Will They Or Won't They?
Council Discusses Possible Moratorium on Transient Accommodations, Delves Into Short Term Rentals, Traffic, and Housing
BAR HARBOR—After remarks from Town Councilor Matthew Hochman during council comments at its August meeting, a potential moratorium on transient accommodations received a lot of press. That discussion continued at the September 5 meeting, but no action was taken since it was not on the agenda. An informal straw poll showed that some councilors are interested in looking into it.
When people visit Bar Harbor and stay overnight, they stay in what the town calls transient accommodations. Those include rooms in hotels and motels and bed and breakfasts. It also includes campsites and then also RV sites. Short-term rentals in houses are a different category than rooms rented in hotels, motels, and bed and breakfasts.
The peak population, the Planning Department estimates, is displayed in the charts below. That population does not necessarily mean all the people are wandering around Bar Harbor at those times. They could be in beds. They could be in Acadia National Park or other towns.
The Bar Harbor Town Council discussed those numbers as well as housing, tourism, and traffic during its meeting Tuesday, September 5, after a pair of presentations by Planning Director Michele Gagnon and Code Enforcement Officer Angela Chamberlain.
A potential moratorium on the permitting of transient accommodations would most likely last 180 days initially and it would halt the approval of any accommodations. While the discussion linked the potential moratorium to housing Hochman said that was not his intent.
Hochman said his intent was to put a pause on things while data is gathered and also ensuring that there’s proper notice to abutters and scrutiny by the planning department. Gagnon said they are currently working on an amendment to the transient accommodation uses. There are currently about two dozen. They are trying to decrease that to four or so and are also looking at the permitting process. June 2024 is the earliest those changes could be on the ballot for voters. Chamberlain said that timeline would be “really pushing it.”
That amendment is not targeted to pull those uses out of the districts, but it’s to give it more structure. “Nobody needs more than 20 different transient accommodations,” Gagnon said.
Interim Town Manager Cornell Knight said that he wasn’t going to employ the town attorney to draft a potential moratorium when the council hadn’t said to put it as a specific agenda item, which is why it wasn’t an agenda item at this meeting.
“Isn’t it time to put this on the agenda?” Council Vice Chair Gary Friedmann asked.
Councilor Kyle Shank stressed that he was not comfortable in having a moratorium without a specified goal. Gagnon agreed, saying that if the council was to create a moratorium, it needs to first figure out what it’s trying to solve.
Transient accommodations are a permitted use. Some are permitted through the planning director (this has notice to abutters) and some are via the code enforcement office (no notice to abutters) and some through the planning board (notice to abutters and public hearing). These differences are in general related to the location. Short term rentals are a licensed use.
There was also discussion about whether the moratorium would be retroactive to a certain date, meaning that transient accommodations already approved after that date but before the moratorium was enacted would no longer be approved.
SHORT-TERM RENTAL LICENSING
The town has two types of short-term rentals VR-1 and VR-2, which are described in the images below. The amount of VR-2 rentals allowed is capped at 9% of the total dwelling units as of January of that year. All rentals must be registered each year by May 31. Registrations cannot be transferred. There are 36 properties currently on a waitlist for VR-2 registration.
There are currently 637 rentals, a decrease from last year’s 686. That decrease came primarily through VR-2s, which lowered from 527 in 2022 to 485 this year. VR-1s decreased by seven from 159 to 152.
The 9% cap would be 307 units, which is below the current total. According to the report, nine VR-2s were denied because they didn’t renew their registration prior to May 31 and two didn’t pass the life safety inspection, which is mandatory. Another was denied because the ownership of the property was transferred. Of the VR-1s, five didn’t pass that inspection. That’s a decrease of 12 total for VR-2s for known reasons.
According to Gagnon via email, since 2019, “Major site plans approved by the Planning Board include 29 rental cabins (that includes what is likely to be approved on September 6), five new campsites, and eight yurts.”
Minor site plans approved by the planning director include seven rooms, which is the Stratford Inn. Building permits approved by the CEO are at least 48 rooms.
Chamberlain has been pulling together existing uses data on lodging in the several zones, which shows the current number of rooms in the buildings and the district the lodging exists in. She’s pulled data off permits and even Expedia to try to give the town a grasp of the numbers and how any changes to zoning would or wouldn’t impact those existing uses if the town’s definitions of lodgings are tweaked.
HOUSING
Gagnon gave the Town Council a housing and tourism overview during its meeting Tuesday night, saying that she envisions this would be an annual presentation to show data, trends, and create benchmarks to assess performance.
