Fayetteville could shut off water service for illegal short-term rentals


FAYETTEVILLE — Violators of the city’s short-term rental law could have their water shut off under a proposal that’s making its way through a City Council committee.

The council’s Ordinance Review Committee last week discussed ways in which the city could enforce penalties upon owners of short-term rental properties that are operating their businesses without a license.

The discussion comes as Fayetteville is quickly approaching its city-wide density cap on properties that operate year-round as short-term rentals.

The cap was set at 475 in July when the council voted to reduce the number from about 900 when the city’s law stated that no more than 2% of all residential units in Fayetteville could be year-round rentals.

The council in 2021 adopted regulations that categorize short-term rentals as either Type 1 or Type 2. Type 1 rentals are homes that the owners live in, but sometimes rent out rooms or the entire house to guests when they’re out of town. Type 2 rentals are rented all year, and have no owners living in them.

As of last week there were 395 Type 2 rentals licensed in Fayetteville, with 34 more pending applications, said Jonathan Curth, the city’s development services director. So far this year, 49 applications have been approved and 16 were denied, Curth said.

A third-party consultant is currently investigating how many short-term rentals are operating without a license. The company has so far discovered 183 non-compliant short-term rentals and 122 more with an unknown status, said Curth.

The committee first discussed involving the criminal court system as a penalty for non-compliance, but City Attorney Kit Williams said that process could take months, and would likely only end with the property owner paying a fine.

“They can pay fines,” said Williams. “They’re making enough money doing the wrong thing to be able to pay fines.”

But even then, the city can’t control the fines. “That would be up to a judge who might not even order any fines for the first two or three times they’re convicted,” said Williams.

A better approach, he said, would be to shut off the water service to the home after due process.

A property owner would receive at least one warning before their service is shut off, Williams said. They’d also have an opportunity to plead their case to city administrators.

“It’s a very strong measure that needs to be used carefully, but it would be extremely effective because they’re not going to be able to operate a short-term rental without water,” he said.

The Ordinance Review Committee is made up of four City Council members. The current makeup includes Sarah Moore, Scott Berna, Teresa Turk and Holly Hertzberg. The group will meet again on Sept. 12 before making an official recommendation to the full council.