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The news articles below offer our readers the opportunity to better educate themselves on the effects and trends of short-term rentals in our local communities. 

Post and Courier Editorial

Editorial: Isle of Palms voters should cap short-term rentals


Published Tue Oct 24, 2023 6:15 PM EDT


Like residents on Folly Beach just a few islands down the coast, Isle of Palms residents seem to want assurances that their coastal city will strike a balance between full-time residents and homes used as short-term rentals.

Earlier this year, many Folly residents believed their City Council wasn't taking their concerns seriously and petitioned for a referendum to limit the number of short-term rentals. That effort was successful, and now Isle of Palms residents have succeeded in their own petition drive.

As a result, island voters will go to the polls Nov. 7 to decide not only four City Council races and a utility commission seat but also this question: “Shall the City of Isle of Palms limit the investment short term rental business licenses to a maximum of 1,600?” They should vote yes.

It's important to understand what the ordinance will and won't do. Those residents who currently live in their home (and qualify for the 4% property tax assessment rate on owner-occupied homes) still may rent out their home for up to 72 days a year, and they would not be subject to the new cap.

The cap would apply only to so-called investor-owned properties and second homes (which have 6% assessment rates). Currently, the island has about 1,600 of these types of properties with short-term rental licenses, so the cap was designed to maintain the status quo — and to ensure the number of short-term rentals doesn't rise much more.

But no current property owner should face an immediate hardship if the referendum question is approved, and that's important to note. All owners of rental properties will have 60 days — through January 2024 — to apply for and receive a short-term rental license, even if the number of applications surpasses 1,600. In other words, the cap would only limit new applications above that 1,600 mark after January, once this grandfather period ends. Also, these licenses will be transferrable to family members. These responsible, equitable provisions should minimize hardships if the question were to pass.

“We have a growing number of short-term rental licenses in residential communities," former City Councilman Randy Bell told reporter David Slade. Mr. Bell has worked with the pro-referendum group Preserve Isle of Palms Now. "We are trying to maintain the one-third, one-third, one-third split between full-time residents, second homes and rental properties."

It might strike some as odd that the cap issue is emerging even as the island has seen a recent slowdown in short-term rentals. Visitors and residents always have made up a large part of the Isle of Palms' identity, but the Nov. 7 referendum is yet another example of South Carolina communities, particularly those popular with tourists, seeking a better balance between the economic vitality of short-term rentals and the relative stability and quietude of neighborhoods with mostly full-time, year-round residents. State legislators should not pass any laws that would hinder the work of cities and counties on this issue.

As with Folly, even if voters approve the cap, we don't expect the referendum to be the last word on the subject. City Council would have to implement it but could make modifications as it sees fit. As City Attorney Mac McQuillin explained, "If the ordinance is approved by voters ...  council can amend or repeal following the election just like any other ordinance." If the referendum is approved, City Council should amend it if there's a consensus that it is not working as planned or officials find a better way to ensure the resident-visitor balance.

If voters say yes — as they should — it's certainly fair for Isle of Palms council members to consider whether 1,600 really is the best number in the long run or whether that number should be changed to reflect the distinctly different areas of the island, such as the front beach and Wild Dunes. That's a fair debate, but one that would take place with council members knowing full well that island residents — also known as city voters — remain concerned about the scale tipping too far away from them.

Click here for more opinion content from The Post and Courier.

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