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CAPE FEAR MEMORIAL BRIDGE: Updates, resources, and context

Wilmington no longer requires short-term rental registration following court decision

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The city has already changed its website stating homeowners no longer have to register their rentals with the city, and removed the distance requirements between homes. Next week, city council will vote on whether to return over $500,000 in short-term rental fees.

Homeowners in Wilmington who want to rent their homes for short-term rentals are no longer required to register their properties with the city or adhere to separation requirements previously put in place.

The move comes after an opinion from a three-judge panel from theNorth Carolina Court of Appeals ruling the City of Wilmington’s short-term rental ordinances violated state law.

On Tuesday, City Council will vote on returning more than $500,000 to those who paid the fees. According to the documents from the City of Wilmington, they’d also pay interest.

“Pursuant to North Carolina General Statute 160D-106, registration fees collected since the inception of the program amounting to $443,428 and related third-party processing fees amounting to $10,189 will be reimbursed to the respective homeowners. Accrued interest, calculated at a rate of 6% and estimated to total $57,867 will also be remitted to the homeowners. The City being mindful of the above statute, held the registration monies collected during the litigation of this matter,” according to an ordinance on which council will vote Tuesday.

That money might have been withheld by the city, but it is still coming out of the General Fund.

“This ordinance appropriates $511,484 of General Fund - fund balance for these reimbursements and accrued interest. Of this amount, $308,665 will come from fund balance assigned as of June 30, 2021 for short-term rental reimbursements and the balance of $202,819 will come from unassigned fund balance,” according to the ordinance.

The ordinance to return the money is not the only indication the city is walking back its stance on short-term rentals. There are changes to the city’s website where rental registration was previously listed.

It read, “All owners wishing to operate short-term lodging of any kind must register.”

Now, that statement is gone, replaced with an antithetical one in its place.

“The City of Wilmington will no longer require registration for short-term rentals or enforce the cap and separation requirements in the City’s short-term lodging ordinance due to a recent court decision. All other provisions of the ordinance remain in effect,” the page reads.

Wilmington still has the option to appeal the Court of Appeals ruling, however, if the proposed ordinance is approved, it could signal the city is no longer wanting to defend its policies. It’s a decision that could impact cities across the entire state since cities like Asheville also require permits and fees (although Asheville lists its fee as a ‘zoning application and technology fee’).

If Wilmington does not appeal to the Supreme Court it could encourage other homeowners in any city, to follow suit and launch appeals to their own city’s rules.

Two courts have already ruled againstWilmington, and since the Court of Appeals ruling was unanimous, the North Carolina Supreme Court does not have to hear an appeal, it is up to their discretion.

The City of Asheville has responded saying they would be reviewing their own ordinances.

“The City of Asheville is aware of the recent Court of Appeals decision, and is reviewing the pertinent local ordinances to determine if any adjustments need to be made. However, Asheville general prohibition against whole home short term rentals remains unaffected,” a City of Asheville spokeswoman Kim Miller said in an email to WECT.

Asheville’s short-term rental website still links to registration applications, however, the ordinance itself is not listed on the page, instead it reads: “Read the Ordinance (See Item 9 – Homestays) – Updates coming soon.”