House OKs commission to study short-term rental issues


STATE HOUSE – A special legislative commission will study the economic and social effects of the short-term rental industry under legislation sponsored by Rep. Lauren H. Carson and approved by the House today.

“Like many of the tech-enabled industries that have grown exponentially within just a few short years of being introduced, short-term rentals have downstream effects that have grown just as swiftly. These effects are particularly apparent in my district in Newport, where our housing crisis is exacerbated by the many residential properties that are now used solely as short-term rentals. There are tax, regulation and safety inequities between this industry and the hospitality industry. These issues are all upon us now, and growing greater with every passing season. We need to thoroughly investigate the many consequences of the short-term rental industry in Rhode Island, carefully balance them with the rights of property owners, and develop responses that ensure safety, promote the economy, and protect neighborhoods and the interests of the people of this state,” said Representative Carson (D-Dist. 75, Newport).

The House resolution (2023-H 6449) passed today establishes a 15-member commission that includes four representatives, the state tax administrator, the mayors of Newport and Warwick, the president of the Rhode Island Hospitality Association, the director of the Rhode Island League of Cities and Towns, the president of the Rhode Island Association of Realtors and the executive director of the Rhode Island Short Term Rental Association or their designees; an owner of a small, owner-occupied short-term rental property and the owner of another a larger one that is over eight units; a representative of a planning or zoning association in the state and a member of a regional tourism district association.

The resolution states that the commission’s study should include a review of all current and existing Rhode Island statutes on short-term rentals, an update on Department of Business Regulation registrations process and enforcement, municipal vs. state regulation, taxation, the impact on year-round and local housing markets and neighborhoods, health and safety concerns and best practice in other states and communities. 

Additionally, the resolution directs the commission to establish a working definition of “short-term rentals;”  engage the public and community stakeholders including property owners, 3industry representatives, police and fire chiefs  and zoning and planning officials for input; develop an understanding of the nature, extent, and scope of short-term rental activity; and identify specific benefits, problems, or issues associated with short-term rentals and how they vary from neighborhood to neighborhood, and municipality to municipality.

Representative Carson has worked throughout her legislative career to address issues connected to the proliferation of the short-term rental industry. Short-term rentals were an issue explored by a special commission on tourism she led for several years beginning in 2015. She worked for years on legislation enacted in 2022 requiring every short-term rental property listed for rent on the website of any third-party hosting platform that conducts business in Rhode Island to be registered with the Department of Business Regulation to ensure safety and tax compliance. She also sponsored bills enabling Newport to enact a two-tier residential tax rate, enabling the city to charge a lower rate for homes that are occupied by year-round residents.