The Rocky Road to STA Licencing in Prince Edward County

By John Francis,
Bruce Peninsula Press

When I heard that Prince Edward County was raising their parking fines from $35 to $400, I contacted the person in charge, Director of Community Development & Strategic Initiatives Todd Davis, hoping he would answer a few questions. He consented to a telephone interview.

“You aren’t by any chance, related to the Tobermory Davises?” I asked. Well yes. Todd Davis is the great-great-great grandson of Abraham Davis, the first lightkeeper at Tobermory’s Big Tub Lighthouse. Todd spent his childhood summers at his grandparents’ place in Tobermory and remembers the community with fondness.

He passed through a couple of years ago and hardly recognized the place.

He has been working at Prince Edward County for nine years; he suspects that anyone returning there after 30 years would feel a similar shock. He felt he had something to contribute to our conversation.

Prince Edward County and MNBP have both been “discovered” by the Greater Toronto Area. Too many people come to spend Saturday at the beaches; too many people are willing to pay far too much money to stay for the weekend. 

But there is a sharp difference between Prince Edward County and MNBP: we’ve been in tourism forever, whereas they’re new to the game. MNBP has close to 500 motel rooms plus a hundred or so commercial rental cottages. Prince Edward County has only a couple of small hotels, but the Short-Term Accommodation (STA) sector has been growing rapidly to take up the slack.

Prince Edward County has 26,000 residents and about 9,000 dwellings, roughly 3,000 cottages and 6,000 year-round homes. 

Investors have been snapping up existing homes and cottages and turning them into short-term rentals; somewhere between 1,500 and 2,000 dwellings at this time. Other investors took advantage of loopholes in a zoning plan geared to single-family dwellings to create purpose-built short-term rentals in residential zones.

The result has been an erosion of the housing stock and an acute housing crisis. The people who work in Prince Edward County can no longer afford to live there. (Does that sound familiar?)

Davis told me about “dark streets” — places where all the houses have been turned into seasonal short-term rentals, From mid-October to mid-May, the houses are dark, whole blocks uninhabited. Some streets in the settlement areas of Prince Edward County are up to 80% STAs.

The combination of overcrowding, dwindling housing stock and labour shortages have created a lot of anxiety in the community. This anxiety became more acute a few years ago during a drought and fire ban, when STA owners weren’t telling customers they couldn’t have fires.

County Council were motivated to create a plan to manage visitors and harness the tourism economy; Davis frames it as “destination stewardship”.

There is not a lot of support among the residential base for tourism management expenditures, so the plan had to be self-funding. Parking fees, park/beach entry fees and increased parking fines are part of the plan.

But a large part of the strategy involved licencing and regulating the STA sector. The process of devising and implementing a plan has taken four years. It has been “a messy, difficult, challenging program to put in place”. There has been “a ton of consultation”, involving residents, cottagers, STA investors and the public — somewhere over 200 people spoke at public meetings. STA investors and their customers resisted any regulation; almost everybody else was in favour.

The licencing part of the program was put in place in 2019. The 4% Municipal Accommodation Tax went into effect on Feb 1 of this year and will be in place whenever Prince Edward County emerges from lockdown. The MAT, combined with fees and fines, will pay for the enforcement and management program at no cost to the taxpayer.

Davis remembers the words of a mentor who spent decades in real estate: “The best deal is one where both parties walk away angry”. The STA licencing program fits that paradigm nicely.

County Council, echoing the anxiety of the residents, feels that the STA licencing program is not restrictive enough. STA owners and their customers are resentful of both the tax and the restrictions.

A key part of the program is the requirement that every STA must have an owner, operator or agent who can attend the property within 30 minutes if there is an issue or complaint.

Prince Edward County offers an object lesson for other tourism destination communities. When it comes to destination stewardship, consensus may be impossible; we will probably have to settle for “majority rule”.