Item - 2024.PH11.9

City Council on April 17 and 18, 2024, adopted the following:

1. City Council reiterate that the primary objective of Toronto Municipal Code Chapter 547, Licensing and Registration of Short-Term Rentals, is to limit short-term rental activity to principal residences to permit residents the flexibility to supplement their income through short-term rental operations while ensuring critical rental housing stock such as secondary suites, laneway suites, garden suites and similar accommodation are preserved for long term living accommodation and not temporary sleeping accommodation for the travelling public.

2. City Council amend Toronto Municipal Code Chapter 547, Licensing and Registration of Short-Term Rentals, to:

a. require an applicant for a short-term rental operator registration to submit, upon request, at least two documents in addition to government-issued identification to demonstrate to the satisfaction of Municipal Licensing and Standards that the proposed short-term rental is their principal residence;

b. amend the definition of principal residence to clarify that an operator's principal residence cannot include another space on the same property as a proposed or existing short-term rental that meets the definition of a dwelling unit;

c. insert a definition of "dwelling unit", for the purposes of determining an operator's principal residence, as a "separate or self-contained living accommodation for a person or persons living together as a single housekeeping unit in which both food preparation and sanitary facilities are provided for the exclusive use of the occupants of the unit, and includes, for the purposes of this Chapter, a secondary suite, laneway suite, garden suite, or similar accommodation";

d. require an applicant for a short-term rental operator registration or its renewal to attend an in-person interview, upon request, at a time and place designated by Municipal Licensing and Standards, and provide any information or documents Municipal Licensing and Standards may require to evaluate the applicant’s eligibility for a short-term rental operator registration;

e. clarify that Municipal Licensing and Standards may require an operator to attend an inspection of their short-term rental at any time during the term of their registration and that the operator must comply with directions given by Municipal Licensing and Standards during that inspection;

f. clarify that a short-term rental operator registration is tied to the address listed on the registration issued by Municipal Licensing and Standards and require Municipal Licensing and Standards to refuse an application for a short-term rental operator registration or its renewal related to any address for which a short-term rental operator registration had been revoked in the 12 months preceding the application date, except where applicant can demonstrate to the satisfaction of Municipal Licensing and Standards that the property has been sold;

g. limit short-term rental operator registrations to one per dwelling unit, regardless of how many people may live in that dwelling unit, to be implemented by permitting only the operator who has held a registration related to the dwelling unit for the longest continuous period of time to renew their registration;

h. require the records short-term rental companies must keep to include the full name of the short-term rental operator as listed on their corresponding registration issued by Municipal Licensing and Standards;

i. clarify the requirements for short-term rental advertisements, verification of operator registration information by licensed short-term rental companies, and the removal of short-term rental advertisements by unregistered operators by amending 547-1.3 to include the following requirements:

1. require that no person shall advertise a short-term rental unless it displays the operator's registration number in a prominent location on the main page of the advertisement;

2. require that no person shall advertise, facilitate the advertising or rental of, or broker a short-term rental unless the operator is registered as such with Municipal Licensing and Standards and is using their full name, address and registration number on record with Municipal Licensing and Standards;

3. require every short-term rental company to verify the above information, at each instance they provide such services, in a manner prescribed by the Executive Director, by reference to the short-term rental registration data maintained and provided by Municipal Licensing and Standards for this purpose; and

4. in addition to the above, require a person, within 24 hours of being requested to do so by Municipal Licensing and Standards, to remove an advertisement that does not comply with the above requirements or that relates to an unregistered operator and cancel all future bookings made with respect to that short-term rental.

j. amend the process to revoke an operator's registration such that if an operator delivers a written response to Municipal Licensing Standards' notice of intent to revoke their registration, the response shall be reviewed by the Executive Director, or their designate, who shall make a final decision that is no longer subject to further appeal or review;

k. require short-term rental operators, in addition to providing emergency information and an exit diagram to guests, to post a physical copy of such information in a conspicuous place within the short-term rental for the duration of a guest's rental period;

l. require short-term rental companies to verify the validity of listings on their platforms that claim to be hotels by reference to a list of registered hotels provided by Municipal Licensing and Standards and to remove any listings that do not correspond with the list;

m. prohibit a multi-tenant house operator from obtaining a short-term rental operator registration related to that multi-tenant house;

n. remove 547-2.2 D given its time-limited application during the City's pandemic response;

o. require that a registered short-term rental operator advertising a partial-unit rental to advertise 1 fewer than the number of bed-sitting rooms available in their principal residence;

p. require an applicant for a short-term rental operator registration to register as either as an entire-unit short-term rental operator or a partial-unit short-term rental operator for the duration of their registration;

q. require a registered short-term rental operator, upon renewal, to register as either an entire-unit short-term rental operator or a partial-unit operator for the duration of their registration;

r. stipulate that consistent with their registration:

1. partial-unit operators may only offer partial-unit rentals; 

2. all rentals by an entire-unit operator will be subject to the 180-night limitation, whether a visitor rents part or all of the entire unit operator’s residence; 

s. prohibit an applicant or registered short-term rental operator from applying for a new registration at an address previously registered as a partial-unit or entire-unit short-term rental where the registration was cancelled within the prior 12 months, except where the applicant or operator can demonstrate to the satisfaction of Municipal Licensing and Standards that the property has been sold; and

t. clarify that where the number of bed-sitting rooms concurrently rented as a partial-unit rental equals the total number of bed-sitting rooms within the entire dwelling unit, it shall be considered an entire-unit rental, and shall count towards the 180-night entire-unit rental limit;

3. City Council direct the Executive Director, Municipal Licensing and Standards and the Chief Technology Officer to develop an Application Programming Interface to facilitate the secure delivery of and access to short-term rental registration data for the purposes of operator validation by licensed short-term rental companies.

