Daily Regulatory Notes 12/30/2025
Cities address STRs. Hawaii enforces law; Houston, TX reviews enforcement and regulations; Birmingham, AL discusses regulations; Chicago, IL proposes rules; Three Oaks, MI launches waitlist. READ MORE.
Hawaii
A federal court ruling will allow Hawaii’s expanded “Green Fee” to take effect on January 1, 2026, extending the Transient Accommodation Tax to cruise passengers for the first time.
The tax raises the base rate to 11%, with counties allowed to add up to 3% more, and is expected to generate up to $100 million annually for climate and environmental projects.
Two teenagers were shot during a large party at a short-term rental in Houston’s Third Ward, renewing concerns over party houses as the city prepares to enforce new STR rules.
Police said about 40 teens were at the home when a fight escalated into gunfire, leaving one victim in critical condition. The incident comes just days before Houston’s STR registration ordinance takes effect, requiring hosts to register and banning parties and special events.
Houston’s new short-term rental ordinance is drawing criticism from both operators and residents as enforcement begins Jan. 1.
Hosts must register, pay a $275 annual fee per unit, complete training, and meet new compliance rules, with platforms set to remove noncompliant listings this spring. City officials argue the rules will improve accountability and help weed out problem rentals through fees, tracking software, and platform removals.
Birmingham is expected to revive debate on short-term rental regulations in early 2026 after the issue stalled amid elections and council turnover.
The proposed ordinance would ban STRs in single-family residential zones and cap them elsewhere at 1% of housing units with a 1,000-foot spacing rule. City leaders say more work is needed to refine enforcement, noise, parking, and occupancy limits before a final vote later in 2026.
Chicago tourism leaders and major hotel owners are pushing to create a Tourism Improvement District funded by a 1.5% self-imposed hotel surcharge to boost convention demand.
The proposal would raise about $43 million a year for marketing and incentives, with funds controlled by the industry rather than the city. Supporters say it’s needed to compete with cities like Orlando and Las Vegas, though it would push Chicago’s hotel tax rate to about 19%.
Three Oaks will launch a waitlist for short-term rental licenses in R-1 residential zones at 1:11 p.m. on Jan. 1, 2026, as the village maintains a 10% cap on licenses in the district.
Officials say there are currently 63 active licenses, just over the threshold, with new permits issued only as slots open. Licenses in MU-1 and Commercial zones remain uncapped, with 2026 fees set at $700 plus $200 for inspections.
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