“Council has been asking for a presentation for short-term vacation rentals,” Chair Valerie Peacock said, and that lead into the discussion of transportation and tourism. That data is continuing to be collected.. The purpose of the presentation is to give the council some updates and information.
The eight-page document separated housing and tourism and included data for each.
According to Gagnon, the town hopes to increase its year-round dwellings. A 2022 analysis of the town writes that there needs to be another 616 dwellings in nine years (2033). About 85% of those need to be rentals. There are currently (January 2023 numbers) 3,415 dwellings, and in January 2022, there were 3,366 dwellings.
“This represents an increase of 50 units or 1.5%,” Gagnon wrote. At that rate it would take about 12 years to reach the goal of 616.
The question becomes where will those dwellings come from?
There have been nine land use ordinances passed since 2020 that are intended to “remove barriers and incentivize the creation of housing.”
People also live in what are called non-dwelling units, which mean that the housing is not family based but employee living quarters or shared accommodations. The College of the Atlantic’s dorm-in-progress is an example of this and will house 46 students.
Councilor Earl Brechlin said that there are challenges ahead, but when you look at the changes that have been made already in the ordinance and the vacation rentals ticking down a bit, there is a positive trend.
“This community has stepped up,” he said, mentioning that the College of the Atlantic is building a dorm; smaller employers are stepping up, as well as the Jackson Lab, and the YWCA. “There are a lot of good things and people throughout the community who are working on it and that’s how we’re going to solve it.”
Friedmann suggested that the number of houses needed according to that report is equivalent to the number of short-term rentals that currently exist. There are currently 637 short-term rentals. However, 152 of those are VR-1s, which means that the owner claims the building as their primary residence. There are 485 short-term rentals where the owner does not live as their primary residence. According to the town’s land use ordinance, primary residence is defined as “the location where the owner resides most of the year. The property owner uses this address as their legal address for tax returns, driver's license, and/or voter registration card.”
Friedmann asked if they were monitoring for the four-night minimum stay for the non-owner-occupied short-term rentals. Chamberlain said it was very hard to monitor this, but that the new software will be able to monitor it.
Chamberlain said that there are a variety of reasons that short-term rentals are not renewed and not all are reflected on the chart. Some were sold. For some, people simply registered in the beginning to protect their property rights and then said later they didn’t intend to rent. One property owner died.
Chamberlain also said that the town might want to work a bit more on the provision that provides that rentals cannot continue whenever a property is conveyed. This means that a woman who removed her ex-husband’s name on a deed would lose her rental license. It means that if a mother and a daughter might co-own a property, and the daughter transferred her portion into a trust, they could lose their license. When this happens, people are sometimes able to make modifications to make their registration continue. Some were voided this year. Two were able to qualify as VR-1s. Chamberlain said that she’d like to discuss and think of ways to modify it that meets the intent of the ordinance.
The code enforcement department performed over 200 required inspections this year. There is no cap on VR-1s and those property owners that can still apply after the May 31 deadline.
Shank asked if the life safety requirements were equivalent for long-term and short-term rentals. Chamberlain said that in the task force meetings they spoke about being less restrictive.
Councilor Maya Caines said that she appreciates employers building housing, but having an employer being your housing security is really rough. If someone is housed by an employer, it can trap the employee into staying with that employer.
She suggested that the permit money vacation rental owners pay each year go toward a housing trust.
She also focused on current living situations for some long-term renters, and stressed she wasn’t speaking of her own situation.
“I’ve seen first-hand a lot of horrible long-term rental conditions,” she said.
She said when it came to registering long-term rentals, she wanted to respect people’s privacy, but that she’s seen horrible things and people have been afraid to report it to the planning department. She said she’s seen holes in roofs and walls and trash bags covering up air coming in through the walls in winter.
A September 6 article in the Bangor Daily News speaks toward similar issues with Sawyer Loftus writing,
“In Maine, more subsidized housing units have trouble passing the required inspection, setting up the potential for tenants to continue living in substandard housing while they await fixes or find another home — if they can.
“In the past five years, the Maine State Housing Authority, which administers about a third of all the Section 8 vouchers for the state, conducted 31,282 inspections of apartments. Of those inspections, 45 percent failed, the authority said. It did not have data on how many units were ultimately fixed or how long those fixes took.”
And towns, it says, often have insufficient tools to deal with such problems.
We spend a disproportionate time disincentivizing solutions rather than incentivizing them. Getting people to convert to long-term rentals is going to be a big, big push, Shank said.
