Lawmakers combined more than eight different bills designed to increase housing stock in Kentucky into one, but the omnibus legislation did not pass before the legislative session came to a conclusion.
The apparent sticking point? A last-minute provision that would block local governments from limiting where and how short-term rentals, like Airbnbs, can operate.
GOP Sen. Robby Mills of Henderson, the sponsor of Senate Bill 9, told Kentucky Public Radio that the Senate and House simply could not agree at the end of the day and that the short-term rental provision was “one of the stickier points,” with some Republicans also opposing the provision.
Several of the components jammed into SB 9 had been talked about multiple times over the course of the session. The original bill allowed local governments to designate special building zones that they could help finance and lower barriers to construction. A freshly added provision would require the automatic expungement of dismissed eviction filings and would protect kids from being listed on eviction cases that could follow them for the rest of their lives.
Kentucky needs to build hundreds of thousands of homes to combat surging prices for both owners and renters, legislators in a housing task force found. It’s not a problem isolated to urban areas, but also persists throughout rural Kentucky, including in areas hit by devastating natural disasters.
A spokesperson for House Republican leadership declined to comment on SB 9 and its failure. GOP Senate President Robert Stivers of Manchester told reporters that the short-term rental component was extremely complicated and the Senate GOP caucus couldn’t come to a resolution on it. He said the rentals may have a negative impact on people looking to buy homes, but could encourage tourism. He said that also had to be weighed with property right concerns and local control issues.
“It covers about every aspect of governmental type of regulation, intervention, non-regulation, non-intervention, taxation,” Stivers said. “So it's hard.”
Some Democratic lawmakers, however, feared certain provisions of SB 9 lowered regulations, potentially making housing less safe and limiting local control. For example, a local regulator would have needed to inspect properties and plans within five and ten days respectively. If they fail to do so, they would have had to issue a temporary permit allowing work to start immediately and refund all application fees.
Regardless, the highly-anticipated bill failed to pass the final hurdle, and Mills said it would need to be picked up in a future legislative session.
The Kentucky Chamber of Commerce lobbied hard for various pieces of the legislation that purported to make building housing easier in the state. They did not immediately comment on SB 9 failing to pass Wednesday.
“Housing remains a critical issue for Kentucky’s economic growth and competitiveness,” Kentucky Chamber President and CEO Ashli Watts said in a statement. “We strongly supported Senate Bill 9 as a meaningful step toward expanding housing supply and addressing rising costs. While more work remains, we are committed to maintaining momentum to support working families, businesses, and communities.”
Various housing advocates who pushed for some portions of the bill declined to comment Wednesday evening.
The short term rental provisions in SB 9 had cleared the House in a previous session, pushed by GOP House Speaker David Osborne of Prospect.
Two weeks ago — after the final legislative day before the governor’s veto period — Osborne said he did not think the short term rental provision was why SB 9 had failed to pass at that point.
“I think obviously that there's some people that don't like that language,” Osborne said. “But I don't think that was the major issue with the bill. I think it just was voluminous, and perhaps we just didn't do a good enough job of communicating it.”
Conservative advocacy group Americans for Prosperity-Kentucky blamed the Senate for not passing SB 9 and accused them of choosing “politics over the people and passivity over good policy.” The two chambers failed to agree on a version of the bill via a free conference committee.
“The people of Kentucky deserve a better shot at the American Dream through homeownership,” the statement read. “As lawmakers return to their districts without making meaningful progress, hardworking families will continue to endure a severe housing shortage and affordability crisis."
*This story was updated to include additional details from the Chamber and Senate President Robert Stivers
