Miami Beach Short-Term Rental Fines Reduced Following Court Ruling

Susan Askew
Susan Askew

Miami Beach Short-Term Rental Fines Reduced Following Court Ruling:

Fines now much lower, in line with State law

Fines for violating Miami Beach’s short-term rental ordinance which prohibits the rentals in most places in the City just got a lot lower. Following a court ruling that the old fines – ranging from $20,000 for the first violation up to $100,000 for a fifth within 18 months – were “illegal and unenforceable,” City Commissioners acted to reduce them to be in line with State law.

Short-term rentals, defined by the City as less than six months and one day, are prohibited in single family homes and other multifamily residential buildings located in certain areas of the City. In October 2019, 11th Circuit Court Judge Michael Hanzman ruled in favor of property owner Natalie Nichols’ who sued to overturn the City’s ban. Hanzman wrote in his opinion that the City’s “hefty (some might say exorbitant) fines,” are in conflict with State law which caps fines for code violations at $1,000 per day for the first infraction and $5,000 per day for repeat violations. An ordinance approved by Commissioners this past week on second reading mirrors the State law.

But what of the fines already paid? The City has collected $706,891 out of $4,060,000 in levied fines, according to City spokeswoman Melissa Berthier. For those who’ve already paid their fines, she wrote in an email, “There is no legal entitlement to any ‘refund’ of those monetary fines that were remitted to the city for violation of the Code.”

And for those unpaid? Do they have to pay the old fine or the new one? “Traditionally, code enforcement fines will become lien(s) against the real property, and the city recoups those imposed amounts once the property is sold or at the time of refinancing,” she wrote. 

But at what rate? “Those fines that were issued by the City, and imposed by the Chief Special Master, for the illegal conduct by these property owners, continue to impair the real property,” Berthier wrote, declining in a follow-up phone call to clarify which fine amount is due, e.g. the amount based on the old fine schedule which was ruled illegal and unenforceable or the new fines which compy with State law.

The Goldwater Institute filed suit on behalf of Nichols in June 2018 to overturn the City’s ban. Nichols, who owns two properties that she previously rented out on a short-term basis, claimed her properties were treated differently from “similarly situated properties” where short-term rentals are allowed. Initially, Hanzman’s ruling on the fines also appeared to overturn the City’s ban in its entirety and was upheld by an appeals court, but the appeals court reversed its decision last month, reaffirming the invalidation of the fines but reversing itself on its decision that the entire law was struck down. The short-term rental ban is still under challenge, however, as the court has not yet ruled on another motion by The Goldwater Institute on behalf of Nichols.

Details on how to find out if a short-term rental in Miami Beach is legal can be found here.


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