Las Vegas short-term rental owners sue Nevada and Clark County

Ed Uehling’s parents hosted out-of-town guests for many years before Airbnb was founded.

But it doesn’t look like he can follow in his parents’ footsteps, thanks to new rules put in place by the county.

Uehling’s parents began hosting visitors in the early 1950s, when there were fewer hotel rooms than the thousands along the Strip. Today, Uehling is a landlord who depends on short-term rentals that cost around $220 a night. Without short-term rental income, he fears he will have to raise rents for tenants in his other units to make ends meet.

Property owners looking to generate income through short-term rentals are battling the state and Clark County to be allowed to rent their properties through popular online vacation rental companies like Airbnb and Vrbo.

It seems like an uphill battle.

The Greater Las Vegas Short-Term Rental Association filed a lawsuit Aug. 2 against the state over the Legislature’s 2021 passage of Assembly Bill 363 authorizing regulation of short-term rentals as well as against Clark County, which is beginning the licensing process. a limited number of units slated for rental next month.

AB363 overturned a ban on short-term rentals in unincorporated Clark County, but set parameters on their placement. Rentals were already legal within the city limits of Las Vegas, Henderson and North Las Vegas.

The 1,200-member GLVSTRA, led by association co-founder Jacqueline Flores, argues that state law and ordinances governing rentals are unconstitutional because they override landlords’ property rights.

“Clark County has the most restrictive STR ordinance in the nation,” Flores said in an interview.

“The lawsuit we filed was our last resort because state and local authorities have gone too far to the point where their regulations require these landlords to give up some of their Nevada and United States constitutional protections in order to be allowed to operate. And the regulations include some of the highest fines and penalties, up to $10,000 and jail time, for simply renting for less than 31 (consecutive) days,” she said.

lucrative business

Guests pay an average of $223.68 per night to stay at an Airbnb here, according to research published earlier this month by London-based online retailer Inkifi. The company claims these are the highest rental rates in the world.

Eight of the world’s most expensive cities for Airbnb rentals are in the United States, and by comparison, the average daily rate for hotels on the Strip and downtown Las Vegas was $162.60 a night for all seven. first months of 2022.

The Inkifi study indicates that there are 11,336 Airbnb rentals available in Southern Nevada.

Flores says that’s roughly true — but she disputes that Airbnb rentals in Las Vegas are the most expensive, citing a study earlier this year by real estate data firm Mashvisor.

Mashvisor reported that the top Airbnb rental rates are in Malibu, Calif., at $895 a night. Las Vegas rates aren’t even in the top 50 in the country with its rates.

Either way, Flores says homeowners in southern Nevada should have the option of renting out their homes and rooms, especially as inflation weighs on the local economy.

Because landlords work to keep their properties in top condition, she says, they create jobs for cleaners, handymen, plumbers, landscapers and contractors.

Restrictions go too far

Flores said the association is not opposed to regulations or taxes and fees that would be applied to licensed rentals. But members say county regulations go too far and are designed to minimize the number of rentals available. According to Flores’ calculations, about 80% of landlords who use their properties for commercial lodging would be bankrupted under county rules.

Some of the restrictions include:

■ The total number of rentals cannot exceed 1% of the housing inventory.

■ Once a pool of eligible potential licensees is established over a six-month period that would begin September 13, a third-party-led lottery would take place to see which owners would get short-term rental licenses .

■ Short-term rentals cannot be within 300 meters of each other.

■ They also cannot be within 2,500 feet, or nearly half a mile, of a resort property or land designated for a resort.

This latest restriction means owners like Uehling would be prohibited from having a license because his property is within 2,500 feet of Virgin Hotels Las Vegas.

Fingers pointing at resorts

Most short-term rental owners blame it on the resort industry.

“The (Clark County) Commission is anti-small business and anti-entrepreneur, and hotels can dictate what we can do,” Uehling said. “It shows how much the industry is ripping us off.”

Uehling said his short-term rentals are ideal for youth sports teams, which come to Las Vegas for tournaments, because players can stay under one roof, prepare their own food and not wander around the Strip.

It also serves families awaiting construction of their new home and those displaced by disasters such as fires and floods.

County officials say they are only enforcing mandates established by state law. They say the purpose of enforcing their rules is to prevent noise, litter and an overabundance of car traffic in residential neighborhoods. They say they receive hundreds of complaints from residents who say those staying in nearby rentals are too rowdy.

Portland, Oregon-based Airbnb imposed its own ban on parties in the state last year, threatening to remove violators from its website.

“Ahead of Memorial Day weekend, we want to make it clear that those who violate Airbnb rules in Las Vegas or throughout Nevada risk suspensions or bans from our platform, and even potentially legal action,” wrote Airbnb spokeswoman Ruthie Wabula.

Representatives of the Nevada Resorts Association were hesitant to comment on this story due to GLVSTRA’s litigation against the state and county.

But a spokeswoman for the Resorts Association said, “The association did not commit to the (county’s) ordinance as it complied with state law.”

GLVSTRA’s Flores said the Resorts Association lobbied for AB363 to go through the bill’s architect, D-Las Vegas Congresswoman Rochelle Nguyen.

“Assembly’s wife Nguyen gave the resort hotel lobbyist privileged access to speak freely and without any time restrictions before the Assembly’s revenue committee where the lobbyist spoke out against (rentals to short term) and demanded strict regulations for us,” said Flores. . “It’s the most shocking thing to happen. I think if the lobbyist hadn’t made her speech via video conference and instead showed up in person, they would have rolled out a red carpet for her.

Nguyen did not return a request for comment.

Another hitch

Las Vegas resident Johnny Dortch, also a member of GLVSTRA, has a different hurdle in his attempt to obtain a license.

Dortch said the county requires him to hook up to county-maintained sewer lines, except his home, on an acre near Las Vegas Boulevard South and Chartan Avenue, five minutes south of South Point, has its own well to supply water and its own septic tank. wastewater management system.

The nearest county sewer line is 250 yards from his home. With installation costs of $250 to $300 per linear foot, hooking up to the sewer system would cost him $210,000 to $252,000 for materials alone. He thinks other expenses could drive the bill up to $280,000.

“It’s not sensible regulation, it’s protectionism,” Dortch said of the county rules. “They only care about making sure the fewest owners get licensed.”

Dortch and Uehling were among association members who donated $5,000 to fund the legal challenge against the state and county.

Dortch said he was counting on the success of the trial.

He accused the county of “gaslighting” the community – saying short-term rental issues are worse than they are. He promised a “controlled chaos” campaign with the county if the lawsuit does not go his way.

“We’re not going to accept that and I hope the county knows that,” Dortch said. “There are a lot of owners who are not going to play this game with them. And if they think that because we’re going to their courts…that’s going to prevent us from being able to run our business with their illegal regulation, they’ve got something else to come.

Contact Richard N. Velotta at [email protected] or 702-477-3893. Follow @RickVelotta on Twitter.

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