This story was originally published under the headline “City collected $1,500 — not $1 million — in short-term rental fines levied over two years.”
Editor’s note (4/23/21): On Friday, April 23, 2021, The Lens was provided information indicating that the numbers contained in this story are inaccurate. We have reason to believe that fines for short-term rental violations — both those assessed and those collected — were significantly larger than what is reported in this article.
This article is an accurate representation of records that the city of New Orleans provided reporter Michael Isaac Stein in response to a public records request on short-term rental fines during the period in question. Furthermore, during the reporting process, Stein was transparent with city officials about what would appear in this story. He repeatedly took his findings to the Mayor’s Office for confirmation and comment, and in every instance, officials either confirmed that the records the city provided were accurate or offered no objections.
It’s not clear how this happened, but we believe the new information we have received is credible. As of late Friday afternoon, we have not yet received a full explanation from the Mayor’s Office, nor have we been given accurate and complete records on short-term rental fines from January 2019 through January 2021.
We will update this story as soon as we have answers. As those may not come until early next week, we felt that placing a note above the story was, if not the best, then the least bad way to let readers know promptly that we have doubts about its accuracy.
As editor, I take full responsibility for any errors that appear in this article, and I apologize to The Lens’ readers.
—Charles Maldonado, editor, The Lens
At a March 4 City Council committee meeting, Department of Safety & Permits Director Tammie Jackson gave a presentation on the city’s enforcement of local short term rental laws.
“The grand total of fines paid between January 2019 to January 2021 is nearly $1,000,000,” the presentation said.
However, records obtained by The Lens show that the city only levied about $68,000 in fines related to short-term rental enforcement from January 2019 through January 2021. Of that $68,000, the city has only collected $1,500, according to the records and an online database of code enforcement actions. It is possible that additional short-term rental fines were collected over that period from fines levied prior to 2019.
A spokeswoman for Mayor LaToya Cantrell, LaTonya Norton, told The Lens that the $1 million figure cited by Jackson “was inclusive of all adjudications not just short term rental cases.” Norton did not respond when asked why fines went uncollected.
Councilman Jay Banks told The Lens that he was under the impression that the $1 million figure cited by Jackson represented only short-term rental fines.
“I assumed that when they said that they were referencing short term rentals since that was the discussion we were having,” Banks said. “So I guess I’m a bit taken aback. I will not say it was anything malicious on their part. I will say I just did not understand what they were relaying.”
Banks and Councilwoman Kristin Palmer both expressed frustration at what they described as a low level of enforcement relative to the large number of short-term rentals operating illegally in the city.
“I think the numbers are way too low,” Palmer said. “They’re definitely not reflective of all the complaints that are coming to our offices from all districts.”
Palmer played a major role in getting the City Council to pass comprehensive short term rental regulations in 2019. The city had already created a set of rules in 2016 under then-Mayor Mitch Landrieu. But critics said the rules made it too easy to convert entire homes into vacation rental properties and too difficult to shut down unpermitted rental properties.
The 2019 rules prohibited almost all whole home short-term rentals in residentially zoned properties, and started forcing platforms like Airbnb to include permit numbers in their online listings and delist delinquent or unpermitted properties at the request of the city.
But even before the law went into effect in December 2019, there were already concerns about how well the Cantrell administration would enforce it. Throughout the 15 months during which the City Council crafted the new rules, council members repeatedly expressed that all of the work would mean nothing without enforcement.
“Why did we go through the effort of having any regulations?” Banks said.. “If there’s no enforcement there’s nothing to make them want to play by the rules. So that’s very frustrating, very disheartening.”
The Lens previously reported on how, over the course of 2019, the Cantrell administration walked back plans for beefed up enforcement, reducing the proposed number of short-term rental enforcement staff from as many as 16 in January to as few as three in August, shortly after the council passed the new rules. Records showed that the administration was worried, in part, about tax revenue losses that could occur if they started strict enforcement, with one top official referring to short-term rentals as a “cash cow” for the city.
The council has also expressed concerns about whether the city is properly spending millions of dollars from a state-controlled fund that is supposed to be used exclusively for short-term rental enforcement. And last year, the city put a former short-term rental executive in charge of the department that enforces the short-term rental rules, sparking concern among short-term rental critics.
“We spent an incredible amount of time crafting regulations for short-term rentals and we did that because we knew STR speculators were displacing people and exacerbating gentrification in historically Black neighborhoods,” said an emailed statement from Cashauna Hill, executive director of the Louisiana Fair Housing Action Center. “When the City shares misleading information with the public and City Council about how little enforcement they’ve accomplished in the past two years, that leaves us deeply concerned that they don’t take this displacement seriously.”
No fines collected for 2019 judgments
Records show that in 2019, from Jan. 1 to Dec. 1, there were $62,415 in “unpaid” fines related to judgments against short-term rentals found to be violating the rules. The document indicates that none of that money was actually collected.
Another document obtained by The Lens shows $5,501 in fines from Dec. 1 2019 (when the new short-term rental laws went into effect) to Jan. 31 2021. City records show that $1,500 of that was collected. The earliest case in which fines were actually collected by the city was adjudicated in November 2020, according to those two documents.
Norton, the Cantrell spokeswoman, pointed out that less than two weeks after the new law went into effect, the city was hit by a cyberattack that brought many city functions to a grinding halt and has taken over a year to recover from. Norton said that the cyberattack, combined with the coronavirus crisis, in part accounts for the low level of short-term rental adjudications since December 2019.
“The City’s new STR rules were implemented December of 2019 during the cyber attack; therefore, 13 months would include 10 months during the cyber-attack and pandemic which hearings had not occurred,” Norton said in an email. “Hearings resumed in October, 2020.”
As Jackson pointed out at the March council meeting, hearings are only one way for the city to crack down on illegal rentals. The city’s laws force platforms to delist properties at the request of the city. Jackson said that “the total properties delisted from Airbnb and VRBO is 267.” Palmer asked whether that was just recently or since the law first went into effect. Jackson said “I believe those numbers were recently,” but said she didn’t know for sure.
Either way, Palmer said she thought the number sounded low considering the thousands of unpermitted short-term rentals that existed prior to the new laws. She told The Lens that while the pandemic may have slowed down the tourism industry, she still gets frequent complaints about illegal operators, or short-term rentals that were hosting large events despite coronavirus restrictions.
“Absolutely there’s been a decline in visitors. But I will say that my complaints for short term rentals, the illegal ones, have not gone away.”
Palmer said that the lack of enforcement also takes money out of the pockets of responsible short-term rental owners and operators that follow the city’s rules.
“At the end of the day, not all STRs are bad,” she said. “We have legally operating, well managed STRs. And they’re being hit because we have illegally operating ones.”
She also said that she wants the city to take on enforcement now, before the tourism industry gets back into full swing.
“If they are really aggressive now with the enforcement, with shutting down the illegal STRs, their job will be a lot easier going into a full recovery,” she said.
The administration seems to be in agreement about the necessity to ramp up enforcement as the city emerges from the pandemic.
“The department also vowed to add more STR cases on the docket as it increases the number of cases on the docket,” Norton said. “This increase of cases will occur gradually until the fall when the Center for Disease Control also anticipates a decrease in COVID infections.”