Councilor Joe Minutolo agreed that incentivizing is imperative going forward. The process takes a long time, he said, because it has to go before the voters. He said, “This is weeks and weeks and weeks of work of discussion between the planning department and the council.”
Government, he says, takes a while. And even the land use changes already instigated create slower change.
“People have to look at their properties and decide if this is a fit for them,” he said of those changes. “It took us a long time to get here and it’s going to take us an awfully long time to get out of this.”
Caines said that the housing crisis is pretty severe on the island. She said the council has a responsibility to pick out what they can do now. Short-term solutions are needed.
“Quick decisions in my mind equate to mistakes, and it’s a process,” Minutolo said.
TRAFFIC
Gagnon wrote in her report to the councilors, “With all the traffic and congestion, road rage and accidents experienced this summer, we were curious to see what the traffic counts looked like at the head of the island.”
Crash data for the accidents or incidents of road rage were not included in the report.
The data for those counts do not show an expected increase of traffic, but a 5.7% increase between August 2019 and August 2023 and a 4.56% increase between August 2022 and this year.
She said the peak hours in January are between 6-7 a.m. and then 3 p.m. in the afternoon. The peaks in August occur later in the morning and then again at 3-4 p.m.
The average workday has more traffic than the weekend. The morning peak traffic is also more than the afternoon peak traffic. However, the data is coming from the traffic light at the beginning of the island. In the morning, not all vehicles funnel through that light. They do in the afternoon.
Shank asked for the variance on the numbers on traffic, saying that “because they are averages, we don’t know the averages or standard deviation,” which makes him not know whether there is a statistically relevant difference. Friedmann disagreed saying that there was a 14% increase. Shank reiterated that comparing averages without knowing the standards or variance makes it hard to know if there is statistical deviation.
Another aspect is that if traffic is jammed, the cars aren’t moving. If the cars aren’t moving because of an accident, those cars aren’t counted at the normal time they’d pass through.
Gagnon said that there is supposed to be a corridor study through Ellsworth to MDI. And that tweaking the 12 signals in Ellsworth and three more toward the island should help.
“There’s a lot of things going on right now that we can keep our finger on,” she said of state projects, including getting the needed improvements earlier in the state’s queue.
Friedmann said traffic at the head of the island is the cruise ship crisis of 2023, “We should look at it the same way as cruise ships.” He said the steady growth of transient accommodations of all types including STRs is contributing to the traffic.
However, most people staying in lodging don’t leave the island in the daytime and check-out times for hotels are later in the morning and are on the weekend, which doesn’t coincide with the traffic peaks according to Stephen Coston, hotelier.
If people are seeing a lot of traffic—traffic jams going off the island at 5 p.m. on a Friday that’s not tourism, Coston said, stressing that the customers don’t leave at five on Friday. “I don’t think that data itself can lead to any conclusion.”
He added that moratoriums on transient accommodations don’t build houses. He said that the lot on Cottage Street, which has caused controversy because a large lodging is being built there, was never going to be a house. It was vacant for decades, he said, and was economically not feasible to be a home site. When the construction is completed, he said, two people will live there for free, and the town will have an additional $40,000 for property taxes.
“I feel like developers are being punished,” he said, adding that the project didn’t cause the problem. “Affordable housing was already in a crisis before we put a shovel in the ground.”
BACK TO HOUSING, PUBLIC COMMENT ABOUT IT, AND THE POTENTIAL MORATORIUM
Shank said that it’s important to not use traffic as a proxy for understanding housing. We should be very careful about reading traffic as a proxy.
“It may be hell,” he said, “but it could lead us down the wrong road because it’s not entirely within our control.”
Ezra Sassaman, Warrant Committee and Climate Change Task Force member, asked about incentives to change short-term rentals and second homes. He thinks that discussions and incentives need to be nuanced and explore the difference between a mom and pop trying to survive via a short-term rental and a corporation just looking for profits.
“What I’m really frustrated about is during my time in Bar Harbor,” he said, is that there have been a lot of buildings, but the buildings aren’t homes. “Stuff is getting built all the time, so why doesn’t it benefit the community?”
Cara Ryan, Appeals Board member, said, “Clearly there’s this huge pressure between the use of houses for year-round life and the tourism industry.” By not having a moratorium on transient accommodations, the town is losing critical opportunities, she said, advocating for a short-term turning off of the faucet to give town planners and the Planning Board space to work things through.
Isaac Iverson advocated everyone riding their bikes to work and said he’s been personally disincentivized in building housing because he can’t rent it the way he needs to rent it to make it pay for itself.
