Heightened Security and Reporting Requirements for Condo Owners

City of Gulf Shores Now Requires Local Contact, Monthly Revenue Reporting and Safety Inspections

By Selena Chavis, Condo Owner Magazine, February 1, 2014

A new ordinance went into effect on January 1 in Gulf Shores that requires owners of rental units to provide local emergency contact information and submit individual monthly revenue reports to the city. An amendment to the city’s business license ordinance, the new requirement is to address the need for enhanced safety and public welfare and provide for better accounting and collection of lodging taxes, according to city officials.

Grant Brown, director of recreation and cultural affairs with the City of Gulf Shores, pointed to recurring instances where the city has been unable reach unit owners or representatives of rental dwellings regarding an issue. Because a large percentage of rental units have out-of-state owners who manage their business through popular Internet sites like Vacation Rentals By Owner, Grant said “there’s not a local person who can address things that come up locally” such as fires, unit overcrowding or renters who become disruptive.

The ordinance specifically requires that a local emergency contact be provided by name, address, telephone number and email address who is able to appear onsite at a rental unit within 120 minutes after a request is made. The local contact information must be provided at the time of business license application or renewal.

Failure to comply with the requirement can result in a fine ranging between $100 and $500 for each violation and potential imprisonment for up to 30 days.

“We are looking at the best situation to keep everyone safe,” Grant said, pointing to a situation that occurred over the spring break period in 2013 where six college students were hospitalized when a deck collapsed at a beach house in the West Beach area of the city. The renters were later evicted from the house, and overcrowding was suspected. “There were two or three issues that brought this to the forefront,” Grant added.

While the new requirement may help alleviate difficulties in contacting those in charge of rental units, some owners and industry professionals have expressed frustrations with the new emergency contact requirement. Especially for those out-of-state owners who manage their own properties, identifying a local contact will likely be challenging, according to Steve Smith, owner of Service Access, a company formed to provide homeowners access to services at a reasonable price.

For owners who want to maintain their business outside of a property management company, Smith is offering a flat annual rate of $100 to list Service Access as the local emergency contact. A $50 response fee would be charged for each call received.

Sarah Kuzma, corporate relations director with Meyer Real Estate, a property management company serving Gulf Shores, said that owners falling under their umbrella would be able to list the company as an emergency contact. Acknowledging that the new requirement will be a challenge to owners who manage their own properties, she said that “they will need to either be their own representative or designate whoever handles their key delivery or maintenance.”

The new rule requiring monthly reporting of income will also create more headaches for owners who work independent of property management companies. Meyer will also be providing this service, according to Kuzma, but it will create additional work for the company’s accounting department.

“The concept for the city is that they want to be certain all businesses are licensed and that they are collecting ad valorem tax,” she said, adding that while the city of Orange Beach has not enacted these requirements yet, they could be next. Currently, both Gulf Shores and Orange Beach collect an 11 percent lodging tax on vacation rentals.

Along with the new ordinance, the city of Gulf Shores is ramping up safety initiatives by adding a rental inspection requirement for condo units and homes used for business. “The city will arrange with owners an inspection of properties for safety issues,” Brown explained, pointing out that the city wants to be proactive in identifying potential structural issues and life safety items such as the existence of smoke detectors and fire extinguishers.

Since most rental units are not built under the commercial code requirements that a hotel property would have to follow, Brown said that many owners may not realize that there are safety issues that need to be addressed. “If it’s your own private home, the wear and tear is not nearly as great as a unit that is being rented regularly,” he emphasized.

Business license fees will go up to $45 for each unit dwelling to cover the expense of the inspection process, and the initiative is a first for the panhandle region. According to Brandon Franklin, chief building official with the City of Gulf Shores, the parameters of the new requirement were built from similar initiatives in other Florida cities including Daytona Beach and Delray Beach. “We’re kind of unique because we don’t have your corporate hotels. Everything is individually owned,” he said, pointing out that the city had to tweak the inspection process used in other cities to work for Gulf Shores.

The goal is have all wood frame and duplex homes inspected in 2014, and applications for business licenses for these types of dwellings would require an inspection certificate for 2015. Condo units will be phased in following this first effort, according to Brown. “It will take some time to implement this fully,” he acknowledged. “It’s a very positive thing. It’s not intended to be a burden to owners.”

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