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Carmel ordering Airbnb hosts to cease operations

January 17, 2017

Home-sharing services are no longer welcome in Carmel.

The city announced Tuesday that it sent letters to 28 residents who rent out their homes on Airbnb, notifying them that they are in violation of city zoning laws and demanding they cease operations within 10 days or file a request for a zoning variance.

The action comes in response to “a number of complaints from local residents, homeowner associations and representatives of local hotels about the issue,” the city said in a written statement.

“Although we share in the excitement and appreciation of the many new ways in which we can connect with each other globally and do business by using modern technology for travel and entertainment purposes, we must also be sensitive to the impact these new things are having on our community — including your neighbors and our local businesses,” the letter sent to Airbnb users states.

The letter explains the purpose of different zoning categories and says operating an Airbnb without complying with the zoning code is unfair to hotels that “invest a lot of money to meet the requirements of their zoning.”

“Your home is an area that is classified as a residential single-family zone, which means you are welcome to use your home as a residence,” the letter reads. “But you are not able to suddenly turn it into a restaurant, a dry-cleaning business, factory or—as is apparently the case now—a hotel or bed-and-breakfast. Doing so would be unfair to your neighbors and to our local businesses, and would be contrary to the community’s zoning laws.”

In Indianapolis and the surrounding suburbs, hundreds of homes and bedrooms are listed on Airbnb and other peer-to-peer lodging sites. Most communities, including Indianapolis, have simply deferred taking action to regulate the business. At least one—Lebanon—has publicly supported the service.

According to data released in December from Airbnb, approximately 83,000 people used the service statewide in 2016, generating a total of $10.6 million in income for hosts.

Carmel was ranked the fifth busiest community in the state for guest arrivals, with 1,900 overnight visitors using Airbnb. The business generated a total of $239,000 for hosts in Carmel.

The top four cities were Indianapolis, South Bend, Bloomington and Michigan City, respectively.

Homeowners in Carmel who are advertising their property on Airbnb are required to remove their listing within 10 days in order to avoid further action by the city’s code enforcement inspector, according to the letter.

Any resident interested in applying for a zoning change is being directed to contact Angie Conn, planning administrator for the city of Carmel.

But at least one Airbnb user has already started the process of rezoning his property.

Tech entrepreneur Scott Jones, who had previously listed five bedrooms at his more than 20-acre Carmel estate on Airbnb with prices ranging from $95 a night to $295 a night, filed to rezone his property to allow a bed-and-breakfast operation several months ago.

The request included being allowed to have outdoor events with up to 300 guests and indoor events with 50-300 guests.

The Carmel Board of Zoning Appeals discussed the request at its October meeting, but postponed voting on the issue. It is expected to be considered at the board’s meeting on Monday.

And Carmel isn’t the only city that has taken action against Airbnb hosts.

The town of Zionsville sent a cease-and-desist letter to a couple renting an apartment above their garage to out-of-town guests in summer 2015 after receiving complaints from other residents.

In July 2015, the Zionsville Board of Zoning Appeals denied the request from residents Steven and Tamara Totty to continue operating the Airbnb.

However, Zionsville officials have said they won’t be proactively going after other Airbnb users because it would require additional staff members. The town will investigate complaints, though.

Carmel Mayor Jim Brainard told IBJ in July that he’s OK with the peer-to-peer lodging being offered in the city, but it needs to comply with city code.

At that time, the city did not have plans to actively enforce the issue.

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