-This week on Nevada Week, short-term rental properties in Clark County face new rules that have some owners and operators fighting back.

♪♪♪ Support for Nevada Week is provided by Senator William H. Hernstadt and additional supporting sponsors.

-Welcome to Nevada Week.

I'm Amber Renee Dickson.

For several years Clark County banned short-term rental properties in the county's unincorporated areas outside of cities like Las Vegas and Henderson, but last year the State Legislature passed a law requiring Clark County to begin regulating the popular industry that provides tourists different accommodation options outside of hotels.

The Clark County Commission recently approved an ordinance with new rules for short-term rentals available on platforms like Airbnb and Vrbo.

And one of those rules caps the number of properties that can be licensed as short-term rentals at 1% of all housing in unincorporated Clark County.

According to the County, that equates to about 2,850 properties which will receive their licenses through a lottery system.

Meanwhile, the County estimates that there are between 6,000 and 12,000 short-term rentals in unincorporated Clark County right now.

Local Short-term Rental Owner Victor Paulo does not like his chances of getting that coveted license.

(Victor Paulo) Welcome.

This is one of my short-term rentals.

-Victor Paulo says he owns and operates four short-term rentals in Southern Nevada.

This property-- -Five bedrooms, three bathrooms, really nice swimming pool.

- --is one of two he has in unincorporated Clark County.

-It started about five years ago.

I separated from my nine-to-five job, and I wanted to pursue my career in real estate sales.

And I needed something to keep me afloat in the meantime.

I only had about four months' worth of savings to stay afloat.

So it was a very scary time for me, and I used Airbnb to extend that time in order for me to get my experience in and pursue my career.

-Airbnb became part of his career, which is now at stake due to the short-term rental regulations Clark County revealed in June.

The County's licensing process includes a lottery that will significantly reduce the number of short-term rentals allowed to legally exist in the county.

-With Clark County, they have very similar regulations than most of the other ones.

They focus a lot on guest safety with fire extinguishers, carbon monoxide, smoke detectors, and things like that, which is great.

What differentiates them is that they are only allowing about 25% of the current Airbnbs that are up on the market to be permitted.

So it's going to be put into some kind of lottery.

And you basically have a 25% chance of getting a permit, even if you've done everything up to code to what they want.

-If you are not chosen in that Clark County lottery, what will that mean for you and your business?

-That would be devastating, to be honest, yeah.

So I would have to have about 16 to 18 people that work for me, maids, maintenance people, landscapers, and things like that, and those people would be out of a job.

-And how are you preparing for that possibility of not being selected?

-I thought about maybe moving to a different market where Airbnb is more appreciated.

And possibly with the current ones, possibly moving them to mid-term or long-term investments.

-That means Paulo would look to buy property in places like Florida and Mexico where he says there are less regulations on short-term rentals, while turning this house into a less profitable long-term rental.

-It is more bang for your buck.

You get more, monthly, with a short-term rental.

-Which he says would impact the livelihoods of more people than just himself.

Joining us to further discuss the implications of Clark County's short-term rental ordinance are Jackie Flores with the Greater Las Vegas Short-Term Rental Association, which opposed some of the new regulations, as well as Beth Blackwood with Nevadans for the Common Good, which supported the County's regulation efforts.

We did ask Clark County to be a part of today's panel, but the County did not provide a representative.

Ladies, thank you both for being here.

Before we get into this discussion, tell me each a little bit more about the organization you represent.

Jackie, I'll start with you.

-(Jackie Flores) The Greater Las Vegas Short-Term Rental Association is a nonprofit organization, and it's made up of individual property owners who have short-term rentals here in Southern Nevada.

-When did that start?

-We started that association about two and a half years ago.

-Okay.

And, Beth, Nevadans for the Common Good.

-(Beth Blackwood) Nevadans for the Common Good is an organization of organizations.

We have about 40 member institutions.

These are churches, synagogues, teacher representation, local nonprofits, and our purpose is to listen to the concerns of the community and see where we can impact, either by working with local legislation or by telling our stories in order to improve the conditions for Southern Nevadans.

-Let's start with the concerns from the people that you represent.

What were they in regards to short-term rentals.

-We held many listening sessions to hear about concerns that short-term rentals were impacting on local communities.

And what came out of that was kind of two separate issues that overlapped, one of which was unregulated short-term rentals operating without any regulations were turning into difficult community situations.

