Las Vegas Strip wants keys to regulating short-term rentals

Clark County says an existing prohibition on its rental regulations is unlawful because it's wide-ranging.PASADENA, Calif. (CN) — A Ninth Circuit Court of Appeals panel on Monday appeared skeptical of Clark County’s short-term rental licensing program.A lower court last year forbid the county — home to Las Vegas — from requiring property owners to obtain short-term rental licenses, opening the door to arguments before the three-judge panel.That restriction is unlawful because it is too broad, and renting property isn’t an inherent property right, said attorney Thomas Dillard, representing Clark County.“I don’t think even California has had the guts to say that,” quipped U.S. Circuit Judge Ryan Nelson, a Donald Trump appointee, referring to Dillard’s latter argument.Clark County’s licensing program had deep flaws, leading the Greater Las Vegas Short-Term Rental Association to file suit. Representing the association, attorney David Zionts said the county has shown it can’t properly operate a licensing system.The county, in turn, said a blanket prohibition imposed by the lower court isn’t lawful. It also said it has processed short-term rental applications, granting 175 while denying 141. About 500 applications have received no decision, Dillard said.Much of the Las Vegas Strip lies in unincorporated Clark County.The appeals panel made no decision Monday.With the county’s regulations on hold, property owners currently need no short-term rental license to operate.The appeals panel peppered Dillard with questions about the licensing scheme. U.S. District Judge Karen Schreier of the District of South Dakota, a Bill Clinton appointee sitting by designation, asked whether an applicant would receive a license if they met all county requirements.When Dillard said officials had to balance equities in their decision, Nelson said his argument had shifted to the county having unfettered discretion to deny licenses.“You could still deny it because you don’t like it?” Nelson asked.Dillard said people who had their license applications denied currently can rent their homes, despite the county’s moratorium on the program — a stop officials placed because they were inundated with applications. However, the existing injunction stopping the county from implementing a licensing scheme is universal, making it unlawful.U.S. Circuit Judge Roopali Desai, a Joe Biden appointee, questioned why property owners couldn’t use their land as they intend. Dillard argued that could lead to a landowner operating a bar next to a school or putting a billboard on their property.Nelson noted that Las Vegas residents have rented out their homes for decades.“At a certain point, I’m not sure we can micromanage this,” Nelson said.Turning to Zionts, the association’s attorney said Clark County failed to implement a meaningful licensing process.He argued that the Nevada Supreme Court decided a system should exist allowing short-term rentals to operate. However, a county attorney argued the government couldn’t hasten the approval process, which Zionts said led to landowners losing the use of their property.“If you’re not going to do the process, then you can’t do the deprivation,” he said, adding: “The county has the keys to get out of this injunction.”According to Zionts, Clark County needs to create a proper licensing system. He described some of its requirements as onerous. For example, if a landowner waits more than five days to challenge a citation, they must pay the full amount of the fine to proceed.Answering Schreier’s earlier question, Zionts said he saw no discretion in whether to issue a license if an applicant meets all criteria.“We’re talking about procedural due process, and you have to give due process,” he added.Given a chance to rebut, Dillard pushed back on a “taking” argument — that the government cannot prohibit a landowner from using their property without proper compensation. He said that would handcuff any county regulations on short-term rentals.Nelson cut off that line of argument.“You’ve got to fix the problem,” the judge added. “I would encourage you to fix the problem that’s before you and not freak out about these other issues.”Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads