PROVIDENCE — Governor Dan McKee vetoed legislation Thursday that would have required all short-term rental properties to be registered with the state— including those from third-party platforms like Airbnb.
Lawmakers approved the legislation, sponsored by Newport Democrats Rep. Lauren Carson and Sen Dawn Euer, on July 1. They argued that the registry would make the public and industry safer.
The news had come shortly after a 22-year-old University of Rhode Island student was killed after being stabbed in the neck during an altercation, which took place during a fight in a Newport rental home. The rental was booked through a third-party website.
McKee argued the legislation would create “additional burden” for property owners.
“Short-term rental concerns, like other property/land use and small business matters, are more effectively addressed at the municipal level,” wrote McKee in his veto message. He said short-term rental owners are already required to register with the Division of Taxation.
But House Speaker Joe Shekarchi and Senate President Dominick Ruggerio, also Democrats, expressed in a joint statement that they were “extremely disappointed” about McKee’s decision.
“It is not asking too much to require the Department of Business Regulation to, in fact, regulate businesses,” they said. They said the responsibility given to the department under the bill would establish and maintain a list of properties offered for short-term rentals, but it would be the obligation of hosting platforms to ensure that properties were registered with the state.
Shekarchi and Ruggerio slammed McKee’s argument that these properties were already accounted for and said the existing procedures through the Division of taxation are “woefully insufficient.” They said there is “no way” for municipalities to know which of their properties are being used as short-term rentals under the current rules.
“Some communities, such as Newport, Narragansett and Westerly, are being overwhelmed by short-term rentals, without the ability to determine if they are receiving appropriate tax revenue or make corresponding decisions regarding their resources,” they said.
The Rhode Island League of Cities and Towns supported the legislation because of the “burden municipalities are facing” from these short-term rentals.
Shekarchi and Ruggerio said they are considering their next steps.
McKee has vetoed just one other bill, which he announced Tuesday, because he said the bill would require ratepayers to pay for electric system upgrades that are currently funded by renewable energy developers. In a veto message, he said those upgrades can cost tens of millions of dollars.