Short-term Rental Policies, Rules and Regulations

Applications for new short-term residential (STR) rental business licenses within the City of Hot Springs will be available on Jan. 3, 2022. This abeyance is in place to allow for implementation of an online portal in connection with the application process for the licenses, as well as the compliance with the STR policies, rules and regulations.

Purpose of STR Regulations

The purpose of the STR regulations, as outlined in Ordinance No. 6399 and in summary below, is as follows:

• Provide a licensing system and operational requirements to minimize negative secondary effects of STR use on surrounding neighborhoods, while also preserving neighborhoods’ character
• Address traffic, noise and density issues
• Ensure health, safety and welfare of neighborhoods, as well as of STR renters, occupants and guests
• Impose limits on the number of licenses issued to ensure long-term availability of the affordable housing stock
• Set regulations to ensure enforcement of these standards, and collection and payment of fees and applicable taxes

Summary of STR Regulations

• Each STR must provide the name, address, phone number and email contact of the following:
  1. STR owner
  2. STR owner representative
  3. At least one responsible, local contact who will be responsible for ensuring the STR meets all regulations
• Strict compliance with the Hot Springs Solid Waste Ordinance – HSC 9-1-1
• Strict compliance by STR guests with the City’s noise ordinance – No. 6392
• STR owner must post, in a prominent location within the STR, the following:
  1. Owner/owner representative name and telephone number
  2. Local contact person’s name and telephone number
  3. Telephone numbers for the Hot Springs Police Department (501-321-6789), Fire Department (501-321-6971) and Neighborhood Services Code Compliance (501-321-6653)
  4. The maximum number of parking spaces available onsite
  5. Solid Waste (trash) pick-up day and applicable rules and regulations
  6. A copy of the City’s noise ordinance
  7. A copy of the Good Neighbor Brochure (will be available soon)
  8. Notification that a guest, local contact person, responsible person or owner may be cited and/or fined by the City in accordance with these regulations
• The owner shall post and maintain, in a prominent location adjacent to the outside front entrance of the STR, a placard provided to the owner by the City upon the issuance of the STR business license, which displays the maximum overnight occupancy number
• STR must be maintained in a manner consistent with the character of the neighborhood, and shall not impair the desirability of investment or occupation of the surrounding neighborhood
• Owner/owner representative must each use their best efforts to ensure each STR occupant does not create or contribute to unreasonable use of the property or noise/disturbances; engage in disorderly or unlawful conduct; or overcrowd the site
• Local contact person must be on-call full-time (24 hours per day, 7 days per week) to manage the property
  1. Must be able to be physically present within 60 minutes of a request any time the property is occupied for transient use
• Within 24 hours of a call from the City, or one of its departments, the owner, representative or local contact person must use his/her best efforts to prevent the recurrence of such conduct by the occupants and take corrective action to address any violation. Failure to timely respond to two or more calls from the City/department(s) regarding any violation is grounds for penalties
• STRs are primarily intended for sleeping accommodations, not for parties or other large gatherings. To that end, the maximum number of occupants authorized to stay overnight (after midnight) at any STR shall be determined by the City Building Official and/or the Fire Chief, or their designee(s), and shall not exceed two per bedroom, each of which shall comply with the 2012 International Residential Code, plus two.
• The maximum number of people authorized on the premises of a transient use site at any one time, other than overnight, shall not exceed the maximum number of occupants authorized to stay overnight, plus 50%. For example, if the maximum number of overnight occupants at an STR is set at eight, then the maximum number of people authorized on the premises, other than overnight, cannot exceed 12.
• Each designated off-street parking space(s) and any driveway at an STR shall be made available for use by overnight occupants of that site. The minimum number of off-street parking spaces required for an STR’s overnight guests shall comply with the applicable residential requirements set forth in Title 16 of the Hot Springs Code of Ordinances.
• Commercial functions and other similar events are prohibited at an STR.

STR Business Licensure

STR owners must maintain a Short-Term Residential Rental Business License at all times, and agree to collect and remit all applicable taxes on all pertaining gross receipts. The STR license must be displayed in a prominent location within the interior of the STR; a copy must also be provided for each responsible tenant. The license number must also be prominently displayed on the following: each online advertisement, sign, circular, card, telephone book or newspaper ad representing the STR.

Business License Fees

The initial and subsequent annual STR fee/occupation tax is $100 per person, per year, based on the maximum overnight occupancy authorized by the STR license. For example, an STR with a maximum authorized overnight occupancy of eight will have an annual STR fee/occupancy tax of $800.

