote came after months of heated debate and long public hearings, as residents stood at the podium and begged the town board to protect their quality of life. Others, second homeowners who rented out their homes on sites such as airbnb said the income was critical to their ability to one day move full-time to their residences; short-term renters said guests provided an influx of business to Southold and were a proven boon to the economy.

The town board, however, maintained that commercial endeavors should not be taking place in residential communities and also felt the short-term rental industry could prove disastrous to an already dwindling year-round housing stock in Southold Town.

This week, Russell reminded that when the board originally adopted code to prohibit short-term rentals it was based on a belief the rentals were commercial enterprises operating in residential zones.

"The code we adopted had language so broad that it inadvertently was extended to commercial zones," Russell said. "We are simply looking correct the language to permit transient rentals in the commercial zones. This law does not promote or expand the potential for hotels. Rather, it restores historical uses to buildings in the commercial zones."

At Tuesday's hearing, Southold real estate broker Tom McCarthy said the rental permits serve a good purpose, ensuring protections for the health and safety of residents.

But he applauded the code change, stating that as change comes to the community, "smaller mom-and-pop businesses are being bought up — it's a capitalistic society — by larger companies not necessarily based here." He referenced plans for hotels and other purchases in the hospitality arena that have made headlines on the North Fork recently.

"This change to the short-term rental code will allow some of the dollars to stay local," McCarthy said. "Transient rentals will always be part of our community, whether legally or illegally, with some folks not necessarily compliant."

Russell agreed that it has been more difficult than anticipated to enforce compliance in regard to the town's short-term rental code.

McCarthy added that the change will meet a need for people visiting town who don't have two weeks to spend, and who can't afford the "ever-increasing cost of hotels and motels — and who don't necessarily want to stay in Riverhead." He added that siting them in downtown areas where there is foot traffic will bring tourism dollars to hamlets, as well as find a purpose for underutilized spaces in those areas.

Councilman Bob Ghosio, during his last town board meeting, said at the time the initial legislation was passed, the board said they were taking a "broad-stroke" approach and would make changes as time passed. "This is one of those steps," he said.