4. City Council request the Province of Ontario to clarify the application of the Residential Tenancies Act with respect to rentals of 28 days or longer.

5. City Council request the Province of Ontario to commit to the preservation of long-term rental housing stock by addressing the Provincial Ombudsman’s recommendations related to resource and process-based constraints impacting the operation of the Landlord and Tenant Board.

6. City Council direct the by-law amendments in Part 2 above come into effect on the following dates:

a. the amendment in Part 2.n. to remove time-limited provisions related to the City's pandemic response come into effect immediately on the date a by-law is adopted;

b. the amendments in Part 2.b., c., h., i., j., k., l., and m. to enhance data verification processes, advertising requirements and bylaw compliance and enforcement measures come into effect on June 30, 2024;

c. the amendments in Part 2.a, d., e., f., and g. addressing strengthening registration requirements and the principal residence requirement come into effect on September 30, 2024; and

d. the amendments in Part 2.o, p., q., r., s., and t. come into effect on January 1, 2025.

7. City Council amend Toronto Municipal Code Chapter 441, Fees and Charges, Appendix C - Schedule 12, Municipal Licensing and Standards by amending fees in the below table:

8. City Council direct that the amendments to Chapter 441 come into effect as follows:

a. the changes to the Short-Term Rental Company Application Fee, Short-Term Rental Company Renewal Fee, and Short-Term Rental Nightly Fee shall come into force on June 30, 2024; and

b. the changes to the Short-Term Rental Operator Registration Fee shall come into force on January 1, 2025.

9. City Council increase the 2024 Operating Budget of Technology Services by $0.243 million gross and net; and increase the 2024 Operating Budget of Municipal Licensing and Standards by $0.777 million gross, $1.020 million revenue, and -$0.243 million net, fully funded from increased licence fee revenues.

10. City Council increase the approved staff complement of Technology Services by 2 positions; and increase the approved staff complement of Municipal Licensing and Standards by 21 positions to support the implementation of the proposed changes outlined in the report (March 21, 2024) from the Executive Director, Municipal Licensing and Standards.

11. City Council authorize the City Solicitor to make amendments to the Toronto Municipal Code, including such technical, stylistic, organizational, or other clarifications to its existing provisions, as may be necessary, in their opinion, to bring these and past adopted recommendations related to short-term rentals into effect or to increase the clarity and readability of its provisions.

12. City Council amend Chapter 547 short-term rental definition to exempt student premises owned or operated by a publicly funded or not-for-profit educational institution from the requirements of the Chapter.

13. City Council request the Executive Director, Municipal Licensing and Standards, to consider amending the screening criteria for Short Term Rental Operators and strengthen the threshold for convictions related to Chapter 591, Noise, to address impacts arising from nuisance parties at Short Term Rentals.

14. City Council request the Executive Director, Municipal Licensing and Standards, in consultation with the Chief Technology Officer, to report back prior to the development of the 2025 budget on technology tools and other technical measures to increase efficiency in the short-term rental licensing and enforcement processes.

15. City Council request the Government of Canada clarify the eligibility criteria and related funding allocation of $50 million for municipalities to support enforcement of short-term rental restrictions, as announced in the 2024 Federal Budget, and City Council request the Executive Director, Municipal Licensing and Standards, to report back on status of available funding and a plan for deployment in the Budget 2025 Process.

16. City Council direct the Executive Director, Municipal Licensing and Standards to monitor compliance and enforcement of partial-unit rentals and report back in second quarter of 2025 with any necessary by-law amendments.

17. City Council direct the Executive Director, Municipal Licensing and Standards, in consultation with the Executive Director, Housing Secretariat, to review the City’s ‘Good Operator Guide’ for opportunities to educate short-term rental operators where appropriate on options for making homes available to residents on the long-term market, to be regulated through the provincial Residential Tenancies Act, to further the supply of affordable housing for Toronto residents.

18. City Council direct the Executive Director, Municipal Licensing and Standards, to examine options for developing licencing requirements for short-term rental property managers/management companies and to report to City Council by second quarter of 2025.

19. City Council request the Executive Director, Municipal Licensing and Standards, consider the current set fines for renting an entire unit for more than 180 days under Section 547-5.3 of City of Toronto Municipal Code Chapter 547, Licensing and Registration of Short-Term Rentals, and determine whether seeking approval to increase the set fine amount from $700.00 is appropriate.

20. City Council direct the Executive Director, Municipal Licensing and Standards, to provide City Council with a progress report on implementation of the recommendations by the second quarter of 2025.