The short-term rental (STR) market for using peer to peer rental services such as Airbnb and VRBO has grown significantly in recent years. These services allow property owners to realize the economic benefit of renting all or part of their properties as an STR.   However, there are corresponding concerns raised by neighboring property owners who feel STRs could result in the loss of a sense of community given the transient nature of such a use. The biggest challenge for a municipality that wants to regulate STRs has been attempting to regulate the use under an existing zoning ordinance that does not specifically address the use.

Recent Commonwealth Court cases, most originating in Monroe County, highlight the difficulty that municipalities have in attempting to regulate STRs under zoning ordinances that do not specifically address the use. In the Monroe County cases, the municipalities attempted to regulate STRs by determining that the use was not a permitted single-family dwelling use but rather was a use not permitted in the underlying zoning district such as a “lodge,” “tourist home” or “transient lodging business.” In all three cases, and others, the Commonwealth Court looked at the definitions in the zoning ordinances and found that the use categories relied upon by the municipalities were not applicable and the STRs were not prohibited.

This is the first post in a two-post series and focuses on one of the Monroe County cases, which was decided in June 2017 by the Commonwealth Court and which the Pennsylvania Supreme Court recently agreed to hear on appeal. The second post in the series focuses on a case out of Lackawanna County that was decided by the Commonwealth Court this past December.

The case to be heard by the Supreme Court is Slice of Life, LLC v. Hamilton Township Zoning Hearing Board, 164 A.3d 633 (Pa. Commw. Ct. 2017). Specifically, the Supreme Court will be reviewing the issue of whether the Commonwealth Court ignored the precedent established by the Supreme Court in the case of Albert v. Zoning Hearing Board of North Abington Township, 854 A.2d 491 (Pa. 2004).

In the Slice of Life case, the Township issued an enforcement notice to the property owner alleging that the property was being used as a hotel or other type of transient lodging in violation of the zoning ordinance. According to the zoning ordinance, single-family residential was the only permitted use in the relevant zoning district. Unlike in the other Monroe County cases, the property owner in the Slice of Life case did not live at the property. The property owner appealed the enforcement notice and the zoning hearing board held eight hearings over a period of ten months. The zoning hearing board denied the property owner’s appeal and the Court of Common Pleas upheld the zoning hearing board’s decision.

The Township’s zoning ordinance defined the term “family” as “[o]ne or more persons, occupying a dwelling unit, related by blood, marriage or adoption, living together as a single housekeeping unit and using cooking facilities and certain rooms in common.” The zoning ordinance also defined the term “hotel.” However, the terms “single family,” “tourist home,” “transient lodging,” and “transient tenancies” were not defined in the zoning ordinance.

The Township argued STRs were not consistent with a single family residential use and that the Albert case was controlling on that issue. In the Albert case, the Court was required to determine whether a single family residential dwelling could be used as a halfway house for recovering alcoholics and drug addicts where the term “family” was not defined in the zoning ordinance. The Supreme Court stated that in the absence of a definition in the zoning ordinance of the term “family,” a “’single housekeeping unit’ must be considered the plain and ordinary meaning of ‘family’ in the zoning context.” The Supreme Court stated that in addition to functioning as a family, the “composition of the group must be sufficiently stable and permanent so as not to be fairly characterized as purely transient.” In the Albert case, the Supreme Court found that the residents of the halfway house would only be staying for short periods of time and that the resulting “instability and transience is simply incompatible with the single-family concept.” The Commonwealth Court discussed the Albert case and noted that in the Albert case, unlike in the Slice of Life case, the term “family” was not a defined term in the zoning ordinance which required that the Court determine the meaning of the term.

The Commonwealth Court found that the fact that the property owner did not live at the property did not ultimately affect the outcome of the case. What appeared to be controlling was whether the property was being used as a single family residential use. The Commonwealth Court found that there was an ambiguity in the language of the Township’s zoning ordinance and that the ambiguity required that the court interpret the language in favor of the property owner. What wasn’t discussed in the Slice of Life decision was whether the tenants actually met the definition of a “family” as that term was defined in the zoning ordinance. It appears that the Supreme Court is interested in reviewing whether the transient character of the occupants of the house must be given greater consideration by the courts in STR cases.

Please feel free to contact any member of the McNees Wallace & Nurick Land Use Group for assistance with any land use or development issues and/or if you have any questions regarding this post.