The topic facing most cities and counties around, airbnbs and short term vacation rentals (STVRs), came up during the Rhea County Commission’s agenda meeting on Tuesday night.
Property Assessor Debbie Byrd addressed the commission along with Noah Wilson of GovOS, a private group, on what the county is missing out on right now.
“We have a problem identifying the airbnbs versus regular properties,” said Mrs. Byrd. “It takes me time to get them on the tax roll as well as with Linda Shavers' office getting them to collect business taxes from them.” Mrs. Byrd said both she and Mrs. Shaver would need to hire a full-time person just to keep up with these properties in the county.
She added that the rentals are taxed at 40 percent vs. the 25 percent that residential properties are taxed at.
Mr. Wilson said his company has already identified 116 properties in Rhea County that are not currently listed as airbnbs or STVRs.
“We have a staff of over 200 people who work on covering 30 different websites looking for airbnbs and rentals and match them to a data base of the government requesting the check by geo files and recognition of photos,” he said.
GovOS is an Austin, Tex.,-based company offering "Short-Term Rental Solution a comprehensive software suite backed by industry experts and enhanced support."
Mr. Wilson said, "With a multitude of use cases focusing on community and economic impact of short-term rentals, the GovOS Short-Term Rental Solution offers compliance, registration/permitting, tax collection and a 24/7 complaint hotline."
The firm touts that they are the leading company in this field. They also add no matter your ordinance structure or existing regulations, "the Short-Term Rental Software can be configured to meet your community’s unique needs."
They state their key components are identification of properties, compliance, seamless paperless tax collections, online registrations and the 24/7 hotline.
In press releases, GovOs includes in their client list more than 100 local governments including the state of Idaho, Greenwood County (near the Augusta, Ga., area), Sandusky Ohio, Dallas, Tex., Vail, Colorado, Newport Beach, Calif., Washington, D. C., Blanco County Texas, Cuyahoga (Cleveland) Ohio, Dauphin (Gulf Shores and Orange Beach) County, Alabama. In Tennessee they have Rutherford, Union, Unicoi, Anderson and Grundy counties.
Mr. Wilson told commissioners that with some 116 units they have found, the county could look to recoup some $216,000 in just motel/hotel taxes and an additional $60,000 in property taxes.
Commissioner Mark Cashman asked Mrs. Byrd how many properties are currently listed on the county tax roll. She said so far she has been able to identify 30. “It takes time to sit and look up these properties and then check them out,” said Mrs. Byrd.
County Commission Chairman Jim Reed asked Mr. Wilson what the cost would be to Rhea County to get this started.
He replied that the GovOS uses a tiered assessment for their clients, depending on how many units they identify. He said Rhea County would be in the bottom tier and would start out around $25,000. They could also add on the other features of a 24/7 hotline for people to call in complaints, and an online registry for owners of airbnbs and STVRs. He said they send out compliance letters to the owners to show them how to get registered and be in compliance with the county.
When asked by Chairman Reed about the letters, Mr. Wilson said,”Ninety percent of them will register after getting the first notice. Many cities and counties add penalties to those who don’t."
Commissioner Nick Welch pointed out to the commission that this service would take care of any staffing and equipping staff to do the same things. “To make money, you sometimes have to spend a little money,” he said.
County Attorney Carol Barron asked Mr. Wilson if there were other companies like his.
“We are the only one in Southeast Tennessee. We are the highest rated company nationwide on finding and bringing units in compliance,” Mr. Wilson said.
County Executive Jim Vincent said that the Rhea/Dayton Economic Community Development Board recently had a presentation by another company on the same topic.
He brought up the subject of creating a procedure for renting venue space or the grounds at the Historic Rhea County Courthouse. Included in the proposal are rules and requirements for rental, a fee schedule which starts out at $50 for the first floor lobby or conference room and $100 for the second floor Main Courtroom, $250 for the grounds, and $300 for the grounds, lobby, and the second floor Courtroom.
The contract will also require $1 million general liability insurance to cover the event being held. Also included is a hold harmless clause to exempt Rhea County from any problems that would arise from the event.
County Commission Chairman Reed said he would only want to rent out the Courthouse to civic organizations in the county. “I would hate to rent it out for a third-grade birthday party,” he said.
Commissioner Welch and County Executive Vincent pointed out that the first line of the rules states "Where the situation warrants, special individual; or group contracts will be prepared in lieu of the standard contract used." County Executive Vincent said that this gives the county the right of refusal for the event.
Chairman Reed said he was of the opinion that the liability insurance would shut down a lot of people from renting it.
Commissioner Welch said that with this contract in place it will be good, “before we had nothing in place.”
Commissioner Cashman asked, “Wouldn’t it be better to collect a $150 security deposit to insure they left the Courthouse clean than wait to charge them later.”
Chairman Reed agreed this would be better.
The Commission will meet in regular session next Tuesday starting at 6 p.m. in the Courthouse Annex.