Public opposition grows as Cape Coral discusses $600 annual rental registration and new tourist development fund

Cape Coral’s proposed changes to rental registration and a newly proposed tourist development fund drew extended public comment and sharply divided council discussion on Tuesday.

Councilmember Donnell asked that two ordinances — one amending residential rental registration and another creating a tourist development fund funded by those revenues — be removed from the council introduction and taken to the Committee of the Whole for further review. After repeated exchanges on procedure, council members agreed to send the items to the Committee of the Whole for more discussion; the council’s procedural votes earlier in the evening left the ordinances live for that next step.

The proposed registration ordinance would replace the city’s current one-time $35 registration with an annual $600 fee, according to materials in the council packet and multiple public speakers. That change, speakers said, would disproportionately affect working-class long-term rental owners and tenants as much as the short-term rental industry. Numerous speakers described the fee as a "double tax" or an "equity" issue and urged the council to target enforcement and fees at unregistered short-term rentals rather than annual landlords.

"A change from a one-time $35 fee to a yearly $600 fee on an estimated 10,000 rental properties in the city of Cape Coral — a $6,000,000 revenue grab — is wrong," said Kevin Besser, director of a local association representing rental property owners. "Many of these properties are long-term rentals to working-class families; they are not short-term vacation rentals."

Others said Cape Coral needs targeted enforcement that identifies vacation rental platforms that fail to collect required tourist bed taxes. Realtor Tom Piotkowski urged the council to focus enforcement on unregistered short-term rentals and to use state registration listings to find them.

In addition to the fee debate, Councilmember Steinke and others urged the council to ensure any tourist development fund be tightly defined with project-level accountability. Councilmember Long said the draft aimed to earmark revenues for tourism-related capital and programming rather than sending the money into the general fund.

What’s next: Councilmembers agreed to take ordinances 26-25 and 27-25 to the Committee of the Whole for a substantive discussion prior to a June public hearing. Staff and councilmembers said they would invite the Realtors Association, short-term rental hosts and other stakeholders to the discussion.

Why it matters: If enacted as introduced, the ordinances would shift how the city regulates and charges rental housing operators and establish a new funding stream earmarked for tourism amenities. Citizens raised concerns over affordability, enforcement and whether the regulation would catch annual landlords who are not the policy target.

Speakers quoted are drawn from the council meeting record and were part of the public comment period.