Anna Durand said the planning department is doing a good job, and what tells her that is the VR-2 numbers decreasing. She wanted to think about potential unintended consequences for ELQ and SA and rural expansion.
“I’m concerned that we are making these dorms for people, that we are making a miniature apartheid. A lot of the workers that are going to be in those are black and brown people.”
She is especially concerned about that in rural areas and was wondering if it meant that they are saying to people that their only worth is their labor. She suggested creating a community bank that could offer initial loans and refinancing to help with creating affordable housing.
Sidman said that rather than approaching the problem from the top down, the town needs to have owner conversations. He suggested having the YWCA director come and talk about what would make Hamilton Station a viable project.
“You aren’t starting with the actual people making the decisions. You’re regulating something without knowing how to make it work,” he said.
Shank explained that he was worried about unintended consequences when making a moratorium on transient accommodations, much like the short-term rental and campground shift to other towns after Bar Harbor imposed limits.
“We’re a keystone in a region that derives a ton of income from tourism,” he said. “If we reduce accommodations in Bar Harbor, we will just shift them elsewhere.”
He advocated thinking regionally and to plan for the consequences and said to expect traffic to increase if accommodations are reduced.
“We’ll just end up fixing one thing and breaking Tremont,” he said.
Friedmann wanted to direct the town manager to talk to a town attorney and write up language for a public moratorium on transient accommodations. Shank said that a moratorium without a goal will likely have an economic consequence, and he would be reluctant to vote for it.
Gagnon said that there is a project coming to the planning board for final approval on September 6. This person has invested money and time to try to do something consistent with the ordinance. Friedmann said he didn’t like a retroactive ordinance.
“We’re just going to keep kicking the can,” Hochman said. “Fine. We’ll make it at the next meeting.”
PUBLIC COMMENT
Three people spoke during the first public comment portion of the council meeting, where people can speak for up to three minutes about items not in litigation (lawsuits) or on the agenda.
Annlinn Kruger called for an accounting of last year’s incidents when she said that former Town Manager Kevin Sutherland singled out her temporary graffiti chalkings to “Google Leonard Leo,” using town personnel and time to eradicate them, while not focusing on permanent graffiti in town. She also called out Friedmann for focusing on her during the last council discussion on changing public comment rules, and she chastised Brechlin, who she said was dismissive of public comments. Government accountability is not an abstraction, she said. Public comment like hers can help provide government accountability.
Sheridy Olson-founding owner of Destination Health and its other co-founder, Mara Raskin jointly took the podium as well to speak about their wellness center on Cottage Street, which recently went before the Planning Board so that three of its rooms could become transient accommodations. Those rooms had been short-term rentals, but they missed the May 31 renewal deadline by three days.
“We built this project just three years ago in the middle of a pandemic,” Olson said. She said they rely 100 percent on the income from rentals for the wellness center to survive and that rental income is the way to survive for a business in Bar Harbor.
“We’ve paid a huge price,” for missing that deadline, Olson said. She added that the partners are at risk of losing everything because the three rooms are no longer short-term rentals and the business loan is connected to the mortgages for their own homes. She stressed that they have no trust funds and no sponsors, but are working people who are trying to get by. She also said they are working diligently to correct their violation. It is against the town rules to rent a room if you do not have a permit. That violation comes with a fine. A second violation increases the fine.
Iverson spoke to the lack of affordable housing and said that the solutions are out there. He spoke of a program where cities make up gaps in earnings or in payments for renters or homeowners. Councilors later spoke about this during their own public comments.
Sidman asked the town to resume the tender operations of cruise ships rather than allowing a private entity to continue, saying it represents a great deal of revenue that the town needs. “We can’t afford to be giving that much away from town coffers,” he said.
He added that Interim Police Chief David Kerns and Harbormaster and Special Services Lieutenant Chris Wharff have the institutional knowledge to run the tender docking and have been approved by the Coast Guard.
According to Wharff, there was a plan drawn up to do this on the west side of the town pier many years ago, but this never came to fruition.
“We would need to go through the process with the Coast Guard to become a secure facility under CFR 105, which governs secure tender ports for foreign flagged vessels,” Wharff said. “Currently Ocean Properties has the only two certified docks under CFR 105 in Bar Harbor.”
Ocean Properties is part of the lawsuit suing the town over the cruise ship disembarkation limits of 1,000 passengers a day.
The lack of certification means that the town cannot accept any tenders from foreign flagged vessels at the town pier.
