STR Regulations

Reasonable Guidelines for STR Regulations Proposed by Town of Hilton Head

The purpose of this document is to create consensus on reasonable guidelines instead of the strict regulations proposed. Consensus can be aligned with the changes to the permit application timeframe congruency with business licensing. There is no direct opposition to safety & fire regulations, the concern is over the exposure to liability and time of implementation being less than 6 months after effective date. Voluntary compliance and guideline framework should constitute regulation, not imposing unenforceable restrictions.

The items listed below represent additions to limiting the overarching impending economic impact on our community that would affect not just tourism, but real estate values, funding for important Town projects, and ability for local businesses to provide the world-class level of services to all of our residents and visitors.

Effective Date

· Problem As outlined, there are time constraints that put an undue burden on property owners and property managers to rush into compliance by May 1^st, 2026. Vendors and Fire Chief have all said a realistic timeframe of 3 or more years would be needed to come into full compliance with all affected properties.

· Solution Compliance windows will be needed no matter what is proposed and voted into code. Align two different grace period windows after the effective date for safety and occupancy limits. Fire safety will take longer for compliance, timeframe of 18 – 24 months from effective date for any item that would require a professional installation. In terms of the occupancy limits, many properties are already advertised and have obtained bookings for 2026 or even 2027. Allow for a 90 – 120 day grace period of occupancy limits to avoid any major impacts to marketing and guest experience. The summer of 2026 can be used to continue to educate our visitors on the coming changes.

Parking

· Problem As outlined, property owners relinquish rights of improvement to the Town because the property is an STR. Overall, parking is considered by the STR community to be the most effective tool to reduce occupancy. This would also assist in the community concern regarding the volume of traffic to the island.

· Solution Remove portion restricting owner's rights of improvement to the property. Sensible parking regulation regarding not blocking access to roads, paths, fire access can be reasonably enforced through municipal court system. Consider parking as the main aspect to enforce occupancy. The visitor profile of our destination indicates 4.4 persons/visit, if you averaged 5 occupants/vehicle with a limit of 6 vehicles the highest occupancy would equal 30 persons.

Definitions

· Problem As outlined, the definition has an in-depth description of what constitutes a short-term rental bedroom. Elements would reduce and impact properties that already have approved variances. The Town created this issue by allowing variances in the first place. Aspects that dictate a natural person affect property owners who have already formed sensible tax protections that add liability shield are not huge investors, they are our future residents.

· Solution The work that will be done during the Land Management Ordinance process is a better, more equitable path to change these types of definitions. The LMO process will include all different elements pertaining to short-term rentals, if this is intended to be guidelines and not restrictions.

Permit Fees & Occupancy Limits

· Problem As outlined, the level of increase in fees and limit of occupancy are the biggest hardships facing property owners and property managers. Permit fee increases equate to 300% increase and does not account for the varying levels of cost for property owners. Smaller properties net less revenue on a whole, so a sliding scale needs to be considered. The same applies to occupancy, the changes would reduce uniformly the number of occupants, despite variances being allowed throughout the building/renovation process. Additional consideration for the volume of reservations already secured for 2026, drastic changes to occupancy could impact retention and lead to economic hardship.

· Solution Very simply, we all need to care about our visitors, residents and businesses as equals in our resort destination. The goal of regulation should be voluntary compliance, what is proposed below tries to account for impacts to the STR community while providing reasonable reductions the overall occupancy to address community concern.

Fire, Safety & Insurance

· Problem As outlined, the timeframe to come into compliance with the items listed in unrealistic and impossible to meet for compliance purposes. The STR community is not opposed to reasonable guidelines that will assist the guests in having a safe experience while visiting Hilton Head Island. The implementation of some of the safety devices also add a layer of liability to the property owner or property manager if not professionally installed. This will cause delays in coming into compliance. The proposed fire safety systems are not feasible for a guideline but should be considered as an additional benefit. The use of fire monitoring systems is not opposed, just the timeframe for compliance. Insurance requirements for the regulation are not burdensome from a cost perspective; professional property managers require property owners to have liability insurance when going into agency agreements. Some individual owners may see this as a major concern, but it is a common business practice.

· Solution Allow for a grace period from effective date to compliance date of 18 – 24 months to allow for proper, professional installation to occur in all properties affected. Items for gas monitoring for outdoor grills, monitored fire alarm system can be implemented to increase safety of experience. The insurance requirement can be seen as a burden, so incentivize those that have it in some way. Requirements for floor plans and escape routes shift the burden of liability to the property owner and property manager. While useful, these pose a question of undue burden, the Town would need to be the final say if these are required. There are systems and processes that should be considered by the Town like Breezeway for both safety and fire compliance.

Hilton Head Island is a diverse community that represents all different ways of life, that is our strength. Prioritizing the needs of all can be a difficult challenge, but this burden should not infringe on the rights of others. Narratives may challenge Hilton Head as a resort, we are a destination community, definition is "a place that people go to for rest, recreation and enjoyment". We support responsible STR guidelines and practices that uphold Hilton Head's standards. Short term rentals are not a threat, they are an extension of the destination community experience being offered by residents, owners and businesses that care deeply about our community's character.