HUDSON — A proposed law would amend the Hudson city code to regulate short-term rentals in the city.
The law was discussed at a Common Council meeting Tuesday.
The amendment would make it so short-term rentals could operate if the owner is a Hudson resident with up to three units that are on the same parcel the resident lives on.
In addition, a non-Hudson resident can rent one unit for a maximum of 60 days of the year, and they must reside in the unit for at least 50 days out of the year.
Other short-term rentals that operated prior to March 6, 2020, and paid a lodging tax for the period ending May 31, 2020, may continue to operate for a set period of time, referred to as an amortization or “sunset period” that the council discussed Tuesday.
Fourth Ward Alderman John Rosenthal, who has been a primary advocate for the law, faced both pushback and support at the meeting for backing a five-year period.
He argued that having a five-year period would protect the city from potential legal challenges and give Hudson a revenue source through lodging taxes.
“We have willfully low revenue to address our obligations, let alone plan to address our very serious immediate issues,” he said.
He said the lodging tax money could go toward addressing housing issues in Hudson, including a housing trust fund that 1st Ward Alderwoman Rebecca Wolff asked the council to support earlier in the meeting.
“Rather than using our lodging tax money for supporting tourism alone, we should consider using some of that money towards housing issues or at least have the flexibility to. We have an immediate housing crisis and it makes sense to harness the revenue from amortized units to address immediate housing needs,” Rosenthal said.
“We should look at these units as a positive short-term funding source, not a way to prove a marginal point about a small number of currently operating STRs [short term rental units],” he added
The amortization period is intended to address short-term rentals in which the owner does not reside. Ten owners who own 23 properties would be affected, Rosenthal said. There are 80 short-term rental units being rented out of those properties — some are full apartment units, and some are just rooms, he added.
Hudson has about 300 short-term rental units out of 1,751 housing units, Rosenthal said. Eighteen percent of the housing units in Hudson are short-term rentals, and 5% would be impacted by the amortization period.
Rosenthal argued that by having a five-year period, the city could collect $32,000.
“We should be reminded of how little tax revenue we actually have,” he said.
Some members of the public voiced concern over a five-year period, saying it is too much time to allow the qualifying short-term rentals to continue to invest in their property while Hudson faces a shortage of housing for residents.
A speaker who identified himself as Dylan, but did not give his last name, accused short-term rental owners as investing in housing displacement.
“When people buy residential units and turn them into short-term rentals, that is an investment in displacing the community,” he said.
He said extending an underregulated market for five years so owners can continue to collect on their investment is unfair.
“It’s time for Hudson to stand up to these essentially predatory investors, and we need to put an end to this” he said.
He also referenced Rosenthal’s idea for lodging tax to contribute to housing issues and not just tourism funding.
“Why just the amortized STR lodging taxes?” Dylan said. “Why not put all STR lodging taxes towards affordable housing or a housing trust fund?”
“Great idea,” Rosenthal responded.
Kaya Weidman, who works with young people in Hudson, said she has seen the damaging effects short-term lodging, particularly Airbnb units, have had on the housing crunch in Hudson.
“This city is hemorrhaging children and families and we cannot afford to lose any more community members — and we actually need to be creating spaces for people to come back,” she said.
She said that although the market rate for an apartment would be high, families are often willing to make sacrifices to live in Hudson.
“I think all of you would be shocked at the sacrifices families are making to pay incredibly high market rate rents to house their families in Hudson because they are so deeply committed to this place and it is so important for their kids to be growing up near their families and loved ones in a community that they belong to,” Weidman said.
Even if only 23 apartments are impacted, the apartments going on the market could make a big difference for a city of the scale of Hudson, Weidman said.
“Additionally, if we risk being sued by (having) a one-year period and we know we will win, or it’s very likely that we will win, then so be it because it will help establish a precedent for other communities and discourage other communities from dealing with the same type of lawsuits when people see that the precedent was set in Hudson,” Weidman said.
“Hudson is a leader in progressive policy change. We have a council that I believe cares about children and families and working people, and who want neighbors,” she added.
Weidman supports limiting the amortization period to one year.
Hudson resident Mary Ann Gizolla raised concerns about the city missing potential revenue from having a five-year period.
“We are going into unchartered waters as far as the economy goes,” she said.
Gizolla said that although restaurants and stores are using outdoor spaces right now, the winter months bring uncertainty.
“There goes a whole bunch of sales tax and who knows what all else? We’ve never been through something like this,” she said.
Airbnb owners Julia Sauceda and Chris Lewine said they chose to make an investment in Hudson and deserve a longer period to adjust to the new law.
“This is the face of someone who has a family that took their savings account and put it into a short-term rental,” Sauceda said, urging people to support Rosenthal’s five-year period, which she sees as a compromise.
Lewine, a full-time Hudson resident, will soon move out of the building he operates as an Airbnb in Hudson so he has more space for his young son, and will be facing the amortization period.
“I am not a predatory lender. I took out debt to make an investment in Hudson where I moved a few years ago and raised my son who was born about a year ago and the investment that I made in the building is really an investment in his future,” he said.
He has poured money into the property by making improvements.
“I removed unsafe asbestos, I improved the fire safety, I put all this money in, partially because I was counting on the completely legal and legitimate small-business opportunity to run an Airbnb to cover those costs,” he said.
He said a shorter amortization period would cause him to charge much higher rents than he usually would to avoid debt.
“If we’re able to have a slightly longer amortization period, I can repay the investment that I made using tourists’ money and then I can charge a reasonable rate of rent for long-term Hudson residents to live here,” he said. “I don’t want to be put in a position where I’m under crushing debt because my opportunity to run a business was taken away from me, and if I am, it’s going to go against the purpose of this law because it’s going to force me to try to charge as high rent as I can.”
Lewine said he understands and supports the law otherwise.
Hudson resident Craig Davis works for a few Airbnb owners in Hudson and urged council members to consider locals whose income relies on their short-term rental jobs.
“All I’m asking is to think about allowing the people that are employed by all these short-term rentals that make their money off of it, to give them enough time to be able to move on and find another course of revenue, whether it be in Hudson or not.”
Wolff said the size of Hudson does not allow for homes as investments.
“It’s a very, very small place, and not big enough to absorb the damages effects essentially of the treatment of homes as businesses,” Wolfe said in response to short-term rental owners feeling attacked for being called predatory.
“One of my constituents lives in subsidized housing. She works three jobs. She doesn’t have the opportunity to have two homes and one to invest in. I respect all of you that made your comments, but put yourself in her shoes,” 2nd Ward Alderwoman Tiffany Garriga said.
Rosenthal, 5th Ward Alderman Dominic Merante and 5th Ward Alderwoman Eileen Halloran supported a five-year amortization period. Garriga, 3rd Ward Alderman Shershah Mizan, Wolff, 3rd Ward Alderman Calvin Lewis Jr., 4th Ward Alderman Malachi Walker, 2nd Ward Alderman Dewan Sarowar and Common Council President Thomas DePietro supported a one-year period, which will be incorporated into the proposed law.