A special provision built into New Orleans’ short-term rental law – allowing the city to waive the normal cap of one rental per block under certain conditions – has created a deluge of paperwork, with hundreds of property owners applying for the exception.
The City Planning Commission, the agency that handles the requests, does not have the staffing capacity for all the extra work. So the city has turned to a contractor to process the applications. But hopeful applicants and some frustrated council staff allege that the contractor’s work is riddled with inconsistently applied standards, creating additional labor for council offices.
“From our perspective, the issue is more of a lack of definition of what the criteria should be,” Robert Rivers, executive director of the City Planning Commission, told Verite News. “So the City Council adopted the regulation and included in those regulations were the criteria that we are charged with interpreting to make decisions. And those criteria – again, which were voted on by the council and adopted by the council – were very broadly worded.”
According to Rivers, the effort to process the applications is strenuous on the office: one City Planning Commission employee works full-time on the short-term rental exceptions alongside outside consultants. By way of comparison, Roberts said that the City Planning Commission typically processes anywhere from 400 to 500 land use matters in a given year. With this exception process, they now need to process hundreds of exception applicants in just a few months.
As of late last month, the city had received 300 requests for special exceptions. The bulk of those came in 2023 after the city put in place new short-term rental regulations and ran its first lottery. But those exceptions couldn’t be processed or considered at the time due to the moratorium on enforcing short-term rental regulations. With the moratorium lifted, the City Planning Commission and the City Council are now tasked with processing the backlog of these applications, along with new exception requests coming in following last month’s short-term rental lottery.
In just the past month, the New Orleans City Council — which has the final say over granting the exceptions — has received 65 processed applications from the City Planning Commission and has granted 19 exceptions. Councilmembers expect to receive dozens of applications for an exception in the coming weeks and will need to vote on whether to approve or deny each one within 60 days of receipt.
The new special exception carveout resulted from a yearslong legal battle between the New Orleans City Council and short-term rental operators. The council, concerned about the proliferation of vacation rentals in residential areas, has tried to find ways to limit them. In 2019, the council passed a law that restricted short-term rental operator licenses to people who lived full-time in the homes they wanted to rent out and could prove it with a homestead exemption.
But a group of operators sued, and in 2022, a federal judge found that the law unconstitutionally shut out property owners based outside of Louisiana. In 2023, the council passed the latest version of the law, including the one-per-square-block cap with licenses doled out through a lottery. But Councilmember Freddie King, who said he worried that the cap would unfairly exclude small operators who need short-term rental income, added the exception.
The new law survived another legal challenge. Now, the city is tasked with putting the new regulations into place.
Under the law, exceptions to the cap are only allowed after a thorough review process. Those reviews are being conducted by SAFEBuilt, LLC, a Colorado-based firm the city hired last year to help with city permitting and land use matters.
But some permit applicants say the company’s work leaves a lot to be desired.
‘No one seems interested in facts’
Steven Schum applied for a special exception to operate an AirBnB on his Touro Street property in Faubourg Marigny. An existing bed and breakfast on his block meant that he was not eligible for the lottery, so the special exception process was the only way that he could potentially receive a license to operate. He went through the required steps – submitting an application to the City Planning Commission, paying a fee, hosting a neighborhood meeting – and expected the city to recommend that his application be approved.
He was surprised to discover that the City Planning Commission instead recommended the council deny the request.
According to the City Planning Commission’s evaluation, Schum failed to meet the necessary number of criteria to earn a recommendation for approval. But, according to Schum, the City Planning Commission’s evaluation was riddled with factual inaccuracies: It miscounted the number of nearby commercial and mixed-use developments, mischaracterized the available street parking, and even noted the wrong address for the property – at one point, the report references a different address located on Governor Nicholls Street.
So, Schum appeared at the City Council meeting on Aug. 8 to plead his case.
“The CPC report is filled with errors and refuses to correct it,” Schum said. “No one seems interested in facts.”
King, whose district includes Schum’s property, appeared to agree.
“I do understand that the CPC has their report,” King said at that meeting. “It seemed like the criteria changed.”
The review was conducted by SAFEBuilt consultants.
According to Roberts, the consultants with SAFEBuilt use aerial photography, maps and GIS databases, as well as property owner information in making their assessments.
“They’re obviously not on the ground here in New Orleans and doing site visits with every application, but they do have a visual,” Roberts said.
A representative from SAFEBuilt confirmed this. The representative also said that many factors go into their evaluation, and they assess whether a property meets a given criteria based on an aggregate of information, adding that the company erred on the conservative side in their recommendations given that it was evaluating “special” exceptions.