So you had party houses, you had weekend issues that created disruption in communities.

But at the same time, we're hearing stories from many people in the community who were having difficulty either with incredibly rising rents or unavailable of accessible affordable housing.

And when you evaluate the number of unlicensed short-term rentals that were operating in our community, you recognize that that is impacting the number of units that are available for either long-term rentals or for people in our community to buy and live in.

-And that is because these can be very lucrative for investors to come in, and they would reduce the housing supply by buying these properties and using them as short-term rentals.

Do you want to respond to the party house aspect, Jackie?

-Yes.

We always hear people referring to "party houses."

The problem with that is they're labeling all of them as party houses.

And the fact is that the vast majority of them are not.

There are obviously some that do cause issues.

We are aware of them.

And we've always been asking why isn't court enforcement or the police enforcing the regulations for nuisance that are already in place.

And that's not happening.

If they're, in fact, party houses being out of control, they should be stopped, and Metro and court enforcement should stop them.

But instead they're going after houses that are not causing any issues at all, playing Whack 'em All, trying to find them, wasting their time, wasting taxpayer money, to try to shut them down when they're not causing any nuisance.

So that's why we have a problem with the label of party houses.

I understand that people try to vilify the industry in order to pass strict regulations, but you have to understand that you are mislabeling a lot of those people that are not in that type of business.

-I completely respect what you are saying, and I know that a lot of short-term rentals are just being used for weekend rentals or even longer term, maybe a couple of weeks even at a time.

And I do appreciate that not every short-term rental turns into a party house.

The new ordinance, however, does limit the number of guests that are allowed in a house that will help to reduce the opportunity for party houses.

And also limits the number of units that are being taken out of our local housing availability for people that live in the community.

-How fair is the system that the County set up, this lottery system that will significantly reduce how many people can legally operate?

I'll ask you first.

-Well, the lottery, we think it's something that should not have been used.

When we were at the State Legislature last year, we asked that those who were operating already should be the ones to get licenses first and then implement all these different restrictions after that because if they have been operating this long, that means that they've been doing something really great, because a platform itself is not going to keep you on the platform if you are a bad host.

-But they have been operating illegally, technically.

-They have.

-So how do you gauge whether they have a history or not?

-For example.

Airbnb, for example, when somebody stays at a property, that guest reviews the host.

You get five stars, four stars, three stars, you know?

And then the host reviews the guest.

If it's a bad guest, one star.

If it's a great guest, five stars.

So you have that system in place already that's kind of self-regulating itself where you know which houses are doing great, which houses are clean, well maintained, no issues, and which guests are also great guests to host versus the ones that are not.

So there is that.

With a lottery system, you might get a bad host with a license.

-This could be someone that just decides to start getting into the business now because there's this path to licensing, whereas they have no experience prior.

-Exactly.

-But the regulation now is going to require the platforms to be licensed and to adhere to the rules.

And then they're going to have to monitor who's using these units and help to dissuade bad actors from participating in the program.

The lottery is a fair system that allows everyone to participate.

And at the time this regulation that we started to investigate what was happening in the county, they estimated that there were 10,000 illegal units going on across all kinds of platforms, not just the major ones like Airbnb and Vrbo.

You know, other platforms don't monitor things to the same extent that some of the larger ones do.

We're short 80- to 100,000 units for people to live in here in our community.

So limiting the number of Airbnbs means that we are, or the number of short-term rentals, means that we are opening up additional housing for people that want to purchase a home or for long-term rentals, people that live in the area and contribute to our community and to our tax base.

-But I think that's a misconception because to think that just because you're going to not have licensed short-term rentals, that those are magically going to convert into affordable housing, that's not necessarily true.

Rents are through the roof right now.

It's not affordable for anyone.

It has nothing to do with Airbnb.

Available units for to purchase, it's also not an Airbnb problem or short-term rental problem.

These short-term rentals have been operating for years before the pandemic happened, before this housing issue started.

So again, everybody seems to be blaming short-term rentals for every single thing that's happening here in the valley where it's affordable housing.

Which by the way, a lot of the short-term rentals are not located in affordable housing areas at all.

So that does not make sense.

Houses to buy, again, when these houses go for sale, they're going go up for the prices that are high right now.

They're not going to go for sale for any lower than that.

-I happen to live downtown, adjacent next to the Medical District.

A corporation came into my neighborhood and purchased four houses all for the same price.

