The New Orleans City Council on Thursday (Aug. 22) signed off on another round of short-term rental licenses to property owners seeking to exceed the normal neighborhood cap, granting approval to 21 applicants across three council districts.

The applicants who were granted licenses on Thursday, and others whose licenses were considered at previous meetings, needed council approval because there are already licensed vacation rentals on the blocks where their properties are located. 

The latest version of the city’s short-term rental law, approved by the council last year, places a limit of one per block. Licenses are granted through a city lottery. But property owners who are not selected in the lottery can apply for a waiver on the cap on their blocks through the City Planning Commission and City Council. 

The exception process, written into the law by Councilmember Freddie King, has been criticized by affordable housing advocates, who are concerned that exceptions to the cap will become commonplace, undermining the protections that were built into the law. Since the new law went into effect last year, the City Planning Commission has fielded hundreds of waiver applications.

Over the course of three meetings, the council has granted 40, many of them in parts of the city — including Treme, Bywater and Faubourg Marigny — where residents have long complained about an influx of vacation rentals taking properties off the long-term market. 

The majority of the applications approved Thursday were in King’s district, which includes those downriver neighborhoods. King successfully moved to approve 12 exceptions, eight of which were recommended for denial by the City Planning Commission. He denied one short-term rental, noting that it had no neighborhood support, and deferred at least two others when applicants or their representatives noted faulty information in the evaluation done by the City Planning Commission.

Though King had the bulk of short-term rental agenda items in his district, other councilmembers also approved special exceptions within their district. Councilmember Joe Giarrusso successfully moved to approve eight short-term rental exceptions, with half of those being recommended for denial by the City Planning Commission. And Councilmember Lesli Harris moved to approve one short-term rental exception that received a recommendation for approval. In each case, the motion passed with all present councilmembers voting in favor. (The council denied one application on Thursday.)

The exceptions have produced a deluge of paperwork for the city, and the Planning Commission has turned to an outside contractor — Colorado-based SAFEBuilt — to conduct application reviews. In prior meetings, applicants complained about the review process, saying the contractor was applying the criteria inconsistently. Again on Thursday, both residents and councilmembers raised issues with the evaluations. 

Meeting attendees complained about a litany of issues, including missing documentation of support for applications from neighbors and inaccurate counts of available parking. 

“I will explain my disagreement with two of these criteria,” said Sanford Hinderlie, who was applying for an exception to run a short-term rental out of one room in his house. He cited the fact that he and his wife had a record of legally operating short-term rentals, though the report said otherwise. City records show that Hinderlie had a license to rent out part of the Bayou St. John home where he lives for more than three years.  

Giarrusso also identified inconsistencies in the City Planning Commission evaluations. He observed that one application, located near Magazine Street, was said to meet criteria for its proximity to local businesses and a park, while another application, located near Carrollton, did not meet that same criteria despite also being in close proximity to local businesses and a park.

“I’m looking for consistency between reports,” Giarrusso said.

A representative for SAFEBuilt previously told Verite News that many factors go into their evaluations, and the burden is on the applicant to prove that they meet a given criterion.

“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,” Robert Rivers, executive director of the City Planning Commission, said earlier this week. “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.”

Council again hears issues on late payments to city contractors

The City Council also held a brief hearing where city departments with outstanding invoices for city contractors, a problem that has plagued LaToya Cantrell’s administration and one that has made it more difficult for the city to hire vendors for essential construction projects, building maintenance and other city services. 

At the last vendor account hearing on July 25, a report submitted by the Department of Finance listed over $1.3 million in unpaid invoices. Approximately $944,000 of that was associated with a capital project with Sewerage and Water Board. 

Still, the number of invoices in limbo has decreased with council intervention, Giarrusso said. 

“Last meeting, we were at 80 total invoices, and we whittled that down. This time, we started at 122, and we’re at 13,” Giarrusso said.

Representatives from several city departments and offices came before the council to answer why specific invoices had not been processed. Most cited issues with the city’s payment system – arguing that some invoices were uploaded for work that was not yet completed or that a vendor had not provided all the necessary information for them to be paid.

The hearing came on the heels of an Aug. 7 report by the Louisiana Legislative Auditor evaluating the city’s processes for paying vendors. The report concluded that the city’s system for vendor payments cannot accurately provide information on how long it takes to pay vendors. The report also noted that the city needed to improve communication with vendors to inform and assist them about invoicing procedures.

The overdue invoice hearings have become a staple of City Council meetings, providing a regular, public accounting of which vendors have not been paid within the mandatory 30-day window and how departments plan to address it.

“The whole hope is to work collaboratively to make this easier,” Giarrusso said.

The council’s economic development committee will discuss the auditor’s report at length during its upcoming meeting on Aug. 27. 

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Katie Jane Fernelius reports on the local government for Verite. Prior to joining Verite, she was an independent journalist and producer. Over the course of her career, she’s reported for and worked...