“I am not sure what it would take for us to become certified at this point as this is not something the town has considered in recent years,” Wharff said. He added that the idea is also being discussed in the Ferry Terminal master plan.
CONSENT AGENDA
The council unanimously approved, without discussion, the items on its consent agenda.
The consent agenda included the small harbor improvement program grant, a few tax abatements for real estate tax and personal property tax, the motion to accept Maine Department Of Transportation (DOT) reimbursement funds, and a bid to accept the bid for the project on lower Main Street.
SMALL HARBOR IMPROVEMENT PROGRAM
The town and State of Maine have entered into a small harbor improvement agreement to replace the floats at the town’s municipal pier. Harbormaster Chris Wharff will coordinate the project and the project manager will be Aurele Gorneau II of the DOT’s multimodal program.
The town and state will share the cost of the $99,000 project. The state will pay up to 50% or 49,680 and the town will pay the estimated local match and any extra costs.
The project will begin with a kickoff meeting and then progress updates will be provided by the town to the Maine DOT. The town and a consultant will create construction plans for the DOT to review. The town will also be responsible for the maintenance and operation of the floats.
STORMWATER IMPROVEMENTS
In an August 29 memo to Knight, Public Works Director Bethany Leavitt said that the town and the Maine DOT have agreed to “install new stormwater/drainage infrastructure within the Route 3 right-of way.” The work would be on lower Main Street. The work will be between Park Street and Cromwell Harbor Road.
It is one part of the Lower Main Street Water, Sewer, and Stormwater Improvements project.
The state will reimburse the town for $482,6000.
In an August 30 memo, Leavitt told Knight that she hoped the bid for the project will go to Ranger Construction Corp., which was the sole bidder. The bid was for $4,529,324.50.
TOWN MANAGER COMMENTS
In his first meeting back as town manager, Knight said that there is a waterline project on Cleftstone Ave. that will begin Monday and will take about a month.
He also congratulated Hannah Chamberlain, who is now a certified Maine assessor after passing her exam on the first try.
COUNCILOR COMMENTS
Brechlin asked about the clearing of brush on the Bluffs, a portion of Route 3, which looks out to the ocean. The land around the road is owned by Acadia National Park. The road itself is a state road. Knight said he would check with the park about it. Friedmann said that thorny bushes are encroaching into the bike lanes causing bicyclists to swerve into the travel lane.
Brechlin also talked about entertainment permits with outdoor amplification, saying that several people in or near Salisbury Cove had complained to him about noise coming from an establishment there.
Shank thanked the crossing guards at Conners Emerson. “They are one of my favorite parts of Bar Harbor,” he said.
Hochman thanked staff for the work they do and mentioned the death of Raymond Cowing Gray.
“We’ve had a large number of characters in town. This week we lost one of our few remaining legends. That is Razor Ray,” he said. “He was a very large part of growing up in Bar Harbor for many generations of kids, especially the basketball kids at Conners Emerson.”
Friedmann asked Knight to praise Leavitt for fixing a gap in the pavement by the ferry terminal.
Minutolo mentioned the village connector trail system and looking into it again. The system has been a Friends of Acadia project that is meant to allow for a “long, one-way hike or bike ride with a return by bus.”
Caines said she’d like to talk about the ethics ordinance soon. She’d mentioned this at previous meetings.
Peacock thanked Chamberlain and Gagnon for their work that they presented during the meeting. “It’s exciting to see the way that data is being collected and the ideas around it,” she said.
FORMER POLICE CHIEF CONTRACT
Though not discussed at the Town Council meeting, Dick Broom reported for the Mount Desert Islander that recently retired police chief Jim Willis is now a consultant for Dirigo Safety LLC and will be providing as-needed consulting services to Acting Chief David Kerns that will be paid to Dirigo for $100 an hour.
The contract is for one year. According to Broom, Willis is expected to have eight hours of contracted work each week. If Willis contracts to the towns for 52 weeks a year at eight hours a week that equals $41,600. The cost sharing was not specified.
According to Broom, Knight signed that contract last Thursday for Bar Harbor. The Mount Desert Select Board authorized its town manager to sign it last night, September 5.
According to Broom, “The contract will automatically renew after 12 months unless any of the parties want to change or terminate it.”
As of today, Bar Harbor’s employment page does not list police chief as a job vacancy. Willis’s last day was the first week of August. Kerns has been acting chief since then. The town manager position is also not listed there.
The position is, however, advertised on the Municipal Career Center under Town of Mount Desert police chief