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Workshop airs pros, cons of new STR regulations

Depending on one’s perspective, the city’s proposed ordinance changes governing short-term rentals (STRs) will either bring Fredericksburg’s economy to ruin or be its savior.

The Fredericksburg City Council held a workshop Monday night, at which the proposed ordinance changes were presented before the public was given an opportunity to comment on them. More than 30 people commented, some for, some against, and some recommending changes.

The workshop began with Jason Lutz, director of development services, outlining the ordinance, which defines the types of STRs, zoning, setbacks for amenities, parking, code violations and numerous other aspects related to the rentals. (A copy of the proposed ordinance can be found on the city’s website at

The floor was then opened for public comment.

Mike Starks noted that the Hill Country Board of Realtors opposes the ordinance as it stands (see related story) and said that STRs sell at a higher price per square foot than residential homes. “The city is going to be picking winners and losers,” he said, explaining that homes with STR certification will be worth more.

Jessica Lyons, who owns STRs, said her business supports “no less than 35 trades” in town and urged rejection of the proposals.

One lady said the value of her property dropped by $100,000 in less than a year because two properties next to hers became STRs.

“We need to prioritize families over businesses,” one man said.

Speakers from a private school and Hill Country Memorial Hospital said the ordinance is needed to help control the rapid rise in property values, which is making it cost prohibitive for people to live and work here. They said it makes it difficult to hire staff when they can’t pay salaries to match the cost of living.

“I believe the rules will be detrimental,” said Jeffrey Morin. “Those new rules will not help anybody at all.”

Belinda McDonald said that counts on the numbers of STRs in the city are skewed because of the way the data is collected. She said there are far fewer than most people realize. “This ordinance puts the vitality of our community at risk,” she said.

One speaker said that real estate prices are rising across the state and nation and said STRs are not causing it. He said the proposed ordinance is too restrictive and will “lead this community to economic demise.”

Sharon Joseph, chair of the city’s historic review board, encouraged passage of the ordinance, saying it is necessary to help maintain the historic district and keep it from being overrun by STRs. “I support what you are doing,” she said.

One man said he was in the process of selling his rentals and leaving the city because of the proposed ordinance. Other speakers addressed concerns with the set-back regulations and the need for parking at the units.

Following the comments, Lutz addressed some of the concerns. “We did try to strike a balance between both groups,” he said. “We don’t look at STRs as being the Golden Goose. We view neighborhoods as the Golden Goose.”

City Manager Kent Myers said the ordinance came about from extensive public input and study of ordinances in other cities. The mayor and each of the councilmembers expressed support in general for the ordinance but with changes. Bobby Watson and Kathy O’Neill said they favor placing caps on the number of STRs, while Tom Musselman was against it. “There are blocks where there is only one full-time resident,” Watson said. “Neighborhoods are my first priority,” O’Neill said.

Mayor Charlie Kiehne said he wants city staff to consider comments and to come back with a revision to the proposal at another work session. He and Lutz were trying to figure out if the ordinance could be adopted by the end of the year, but concluded that the earliest it could be would be in February.

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