The Eureka Springs City Council has doubled down on a planning commission proposal involving new bed and breakfast locations in residential areas.
At its regular monthly meeting on Monday, Aug. 14, the city council approved a resolution extending a moratorium on new B&B locations for 12 months. The planning commission’s recommendation was to extend the moratorium for six months but council members voted 5-1 to extend it until midnight Aug. 15, 2024.
“Unfortunately, the B&B license, to me, has been so abused with people getting B&B licenses and not living there and then trying to run it as tourist lodging,” council member Melissa Greene said.
The planning commission has been trying to identify all the B&B’s in the R-1, R-2 and R-3 zones that are in operation. Some aren’t following rules such as having someone living on site and serving breakfast, commissioner Ann Tandy-Sallee told council members.
“We have identified approximately 19 bed and breakfasts in the R-1, R-2 and R-3 areas,” Tandy-Sallee said. “When we started our research approximately eight of them were not advertising as a bed and breakfast and not serving breakfast. Now, it has come to our attention that we have quite a few that either never have paid [City Advertising and Promotion Commission] taxes, have paid CAPC taxes and never submitted reports, or none of the above. We are working to bring people into compliance. There may be some that do not want to come into compliance and we will do a show cause hearing. I find it very disturbing that tax reports are not being filed.”
Tandy-Sallee told council members that the CAPC provided the planning commission with a list of B&B locations that are behind on paying their tourism tax.
“Are they literally not paying?” Greene asked.
“Well, that’s what we’re trying to find out,” Tandy-Sallee said, noting that AirBnb is the only company that collects taxes from the owner and submits the money to the city. “It’s up to the business. An example is, one lady has been in business since 2018 and they report she’s never paid. We have [another] business that has recently sold and they reported they haven’t paid a tax since 2021 and they are inactive. So, we are asking questions.
“There’s some cleaning up that needs to be done. I don’t want to take anyone’s livelihood away from them but I have to pay my taxes.”
Ida Meyer, city clerk treasurer, said any business that is required to pay CAPC taxes receives a tax permit application when they get their business license. Tandy-Sallee, said, however, it is being discovered that some aren’t submitting the form, even if they are currently not in operation.
“Every month you’re supposed to fill out a form for the CAPC,” Tandy-Sallee said. “… Maybe you’re closed for two months for the winter or something like that, but you still need to turn in that form and those forms are not being turned in. So, there’s a disconnect.
“Have they paid? Have they not paid? Are they AirBnb? Are they VRBO? … Right now there’s not a connect between the three offices between planning, CAPC and city clerk. There needs to be and it’s something that should have been done a long time ago. We’ve got some new people in place now so we’re hoping that this gets fixed.”
Council member Harry Meyer made the motion to extend the moratorium for the six months that the planning commission requested and Greene seconded Meyer’s motion. Council member David Avanzino, however, suggested the moratorium instead be extended to 12 months, which was approved 5-1.
Council member Terry McClung cast the lone dissenting vote, instead saying perhaps the council should just do away with B&Bs altogether.
“If you’re going to extend the moratorium it’s going to come up again and you’re going to want to do it again,” McClung said. “If you’re going to [extend it], just do away with it. That’s what you’re doing is, you’re doing away with bed and breakfasts by the moratorium. So, nothing is going to change.
“Go ahead and make a motion to write an order for it to go away … that’s what you want to do and that’s what you’re doing effectively.”
OK FOR TUNNEL GRANT APPLICATION
In other business, the council unanimously approved a resolution authorizing Mayor Butch Berry to apply for a Transportation Alternative Program grant that could possibly lead to the installation of a pedestrian and bicycle tunnel under the soon-to-be constructed roundabout at the intersection of Highway 62 and Highway 23 South.
If awarded, federal funds would reimburse the city 80 percent of the cost, or $746,288.50. The city’s part would be $149,257.70, according to the resolution.
“This resolution is just to apply for the grant,” Berry stressed.
BB&B ENTERTAINMENT DISTRICT The council also again approved a temporary entertainment district on the property of Pine Mountain Village on East Van Buren during the upcoming Bikes, Blues and BBQ.
The location is a parking lot that includes Eureka Springs Harley-Davidson and has had the temporary entertainment district the past few years with no issue, according to Mayor Butch Berry.
The temporary district, which allows open containers of alcohol and will have live music, is authorized to be open from 10 a.m. to 9 p.m. Wednesday, Sept. 20, through Saturday, Sept. 23.
