Strapped for funds, Tisbury is considering eliminating a cap on how many nights a unit can be used as a short-term rental throughout the year in order to increase the returns with a new tax structure.
On Feb. 10, the Tisbury Select Board raised the possibility of implementing a three percent community impact fee on short-term rentals as a way to generate revenue for the town, 30 percent of which would be reserved for the use of the town’s affordable housing committee to address in part the Island’s housing crisis.
The impact fee is an optional, additional tax that a municipality can impose on up to three percent of professionally managed short-term rentals on top of state and local taxes. Although no towns on the Vineyard have implemented the fee so far, it’s utilized in some communities in the region, like Falmouth and Nantucket. Tisbury Town Administrator Joseph LaCivita said the remaining 70 percent of funds collected can be used for other municipal needs, like the maintenance of infrastructure or parks.
Roy Cutrer, board member, said this could generate hundreds of thousands of dollars for Tisbury. But to maximize the flow of money to the town, Cutrer also wants to eliminate the total number of nights allowed for a short-term rental in the town. Under Tisbury zoning bylaws, short-term rental properties are only allowed to be rented for up to 75 nights in a year, which Cutrer said is the only such limit on Martha’s Vineyard.
“We would be limiting ourselves,” Cutrer said, highlighting the summer tourism and the wedding season in May and in the fall.
Additionally, Cutrer said he wanted to eliminate the cap to ease the restrictions placed on seasonal taxpayers, some of whom use a second home as a short-term rental during parts of the year. He highlighted the town’s 22 percent residential tax exemption, which shifts a part of the tax burden to second homeowners and those who own residential properties they don’t occupy, including apartments and vacant lands. He said that the town was “asking the seasonal taxpayers to shoulder our taxes” while controlling how their properties can be used.
“This is an industry,” Cutrer said. “It keeps cleaners working, landscapers working, caretakers working. There are a lot of people in our community who make their living from the seasonal rental market.”
Cuter, who is a “semi-retired” real estate broker, also said buyers will purchase a similar property in another town rather than in Tisbury because of the 75-night cap, so he also viewed the elimination of the restriction as a way to protect property values and limit a potential rise in tax rates in Tisbury.
The town’s need for money is raised amid a tide of large projects that are expected in the future. Tisbury plans to build a new town hall, and its voters are supposed to decide in June, as a part of an Island-wide vote, whether to fund the rebuild of Martha’s Vineyard Regional High School, which is, in total, expected to cost over $300 million.
Although the new tax was met positively, other Tisbury officials were wary of eliminating the cap because of the impact it may have on year-round residents.
Hilary Conklin, Tisbury town clerk, said eliminating the limits could “commercialize” neighborhoods and that the partying seen at some of the short-term rentals would disturb neighbors. Victor Capoccia, Tisbury’s affordable housing committee chair, also argued in favor of keeping some kind of cap. He said outright elimination could further decrease rental housing units for Islanders.
Ben Robinson, Tisbury planning board member and town representative on the Martha’s Vineyard Commission, highlighted a lack of enforcement. He said a report conducted with Oak Bluffs showed that only 22 percent of Tisbury short-term rentals meet the 75-night maximum. Robinson said most units are giving rentals for significantly longer: 300 nights or more. He said the limit was placed as a way to incentivize property owners to rent long-term rather than on a short-term basis.
“We won’t know how that plays out unless we do the enforcement side of our zoning,” Robinson said.
Capoccia also highlighted safety concerns over the limits. He said there have been “multiple hundreds” of public safety calls for short-term rental units in 2024.
Meanwhile, Tisbury finance committee chair Nancy Gilfoy highlighted that short-term rentals require inspections from various town departments, which costs money and could increase without the caps.
A draft warrant article would go before a public hearing process before being deliberated at the annual town meeting in April.
I would challenge Ben Robinson’s claim that some short term rentals are booked 300 days a year. He clearly has absolutely no clue about what is perhaps our largest form of employment for islanders. An 82% occupancy rate would be considered exceptional in highly desirable 4 season locations. We have at best a four month season with very few properties achieving an 82% occupancy, probably none. Thankfully the Select Board won’t listen to Ben who is known to be wrong on so many issues.