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Indianapolis owners of short-term rentals—such as Airbnbs or VRBOs—would be required to obtain annual permits under a new proposal pending before the City-County Council.
The measure, authored by Democratic Councilor Kristin Jones, aims to create a permitting program that would allow the Department of Business and Neighborhood Services to conduct inspections of properties as a condition of registration. Short-term rental owners would be required to pay a $150 annual registration fee.
The council referred the proposal to the Metropolitan and Economic Development Committee, where it will receive a public hearing at 5:30 p.m. Monday in the City-County Building Public Assembly Room.
The proposal is a step that some see as necessary to weed out bad actors that offer short-term rentals that can become hotspots for crime.
Some residents in the Old Southside have advocated for registration fees since at least 2022. Their efforts have brought together neighbors, a local short-term rental owners organization city leaders and police officers in support of some sort of regulation of short-term rentals. Even Airbnb supports Jones’ proposal.
Jones told IBJ in a statement that the measure “has been a significant focus” for the council, “driven by passionate advocacy from our constituents who have expressed their concerns for the future of short-term rentals in Indianapolis.”
“This proposal addresses immediate concerns by establishing a permitting and inspection program; it also lays a strong foundation for the sustainable growth of short-term rentals in our city,” the statement said. “I want to extend my heartfelt thanks to everyone who participated in the discussions and shared their stories.”’
Short-term rentals, often associated with platforms like Airbnb or VRBO, have occasionally been cited as hotspots for Indianapolis crime. Beginning in 2022, Judith Essex and others in the Old Southside neighborhood association sounded the alarm on the concerns caused by these homes and convened neighborhood leaders across the county.
The group formalized in months to create the “coalition to address short-term rentals.” Essex said that the group ultimately included neighborhood organizations, City-County councilors, neighbors and businesses. The collaboration extended to the Indiana Short-Term Rental Alliance and the Indianapolis Metropolitan Police Department’s Nuisance Abatement Unit.
Essex said the group is happy to see city-level work to regulate these properties. So is the local alliance of short-term rental owners.
Jim Borthwick, an Indianapolis-based owner of short-term rentals, told IBJ that the permits and associated costs are reasonable and largely comparable to that of other short-term rental permitting programs in other cities. As the president of the Indiana Short-Term Rental Alliance—a loose advocacy and networking group of 50 plus property owners—Borthwick said most see that bad actors can give the business a bad reputation.
“Being a good neighbor to those around us is very important to the Indy hosting community,” Borthwick said.
The short-term rentals themselves aren’t going anywhere. According to Airbnb, the company’s rentals helped generate an estimated $434 million in gross domestic product for Indiana’s economy last year. A spokesperson for the company told IBJ in an email it is supportive of the council measure, “which protects responsible home sharing and enables Indianapolis to benefit from the growing opportunities around tourism.”
The Department of Business and Neighborhood Services will maintain the registry. If there is an incident at a short-term rental—a noise ordinance violation, an act of violence—IMPD will be able to use the registry to look up the owner. If the short-term rental does not appear on the registry, it is a Class C Infraction. If there are concerns about the interior of the short-term rental, the Health & Hospital Corporation of Marion County would do a building inspection.
In a statement, IMPD said the department “looks forward to any ordinance or proposal that would assist in addressing and mitigating issues related to short-term rental properties “and called the measure “a step toward enhancing the safety and quality of life for all Indianapolis residents.”
Correction: This story was corrected to better explain which city agencies would be responsible for enforcing various aspects of the proposed ordinance on short-term rentals. The initial version of the story incorrectly attributed all enforcement to the Department of Business and Neighborhood Services.
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I call the police regularly regarding the short-term rental house next door. They constantly have guests who wake us up in the middle of the night with partying. It’s awful. They lower the quality of life, and the owner will only be made to care if some enforcement mechanism exists to cause him some pain if he continues to inflict this bad conduct on us regular home-owning neighbors. So I support this ordinance and recommend it include enforcement provisions, with a database that tracks bad actors.
Wouldn’t it make more sense to create and actually enforce a robust nuisance law, or carve out additional specifics in the current laws to allow for higher enforcement with short-term rental nuisance calls? This way, we do not punish all of the quality hosts with a new tax, inspections, etc., etc.
S.B. no one is being “punished” by having to have a business regulated. If you rent out your home, whether you are “quality” or not, you are engaging in a business, which impacts those around you both positively and negatively, even among “quality” hosts. So, to operate your business you have to meet certain standards, just like a restaurant, a retail store, or a hair salon. That’s life. If you live on a desert island far away from any person, fine, do what you want, but when you live in a society, you accept that there is a balance between doing whatever you want and having to follow certain standard and expectations since what you do impacts others.
Absolutely Chris, a society, where we should be cognizant of each other. The harm however is real, it comes in the form of a new tax, new regulation, new intrusion, etc., for all of those that good members of society, simply to try and root out the bad ones. Seems like an extremely silly approach to harm the good members of society, to try and catch the bad guys.
