Continuing on from our previous article, we’ll be discussing the following additional changes that have recently been made to the Philadelphia Zoning Code: new Airbnb regulations as well as new restrictions in the Neighborhood Conservation Overlay District (/ FNE) and Far District of northeast overlay (/ NCO).
New Airbnb regulations
On June 23, Mayor James Kenney enacted Bill 210081 which amends Section 14-604 of the Philadelphia Zoning Code titled “Incidental Uses and Structures”; as well as Chapter 9-3900 of the Philadelphia Code, entitled “Ownership Licenses and Owner’s Liability”; Section A-906, titled “Property License Taxes”; and Chapter 19-2400, entitled “Tax on the rental of hotel rooms”.
Section 14-604 of the Philadelphia Zoning Code describes the permitted ancillary uses and structures in conjunction with the permitted primary uses and structures.
Under the amended law, the Philadelphia Zoning Code was amended to define the term “limited accommodation” to more closely track Airbnb usage.
Limited accommodation is now generally defined under Article 14-604 (13) (a) as “the incidental use of accommodation for temporary rental for the purpose of occupancy for lodging, sleeping or accommodation ”.
Under the amended law, it specifically provides that “the standards in this section are intended to ensure that limited housing will not adversely affect the character and livability of the surrounding neighborhood”.
The Philadelphia Zoning Code now limits such limited housing to a “natural person” who is considered a primary resident of the property. Under the amended law, the principal resident of a property is considered to be the one who owns and resides there or a tenant who lives in the property as the tenant’s principal domicile for more than half of the year and who is authorized in writing by the owner to provide such limited accommodation.
Restricting accommodation to a “natural person” was a decision taken by Philadelphia City Council in an effort to bypass the complex ownership structures of businesses and hold individuals accountable for any nuisance that may arise due to nature. short term rental. In other words, it appears that the amended law eliminates the ability for corporations or investors to use real estate in Philadelphia for what has been characterized as limited accommodation.
Chapter 9-3900 of the Philadelphia Code, titled “Ownership Licenses and Owner’s Liability” has also been amended to create what is now known as the Limited Hosting Operator License.
Before this bill was passed, only short-term rental operators who rented housing units for more than 90 days a year were required to obtain a government permit.
Under the new law, short-term rental operators must now obtain this limited accommodation operator license.
In addition, only the principal resident of the property can operate a property as limited housing and obtain such a license, provided that in the Tenth Councilmanic District only a principal resident who is the owner of the property can operate a housing. limited and obtain such license and an otherwise qualifying tenant cannot do so.
In accordance with Chapter 9-3900 of the Administrative Code, the annual license fee for a limited hosting operator license is $ 150.
To obtain a license, the applicant must have a valid business activity license and no pending notice of violation issued under Title 4 of the Philadelphia Code associated with the property for which the application is made, unless the owner has filed an appeal of the violation that is pending at the time of the government request.
In addition, if the owner of the asset is not a natural person or a listed company, the request must identify, in addition to the name of the owner of the asset, the name and preferred mailing address of each natural person who has an interest in this property. owner that exceeds one or more of the following, whether the natural person holds a direct interest or the interest of that natural person is held through one or more levels of a corporate structure, such as a parent-subsidiary structure: 49% of the property’s value or 49% of the owner’s value. However, if no natural person has such an interest, the request must identify the name and preferred mailing address of the 2 natural persons who have the largest stake in the property.
Under the new law, all short-term rental operators are required to use a registered reservation agent.
In an effort to drive out third-party short-term rentals independently listed on unregulated websites, such as Craigslist, a reservation agent is defined as “a person or entity who facilitates reservations for direct or indirect reception. of a fee or collects the payment. for, accommodation on behalf of a person offering residential accommodation to the public as limited accommodation or as a hotel or similar short-term rental.
Under the new law, “just posting an advertisement for accommodation does not make the publisher a booking agent.” In addition, the new law provides that “a booking agent does not include a person or entity that facilitates reservations or collects payment for accommodation if the accommodation is offered by a person operating under the same brand,” trade name or service mark used by the person. or entity facilitating reservations or collecting payments, provided that such person or entity maintains a publicly accessible telephone number through which such person or entity receives and deals with complaints regarding activities in such accommodation.
A reservation agent must have a limited accommodation and hotel reservation agent license.
The initial license fee for an accommodation and limited hotel reservation agent license is $ 7,000 and the annual license renewal fee is $ 5,000, under the new law.
A reservation agent will also be subject to the hotel room rental tax, tourism and marketing tax, and hospitality promotion tax under the new law.
New penalties have been imposed for non-compliance with these new provisions of the law.
Neighborhood Conservation District (/ NCO)
On July 15, Kenney enacted Bill # 210361 which amends section 14-504 of the zoning code titled / NCO, Neighborhood Conservation Overlay District.
The / NCO, Neighborhood Conservation Overlay covers various sections of the city and aims to promote the public welfare of the city by encouraging conservation and preservation through the revitalization of the physical environment unique to a specific neighborhood.
Section 14-504 (6) covers the Overbrook Farms / NCO District, which is within the Neighborhood Conservation District.
The Overbrook Farms / NCO District was established to preserve and protect the Overbrook Farms National Historic District, which is a single, mixed-use, neighborhood-oriented commercial district containing residential and commercial uses interspersed at the level of the street with residential uses on the upper floors.
The new law does not allow multi-family use in any single-family zoning classification in the Overbrook Farms / NCO district.
It is not clear how this bill differs from the use requirements of the Philadelphia Zoning Code; however, it appears that the bill will restrict the ability of landlords or tenants to apply for a waiver of the Philadelphia zoning code.
Far Northeast Overlay District (/ FNE)
On June 23, Kenney enacted Bill 210425 which amends section 14-500 of the zoning code titled Overlay Zoning Districts.
Section 14-514 covers / FNE, Far Northeast Overlay District which applies to 56th Ward, 58e Neighborhood, 63rd room, and 66e Room.
The new law states that any use in the Philadelphia zoning code that qualifies for a special exception will instead require a waiver within the / FNE, Far Northeast Overlay District.
Alan nochumson is the sole shareholder of Nochumson PC, a legal services firm specializing in real estate, land use and zoning, litigation and business advice for the people of Pennsylvania and New Jersey. Nochumson is a frequent author and speaker on issues frequently faced by businesses, individuals and professionals. You can reach him at 215-399-1346 or [email protected]
Clementa Amazan is an associate attorney with The Firm, a law firm specializing in real estate, land use and zoning, litigation, and business advice for residents of Pennsylvania and New Jersey. Her experience as a legal assistant has enhanced her ability to identify, analyze and resolve a wide range of legal issues facing her clients. You can reach Amazan at 215-399-1346 or [email protected]
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