Groton, Connecticut Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Groton, Connecticut?

The town of Groton, Connecticut, recently approved new zoning regulations for short-term rentals like Airbnb and VRBO that will go into effect on May 15, 2024. Previously, the state of Connecticut had no legislation regulating STRs statewide, and Groton historically did not regulate them either.

The new regulations aim to address concerns raised by some residents about noise, quality-of-life issues, and impacts on housing stock, while balancing the economic benefits touted by STR proponents. Key provisions of Groton's STR regulations include:

• In residential zones, the STR owner must have their primary residence on site. There are also limits on the number of STRs allowed per lot.
• STRs are banned in single-unit residential, heavy industrial, working waterfront, and open space/green zones.
• STRs are conditionally allowed with site plan approval in neighborhood commercial, regional commercial, and mixed-use industrial zones.
• In residential zones with 1-2 unit dwellings, rural residential, multi-unit residential, and certain mixed-use zones, STRs require both site plan and special permit approval, which involves a public hearing.
• STR owners must provide one off-street parking space per bedroom, demonstrate the rentals will not be a nuisance to neighbors, and comply with lighting standards and building/fire/electrical codes.
• A short-term rental is defined as 30 days or less.

The regulations only apply to new STRs going forward, as existing ones are grandfathered. They also do not apply in the City of Groton, Noank, or Groton Long Point.

Starting a Short-Term Rental Business in Groton

Property owners interested in starting a short-term rental in Groton will need to follow the new zoning regulations carefully. The approval process and requirements will depend on the specific zoning district.

In most residential areas, the owner will need to maintain their primary residence on-site and go through the site plan and special permit process, which includes a public hearing. Providing adequate off-street parking, avoiding nuisances, and meeting all building and safety codes will be critical.

STRs are prohibited in certain zones like single-family residential neighborhoods. However, there may be opportunities in commercial, mixed-use, and multi-family zones, subject to the stipulated approval processes.

Groton STR operators will also need to collect and remit the 15% state room occupancy tax. Additional local registration or licensing requirements may be implemented in the future, pending the outcome of a state Supreme Court case.

Those with existing STRs in Groton appear to be grandfathered under the new zoning regulations. However, a separate town ordinance, if enacted, could potentially require registration of both new and existing STRs.

Overall, Groton's new STR regulations attempt to strike a balance between competing interests. However, the zoning approval process for new STRs, particularly in residential areas, will likely be rigorous. Prospective operators should review the regulations in detail and consult with local officials.

Short-Term Rental Licensing Requirement in Groton

Based on the information provided, it does not appear that the Town of Groton currently has a licensing requirement for short-term rentals. The recently approved zoning regulations, which go into effect on May 15, 2024, govern issues like which zones allow STRs, parking requirements, and the approval process needed (site plan, special permit, etc.) depending on the zoning district.

However, these zoning regulations only apply to new STRs going forward, as existing ones are grandfathered. The Groton Town Council has discussed potentially implementing a separate ordinance that could require registration or licensing of both new and existing STRs. But, they have decided to delay pursuing any STR ordinance until the Connecticut Supreme Court decides on a pending case that may impact the legal landscape around regulating STRs.

So, in summary, while Groton has enacted zoning regulations for new STRs, there is no town-wide licensing requirement at this time. STR operators will need to go through the applicable zoning approval process for new rentals, which varies by district, and can involve site plan approval, special permit approval, and a public hearing in some cases.

STR operators in Groton are required to collect and remit the 15% Connecticut room occupancy tax. Failure to comply with the new zoning regulations once in effect could result in enforcement action by the town's zoning enforcement officer. If a licensing ordinance is implemented in the future, it would likely come with additional requirements, fees and penalties for non-compliance. But the details remain to be determined pending the outcome of the state Supreme Court case.

Required Documents for Groton Short-Term Rentals

Based on the information available, the Town of Groton does not currently have a licensing or registration requirement for short-term rentals that would necessitate submitting specific documents. The recently approved zoning regulations, effective May 15, 2024, govern issues like which zones allow STRs and the approval process needed (site plan, special permit, etc.) depending on the zoning district.

However, to obtain zoning approval for a new short-term rental under these regulations, applicants will likely need to submit certain documents as part of the site plan and/or special permit application process. While the exact requirements are not detailed in the available sources, typical documents for such applications could include:

1. Completed application form
2. Site plan showing parking and property details
3. Floor plans of the rental unit
4. Proof of property ownership or landlord permission
5. Description of the proposed STR operation
6. Application fee

The purpose of these documents would be to demonstrate compliance with the STR zoning regulations, such as having the required off-street parking, meeting building and fire codes, and not causing nuisances to neighbors.

Existing STRs are grandfathered under the new zoning regulations. However, the Groton Town Council has discussed potentially implementing a separate ordinance that could require registration or licensing of both new and existing STRs. If enacted in the future, such an ordinance would likely come with its own list of required application documents.

