Short-term rentals will be focus of public meeting

A public meeting has been called for June 1 to discuss short-term rentals and the new user fees the City of North Bay is seeking to associate with the increasingly popular form of accommodations. 

In a zoning by-law update, the City of North Bay defines a short-term rental (STR) as "all or part of a dwelling unit used to provide sleeping accommodations for any rental period that is less than 28 days in exchange for payment."

See related: The Home-Sharing Guide for Ontario Municipalities from the Ministry of Finance 

The City's STR definition excludes bed and breakfasts, institutional tourist establishments, tourist establishments, tourist camping establishments, motels, resorts or similar commercial or institutional use.

STRs are divided into two sections: principal and non-principal. A principal dwelling unit short-term rental also serves as someone’s principal dwelling unit. Conversely, a non-principal dwelling unit short-term rental does not serve as someone’s principal dwelling unit.

 A zoning by-law amendment will establish where STRs are permitted. 

According to a City of North Bay staff report, "There are clear differences between a principal dwelling unit STR and a non-principal dwelling unit STR and therefore they should be held to different standards by using a zoning amendment as the primary regulatory tool. A principal dwelling unit STR is a form of home-sharing while a non-principal dwelling unit STR is considered a commercial use similar to a hotel."

For more on proposed zoning amendments, click here.

Short-term rentals are often brokered by companies such as Airbnb and VRBO that provide an online marketplace for accommodations meant for vacation rentals and tourism activities. The prevalence of these online hosting sites, coupled with the pandemic-driven "staycation" trend has left some northern Ontario municipalities with a desire to regulate the practice and recover service costs.

See also: East Ferris plans to bring short-term rental by-law home

And: Bonfield’s short term rental review set for a long haul

"To offset the cost of providing services, municipalities have the authority under Section 391(1) of the Municipal Act to impose a fee or charge on individuals." The City "performed a costing analysis to determine the full cost of providing and upholding the by-law. The full cost recovery rates were then used as a benchmark against which new fees were established," per the staff report.

The proposed STR by-law calls for a $600 application fee and a $275 application renewal fee for hosts. These user fees include tasks that are defined for the average application, including receipt of application, review, processing, inspections, notices, orders, monitoring, communications, and inspections. 

The appeal fee is $1,600. And, a stand-by fee will be calculated at the rate of $78 times the number of hours on stand-by. This fee is intended to be charged for the actual time spent in organizing, documenting and supervising work outside of the standard fees.

"The benchmarking of this by-law was conducted with the framework of local communities and municipalities of similar sizes to North Bay, when applicable," according to the report. For a comparative table of applicable fees, click here.

These user fees are designed to gain compliance, states the report, and notes municipalities are adding these user fees to help offset the impact of municipal services on property taxes. 

"The Municipal Act and case law require that there be a nexus or connection between the fee charged and the costs incurred so that the fee is revenue neutral (over the long term). In situations in which there is also a community benefit associated with providing the service, the fee charged may be less than the full cost recovery rate and a portion of the cost is funded by the general tax levy."

The Planning Department's initial investigation into STRs was presented in October 2021 as a high-level overview listing various options available for regulation. Council directed staff to develop a regulatory framework for STRs in North Bay that achieves the following goals:

• minimize potential conflicts/compatibility issues within residential areas;
• directly protect long-term housing availability in all residential zones throughout the City;
• recognize and capitalize on the positive economic impacts that STRs can provide for individuals, businesses and the tourism sector at large;
• protect STR guests, neighbours and operators from a health and safety perspective; and
• hold non-compliant STR operators accountable and enforce the proposed short-term rental by-law and any other applicable municipal by-law if/when required.

The public meeting is scheduled for June 1 at 5:15 p.m. Any person may attend the public meeting and/or make written or oral presentations either in support or in opposition to the proposed zoning by-law amendment to define short-term rentals.