That impacts my property value, and also takes away from available housing for people that might be attending the medical school or working in our local hospitals, working in our schools, working in our hospitality industry.

It takes away the availability of all of that and just allows people to come into town and stay for the weekend and not contribute to our local community.

I think they actually do contribute.

Going back to just the housing prices, before we had the housing price issue, Airbnbs or short-term rentals were being accused of lowering property values by having a short-term rental in the community.

People that were opposing shor-term rentals were claiming Airbnbs lower property values.

Now they're being blamed for raising property values.

So which is it?

I mean, you can't have both happening.

Now as far as people coming to stay at our short-term rentals, they do contribute to the local community.

In fact, a lot of the small businesses in our neighborhoods are thankful that these guests who are coming to see our short-term rentals are coming to town because they go and spend their money in the local restaurants, in the local bars and grills, to the supermarkets.

They do invest.

All that tourism dollars are now going to our local community, not just on the Strip.

-It's difficult when you have a city whose economic base is built off of hospitality and tourism.

And yes, I can see the side of people coming in and contributing to the local economy that way, a huge part of our economy, but then you also have teachers out there who are struggling to afford a basic apartment.

And that is such a need we have here in Clark County with the teacher shortage.

Who do you think is the average short-term rental owner and operator?

What is the profile?

Could you even put it-- -I can't even put it in words.

We really support mom-and-pop owners being able to rent out their home or a vacation home, and that's part of this new ordinance.

A single entity can own one property, rather than a corporation or an investment firm coming in and operating multiple units.

So it's a combination of both, but the new ordinance is really going to support an individual owner, a mom-and-pop owner taking advantage of supplementing their income with a short-term rental as opposed to a corporation that has multiple units that's operating, that's not contributing to the local economy, not invested in our local communities.

You know, there are so many-- So many things are impacted by just having a home that's utilized on such a short basis because then you don't have families living in those homes.

You don't have kids attending school.

You don't have parents that are involved in community activities.

So my hope is this ordinance will create a situation where individuals are taking advantage of the opportunity to operate a short-term rental, but we're not seeing large corporations invested in operating multiple properties across the valley.

-There are mom-and-pops, and then there are the corporations.

And then there is someone like Victor in our package who has four properties in Southern Nevada.

Under this ordinance with two of them being in unincorporated Clark County, he will have to get rid of one.

And that was a specific part of this ordinance that went beyond what the State required, which was to allow one license per up to five properties.

What did you think about the one license per property?

-Obviously, we are against that.

Like I said, there's not just big corporations that buy multiple properties.

We know some of our members, for example, are accountants, and they have three properties.

Not because they want to become millionaires or billionaires, they're doing that because that's what they need in order to be able to afford the house that they live in, to be able to pay for their kids education.

There's people that are doing short-term renting because they need to pay for the high cost of prescription drugs.

There are so many things that people need to pay for that having one house is not enough.

Sometimes they have to do two houses, and they take their life savings to do this.

And they're not big corporations or big businesses that are doing this.

-Do you consider those mom-and-pops?

-I'm sorry, I don't.

I think that if an accountant owns three houses and they're profiting off of short-term rentals, there needs to be more of a balance in how we invest in our community.

And right now available housing is such a limited quantity, and it's so-- It takes so long to build new units.

And building new units now is so expensive.

And additionally, you have neighborhoods that are fighting apartments in their neighborhood being built close by.

You've got people that don't want multiple units built in their neighborhoods.

We feel like everybody is caught in the crunch of where to live.

You know, an accountant that owns three houses that is making a good living, he could certainly rent two of his houses to long-term rentals and make a significant income off of that.

-Not nearly as lucrative though.

-Not nearly as lucrative.

Of course not, and that's the whole issue.

-Let's remember what just happened during the pandemic, where people were not working, were not able to pay rent.

What happened to those property owners?

Right?

They could not collect rent, and they had to still keep those tenants there for months, and they were unable to collect rent.

So what happens to them at that point?

So there's risks to everything.

And the people that have more than one home, again, they're not doing it to become millionaires, to become rich.

They're doing it because that is the type of income that they need in order to be able to provide for their family.

-I think to some extent they are doing it purely for profit because right now, it's estimated that a short-term rental can make $10,000 a month in Las Vegas.

We're one of the highest profitability markets in the country for short-term rentals.

And somebody that owns multiple units that's making those kinds of incomes, they are doing it for profit.

