Committee moves bill allowing municipalities to restrict short-term rentals within exclusively residential zones

The Assembly Housing Committee voted to release A5434, a bill that would permit municipal zoning ordinances to designate areas exclusively for residential use and to restrict short-term rentals within those districts unless the municipality explicitly authorizes transient accommodations.

Under the bill’s text read into the record, a municipality could allow short-term rentals in designated areas only if the total land area available for transient accommodation does not exceed 25% of the municipality’s total land area. The bill also allows municipalities to prohibit short-term rentals in exclusively residential districts unless the ordinance explicitly permits them.

Assembly members raised concerns about potential state encroachment on municipal zoning authority. Assemblywoman Flynn said she would abstain on the release motion because "we are slowly encroaching upon the local municipality's ability to zone" and indicated she would seek feedback from local officials and leagues of municipalities. Assemblyman Clifton also abstained for the same reason.

Committee members who voted to release the bill said the measure is intended to give local governments more explicit tools to manage how short-term rental markets affect available housing stock. Assemblywoman Keanu recorded a yes vote but signaled she would discuss outstanding concerns with the bill sponsor.

The motion to release A5434 passed with recorded abstentions and yes votes. Committee members instructed staff to continue consultation with municipal officials and stakeholders as the bill moves forward.