STR licenses issued during any part of any calendar year must be renewed the succeeding year. Annual License fees are due on January 1.

Each STR license application must:

• Identify the name, address, phone number and email contact information of the local contact person.     
• Include a floor plan that labels each room and the structures of the property, including the total square footage of living space; number bedrooms and the square footage of each; and the number of required off-street parking spaces.
• Provide information contained within the City's approved report form after submitting to an inspection. The inspection report form must be completed by a registered home inspector in good standing with the Arkansas Home Inspector Registration Board, pursuant to A.C.A. § 17-52-301 et seq. The inspection report must be completed within 120 days prior to the initial application or renewal application for an STR business license. One of the purposes of the inspection report is to ensure compliance with all applicable fire and building codes, including the Hot Springs Fire Prevention and Building Code (HSC 15-7-1 et seq) and the Swimming Pool and Spa Code (HSC 15-3-1 et seq), in order to receive a required certificate of occupancy from the City.
• Include a Zoning Certification Letter from the City of Hot Springs Planning and Development Department.
  1. If the Zoning Certification Letter indicates that the proposed STR site is in Zoning Districts R-1, R-2, R-3, R-4 or R-L, the applicant must obtain a valid special use permit, issued by the City's Planning and Development Director.
• Be accompanied with all required annual fees. The applicant must renew and/or amend the license if there is a change in any fact stated in the application. The annual license fee cannot be prorated for any portion of the calendar year.

Maximum Number of STR Licenses in Residential Zones

The maximum allowable number of STR business licenses for sites located within Zoning Districts R-1, R-2, R-3, R-4 and R-L, other than a horizontal property regime, shall not exceed 500 per calendar year. The renewal of existing licenses will be given priority over initial applications for new STR sites.

Separate Properties

A separate STR Business License must be obtained for each separate STR site, including every separate STR site that is advertised. Such an STR License will authorize the licensed owner to transact and carry on transient use of residential property only at the specified location, and in the manner and subject to the limits designated in each specific license.

STR licenses are not transferable to other persons or locations, except for the following:

• Amendments to any information provided on the license are made within 30 days of any change of owner, a change of the owner representative, a change in the local contact person, a change in any material fact upon which the license was issued or if any other person acquires an ownership interest in the STR site.
• In the event that STR ownership transfers to an immediate family member by means of a gift or testamentary transfer, the new owner of the property shall also acquire ownership of the existing short-term rental license until its expiration without paying additional fees. The new property title owner shall, within 30 days of transfer of ownership of the transient rental site, update the information provided on the license issued via an online portal established by the City and on the City's website, and shall provide all information and prerequisites required therein.

License Denial, Suspension or Revocation

The City Manager or his/her designee may deny any application for an STR business license as a result of a failure to comply with the STR requirements. Also, suspension or revocation of an STR license as a result of a failure to comply with the requirements may occur by mailing a notice to the owner or owner representative at the address provided in the STR license application. Continuing to advertise for or operate any type of STR in the City of Hot Springs without a business license may result in the forfeiture of the certificate of occupancy for such use.

Any person who has been denied a special use permit or a STR license, or to whom notice of revocation or suspension of a STR business license has been mailed, may appeal within 30 days by writing to the Board of Zoning Adjustment, which shall have authority to determine all questions raised by such an appeal; provided, however, that no such determination shall conflict with any STR guidelines.

Any applicant or license holder whose license has been revoked will be ineligible for a two-year period from applying for a new license. No person whose License has been revoked can continue to advertise for, engage in or carry on the activity for which the license was granted, unless and until such license has been reinstated or reissued. Any decision by the Board of Zoning Adjustment will be final. Appeals afterward must be taken to the Circuit Court of Garland County, using the same procedure as for administrative appeals of the District Court Rules of the Supreme Court. See A.CA. 14-56-416(b)(2).

Penalties

Failure to comply with any of the STR provisions shall be subject to the following fines, penalties and forfeitures:

• $1,000 for the first offense or violation
• $2,000 for the second offense or violation
• $4,000 for each subsequent offense or violation
• If a prohibited action continuous in respect to time, the fine or penalty for allowing the continuance shall be $500 for each day it is unlawfully continued

For more detailed information, read the full Ordinance No. 6399 relating to Short-Term Residential Rental Businesses within the City of Hot Springs from the Oct. 5, 2021, Board of Directors meeting.