-Some of the ordinance requirements: Maximum of 10 people or two per bedroom, whichever one is less, I believe.

Minimum two nights stay for every reservation.

One important distinction between Clark County's ordinance and let's say, the City of Las Vegas is that the City of Las Vegas requires the owner of the property to occupy the property at the same time that it is being rented out.

Clark County's ordinance does not.

What did you think of that, Jackie?

-I think that they all should be allowed to get a license.

That's why City of Las Vegas is having issues on that respect over there, because they're only doing owner occupied.

We do.

We even ask Clark County to exempt people that are doing homeshare--those are people that live in the property and rent a room or two--because those are usually not the ones that are creating the issues that most people talk about.

These people live on the property, they're there to monitor what's going on.

And those are probably the people that need the money the most.

-How often do you see that?

-We estimate about 40% of the current short-term rentals are owner occupied.

-And perhaps this is something that you both agree on.

-I certainly understand somebody renting a room and supplementing their income that way.

That's understandable.

At the same point in time, the County had come up with some sort of a policy that they could put into the ordinance.

And we support what they came up with.

-In particular, what did you like about the ordinance?

-We liked limiting the number of units available.

We liked the 1,000-foot distance between units.

-Which is different than what the State required.

-Right.

The State requirements were less.

-Only 660.

-And we respect the fact that Clark County recognizes the needs of our local community, and the ordinance was written accordingly.

For instance, they exempted Mount Charleston because of water and fire concerns and said no short-term rentals there.

So local control, and in considering what our local community needs is an important part of the ordinance.

-Why does that make such a big difference, the 1,000 feet between short-term rental properties and the 660 feet?

-It provides diversity as far as the type of houses that are available for short-term rentals, that they're not all concentrated in a single type of community.

-And why would you oppose that?

-Again, it just makes no sense.

Why not 2,000?

Why not 500?

I mean, there's no rhyme or reason with-- This is the problem with the county ordinance.

They come up with so many things that have no common sense at all.

They just came up with numbers and just threw it out there.

660 was the minimum that was required by the State.

That's what we were supporting.

And, you know, it just allows more people to be able to get licensed.

Clark County is going to have a big problem when they issue 2,800 or 2,400 licenses, what's going to happen with the other ones?

If they think that they're going to shut down, that's not going to happen.

People still have to pay bills.

People still have to take care of their families.

And that problem is not going to go away.

-How well do you anticipate this to be enforced?

The County is going to get its enforcement budget from the licenses which are collected annually.

Those fees, nonrefundable inspection fees, nonrefundable application fees, and then if there are ordinance violations, they'll be getting that money but, boy, they have to start this from the ground up.

-Enforcement is going to be an ongoing concern.

And that is something that the County is going to have to figure out how they're going to enforce that.

-Because what does any of this even matter if it can't be enforced?

-And like she said earlier, all the nuisance laws and regulations are already in the book.

Why not enforce them?

That's what we've been saying all along.

For years we've been asking them to legalize short-term rentals, give licenses so they could be regulated and pay taxes.

And they have been opposed to all this for years.

And now they're rushing to put this together, and that's why we have this horrible ordinance, because they are rushing to the last minute.

-I don't think they rushed.

They put out a survey that had over 6,000 responses.

They held town halls.

We held public actions with different commissioners.

They listened to our concerns, and they took those into effect when they wrote the ordinance.

-But they didn't listen to the concerns of the short-term rental people.

And that's the problem, because if anybody knows anything about short-term rentals is those operators.

-Those operators have been operating illegally.

So evidently they don't care about ordinances.

-But still, they were operating successfully.

Because if you figure 10- to 12,000 short-term rentals operating every single day, that means we would have complaints every single day about short-term rentals.

Did you hear about a party house that got out of control over the weekend?

No.

Last weekend?

No.

All this month?

No.

So that means that they have been doing an excellent job at running short-term rentals.

-I don't want to live in a community with unlicensed businesses operating next door to my house.

I want regulations and ordinances to be in effect that we can enforce and see results from.

-Ladies, thank you so much for joining us.

Clark County anticipates opening its short-term rental application period in September, and it will remain open for six months.

For any of the resources discussed on this show, including a link to frequently asked questions about the Clark County Short-Term Rental Ordinance, go to our website, vegaspbs.org/nevadaweek, and please follow us on Facebook and Twitter @ VegasPBS.

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