SOUTH PORTLAND — The City Council took steps Wednesday night to ban controversial “unhosted” short-term rentals in all residential zones and set up a licensing scheme to regulate and greatly limit “hosted stays.”

Under the proposed ordinance, a homeowner could host Airbnb or HomeAway guests in his or her primary residence for periods less than 30 days. Many of the nearly 300 short-term rentals operating in the city would be illegal under the proposal because they are owned by people who don’t live on the premises.

Homeowners could rent out only one room or accessory apartment and could host a maximum of two adult guests, mirroring an existing ordinance that allows “home occupations.”

“The language that should guide us is already there,” said Councilor Claude Morgan, adding that the ordinance is intended to allow homeowners to generate supplemental income, not create “an independent source of commerce.”

Morgan said the council could increase the limits on hosted stays in the future, but for now the community needs to heal from a conflict that has “ripped apart” neighborhoods. The council is expected to vote on a first reading of the proposal on Feb. 6.

Hosted stays wouldn’t be allowed to have business signs, host gatherings or exceed parking limits. No short-term rentals would be allowed in buildings with three or more dwelling units, including condominiums.

Also during Wednesday’s workshop session, the council dropped a proposal that would have allowed homeowners in residential zones to rent out their primary residences for less than 30 days while they were away.

This two-family home on Willard Beach, overlooking Simonton Cove and Casco Bay, is one of a growing number of short-term rental properties in South Portland.

INNS AND OUTS

While short-term rentals have existed in the city’s seaside neighborhoods for decades, the issue came to light last summer when some residents near Willard Beach complained about noisy and disruptive guests at rentals without an owner on the premises.

All seven councilors have expressed concern at past meetings about the proliferation of short-term rentals, fearing that they are eroding the city’s residential neighborhoods, removing already scarce housing from the market and driving home prices even higher.

A significant worry is the trend of buying, renovating and renting out entire homes in South Portland for a few days or weeks, on popular websites such as Airbnb and HomeAway.

The council acted on the recommendations of its attorney, Sally Daggett of Jensen, Baird, Gardner & Henry in Portland, who said the city’s land-use ordinance wouldn’t withstand court scrutiny because it doesn’t clearly address short-term home rentals.

The city’s land-use or zoning ordinance defines an “inn” as a business renting one to 20 “sleeping rooms” to transient guests, and inns aren’t allowed in residential zones. It also allows homeowners in residential zones to rent out rooms to as many as two people at a time as a “home occupation.”

ISSUE ACROSS THE COUNTRY

South Portland is the latest U.S. city to wrestle with this issue, as has neighboring Portland. On Tuesday, the Metro Council in Nashville ended a yearlong debate voting 25-5, with seven abstentions, to phase out short-term rentals in single-family homes and duplexes in residential zones that aren’t occupied by their owners, the Tennessean reported. The process will take three years.

There are 282 short-term rentals in South Portland, including about 200 single-family homes that are not owner-occupied, allowing travelers to rent a whole house or apartment for a few days or a few weeks, according to Host Compliance, a third-party web service.

Andrew Kalloch, a representative of Airbnb, said some of its “entire home” listings are primary residences that are rented out only when the homeowners are away, usually for several weeks a year.

This week, Airbnb sent an email to South Portland residents, asking them to “Email the mayor and City Council today and tell them about your home-sharing experience and to urge them to recognize Airbnb and other short-term rental platforms as economic engines in the community.”

The email linked to a web page where Airbnb claimed that last year, 170 of its South Portland hosts earned $1.6 million and welcomed more than 11,000 guests arrivals.

CONFLICT UNRESOLVED

Among about 30 people who addressed the council Wednesday night, several urged city officials to enforce the existing ordinances.

“I didn’t think I had to worry about a commercial business moving in across the street,” said Louise Tate, who has lived on Deake Street near Willard Beach for 20 years. She said people who are buying single-family homes to operate as short-term rentals are “speculators” and questioned the motives of real estate agents who have promoted such sales.

At the same time, many short-term rental operators say the few noisy, out-of-control properties that riled the city’s seaside neighborhoods last summer are the exception, not the rule.

They say city officials shouldn’t suddenly crack down after allowing short-term rentals to operate unfettered for several years. They’ve formed an association and hope the council will establish a committee of stakeholders to work on a mutually acceptable solution.

Peter Cooke, who lives near Willard Square and operates a non-owner-occupied short-term rental a few blocks away, was one of several speakers Wednesday who urged the council to form such a committee.

Cooke said the process so far had divided the community and “criminalized” some short-term rental operators.

“Is there no middle ground?” Cooke asked.

Kelley Bouchard can be contacted at 791-6328 or at:

kbouchard@pressherald.com

Twitter: KelleyBouchard