Chatham Raises Short-term Rental Fee To $200; Higher Fee May Be Considered

CHATHAM – The cost of operating a short-term rental in town will increase in January.

 That’s when a new $200 annual registration fee will kick in, replacing the $50 fee that has been in place since 2023.

 But select board members said at an Aug. 11 public hearing that the new higher fee may not be high enough. They indicated that a fee of as much as $350 may be appropriate, and left open the possibility of an increase before January.

 Revenue from the registration fee is intended to cover the cost of administration and annual inspections. According to a memo from Natural Resources Director Greg Berman and Town Manager Jill Goldsmith, the $50 fee generated about $45,000 annually, and the new $200 will bring in $180,000. It costs approximately $151,040 to run the program.

 Those figures are based on approximately 900 short-term rental registrations. That figure may be low. A search of the state short-term rental database turned up 1,700 matches for short-term rentals in Chatham, although it’s uncertain how many of those are active rentals.

 Short-term rentals are required to register with both the state and town and are defined as rentals of not more than 31 consecutive days. Under new regulations adopted by the board of health this summer, the registration period runs with the calendar year, and the registration fee is set by the select board.

 At the Aug. 11 select board meeting, Berman said the program administrator is actively searching to ensure that all short-term rentals are registered, including using an AI bot to crawl rental websites.

 “There are some that aren’t registering, but the preponderance of them do,” he said.

 He added that the costs of the program could increase if Maggie’s Law is passed, which requires smoke detectors and inspections on all rental properties.

 Noting that short-term rental registration fees on the Cape range from Chatham’s previous low of $50 to $750 in Provincetown, board members suggested that $300 to $350 might be a more realistic fee here. Board member Dean Nicastro said the board could hold another public hearing and increase the fee before new registrations are required in January. He added that he’d want to see justification for the higher fee, since the town is not allowed to charge a fee that is higher than the cost of a service.

 “I get the sense that the issue is not closed,” Chair Jeffrey Dykens said after the board voted unanimously to increase the fee to $200.