A City Council committee moved Wednesday to put a lid on the burgeoning vacation rental industry that has turned large swaths of some Chicago wards into party central.
The Committee on License and Consumer Protection approved an ordinance championed by Far Northwest Side Ald. Anthony Napolitano (41st) that would tilt the scales in favor of the local alderperson.
Already, residents of individual precincts have the power to ban Airbnb and its competitors from residential neighborhoods, using a petition process similar to the one used to vote precincts dry. But the threshold is high. It requires petitions with signatures from 25% of a precinct’s registered voters to trigger a ban.
If Napolitano’s ordinance gets approved by the full City Council, alderpeople could ban new vacation rentals in individual precincts within their wards. The onus to gather signatures from 10% of registered voters in that precinct would be on rental firms such as Airbnb and Vrbo to overturn the local ban.
Napolitano’s ward is attractive to vacation rentals because of its proximity to O’Hare Airport.
On Wednesday, he described how Friday night raves at vacation rentals in his ward have turned into “stabbings, shootings and community disruptions,” and he is powerless to stop them. “The next day, the party is gone.
“What we’re told to do is to call 911. Now the industry’s problem becomes a police problem and, unfortunately … our police have little to no powers. And when they find out that [the] location is a legal short-term rental, the officers leave,” said Napolitano, a former Chicago police officer.
Chicagoans whose homes and condos are already listed on Vrbo and Airbnb would be free to continue supplementing their incomes. Those existing vacation rentals would be grandfathered in, even in precincts where the local alderperson chooses to take advantage of the new power.
“It is not a blanket ordinance that goes over every ward. Precincts will not close automatically. They need to be closed individually or not at all. … If you don’t have a problem, this doesn’t affect you at all. If you do, it gives you the power to confront it,” Napolitano said.
Airbnb Chicago Policy Manager Jonathan Buckner branded the ordinance a legislative overreach and an “unncecessary violation of Chicagoans’ constitutional property rights” that “echoes the city’s dark history of `Restricted Residential Zones,’ which once controlled who could visit, travel through and own homes in certain neighborhoods.”
Buckner’s statement also claimed that Napolitano’s amendment, poised for a final vote at next week’s City Council meeting, “threatens to destabilize tax revenue from short-term rentals that the City of Chicago relies on to fund the fight against homelessness and aid survivors of domestic violence.”
The city imposes a 6% tax on short-term rentals. Two-thirds of that money is set aside to combat homelessness. The remaining third is earmarked for programs that support victims of domestic violence.
Napolitano’s amendment has the potential to cut “up to $10 million in funding” for those vital programs, according to Airbnb.
“This helps families — particularly women and children in horrible situations — get out. How are we going to replace that?” asked Southwest Side Ald. Matt O’Shea (19th), an outspoken advocate for domestic violence victims.
O’Shea said there was a problem at a post-prom party for 100 people at a vacation rental in his ward just last week and it was quickly addressed.
“If more of us had a better relationship working more closely with … short-term rentals, we could get these problems addressed as opposed to just a blanket ban,” O’Shea said.
Downtown Ald. Bill Conway (34th) said he also views the power to ban new vacation rental in an entire precinct as “overly broad” and a possible “infringement of property rights.”
Ald. Silvana Tabares (23rd) represents a Southwest Side ward close to Midway Airport that has become a haven for vacation rentals and a target for investors eager to gobble up single-family homes and turn them into short-term rentals.
“We have had an extraordinary number of calls for service at these short-term rentals. Instances of public urination, noise disturbances, large gatherings, litter and drug use not only flood my ward office but also CPD’s 8th police district,” Tabares said.
“We discovered a short-term rental that was being rented and used as a meeting place for participants in the car caravans that have resulted in shootings, auto crashes and property damage. … It’s taken years of working with [City Hall] to try to address these issues because the law is on the side of the property owner — not the residents who actually live on the block. The deck is stacked.”