Law
9:13 am
Wed November 13, 2013

Grand Rapids looks to regulate increasingly popular ‘couch surfing’ rentals

Update 11/20/13: This week Grand Rapids City Commission voted to create a task force to study this issue deeper. See this new post for updated information.

The growing number of people renting out a room or just a couch in their homes on websites like airbnb.com has some cities considering how these set-ups should fit into local zoning regulations, business permits and taxes.

Grand Rapids is considering changes that would require people who want to rent out space like this get a home-based business license and zoning permit.

“There’s been a lively debate on this subject in the community, perhaps unparalleled since urban chickens, I don’t know,” Mayor George Heartwell said as he opened a public hearing on the proposed changes Tuesday night.

Barbara Hekhuis worries about the impact short-term rentals would have on the popular, Heritage Hill historic district where she’s lived for 25 years.

“Turning my neighborhood into a hotel, commercial district is very offensive to me. And it destroys all the things that I and my neighbors have invested into,” Hekhuis said at a public hearing Tuesday night.

Opponents of the proposed regulations agree there are legitimate concerns.

“Airbnb has been in Grand Rapids for three years and we cannot find any evidence of even one complaint against a host or a guest that was disrespectful or noisy or loud of any kind,” Airbnb host Karen Coy said.

“So other than the fact that it’s illegal it actually appears to be working pretty well,” Coy laughed.

Coy and others asked to work with the city to come up with a compromise that will keep short-term rentals viable. They worry the increased fees associated with city permits would deter most people from considering renting an extra room out.

Grand Rapids City Attorney Catherine Mish pointed out people who have been hosting should be disclosing that income on their taxes. Hosts with this kind of home based business license would have to pay hotel/motel taxes in Kent County, Michigan sales tax, and could not claim 100% of the homestead exemption on their tax returns.

The issue's been around for a while in tourist communities on the Lake Michigan shore.

Traverse City adopted regulations a few years ago. Short term rentals were banned in residentially zoned districts. Those with a condo or home in a business district are allowed to rent out all or part of their homes, but for no less than a week at a time.

Grand Rapids could decide on the changes as soon as next week.

Editors note: A reference to couchsurfing.com was removed from this article to prevent confusion. The city is not looking to regulate any specific website, rather the practice of renting out a space in a person's home as a home occupation.