It's also important to note that Groton STR operators must collect and remit the 15% Connecticut room occupancy tax. This is a statewide requirement, not a local one.

For the most up-to-date information on required documents, STR operators should contact the Town of Groton Office of Planning and Development Services and consult the official zoning regulations once adopted. Requirements may evolve if a local STR ordinance is implemented.

Groton Short-Term Rental Taxes

Short-term rental operators in Groton, Connecticut, are subject to several taxes at the state and local level:

Connecticut State Room Occupancy Tax: The state imposes a 15% room occupancy tax on the total payment received for stays of up to 30 consecutive days in short-term rentals, including Airbnb and Vrbo properties. This tax is collected by the rental platform and remitted to the state on behalf of the host.

Groton Sales Tax: The combined state and local sales tax rate in Groton is currently 6.35%. However, this tax generally does not apply to short-term rental accommodations, as those are instead subject to the state room occupancy tax.

Local Occupancy Taxes: At this time, the Town of Groton does not impose any additional local occupancy taxes on short-term rentals beyond the state's 15% room occupancy tax. However, the town recently approved new zoning regulations for STRs that will go into effect in May 2024.

It's important to note that short-term rental income is also subject to federal and state income taxes. Hosts will need to report their rental income on their tax returns.

As for potential write-offs and deductions, STR operators may be able to deduct certain expenses related to their rental business, such as:

1. Mortgage interest
2. Property taxes
3. Rental platform service fees
4. Cleaning and maintenance costs
5. Utilities
6. Supplies
7. Insurance

Hosts should keep detailed records of their rental income and expenses, and consult with a tax professional to determine which deductions they may be eligible for.

In summary, the primary tax that applies to short-term rentals in Groton is the 15% Connecticut room occupancy tax, which is collected and remitted by platforms like Airbnb and Vrbo. Groton does not currently have any additional local occupancy taxes, but new STR zoning regulations will take effect in 2024. Rental income is also taxable, but hosts may be able to write off certain expenses.

Connecticut Wide Short-Term Rental Rules

While there is currently no comprehensive statewide legislation regulating short-term rentals in Connecticut, several state-level rules and considerations still apply to Groton hosts:

Connecticut Room Occupancy Tax: The state imposes a 15% room occupancy tax on the total payment received for stays of up to 30 consecutive days in short-term rentals, including Airbnb and Vrbo properties. This tax is typically collected by the rental platform and remitted to the state on behalf of the host.

Proposed Statewide Legislation: Connecticut lawmakers are considering a bill (Bill 335) that would grant municipalities more authority to regulate short-term rental properties, including the ability to establish ordinances governing issues like zoning restrictions, guest occupancy limits, and parking requirements. If passed, this legislation could impact the regulatory landscape for Groton hosts.

Fire Safety and Health Codes: Connecticut state law requires that short-term rentals have functional fire extinguishers, smoke detectors, carbon monoxide detectors, and clearly posted escape routes. Properties are also subject to regular fire marshal inspections and must comply with state electrical, plumbing, and egress standards.

Pending State Supreme Court Case: The Groton Town Council has discussed potentially implementing a local ordinance that could require registration or licensing of both new and existing STRs. However, they have decided to delay pursuing any STR ordinance until the Connecticut Supreme Court decides on a pending case that may impact the legal landscape around regulating STRs.

Statewide Housing Bill: The Connecticut Senate recently passed a wide-ranging housing bill (H.B. 5474) that includes a provision giving towns more explicit authority to adopt ordinances related to the operating and licensing of short-term rental properties. If signed into law, this could pave the way for more local regulation of STRs in Groton and across the state.

While Connecticut does not currently have a singular, comprehensive statewide law regulating short-term rentals, the combination of the room occupancy tax, pending legislation, applicable safety and health codes, and the potential for future court rulings and laws suggests an evolving regulatory environment for Groton hosts to navigate. Staying attuned to these state-level developments will be crucial for STR operators in Groton and throughout Connecticut.

Does Groton Strictly Enforce STR Rules?

Based on discussions in online forums like BiggerPockets and Reddit, it appears that Groton is not particularly strict in enforcing short-term rental regulations compared to some other cities. While Groton recently approved new zoning rules for STRs that will take effect in May 2024, the town has historically not regulated them.

Many hosts seem to operate STRs in Groton despite the lack of clear rules. A search on Airbnb shows dozens of active listings for properties in Groton, ranging from private rooms to entire houses. This suggests a fairly Airbnb-friendly environment, at least up until now.

However, with the new zoning regulations coming into force next year, Groton STR hosts will need to pay closer attention to compliance. The rules stipulate issues like parking requirements, occupancy limits, and permitting processes depending on the property's zoning district.

That said, the new regulations only apply to new STRs going forward - existing rentals are grandfathered. And the zoning rules don't cover registration or licensing of STRs, which would require a separate ordinance that Groton has delayed pursuing pending the outcome of a state Supreme Court case.

