Committee proposes higher fines, new registration split for unlicensed short‑term rentals; legal counsel urges rational basis

The Annapolis Finance Committee debated stepped-up enforcement for unlicensed short‑term rentals on May 11, proposing larger baseline fines and a registration-fee split between owner‑occupied and non‑owner‑occupied units.

Members floated several options: a flat baseline fine (e.g., $500 per night) and a supplemental rule tying minimum fines to the highest advertised nightly rate or a multiple of the average nightly rate. "If they advertise it for $1,000 a night, you could actually get charged $1,000," a committee member said while discussing the intent to make fines meaningful and proportionate.

Legal counsel Miss Leonard cautioned the committee that fine schedules must have a rational basis to withstand legal challenge, typically linking fines to factors such as administrative costs, staff time or public-safety risk. "There has to be sort of some sort of rationale because otherwise you're treating essentially two people that are essentially doing the same thing…without a basis for it," she told the committee.

Committee members resolved to include two options in the committee recommendations for council consideration—(a) a $500 baseline fine per night and (b) a minimum tied to the advertised nightly rate or a multiple thereof—and to ask the city attorney’s office to draft defensible code language for enforcement and for staff to analyze cost recovery to ensure fees cover administrative costs.

Committee members also discussed raising registration fees for non-owner-occupied short‑term rentals (suggested increases in discussion: $700 for non-owner-occupied, $600 for owner-occupied as a starting point) and asked staff for the current owner/non-owner breakdown to model revenue impacts. The committee emphasized that fees should cover full program costs.