Is Miami Beach's Airbnb Crackdown Legal? | Miami New Times

Miami Beach's Airbnb Crackdown Might Not Be Legal Under State Law, Opponents Argue

Miami Beach's crackdown on AirBnB and other short-term renters has been swift and brutal. In March, the city changed its rules to levy $20,000 fines on anyone who rents out a space for less than six months, and since then has handed out $1.6 million in fines.  But was that...
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Miami Beach's crackdown on Airbnb and other short-term renters has been swift and brutal. In March, the city changed its rules to levy $20,000 fines on anyone who rents out a space for less than six months, and since then has handed out $1.6 million in fines

But was that crackdown legal? That's what Ross Milroy, a luxury property broker in Miami Beach, wonders. He points to a 2011 bill passed in Tallahassee that banned local governments from restricting the time or duration of short-term vacation rentals in any form.

"They dramatically ratcheted things up when they did that in 2016," Milroy says, who adds that "this needs a class-action lawsuit" to find out if the city's new fees are actually permissible. "I think they pushed the envelope too far."

But Miami Beach Commissioner Michael Grieco, who holds a law degree, calls the allegation "nonsense."

"I had a team of lawyers to work with me," he says. "This was a fully vetted issue. We were just tweaking the fine schedule and tweaking the enforcement policy."

Long before March's tweak to the rules, Miami Beach had a law banning rentals shorter than six months and one day. So even after Florida's state law went into effect in 2011, the local ban in Miami Beach was grandfathered in.

In March, the city greatly increased the fines for breaking that short-term rental law. The fees jumped from $500 to $20,000 for first-time violators in residential areas of town. Previously, the maximum fine was $7,500 for renters caught flouting the code four times in 12 months. The max fine is now set at $100,000.

(It appears the code was amended in 2014 to prohibit short-term rental advertising as well.)

But according to state Statute 509.032(7)(b):

A local law, ordinance, or regulation may not prohibit vacation rentals or regulate the duration or frequency of rental of vacation rentals. This paragraph does not apply to any local law, ordinance, or regulation adopted on or before June 1, 2011.
Milroy says he and a small group of brokers and lawyers in town believe the new fines might not be legal under state law.

"I underlined all the new changes, and I think they are extremely onerous," Milroy, who used to work as a hotel broker before starting his luxury rental business, says. "Is it OK now that in 2016 you can add all that, when the state said in 2011 you cannot?"

Milroy says he's surprised that the city would work so hard to crack down on short-term renters in a city where significant numbers of residents are transient tourists.

"People are buying real estate in a tourist city and saying, 'Well, why can't I rent to tourists?'" he says. "I've lost business because of this. There have been people I've spent months and months with, and I have to tell them: 'Sorry, since March, the city will fine you if you rent your property for less than six months and one day." Thus, he says, possible real-estate buyers are looking elsewhere.

"Some people are spending 100,000 a year in property taxes, but if you want to rent your home for a month of that time, the city says, 'Screw you, you can’t.'"

But simply being dissatisfied with a law does not make it illegal, and Commissioner Grieco tells New Times that he and the city's legal team worked diligently to ensure the fee changes abided by state law.

"For every one person who gives me a passive-aggressive comment about it, there are 50 who tell me they're happy we're finally taking a stand against the proliferation of illegal short-term rentals," Grieco says. "There's a big difference between having a home-based business and your home being a business." He says that, rather than protecting the hotel lobby, the city is fighting for the residents who do live on the Beach year-round.

Grieco adds that the city should have begun policing vacation rentals years ago, but it's "taken us a few years to get caught up. Now that we're there, people are just unhappy that we’re finally enforcing the law. The market will adjust."
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