The City of Bloomington is considering an ordinance that would require inspections and permits for short-term rentals available through websites like Airbnb and VRBO.
A small group of property owners attended a meeting Tuesday night to learn more about the proposal.
The ordinance would require those operating short-term rentals within city limits to live at the properties. Property owners would also have to obtain a $100 permit through the city, which requires general liability insurance and proof of registration as a retail merchant with the state of Indiana.
The city's planning and transportation department would have to inspect the property before issuing a short-term rental permit, which would have to be renewed every two years.
Fines for operating a short-term rental without a permit would start at $2,500.
The city says the proposal isn't intended to squash entrepreneurship.
"But rather to make sure that anyone's who's coming within our community who are utilizing such properties to make sure they're safe and sanitary," says Doris Sims, director of housing and neighborhood development.
The city says current ordinances actually prohibit short-term rental properties, but those rules aren't being enforced. At least two people at the meeting say they received cease and desist letters from the city last year threatening fines if they continued offering short-term rentals.
The city says those rules won't be enforced until it decides whether to move forward with the proposed short-term rental ordinance.
Several people who rent their properties out say they're worried the proposal is too restrictive. They expressed concerns about the city infringing on their rights as property owners and the large financial burden the regulations could impose.
Susan Slaven rents her condo out as a way to generate some extra income and says there's a need for short-term rentals in the community.
"There's a lot of folks that are coming here because they have students at IU," Slaven says. "[During] graduation they can't find hotels."
Slaven says she'd like to see several changes made to the proposal, including eliminating language that limits the number of people allowed to stay at the properties and prohibits serving guests food.
The proposed ordinance could change before it goes before the city council. That could happen as early as Nov. 9.
According to Airbnb, no other Indiana cities have specific ordinances regulating short-term rental properties.
