PROVIDENCE, R.I. (WPRI) – Gov. Dan McKee on Thursday vetoed legislation that would require every short-term rental property listed on third-party websites – such as those listed by Airbnb – to be registered with the state.
The General Assembly approved the legislation on July 1 sponsored by Rep. Lauren Carson and Sen. Dawn Euer, both Newport Democrats, who argued that a statewide registry to track short-term rental properties would help make the public, the industry and its visitors safer.
But McKee rejected their arguments.
“I cannot support this bill because it will create additional burden for property owners,” he wrote in his veto message. “Short-term rental concerns, like other property/land use and small business matters, are more effectively addressed at the municipal level.” He also noted that short-term rental operators are already required to register with the Division of Taxation.
The legislation was spurred by the death of a 22-year-old man last month during at a house party at a high-end rental in Newport.
House Speaker Joe Shekarchi and Senate President Dominick Ruggerio quickly issued a joint statement describing themselves as “extremely disappointed” about the veto. They argued that communities such as Newport, Narragansett and Westerly “are being overwhelmed by short-term rentals.”
“It is not asking too much to require the Department of Business Regulation to, in fact, regulate businesses,” they said. “The responsibility given to DBR under this bill was merely to establish and maintain a list of properties offered for short-term rental. It would be the obligation of the global hosting platforms to ensure their properties are registered with DBR.”
The two legislative leaders also said the Division of Taxation registration system is “woefully insufficient.”
When the legislation passed the General Assembly, Carson suggested the growth of short-term rentals is hurting her city and the local housing market. The industry has exploded in popularity in recent years – fueled by the websites Airbnb and VRBO – especially in tourist destinations such as Newport.
“In our community in Newport, the effects of the short-term rental industry are particularly evident, especially since investors began purchasing properties solely to offer them for short-term rentals and taking them out of the housing stock available to residents,” Carson said in a statement at the time.
The R.I. League of Cities and Towns had supported the bill, while Airbnb lobbied hard against it.
It wasn’t immediately clear whether the General Assembly would mount an effort to overturn the governor’s veto, but Shekarchi and Ruggerio said, “We will be carefully considering our next steps.”
This is the second bill McKee has rejected since taking office in March, after he also vetoed a bill that would change the rules around how utilities deal with renewable-energy projects.
Lawmakers are considering returning for a special session in the fall, when they could take up veto override votes.
Ted Nesi (firstname.lastname@example.org) is a Target 12 investigative reporter and 12 News politics/business editor. He co-hosts Newsmakers and writes Nesi’s Notes on Saturdays. Connect with him on Twitter and Facebook