So, in summary, while Groton appears to have been relatively lax about STRs historically, the regulatory environment is evolving. Hosts should be able to continue operating if they follow the new zoning rules, but enforcement may tighten up compared to the past. Monitoring future developments around a potential registration ordinance will also be important for Groton's STR operator community.

How to Start a Short-Term Rental Business in Groton

Starting a short-term rental business in Groton, Connecticut, involves several key steps:

Research Groton's STR Regulations: Groton recently approved new zoning regulations for short-term rentals that will go into effect on May 15, 2024. Familiarize yourself with these rules, which govern issues like which zones allow STRs, parking requirements, and the approval process needed (site plan, special permit, etc.) depending on the zoning district. Existing STRs are grandfathered, but new rentals will need to comply. Contact Groton's Office of Planning and Development Services for guidance on the specific requirements for your property's zoning district.

Register Your Business: Register your short-term rental business with the Connecticut Secretary of State. You'll also need to obtain a federal Employer Identification Number (EIN) from the IRS for tax purposes. Consult with a business attorney or accountant to determine the best legal structure for your STR business (sole proprietorship, LLC, etc.).

Obtain Necessary Licenses and Permits: While Groton does not currently have a town-wide STR licensing requirement, you may need certain permits as part of the zoning approval process for new rentals. This could include a zoning permit, building permit, or health permit, depending on your circumstances. Check with Groton's Building and Zoning Department for specific permit requirements for your property.

Prepare Your Property: Ensure your rental property is safe, clean, and well-maintained. Install smoke detectors, carbon monoxide detectors, and fire extinguishers as required by state law. Consider smart home technology for added security. Decorate and furnish your rental to appeal to your target guests, whether they be families, business travelers, or vacationers.

Create a Detailed Listing: Craft an attractive, informative listing for your rental on platforms like Airbnb and Vrbo. Include high-quality photos, detailed descriptions, and clear house rules. Be transparent about any quirks or limitations. Highlight unique selling points of your property and the local Groton area to make your listing stand out.

Set Competitive Prices: Research similar STR listings in Groton to determine competitive nightly rates. Consider using dynamic pricing tools to automatically adjust prices based on demand. Factor in additional costs like cleaning fees, extra guest charges, and Airbnb/Vrbo service fees when setting your prices.

Implement a Robust Cleaning Protocol: Develop a thorough cleaning checklist and protocol to ensure your rental is properly sanitized between guests. Hire a reputable cleaning service if you cannot manage this yourself. With heightened cleanliness expectations due to COVID-19, consider investing in professional cleaning equipment and EPA-approved disinfectants.

Comply with Tax Obligations: Register with the Connecticut Department of Revenue Services to collect and remit the 15% state room occupancy tax on your short-term rental income. STR income is also subject to federal and state income taxes. Use an automated tax tool or work with an accountant to ensure you are properly collecting and reporting all applicable taxes.

Secure Appropriate Insurance: Contact your homeowners insurance provider to discuss your STR business. You may need to modify your existing coverage or purchase an additional business liability policy. Consider requiring guests to purchase travel insurance and/or a security deposit to mitigate potential damages.

Be a Responsible Host: Once your Groton STR business is up and running, be a responsive and responsible host. Communicate clearly with guests, promptly address any issues that arise, and be a good neighbor in your local community. Provide a digital welcome book with key information about your rental, house rules, and local recommendations to create a seamless guest experience.

By following these steps and prioritizing compliance, guest satisfaction, and operational efficiency, you can build a successful short-term rental business in Groton.

Who to Contact in Groton about Short-Term Rental Regulations and Zoning?

For the most up-to-date information on Groton's short-term rental regulations and zoning requirements, contact:

Groton Office of Planning and Development Services
134 Groton Long Point Road
Groton, CT 06340
Phone: (860) 446-5970
Website: https://www.groton-ct.gov/departments/plandev/

Key contacts:

1. Deborah Jones, Assistant Director of Planning and Development Services
2. Jeff Davis, Senior Planner

The Office of Planning and Development Services can provide guidance on the specific zoning requirements for your property's district, the approval process for new STRs, and any upcoming changes to the regulations.

You can also visit the town's dedicated Short Term Rentals project page at http://www.greatergroton.com/short-term-rentals-in-groton. This page includes a project timeline, meeting dates, relevant documents, and opportunities to provide feedback.

For questions related to building permits, contact:

Groton Building and Zoning Department
Town Hall Annex
134 Groton Long Point Road
Groton, CT 06340
Phone: (860) 446-5982

Local STR host communities and resources:

1. Connecticut Airbnb Hosts Facebook Group: https://www.facebook.com/groups/ctairbnbhosts/
2. Connecticut Short-Term Rental Alliance: https://ctstra.org/
3. Mystic-Stonington Airbnb Hosts Facebook Group: https://www.facebook.com/groups/238076417097294/

These groups can provide a forum to connect with other local hosts, share experiences, and stay informed about regulatory developments impacting STRs in Groton and across Connecticut.

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.