MAC

In a closely watched case, the Chittenden County Superior Court rejected a challenge to the City of Burlington’s (the City) regulations for the operation of short-term rentals in its Minimum Housing Standards ordinance, adopted in 2022. Specifically, the regulations define short-term rentals in accordance with state statute (as “units rented for fewer than 30 consecutive days and for more than 14 days in a 12-month period”). 24 V.S.A. § 2291(29). The ordinance also establishes an owner-occupancy requirement except in limited cases. This means that the short-term rental unit must be located within the host’s primary dwelling, in a dwelling unit on the same lot, or in the same building as the host’s primary residence. Hosts must register their rentals and pay a 9% tax, and violators can be fined. 

This case was brought by 14 distinct entities or individuals that own and rent out properties on a short-term basis in the City (the Plaintiffs). The Plaintiffs claimed that the City lacked authority to impose durational limits and owner occupancy requirements for short-term rentals. The Court, however, was quick to note that 24 V.S.A. § 2291(29) “clearly authorizes the City to impose durational limits and owner occupancy requirements on short-term rentals.” 

Moreover, the Plaintiffs claimed that, even if the City holds authority to regulate short-term rentals in this manner, the durational and occupancy requirements fail to “promot[e] the public health, safety, [or] convenience [of] a town, city or incorporated village” as required by the law. Again, though, the Court disposed of the question quickly, noting that the promotion of the public health, safety, and convenience of a municipality is “broad and inclusive.” The Court further explained that the “relationship between a lack of available long-term housing and strains on the housing market, with impacts on homelessness, is intuitive, as is the consequent impact on a municipality’s general welfare.” 

This is a good case for municipalities as it makes clear that the protection of the long-term housing market promotes the public health, safety, and convenience of a municipality. It sets the foundation for municipalities to regulate short-term rentals with statutory durational limits and an owner-occupancy restriction, the latter of which has been challenged in federal courts with varying results. It’s important to keep in mind that this ruling is only binding within Chittenden County for now, but it does provide persuasive authority for other counties if a challenge were to be filed there. 

It is still unclear if this case will be appealed to the Vermont Supreme Court which could have significant impacts on municipalities depending on the outcome. We will watch closely and provide updates should it be appealed.    

The 32 Intervale, LLC et al v. City of Burlington case is archived at https://www.vermontjudiciary.org/sites/default/files/documents/32%20intervale%20v%20city%20of%20burlington%20hoar%2023-cv-2886%2011-19-24.pdf.