Both Roberts and the SAFEBuilt representative said that the burden of providing additional information falls on the applicant, who must prove that they deserve a special exception.
“The council adopted a one per square regulation on the premise that one per square is the most that is generally acceptable in a residential area,” Roberts said. “And so from our way of looking at it, that kind of sets the bar. And so any more than one is going to have to be special, and there’s going to have to be some special circumstances that warrant a recommendation of approval. And so the way we are reviewing them, our starting point is denial.”
Complaints like Schum’s have been a regular feature in recent City Council meetings as councilmembers have begun to vote on approving or denying a wave of applications for short-term rental exceptions.
Many residents say that the City Planning Commission’s process for recommending approval or denial is riddled with minor factual errors and inconsistencies.
According to one council staff member, a resident said that they had off-street parking for their proposed short-term rental, but the City Planning Commission’s report said otherwise.
There have also been discrepancies in how the City Planning Commission has applied its standards. One evaluation said that a property located on Octavia Street met the criteria for serving the neighborhood’s needs due to the property’s proximity to Tulane University. The recommendation said that parents of Tulane students could stay at the short-term rental, making it an appropriate use in that neighborhood. However, another evaluation found that a property on Hillary Street did not meet the criteria for an exception despite being a similar distance from the university.
Though the City Planning Commission and its consultants receive and evaluate the applications, it is ultimately up to the City Council to vote on whether to grant the exceptions. But with frequent complaints about the city’s recommendations, councilmembers often have to come to their own conclusions as to whether to vote to approve or deny the exception.
King told Verite News that what was most important to him in deciding whether to grant an exception was whether the applicant had the support of their neighbors.
“If your next-door neighbor, the person who’s most affected, or the person across the street says, ‘I think they’re good,’ then who am I to say no?” King said. “I don’t want to jeopardize a livelihood or ability to make ends meet because they take out one extra parking spot.”
King said even if this exception process creates extra work for his office, it has been worthwhile.
“I think the extra work that’s been put on our office is worth it when you’re trying to keep a neighborhood intact or save somebody’s mortgage assistance,” King said.
Councilmember Joe Giarrusso told Verite News that the City Planning Commission, like many city agencies, is in a tough position because it has to give a black-and-white answer to the criteria while councilmembers are able to apply more nuance.
For his part, he and his council staff have come up with their own rubric to determine whether he will support a special exception in his district. This rubric includes questions like “Can this property be rented out to long term tenants?” and “Are your immediate neighbors in favor?”
Giarrusso and his staff developed the rubric so that they could apply their own consistent standards, as well as explain why he may ultimately vote against the recommendations of the City Planning Commission.
“I just worry that people are grabbing the CPC report as the holy grail of the high water mark,” Giarrusso said. “My hope is that there’s a little more faith in councilmembers digging beyond that and trying to consider what is important.”
A subjective review process
For Monique Blossom, policy and communications director at Louisiana Fair Housing Action Center, the issues arising over the special exceptions for short-term rentals show the weakness of the law.
“[We have] firmly opposed the exemption process from the beginning,” Blossom said in an email. “We have consistently advocated for clear regulations and vigorous enforcement. And frankly, a subjective exemption process muddies the waters and makes the City vulnerable to further litigation. Do we really want to find ourselves unable to enforce existing laws or forced to rewrite ordinances because of more lawsuits?”
Affordable housing advocates argue that a proliferation of short-term rentals has dismantled the rental housing market as landlords have converted long-term units into short-term rentals for tourists, squeezing the city’s housing supply, particularly in neighborhoods in the historic core, which are popular with tourists and close to a large number of jobs.
Building in the exception to the law weakens the protections that the cap was meant to provide. And the evaluation process — which hinges on things like recommendations from neighbors and councilmembers’ assessment of whether an applicant will be a good actor — is not objective, Blossom said.
“While the lottery process was a straightforward and objective process that picked ‘winners and losers’ from qualified applicants for who can and cannot receive a short-term rental license, the exemption process is playing out as a highly subjective process of who is in the greatest need of extra income, who can garner the favor of their neighbors, and final decisions from councilmembers who can either follow or overrule the recommendations of the City Planning Commission,” Blossom said.
For Schum, the aspiring operator of an AirBnB on Touro Street, that subjective process ultimately worked in his favor after King and other councilmembers voted to approve his special exception license in spite of the City Planning Commission’s recommendation for denial.
“There’s no objective criteria for this process,” Schum said. “They are written to be interpreted however the city planner wants to interpret them. It’s a joke.”
Republish our articles for free, online or in print, under a Creative Commons license.
