Select Board approves regulation tightening to limit corporate control of Nantucket short‑term rentals
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Summary
The Select Board approved an amendment to Town Regulation Chapter 3.38 to close a loophole allowing corporate-controlled short‑term rentals to operate through LLCs and S corps; the Board of Health previously approved the change and town counsel and residents asked for clarity on definitions.
The Nantucket Select Board voted to approve amendments to Town Regulations Chapter 3.38 intended to prevent corporations that operate short‑term rentals (STRs) from circumventing limits by registering properties through LLCs or S corporations.
"The amendment seeks to clarify that LLCs and S corps are only eligible for a short‑term rental certificate if all of its members, partners, shareholders or beneficiaries are natural persons, and none of whom also serve as an officer or director of a corporation, a partnership, or a real estate investment trust that is operating short‑term rentals in Nantucket," Devin Braun, attorney with KP Law, told the board. The Board of Health had already approved the amendment and the regulation was presented to the Select Board for final approval under the town code.
Rockey Maramantes, the public health director, said the change was intended to close a loophole that some companies were exploiting "by registering those homes as LLCs, thereby creating a kind of a situation we were unable to determine whether that met guidelines." He added the amendment is designed to align the regulations closely with the intent of bylaw Chapter 123.
Several residents welcomed the intent but urged clearer drafting. Rebecca Duham said the language could be imprecise and asked whether the definitions in Chapter 123 carry over into Chapter 3.38: "It would seem that the specific definition of corporation and partnership that exists in 1 23 needs to be reiterated in chapter 3 38 so that we can make sure that the interpretation is clear," she said. Devin Braun responded that, in his view, the definitions in Chapter 123 carry over into the regulations promulgated under that chapter, and that the Board of Health can amend the regulations if enforcement reveals unforeseen problems.
The board moved, seconded and approved the amendment by roll call. Don recused himself from participation in that matter earlier in the meeting, and the board recorded votes for and against as part of the roll call.
The Select Board did not change the regulation's intent at the meeting; staff and counsel said they will assist operators with questions and that enforcement and fine‑tuning would be managed by the Board of Health going forward.
The vote concluded the Select Board’s formal role in approving the regulation; residents who raised concerns were encouraged to follow up with the Board of Health and town staff for clarifications.
