A long-awaited study is calling for an overhaul of New Orleans' controversial vacation rental regulations, suggesting a ban on new commercial short-term rentals in some neighborhoods, a limited expansion in others, and the creation of new definitions for different categories of lodging. 

Among the recommendations in the 127-page draft report, unveiled publicly on Oct. 28, are: a citywide, one-per-block limit on new commercial short-term rentals and traditional bed-and-breakfasts; new size categories for commercial short-term rentals and hotels that would determine where they are allowed; and more closely aligning zoning rules with commercial short-term rental regulations.

The report comes more than two years after the City Council first directed the City Planning Commission to commission the study amid legal challenges to its existing short-term rental rules and an outcry from local residents over the proliferation of the popular tourist housing in their neighborhoods.

The report, prepared by Metairie-based consultant Desire Line, was supposed to help guide the council as it sought to revise its laws to withstand legal scrutiny. Some city leaders and neighborhood activists now question whether it will make matters better or worse.

At its outset, the report's authors acknowledged the challenge of rewriting the rules.

"A simple solution (such as an outright ban or a broad approval of transient lodging uses) will not resolve divergent perspectives and land use conflicts amongst owner and non owner cohorts," the report said. "A reasonable compromise is needed."

A full presentation to the planning commission is scheduled for Dec. 9. 

New definitions

The report contains a series of recommendations designed to simplify enforcement, close loopholes and lessen the damage that too many short-term rentals can do to neighborhoods. 

The study says the overriding goal of the report is to prevent the proliferation of transient lodging from making housing less affordable and destroying the character of New Orleans’ historic districts.

“It is the very exceptional community character in New Orleans that drives the tourism industry and increases demand for STRs,” the report says. “For this reason, protecting community character must come first.”

Among the suggestions is a one-per-block limit for both bed-and-breakfasts and commercial short-term rentals, or CSTRs, across the city. The cap is already part of the city's rules for short-term rentals in residential areas, which require an on-site operator, so a similar rule for the rentals in commercial areas would create more uniformity, the report said.

It also recommends rewriting the zoning code to divide CSTRs by size — small, medium and large — based on the number of units and rooms in a given building. The report suggests, for instance, that while only one medium-sized CSTR would be allowed per block, each could have up to four units per building licensed as vacation rentals.

"New definitions create opportunities to permit less intense uses in zoning districts where impacts are minimal, and close loopholes where CSTRs may currently operate more like a hotel or bed and breakfast without having to meet the building code or retain an operator on site 24/7," the report said.

Another suggestion from the study is a ban on new CSTRs in historic residential districts like the Bywater, Marigny, Treme and in the French Quarter. However, the study suggests allowing them in the 200-700 blocks of Bourbon Street, which is part of a special commercial district, and, for the first time, in the 200-300 block of Decatur Street surrounding the House of Blues. 

Other changes include the creation of a new category of smaller, "neighborhood" hotels and the consolidation of two existing types of B&B permits into one.

Currently permitted short-term rentals, hotels or other forms of lodging should be allowed to keep operating as long as their license remains active, the report recommends.

'Thought this would be resolved by now'

Though still in a draft form and months, if not years, from resulting in any zoning changes, the draft is drawing mixed reviews from neighborhood activists and those on both sides of the short-term rental debate.

“I think that the team did a really good job of trying to thread the needle of allowing them where appropriate and then not,” said Erin Holmes, executive director of Vieux Carré Property Owners, Residents and Associates. “But the thing is, the enforcement of short-term rentals is an entirely different monster. It comes down to: what can an inspector access and see from the public right-of-way?”

Tripp Ruckman, chief operating officer of BookNola, manages more than 60 properties in New Orleans, the majority of which are commercial short-term rentals. While the consultant's recommendations purport to close loopholes in the code, Ruckman said some of the proposed changes, such as the size distinctions, are too intricate to enforce.

"There's going to be plenty of loopholes," said Ruckman, who blames the hotel industry for "causing all the chaos, not the locals."

Airbnb officials have described New Orleans’ regulations as some of the "most extreme" in the country and the company has sued the city over its licensing regime. It is currently appealing a recent district court ruling that upheld nearly all the city's rules and said it is reviewing the new report.

Eleanor Graham, a retired lawyer who worked as a city land use attorney in the 1990s, disagreed with the report’s assumption that a short-term rental ban would be unworkable.

“It has provided unsafe living conditions on a mass scale and it cannot be regulated,” said Graham, a board member of the group Neighbors First for Bywater and a resident of a condominium building containing multiple commercial short-term rentals. “In my opinion, they need to dial back the law, and someone needs to put forward legislation to rescind.”

The city's moratorium on new commercial short-term rental licenses ended Tuesday with the expiration of an interim zoning district. Ahead of its expiration, the City Council unanimously adopted a motion calling on the City Planning Commission to replace it with a new citywide district requiring conditional-use permits for all types of transient housing.

Ahead of the release of the report, District B Council member Lesli Harris said the moratorium has placed a significant burden on elected officials and staff.

“It's not only two years that we've been waiting, but it's two years that we as a City Council have had to evaluate special exceptions, create rules around special exceptions, consider conditional uses, reject conditional uses,” Harris said.

At-large council member JP Morrell likewise expressed frustration that the report had taken so long.

“I can tell you,” he said, “that when council member Harris and I asked for a transient lodging study two years ago, we thought this would be resolved by now.” 

Long-awaited city report recommending re-write of New Orleans' Airbnb regulations released