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Paradores ask senators to reject short-term rental House Bill 1557

The group said the bill should be withdrawn or rejected so that it may be “responsibly reworked” during the next legislative session.

The Association of Paradores and Puerto Rican Small Inns is asking the island’s Senate to reject House Bill 1557, which seeks to regulate short-term rentals (STRs), commonly known as Airbnbs, in Puerto Rico.

In a statement released Wednesday, the group said the bill should be withdrawn or rejected so that it may be “responsibly reworked” during the next legislative session in 2025.

They recommended that Puerto Rico should use best practices already implemented and tested in other jurisdictions in the U.S., Canada and Europe that have been accepted by digital platforms in other tourist destinations throughout the world.

“We reiterate that HB 1557, as submitted by Reps. [José H.] Rivera Madera and [Joel] Sánchez Ayala, was a step in the right direction, but it was severely affected in the legislative process in the House with illogical and confusing amendments. The current version aims to legitimize the prevailing anarchy and create a new business category above our current laws and regulations,” Xavier A. Ramírez, president of the Association of Paradores and co-owner of the Combate Beach Resort, said in the statement.

The measure was introduced in November 2022. After hearings held in February and May 2023, the House passed the bill in June 2023 and sent it to the Senate for a vote. The Senate then sent it to its Education, Tourism and Culture Commission, which held a new set of hearings in April 2024. A second report with amendments was released last week, and the bill has been submitted to the Senate floor for a vote.

According to Ramírez, the final version of HB 1557 is weak because it does not identify STRs as a commercial activity and does not address gentrification nor the main difficulties that affect condominiums and residential communities.

The bill also fails to correct the evasion of permissions and contributions by professional hosts and to consider the proliferation of illegal hotels. In addition, it includes the previously rejected proposal of Senate Bill 936 and seeks to limit the ministerial and fiduciary functions of municipalities and regulatory agencies on the island.

“Maintaining these gaps would be disastrous for the communities in Puerto Rico,” Ramírez said.

Christian Rivera, co-owner of the Parador Guánica 1929 and vice president of the association, said that STRs, like other businesses, should be registered and contribute equitably to maintaining the infrastructure and public and common services they use for their operations. All their data and characteristics clearly indicate that they are a commercial activity and must comply with all current regulations applicable to all transient accommodations, Rivera said.

The association criticized HB 1557 for focusing on STRs that are marketed through digital platforms such as Airbnb and Vrbo while ignoring global STR trends toward direct booking. Direct bookings facilitate evasion of the room tax, which exceeded $20 million in 2023, the group said.

“Our legislators have all the necessary information to create an adequate and balanced regulation to address the gaps created by STRs, using and adapting legislation approved in dozens of North American jurisdictions, much more robust than what is proposed in HB-1557,” Ramírez added.

On Tuesday, the Puerto Rico Hotel and Tourism Association (PRHTA) said it was disappointed over proposed amendments that were not incorporated into the final bill and asked senators to vote against it. Among other amendments, the PRHTA had asked the Senate Education, Tourism and Culture Commission to change the bill to define STRs as a commercial activity.

The PRHTA called for strengthening the bill by including an express prohibition against illegal hotels, noting that any building with more than six units must meet the same requirements as a hostel or bed-and-breakfast.

At present, Puerto Rico does not have a regulatory framework in place for STRs, although several towns, including the Municipality of San Juan, have established their own regulations not only to govern the sector but also to generate funds through required permits and licenses.

Because of the pending Senate vote on the bill, which would regulate STRs at the state level, San Juan recently decided to extend its deadline for the mandatory registration of STRs in the capital to Dec. 31. STRs owners initially had until June 3 to register on an electronic portal of the San Juan City Hall.

Author Details
Author Details
G. Torres is a freelance journalist, writer and editor. She’s worked in business journalism for more than 25 years, including posts as a reporter and copy editor at Caribbean Business, business editor at the San Juan Star and oil markets editor at S&P Global Platts (previously a McGraw Hill company). She’s also worked in marketing on and off for decades, now freelancing for local marketing and communications agencies.

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