Chatham Begins Enforcing Short-term Rental Registration

CHATHAM – The town’s effort to identify and regulate short-term rental properties is on track, and officials have begun issuing fines against property owners who have failed to register their rentals.

 Short-term Rental Administrator/Inspector Karen Chimwaza said there are between 1,000 and 1,100 short-term rentals believed to be in Chatham, and more than 900 have been registered so far.

 “I think that’s pretty good for one full year,” she said. The effort began with identifying rental units registered with the state department of revenue, “but I’ve also gone through most of the rental listings and we have a solid 1,000 that we’ve identified,” Chimwaza said.

 “Karen did quite an exhaustive search through all of the typical websites,” Health Agent Judith Giorgio said. The effort required a lot of legwork but was more accurate than using artificial intelligence to track down rental advertisements, she said. The vast majority of rental owners registered without complaint, paying the $50 annual fee and submitting to an inspection by Chimwaza. In the past year, Chimwaza inspected more than 275 rentals, most with no problems.

 “The biggest thing that we find is basement bedrooms without egress,” she said. Other owners are asked to install a few extra smoke detectors. “It’s been minor, and people have been very cooperative and willing to work with us,” Chimwaza said.

 The short-term rental regulation adopted by the health board provides for fines of $200 per day for each day the violation continues, and the enforcement process has begun, Giorgio said.

 On Aug. 18, the health board held a hearing to consider fines for six properties owned by three different owners, and none of the owners attended, prompting the board to vote to begin the fining process. One of the owners came forward “and they did get it straightened out, so they weren’t fined,” Giorgio said. That left two owners responsible for five unregistered properties. 

 The owners subject to fines received a minimum of three letters from the town, Chimwaza said. She also verified that the rentals had active online listings with reviews from prior renters, “so we knew that they had been renting.”

 At Monday’s meeting of the health board, Giorgio provided an update: another property owner has come forward and has registered all four of his properties — but not before having amassed some $6,000 in fines. The owner, who was not identified, told town officials that the notification letters were all delivered to an address where he no longer resides, and the person living there did not alert him to the messages. The owner, a New Hampshire resident, told town officials that he only learned of the violation when his renters sent him photos of a violation notice the police had tacked to the front door. Saying he was never made aware of the violations, the man asked the town to vacate the fines.

 “I did say to him, ‘Our goal is not to fine you, it’s to get your property registered,’” Giorgio told the health board. She said she favors waiving the fines, but planned to ask town counsel about the best process for doing so.

 Health board member John Beckley said he favors adjusting the fine, but said the department should “determine our costs and time, what we had to do in terms of staff fine, attorney time and what have you, to respond to this.” He favors waiving the penalties but assessing the owner an amount that reflects the town’s cost in tracking him down. “That’s being generous, in my opinion,” he said.

 That leaves a single property owner responsible for one unregistered rental unit in the current batch being considered for enforcement, and Giorgio said the town is still trying to track down that person. But there are still roughly 15 more unregistered rentals in line for enforcement action.

 “We’re starting with small batches so we don’t overwhelm the process or the board of health,” Giorgio said. The process is labor-intensive, she noted. “In the next few months we’ll be targeting other property owners for the same thing.”

 Chimwaza said the town has been contacted by some renters who weren’t on their radar, and all local real estate agents are now aware of the new regulation.

 “The word is out,” she said. 

 “I’m sure there’s ones we’re missing, but eventually we find out about them,” Giorgio said.

 In Chatham, the push to regulate short-term rentals came in response to concerns that some properties were advertising rentals with occupancies that far exceeded the available parking, the number of listed bedrooms and the septic system capacities of the houses. Critics argued that the properties were being run primarily as business entities, but were not subject to the same regulations applied to hotels and inns.

 Short-term rentals are defined as any rental less than 31 days. The state began collecting the 5.7 percent room tax, previously only applied to hotels, inns and bed and breakfasts, on STRs in July 2019. Chatham separates 1 percent of the STR tax into a separate account, which currently contains $2,096,615.72. Barnstable, Dukes and Nantucket counties also impose an additional 2.75 percent room tax for the Cape Cod and Islands Water Protection Fund, which awards money for wastewater and water pollution abatement projects in local towns. Chatham’s $50 registration fee is designed to offset the cost of the town’s registration and enforcement efforts.