Addressing Short-Term Rental Challenges in the Village of Ellicottville

The recent hearing on the Village of Ellicottville’s short-term rental (STR) law revealed significant challenges in regulating and enforcing current rules. While there is widespread recognition that effective enforcement is critical, the village’s inability to address violations due to limited resources remains the core issue.

The Enforcement Gap

Currently, the village faces a significant discrepancy: only about 30 licensed short-term rentals exist, while approximately 170 unregistered properties operate in the area. Most violations occur on weekends when enforcement officials are unavailable, creating a gap in oversight during the times issues are most likely to arise. Even when enforcement action is taken, the legal process to shut down non-compliant operators has proven too costly and often unsuccessful. The village simply does not generate enough revenue from licensing fees to fund the necessary enforcement resources.

Proposed Fee Increase: Penalizing the Compliant?

The village’s proposal to increase the STR licensing fee from a flat $200 to $1,000 appears to be a flawed approach. While it might generate $30,000 from the 30 currently licensed properties, this amount is unlikely to adequately fund consistent enforcement. Moreover, this increase penalizes responsible property owners who are already complying with the law, while unregistered operators remain unchecked.

A Better Path Forward

The village must take a more thoughtful approach to generate the revenue needed for enforcement while encouraging compliance and improving outcomes for the community. Here are some proposed strategies:

1. Determine Real Enforcement Costs:

Before increasing fees, the village must assess the actual cost of a dedicated enforcement program. Knowing the target budget will allow for a more informed revenue strategy.

2. Create a Proportional Fee Structure:

A one-size-fits-all licensing fee is not appropriate for Ellicottville’s diverse properties. Instead, licensing fees could be based on a property’s noise risk factors, including:

• Occupancy limits

• Square footage

• Proximity to neighbors

• Lot size

• Amenities like hot tubs, fire pits, and decks, which often invite gatherings that pose greater risks.

Properties with higher risk factors would pay higher licensing fees, aligning costs with enforcement needs.

3. Shift Some Costs to Guests:

The village should allow operators to hold guests accountable for violations. By increasing the cost of fines and making violations highly visible, owners can include clear house rules during bookings. This empowers operators to pass fines to guests who break the rules while encouraging compliance.

4. Tie Fees to Booking Revenue:

Instead of a flat fee, the village could charge a small percentage of total booking revenue. This approach treats properties fairly based on their income and relative risk.

5. Educate STR Operators on Best Practices:

Responsible property management can prevent many issues. Operators should be encouraged to:

• Raise nightly rates for short stays to deter parties.

• Incentivize longer stays (e.g., 3+ nights), which typically pose lower risks.

• Prohibit single-night bookings, which are more likely to attract problem guests.

• Implement occupancy-based pricing strategies that discourage large, unplanned gatherings.

6. Enforce a Three-Strike Accountability System:

Owners must remain responsible for their properties, but a fair three-strike system would balance accountability and give property owners time to address recurring issues.

The Village Needs Dedicated Enforcement Resources

Ultimately, the village cannot succeed without dedicated staff or funding to enforce its STR regulations. Rather than overburdening compliant property owners, the village should focus on strategies that generate sufficient revenue while encouraging registration and compliance.

Conclusion

Ellicottville needs a more balanced approach to short-term rental regulation—one that prioritizes consistent enforcement, creates fair licensing fees, and promotes best practices among property owners. By focusing on proportional fees, revenue-based structures, and guest accountability, the village can strike a balance that supports its residents, visitors, and economy without unfairly penalizing those who follow the rules.