18 April 2011 by By Jason Garcia, Orlando Sentinel
An attempt by the vacation-rental industry to avoid many local government regulations has run into an influential opponent in the state Capitol: Walt Disney World.
Disney, which considers offsite vacation rentals competition to its 25,000 hotel rooms and time-share units, recently joined local governments to oppose a bill that would have invalidated existing city and county laws that either prohibit vacation rentals entirely or require those rental homes to comply with the same regulations as commercial hotels.
The legislation was subsequently rewritten to placate Disney and other critics. The new version would prohibit only new laws targeting vacation rentals; current regulations would be permitted to stand, as long they were adopted by June 1 of this year.
That exception would spare existing restrictions in Orange County — home to most of Disney World's vast property — that prohibit residential properties from being rented out for periods of less than six months. Short-term rentals are allowed only on properties zoned for commercial or industrial uses.
"We believe the current regulatory environment is appropriate," Disney spokesman Bryan Malenius said.
But some vacation-rental advocates aren't happy with the concession.
"We believe the current, non-consistent policies by different local and county governments throughout the state are confusing to tourists, investors and second-home buyers, which are all vital to the future strength of our state's economy," said Scott House, president of the South Florida Vacation Rentals Association, an organization that was founded in response to what it calls "excessive" restrictions on rental homes enacted by South Florida governments.
"The results of such restrictions have already impacted local economies, by way of increased home foreclosures, decreased tourism visitors, and lower taxes being collected by local and state agencies," House added.
The conflict comes as the vacation-rental industry, once a niche segment of the state's tourism industry, has mushroomed into big business. The Florida Vacation Rental Managers Association, the trade group that lobbied to eliminate all local-government restrictions, estimates that there are now more than 20,000 vacation-rental homes in Central Florida alone.
Those homes are most heavily concentrated to the south and west of Disney World, in northeast Polk and northwest Osceola counties, where they pose a unique form of competition to the giant resort. That's because such homes are often attractive to larger families — a market that Disney hopes to capture more of itself.
Disney next year plans to open a roughly 2,000-room hotel dubbed Disney's Art of Animation Resort. More than half of its rooms — 1,120 — will be "family suites" with enough space to accommodate as many as six people and priced more affordably than Disney's multi-room time-share "villas," which the resort also rents out. Disney currently has only about 215 family suites in its entire room inventory.
Another wrinkle for the resort: Disney is in the midst of building "Golden Oak," a residential community of multimillion-dollar mansions near the Magic Kingdom that Disney says will ultimately contain about 450 homes. Disney says those homes would be bound by Orange County's existing restrictions on short-term rentals.
State Rep. Mike Horner, a Republican from Kissimmee who is sponsoring the vacation-rental legislation (HB 883), called it a property-rights issue.
"If I own a vacation-rental home and there's other vacation-rental homes around, and let's say some of those [neighborhood's other] homes are bought up, and now they have full-time residents living in them, and they go to their city commission, and it comes along and says, 'Well, we're going to make it illegal to have vacation rentals in this area.' I invested in this property for a reason, and all of a sudden I've lost that use of my property," Horner said.
But Horner said he also wanted to accommodate some of the concerns raised by Disney and local governments. "When you have an asset like Disney World, you want to be very careful about the activity that goes on around that," he said. "I think they want to be careful that they preserve that relationship and they understand what the future holds in terms of land use around their property."
It's not the first time this spring that Disney has objected to efforts in the Legislature to eliminate regulations. When a plan surfaced in the Florida House to deregulate the time-share industry — as part of a broad bill lifting state oversight of roughly two-dozen industries and professions — Disney immediately balked, citing concerns about unscrupulous developers soiling the time-share industry's reputation.
The time-share language was quickly stripped from the bill, though some critics accuse Disney and other big businesses of supporting certain regulations because they stifle competition by making it more difficult for new businesses to start.
And now that existing rules for vacation homes would also remain in force, Disney says it no longer opposes the vacation-rental legislation.
"The bill as it stands today would not impact our business," Disney spokesman Malenius said.
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