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Paradise Valley moves forward with short-term rental fee study as local control appears within municipal grasp

Photo of Paradise Valley municipal complex
A picturesque view of the Town of Paradise Valley Municipal Complex.(Photo: Arianna Grainey/DigitalFreePress.com)
Paradise Valley pursuit embodied in local ordinance, penalty structure
By Terrance Thornton | Digital Free Press

A fee study is afoot at the Town of Paradise Valley, but unlike most fee studies this one focuses on a key issue at Town Hall: the regulation of short-term rental enterprises within municipal bounds.

The fee study, approved unanimously at Town Council’s Sept. 8 meeting at Town Hall, 6401 E. Lincoln Drive, is under review and study for the next 60 days.

What are the fees being considered? Acting Town Attorney Andrew McGuire, prior to the public hearing, outlined in detail:

  • Short-term rental enterprises that do not apply for a permit within 30 days of operations must cease operations.
  • Failure to register within 30 days = $1,000/month.
  • Failure to provide contact information after 30 day notice = $1,000/30 days.

Additional penalties for violations within same 12-month period:

  1. Greater of up to $500 or one night’s rent at the advertised rate.
  2. Greater of up to $1,000 or two night’s rent at the advertised rate.
  3. Greater of up to $3,500 or three night’s rent at the advertised rate.

Found a part of his report to Town Council, Mr. McGuire explains the proposed town regulations and fee study around STR operations is legal, according to the Attorney General’s Office.

“Subsequently, the Arizona Attorney General’s Office issued a report in which it determined that ‘most of the ordinance does not violate state law, but that a few’ specific provisions within the ordinance did violate state law related to local regulation of STRs. The town attorney consulted with the Attorney General’s Office regarding proposed amendments to the town code, as required to resolve the allegations contained in the Attorney General’s report,” he said of a February “request to investigate” ordinance 2022-03 in Paradise Valley filed by Arizona Sen. Warren Peterson (R) in January of this year.

“Pursuant to those consultations, staff prepared, and the Town Council adopted ordinance 2022-04; the Attorney General’s Office confirmed that the amendments in ordinance 2022-04 addressed the issues raised by its report.”

Under proposed town article No. 10-14, short-term rental owners must:

  • Register with the town and pay a permit fee at $250, potentially;
  • Obtain a transaction privilege tax license;
  • Show proof of lawful residence in the U.S. (if individual);
  • Maintain at least $500,00 liability insurance;
  • Renew annually;
  • Notify neighbors before first rental and upon change of information; and
  • Display the STR permit number on every advertisement.

For Paradise Valley Mayor Jerry Bien-Willner, while the early September municipal measure is a fee study, he says it is a culmination of work with all members of Town Council and staff providing steadfast dedication.

“I was thrilled to see the town’s professional team bring to council a set of code updates to allow the town to utilize the maximum extent of the state law changes that we fought hard for to help reign in problem short term rentals,” he told Free Press Paradise Valley.

“Thanks to the work done over the summer, we are now well on our way to making the changes to our local code that will maximize the benefits of the state law coming into effect toward the end of September.”

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