St. Catharines licences B&Bs to close loophole exploited by short-term rental owners

Bed and breakfasts in St. Catharines are being placed under the same licensing bylaw that Airbnb, Vrbo and other short-term rentals fall under to close a loophole" city staff says is being exploited.

City council unanimously agreed to bring bed and breakfasts into the licencing system after learning about the challenges bylaw officers are facing trying to enforce the short-term rental bylaw, which came into effect in January 2022 to crack down on home rentals with badly behaving guests.

A staff report said bylaw officers are finding operators of illegal short-term rentals are claiming they are running bed and breakfasts in an effort to circumvent the short-term rental licencing bylaw and the penalties it carries.

Bed and breakfasts didn't fall under a licensing system until now.

Port Dalhousie Coun. Carlos Garcia questioned Monday if it was fair to add bed and breakfasts to the system when they aren't the ones causing the problems.

I do not believe that over the years we have had many complaints about bed and breakfasts. The complaints started because of Airbnbs, Vrbos and essentially what we call short-term rentals," Garcia said.

Because some of these short-term rentals are trying to disguise themselves as bed and breakfasts in order to get around things, we're essentially going to lump in bed and breakfasts - many of whom have probably been there for many, many years and have never elicited any complaints - and now we're going to make them apply and pay for permits and fees and so on. Is that fair?"

Paul Chudoba, manager of bylaw enforcement and licensing, said ultimately a bed and breakfast still invites people into a household and the new licencing requires them to have a fire safety plan and allows for inspections.

As well, St. Catharines would be following what Niagara-on-the-Lake and Niagara Falls already do in licencing bed and breakfasts.

It does kind of synergize with what's already occurring in the region."

Council adopted a short-term rental bylaw in 2021 to deal with neighbourhood complaints about noise, traffic, garbage and party houses being rented for short durations.

After the bylaw came into effect last year, the city took an education-first approach to gain voluntary compliance. It started active enforcement of the bylaw in May 2022 over the Victoria Day long weekend.

The staff report said it was during those enforcement efforts that bylaw officers noticed a pattern in which a loophole was exploited by defendants claiming they were operating as bed and breakfasts and shouldn't be subject to the bylaw.

Short-term rentals offer an entire dwelling for rent and the owner of the building isn't present during the rental. Bed and breakfasts have rooms that are rented separately, the owner is present and breakfast is provided. There are different parking standards as well.

It's not exactly known how many true bed and breakfasts are operating in the city.

Chudoba said there are about 200 active short-term rentals advertised currently and it's assumed that number includes a combination of short-term rentals and bed and breakfasts.

Only 33 short-term rental licences were issued by the city as of December 2022, with 18 pending.

Chudoba said the city estimates short-term rentals made $6.3 million in the city in 2022, based on the average short-term rental pulling in just over $1,600 a month with a 57 per cent average occupancy.

The city has issued 116 successful administrative penalties for short-term rental bylaw infractions worth $93,000.

Planning and building services director Tami Kitay said the number of complaints about short-term rentals have dropped in severity since the bylaw was enacted.

We have not been getting the same complaints with the same urgency and the same neighbourhood impacts that we have had in the past," she said.

Council repealed the previous bylaw Monday that only dealt with short-term rentals and replaced it with a licensing bylaw that includes bed and breakfasts.

The new licensing means bed and breakfasts will be subject to administrative monetary penalties and demerit points. There's also an application fee of $516, a renewal fee of $516 every two years and other fees for appeals.

Karena Walter is a St. Catharines-based reporter, primarily covering City Hall for the Standard. Reach her via email: karena.walter@niagaradailies.com