S.B., libertarianism does not work in a large, complex society where many care only about themselves and their greed. Thus, regulations and taxes are required to force those selfish individuals to comply with the norms that society establishes or to put them out of business.
SB, there are plenty of “good members” of society who run hotels and restaurants who pay taxes and permit fees specific to their industry and who are subject to various health and safety regulations. I have not seen you or most of the other “libertarian” crowd either on IBJ or other forums arguing the hotel and restaurant industry should be completely deregulated.
We get it, you or someone you know operates an Airbnb, and I am sure you or they try to be a good neighbor, but that does not mean certain people should have to play the rules while others do not. And, there already are effective public nuisance rules on the books, but going to court to enforce them is a tedious, lengthy, expensive and uncertain process.
Moreover, not everything that causes harm and is a nuisance in the ordinary sense necessarily meets the legal standard of a public or private nuisance.
Also, nuisance laws only address harmful behavior *after the fact,* and typically do little to nothing to prevent harmful behavior from occurring in the first place. In addition, not all nuisance behavior comes from those with malicious intent or even mere indifference to others’ well-being. Even well-meaning people may be unaware they are creating a situation that could lead to serious safety or health risks. Inspections can catch such issues *before* they cause harm.
Brent – Yes, rules, regulations, taxes, etc. all part of our society, not sure where you got libertarianism from, I certainly never mentioned it. Rules, laws, regulations, enforce them, but why the tax? You are talking about the necessity of these things to “force those selfish individuals to comply…..”, so why are you supporting the tax on the “good” members?
Christopher, you are missing the point, if nuisance laws, regulations, rules, etc., are difficult/tedious to enforce, then there is the issue to solve. Solve the actual issue, instead of adding a tax on all those that are “good members” of society. Also, Airbnb is not a hotel; it is most often people occasionally renting out their home/spare room, that is who makes up the majority of hosts. Also not sure where you dug up libertarianism or the rest of “that crowd” from? Thinking a tax is a silly way to solve an issue that inherently lies within the law/nuisance enforcement realm, does not make a libertarian. Finally, I stopped hosting with Airbnb a few years ago. It was wonderful, but no longer fit into my changing schedule. You make wild assumptions that someone must have an Airbnb or know someone, or be a libertarian, if they disagree with a ridiculous idea to attempt to solve a problem.
I live on a street of 3 homes. The other two are not owned by me.
I unerstand the pain however, if the city has so much integrity they would would not have planned a low barrier housing project literally next door to me.
Just pass a nuisance and lotering ordinance.
John, +1. A robust nuisance and loitering ordinance would solve the issues of concerns, assuming it was actually enforced.
Take the issue to your State legislators as they keep enacting laws to pre-empt local governments from addressing the nuisance properties as nuisances. A couple of years ago they prohibited local governments from using calls for service (911 calls) as evidence of a nuisance.
John, your crusade against this housing project is just ridiculous.
You own at least 8 parcels on this street, which is situated between two active RR corridors & I65. You used to own at least one additional parcel on the street as well, but you sold it & it ultimately ended up in the city’s hands.
I get that you built a house here, but you cannot – in good faith – say with a straight face that buying 8 parcels on both sides of the street was not a speculative investment. You have no right to come out on top, and you could’ve come out on top had you ‘just’ bought the rest of the street. You took a risk & it didn’t pay off. Welcome to capitalism.
Great, so to “weed out the bad actors”, the solution is to tax everyone, the overwhelming majority of which are quality hosts. More government coming in to conduct “inspections”, as if the department of neighborhood services is somehow all of a sudden qualified to know what a quality host is and is not.
Unfortunately, the bad-faith actors have ruined it for everyone else. There needs to be a funding stream to ensure that the short-term rental market isn’t tarnished and that reputable hosts are promoted and rewarded. The fewer bad-faith actors there are, the broader the customer base for the good ones.
This feels like another “Good government” idea that is likely overkill or missing the mark. The last great idea from govt was losing a lane on Meridian for the Red Line, which I do not believe can yet be called a great success.
Yes, the very last thing local government did was build the *voter approved* Red Line almost 5 years ago. Since then, there have been absolutely no government initiatives or new policies. I am sure even you do not believe the nonsense you post.
Also, hundreds of local communities across the US in both “deep red” and “deep blue” states successfully regulate Airbnb’s and other short-term rentals. This is neither a radical nor novel proposal.
As a former Airbnb owner and operator, $150 might be 1 or 1.5 nights revenue. That is chicken feed.
If it creates a system where properties or owners are forbidden from operating troublesome short term rentals, then power to them. Additionally, there are easy things that an owner can do to not be a nuisance, but there are people out there that don’t care. They need to be stopped from inflicting pain on unsuspecting neighbors.
Part of the system needs to be a requirement that suspended licenses get reported to the short term rental company right away and the short term rental companies has mechanisms in place to immediately suspend operations of these places.
+1
List the council names so we can put out a vendetta against them. THIS is a money grab, and one not needed. Pressure the companies to kick out bad houses and apartments and problem solved. You have lobbyist, use them!