Biloxi Councilman Kenny Glavan leads meeting on short-term rentals
Nobody knows how many people in Biloxi and across the Coast are renting their homes, apartments and condos to tourists, but Councilman Kenny Glavan said he is sure most of them aren’t permitted or paying taxes on the rentals.
Glavan called a special meeting of the council for Tuesday morning to address the issue of short-term rentals.
He’s president of the Biloxi City Council. He’s also president of the Mississippi Hotel and Lodging Association and area director of hotel operations for Margaritaville Resort and White House Hotel. The executive director of the association also addressed the council Tuesday.
The hotel industry has been battling Airbnb and online short-term rentals across the country for years.
Glavan said he would check, but doesn’t believe there is a conflict if he and the council vote on any updates to the short-term rental laws.
“This is not meant to run Airbnb out,” he said. “It’s intended to make sure they’re in compliance.”
He arrived 45 minutes late to the meeting that started without him and without a quorum. Council members Felix Gines, Robert Deming III and Paul Tisdale said a quorum wasn’t necessary since they wouldn’t be taking any action at the meeting.
A search of Airbnb, one of the most popular online sites, shows more than 300 short-term rental listings in the Biloxi area.
VRBO, or Vacation Rentals By Owner, lists 372 condos in Biloxi, along with 140 houses, 34 cottages and 34 townhouses. The website said it had 821 rentals near the Port of Gulfport, 488 in Ocean Springs, 492 in Long Beach, 95 in Gautier and 536 in the St. Martin area, with many of the listings overlapping the cities.
That’s part of the issue with enforcing Biloxi’s ordinance, said Jerry Creel, Biloxi’s Community Development director. Homes listed in Biloxi actually may be in D’Iberville, Ocean Springs or Gulfport, he said. Once the property owners discovered the city was patrolling the websites to look for those who weren’t in compliance, he said they removed their street addresses from the listings.
Since the Biloxi Council approved short-term rentals in January 2016, only 12 applications have been approved and nine took no action to follow through, Creel said.
‘There’s a market’
James Foster is one of those few owners who legally rents his Biloxi home for less than 30 days and he told the council it’s good for the neighborhood because the income enables him to keep the house updated.
Most of the people he rents to want a yard for their dogs, he said, or are small groups who come from across the country and want a house so they can all be together.
“There’s a market for this stuff and the tourists want it,” he said. South Mississippi has hotels, casino hotels, campgrounds and other accommodations, he said, and needs to be able to give visitors the option of houses as well.
Glavan said his intent of calling the meeting was to focus on tax collections that go to promoting the Mississippi Gulf Coast.
Biloxi and other Coast cities aren’t losing much tax revenue from unreported rentals, since they receive only 1.295 percent of the 12 percent sales tax collected, or about $1.30 for every $100 rental.
The area is losing the 5 percent of sales tax revenue that comes back to the Coast, he said. It is split between paying for the Coliseum & Convention Center bond and with Visit MS Gulf Coast, which he said promotes the area for owners of hotels and short-term rentals.
Airbnb does collect and pay sales tax to Mississippi, but that money remains with the state and isn’t diverted back to the city or county where the rental is located.
Linda Hornsby, executive director of the hotel association, said Airbnb vacation rentals increased at twice the rate of hotels last year. The organization identified more than 125 properties on Airbnb in Biloxi and said the unlicensed rentals are a tax issue and a safety issue.
“We’ve actually gone through booking process,” she said. None of those online properties a permit, were paying taxes, were inspected by the fire department or provide information about a fire extinguisher, she said, let alone smoke alarms and sprinklers — all of which are required of hotels. And most of them are not using keypads or electronic locks, she said.
Creel said Biloxi relies on neighbors reporting anything out of the ordinary, like new cars in a driveway every week. Last week two neighbors complained about houses on Hopkins and Jeff Davis streets, he said. One of the homes was bought by investors from out of state specifically for short term rentals, but without checking to see that it is in a residential area, where vacation rentals are not allowed.
Nobody at the meeting knew how much the fine is for renting a vacation home without a license.
Mayor Andrew “FoFo” Gilich said there are more than 11,300 homes in Biloxi. Recognition software could be used to detect whether an advertised property is in the city, but he asked, “Is it worth it?”
The policy now is to turn over information about any unlicensed vacation rentals to the state Department of Revenue for investigation.
“They can deal some misery just by the amount of paperwork they require,” he said.