March 20, 2008

In most of America, the issue of whether or not homeowners can lease residences as short term rental units may not be the subject of sizzling debates. In Florida, however, the use of beachfront and non-waterfront homes near major tourist attractions as vacation rentals is commonplace and a vital part of the Sunshine State's economy. Increasingly, local governments are seeking to restrict short term rentals and these property rights infringements are producing heated debates.

This week, Florida's 12th Judicial Circuit Court issued an important pro-property rights ruling overturning a municipal decision to limit short-term rentals to three times per year. Judge Robert Bennett's order in Stephen E. Milo, et al. vs. the City of Venice, stated the City's decision was "clearly erroneous." This ruling has statewide implications.

In August 2006, the City's planning and zoning director declared houses in single-family residential neighborhoods could not be rented for 30 days or less in excess of three times per year. Property owner Stephen Milo joined with a group of owners in appealling this decision to the Planning & Zoning Commission. The P&Z Commission sided unanimously with Milo. In December 2007, the Council overturned the P&Z and supported the zoning director's decision to limit rentals. Mayor Ed Martin remarked, "The owners can accept that fact or go to court."

Judge Bennett's ruling invalidates the City Council decision and clarifies that temporary residences are expressly allowed under City Code, without limitations.

"The mayor and the city council told us we go had to go to court, and that's exactly what we did,"said Milo's attorney Rick Rumrell. "The homeowners were able to come away with a significant victory for protection of their property rights."

Municipalities across Florida may now be forced to reconsider their policies and could be liable for financial damages inflicted by ordinances restricting short term rentals. The ruling may impact municipalities inappropriately limiting rentals on the basis of duration or frequency of use and may apply to the enactment of rental restrictions where owners are not compensated for the impact of these regulations.

"This is a clear victory for property owners," said Valerie Fernandez, managing attorney with the Pacific Legal Foundation, a non-profit, public-interest legal organization which assisted in the case. "The court ruled unambiguously that, when governments seek to take property or even a portion of someone's property, the owners must be justly compensated under the 5th Amendment."

In light of Florida's current property tax and insurance crises, denying non-homestead property owners the ability to derive income from their property may effectively force some owners to relinquish ownership.

Regulations which diminish usage rights and openly discourage property investment are not healthy for property rights or Florida's economy.

CONGRATULATIONS!

Congratulations to property owners Stephen Milo, Sara Milo, Damaris Milo, Alan Evans, Cecilia Evans, Daniel Cohen, Venice Sunshine, Venice Real Estate Investors, Venice HSD, Venice Beach Investors, and Vacation Rental Pros Property Management on this great legal victory and for your courage in fighting for your rights!

Kudos also go out to attorneys Rick Rumrell and Alicia Curran of the Rumrell, Costabel, Warrington & Brock law firm in Jacksonvilleand to Valerie Fernandez of the Pacific Legal Foundation's Atlantic Center!

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