A Dallas County judge has temporarily blocked enforcement of a new short-term rental ordinance adopted by the City Council in June.
Airbnb and Vrbo rental operators said that after years of debate, Dallas has effectively banned short-term rentals. The council approached the issue with a one-two punch. This triggered new zoning to exclude his STRs from neighborhoods zoned for single-family homes and limited the density of his STRs in areas zoned for commercial and multi-family housing. It also included an ordinance regulating what remains of the city's short-term rental market. It took effect immediately, but was not scheduled to go into effect until December 14th.
When the bill was passed, many city council members seemed unfazed by the possibility of litigation.
“I'm just saying I'm not afraid of the courts,” said Councilwoman Carolyn King-Arnold, who represents part of Oak Cliff. “Let's get dressed up and go out.”
In October, four short-term rental companies and the Dallas Short-Term Rental Alliance sued the city. The four plaintiffs (Sammy Afflalo, Vera Elkins, Daniel Lindsay, and Dennis Rowley) have been operating short-term rentals for many years and have complied with the city's advance requirements for hotel registration and lodging tax payments. claims to have done so.
Their lawsuit argues that the city's actions are inconsistent with the state constitution and that the reasons cited by the city for taking stricter action are not conclusive. They asked Judge Monica Purdy to approve a temporary restraining order that would prevent the city from enforcing the new rules until the lawsuit is resolved in court.
On Wednesday, Purdy agreed, ruling that the injunction was necessary “to prevent imminent and irreparable harm.”
The order also said the plaintiffs presented evidence on seven different aspects of the claim, including that the ordinance and zoning affected the value of the property “without just compensation.”
“It is impossible to quantify the approximately 10 years of investments Plaintiffs have made in the STR project, including hiring employees, acquiring numerous properties, and improving those properties based on the City’s representations. “There is no adequate legal remedy because STR is and remains a legal business,” she wrote.
Purdy also said that part of the reason businesses are likely to succeed in their lawsuits is because of so-called “Death Star” legislation introduced this year that prevents local governments from passing ordinances that conflict with state law. He also acknowledged that it was passed by the Texas state legislature.
The city of Dallas disagrees. In arguing against the injunction, City Attorney Tammy Palomino said the operators were “seeking to further their own economic interests over the legitimate interests of all other stakeholders.” Ta.
Mr. Palomino also argued that STR operators “freely acknowledge that their STRs are businesses operating in residential-only areas.”
The trial is scheduled to begin June 3, 2024, and the city may choose to appeal the injunction.
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Bethany Erickson
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Bethany Erickson is D Magazine. Throughout her career, she has written about real estate, education policy, the stock market, and crime, sometimes simultaneously. She hates lima beans and 5 a.m. and takes her SAT practice tests for her fun.
