South Padre Island reinforces short-term rental operator responsibility for guest behavior

Short-term rental (STR) operators on South Padre Island, Texas, now face stronger consequences if their guests cause problems. According to a new ordinance, the city can revoke an operator’s license if they receive three different citations for law violations within a 12-month period. The City Council will have the final say on license suspension.

South Padre Island defines STRs as residential dwellings, including single-family residences, apartments, or condominiums, that can be rented out by the public for a period of less than 30 consecutive days. The law requires STR operators to obtain an STR license every year for a fee of $125. Licenses are transferrable if ownership changes.

STR operators must also:

• Include permit numbers in all advertisements for STR properties.
• Designate a local contact who is available 24 hours a day, seven days a week to respond to complaints from city officials within one hour.
• Post a sign on the STR property that includes the license number and local contact information. 
• Notify guests about standards of conduct, including observing noise, parking, and garbage rules.
• Provide a smoke detector in each sleeping room.

Property owners are required to follow private agreements and restrictions on STRs — such as homeowners association rules — and the island prohibits commercial activities, including large events, at STRs. Violations of city law can be penalized with fines up to $2,000, and each day of violation is considered a separate offense.

South Padre Island isn’t the only Texas vacation destination focusing on enforcement of local STR laws. Galveston recently passed stricter STR regulations, including harsher penalties for breaking the rules. The law creates a new STR licensing board, which can recommend the revocation of a license if an STR operator has three violations within 12 months. Those types of recommendations are reviewed by the city manager and decided by the City Council.

Violations of the Galveston law are Class C misdemeanors and may be issued to owners, operators, or occupants. They’re punishable by fines of up to $2,000 per violation. Each day of a continuing violation constitutes a separate offense.

STR owners are also responsible for collecting South Padre Island’s Hotel Occupancy Tax (HOT) from guests, filing HOT reports, and submitting the tax to authorities. Operators are required to submit collection reports every month, even if their STR wasn’t rented during that month.

All Texas STRs are also subject to state HOT. Operators must register with the Texas Comptroller’s Office, collect taxes, and file state occupancy tax returns. Owners aren’t required to register with the state if an STR marketplace collects all state HOT for the property. STR marketplaces such as Airbnb and Vrbo are required to collect city and state tax for bookings on their sites.

Avalara MyLodgeTax can help short-term rental hosts automate and simplify city and state lodging tax compliance, from registration to tax return filing. If you have tax questions related to Texas vacation rental properties, drop us a line and we’ll get back to you with answers. See our Texas vacation rental tax guide for more on STR lodging taxes in the state.