SOUTH PORTLAND — Eight months after voters approved rules for short-term home rentals promoted on websites such as Airbnb and HomeAway, city officials are preparing to take action against operators who appear to be breaking the law.

City Clerk Emily Scully has sent two rounds of warning letters to the owners of 62 properties that have been advertised as short-term rentals without being registered with the city, and the city is poised to send another letter threatening fines and possible court action if they don’t comply.

“There are folks who appear to be playing chicken with the city,” says South Portland Mayor Claude Morgan. Ben McCanna/Staff Photographer

“There are folks who appear to be playing chicken with the city,” said Mayor Claude Morgan. “The upshot is, the time has really come for the scofflaws who’ve been putting it off. The city is ready to take action on enforcement.”

Forty-five rentals have been registered and licensed since Jan. 1, after city residents approved ordinance amendments last November that were largely designed to halt the proliferation of unhosted or whole-house short-term rentals in residential neighborhoods.

Even with 62 scofflaws factored in, 107 active rentals are a significant decline from the 265 unique rentals that the city’s online consultant, Host Compliance, found operating in the city last December, Morgan said.

“The ordinance has clearly made a big difference,” Morgan said. “People have largely honored the results of the referendum and the decision of the citizens.”

Morgan said he believes some former operators whose properties became ineligible under the new rules decided they wouldn’t break the law, while others simply removed inactive listings, started renting to long-term tenants or decided they no longer wanted to rent out their properties.

Some rentals became ineligible because the owner doesn’t live in the house. Among five applications that were denied, four were unhosted properties; one was in a residential zone and three were multi-unit buildings in nonresidential zones.

The council this month approved a first reading of proposed amendments to the short-term rental rules that would lift unintended impediments to listings in nonresidential zones.

Some violators appear to be whole-house rentals in residential zones. At least 15 noncompliant operators have notified the city that they aren’t renting their property for less than 30 days – the cutoff for short-term rentals – they just haven’t changed their listing for one reason or another.

Other violators tried to register but failed to meet building and fire safety code requirements during a mandatory licensing inspection. Their applications are considered pending but noncompliant.

In November, city residents voted 6,375 to 5,378 in favor of the zoning and licensing ordinances that the City Council approved in July 2018. Supporters said the rules would stop homes from being converted into mini-hotels, while opponents said they infringed on property rights.

The regulations – a relaxed version of ordinances initially passed in February 2018 – ban unhosted short-term rentals of less than 30 days in residential zones. Hosted short-term rentals – where the owner lives on the premises – are allowed in residential areas under certain conditions.

The referendum followed a yearlong struggle over short-term rentals, an issue that has caused similar disputes in communities across the nation, including neighboring Portland, where the City Council in November tightened short-term rental rules that were passed in 2017.

Under the new rules, all short-term rentals must be inspected, insured and licensed by the city. There’s a link on the city’s homepage to a rental registration application packet, which contains information and forms needed to operate legally.

Licenses cost $200 for hosted rentals and $400 for unhosted rentals, plus a $100 fire safety inspection fee and a $20 processing fee. Fines for violations range from $500 to $1,500 per day, which would be recovered by the city filing a lawsuit.

Under the modified regulations, hosted short-term rentals are allowed two adult guests per bedroom, with a maximum of six guests per house. The original ordinance capped the total number of guests at two adults.

Owners of two- or three-unit buildings in residential zones may operate one unit as a short-term rental, as long as they live in one of the other units; owners of four-unit buildings may operate two apartments as short-term rentals if they live on the premises.

The council also dropped an initial ban on homeowners renting out their houses while on vacation. Owners of detached single-family homes could rent their houses for up to 14 days per year when they are away.

Morgan said the city would rather avoid enforcement action and the prospect of going to court, but it’s preparing for that possibility.

“We’re gathering our evidence and we will get people into compliance,” Morgan said. “These are reasonable restrictions. We don’t want to beat people up about this. We want people to be in complete compliance or take their listings down.”