EASTHAM — The town’s short-term rental registration fee will increase from $75 this year to $350 in 2025. The projected additional $192,500 in revenue will fund stricter oversight of more than 1,000 short-term rentals that Town Manager Jacqui Beebe said Eastham is struggling to supervise.
The select board unanimously supported the increase at its Feb. 5 meeting along with an increase in the fee for longer-term rentals (more than 31 days) from $75 to $100. Beebe said she proposed the fee increase after examining the preliminary budget for fiscal 2025 with Finance Director Rich Bienvenue and finding that “our operating budget is extremely tight.”
Some of the costs of the town’s housing coordinator, housing inspector, and an administrative assistant for health should be supported by short-term rental fees rather than the regular budget, Beebe said. Compliance services from Granicus, a short-term rental tracking company used by Provincetown and Barnstable, would cost another $65,000, Beebe told the select board.
Beebe told the Independent she has received many letters from residents who were surprised by the dramatic increase. “I know people are upset by it, and they’re absolutely right,” Beebe said. “I should’ve raised it more incrementally over time.”
Select board member Suzanne Bryan said that raising the fees was more fair to taxpayers who don’t operate short-term rentals, however.
“This is one way to keep it out of the overall tax burden for the town,” Bryan said. “Now, if you don’t run a short-term rental, your taxes aren’t funding them.”
Beebe said that Eastham does not have a system for accurately counting short-term rentals, tracking complaints about them, or estimating the income they generate. She said the select board and the Task Force on Zoning and Regulation frequently request that information and the town has been unable to provide it.
There are 782 short-term rentals and 310 long-term rentals currently registered with the town. Town staff asked Granicus to do an initial assessment last month, however, and the company found that in January 2024 there were 1,029 short-term rentals available on more than 30 websites — indicating that about a quarter of Eastham’s short-term rentals are not registered with the town. The company found an average rental rate of $268 per night; the lowest daily rate was $200 per night, Beebe told the select board.
Tyler Hands, a year-round Eastham resident who works in property management, asked at the meeting if the fee should vary depending on how much revenue a property earns from short-term rentals. “Having it more closely connected to the amount of income seems more fair,” he said.
A set fee increase “tends to hit people at all levels regardless of their income, the value of the property, or the number of weeks they rent,” Hands told the Independent.
Bryan said that the town had not been able to fund a basic monitoring system, let alone a staff person to do income verification. A flat rate for all short-term rentals is the most feasible path forward, she said.
Bryan also said that with an average rental rate of $268 per night, the fee could be covered with just two nights of revenue.
Beebe noted that the town has received many complaints from residents regarding short-term rentals, particularly in the summer.
“As the intensity of use has grown, so have the complaints,” said Beebe. Residents complain about “lots of cars in the driveway, lots of noise, or smoke from barbecues.”
Overloaded septic systems could harm the town’s water supply, Beebe said, and residents sometimes report seeing “small cottages with 10 cars in the driveway.” Granicus software is able to check the capacity offered in short-term rental listings against the property’s septic capacity, according to Beebe’s memo to the select board.
“Where in the past we had part-time resident owners who would stay and visit and rent for a few weeks to cover property taxes, now we have increases in rental-heavy or rental-only properties that simply act as hotels and party destinations,” Beebe said.
“Over time, we have not kept up with the changes,” she continued. “The truth is, we are paddling as fast and as creatively as we can, and we can’t stay abreast, never mind ahead, of this challenge.”
Eastham has also been collecting short-term rental taxes since 2019, when a state law took effect that expanded the rooms tax charged on hotel bookings to also cover short-term rentals. Last year, the town took in $2.1 million in rooms tax, of which $1.5 million came from short-term rentals, according to Bienvenue.
Eastham has bonded out, or promised to a lender, five years’ worth of short-term rental tax receipts in order to finance almost $7 million of design and engineering work for its new sewer system.
Truro’s select board also raised its short-term rental registration fee this month from $225 to $450 per year, to help pay for its oversight efforts. Provincetown raised its fee from $100 every three years to $750 per year in January 2023.
Editor’s note: An earlier version of this article, published in print on Feb. 22, incorrectly reported the new annual fee for short-term rental registration in Truro. It is $450, not $415.
