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Flagler County Hit Today with Anticipated Lawsuit over Short-Term Vacation Rentals

Governmental regulation vs. Private Property Rights is the theme as Steve Milo files a lawsuit against Flagler County officials over its recently passed Short-Term Vacation Rental Ordinance.

By Toby Tobin
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Palm Coast, FL – March 6, 2015 – Flagler property owner and vacation rental businessman Steve Milo today filed a lawsuit against Flagler County officials alleging that commissioners violated Florida law and the constitutional rights of all citizens when they passed a discriminatory anti-property rights and anti-privacy ordinance last month. Passage of the ordinance followed an extended and heated debate between those on the vacation rental industry side and neighboring residential property owners.

As reported in the Daytona Beach News-Journal, Palm Coast was recently listed along with Orlando and Sanibel Island as 12th among the most popular destinations for vacation rentals in a recent survey of TripAdvisor users.

The Plaintiffs in this battle between government regulation and private property rights are 30 Cinnamon Beach Way LLC (CBW) and Vacation Rental Pros Property Management LLC (VRP), both headquartered in Ponte Vedra and owned by Steve Milo.

From the lawsuit:

CBW owns an 11 bedroom single family home in a gated community known as Ocean Hammock Resort located in an unincorporated portion of Flagler County which is East of U.S. Highway 1. CBW purchased the unimproved real estate and constructed the home for the specific purpose of rental to vacationers and families on a short-term basis.  Architectural plans for the 11 bedroom home were approved by the Architectural Review Board of Ocean Hammock Resort and a building permit and a certificate of occupancy were issued by the County.  CBW invested substantial effort and financial resources (in excess or $835,000) into purchasing the real estate, designing the plans, and constructing the home for the specific purpose of renting it to families and vacationers on a short-term basis. Since its construction, the home has been advertised and rented as a vacation rental located in Ocean Hammock Resort which will accommodate 24 guests.  CBW’s investment and rental efforts were undertaken in reliance upon the regulations concerning vacation rentals as they existed in Flagler County prior to the adoption of Ordinance No. 2015-02 (“the Ordinance”), which is attached hereto as Exhibit A.  The Ordinance will apply to CBW’s property and will destroy the viability of CBW’s rental of the home to families and vacationers on a short-term basis and cause damages to CBW.

VRP operates a property management company which rents vacation properties owned by third-parties to the families and other members of the public. VRP currently manages the rental of in excess of 70 single-family homes located in Flagler County as short-term vacation rentals, accommodating up to 24 guests. The owners of these single-family homes managed by VRP rely on VRP to advertise their properties for short-term rental, contract on their behalf for the short-term rental of their properties, and to advise and assist them to comply with all applicable laws, ordinances and regulations concerning the short-term rental of their properties. VRP receives a fee from the owners of the properties based upon the income generated from short-term vacation rental. The Ordinance will apply to the properties managed by VRP and will destroy the viability of the rental of the homes managed by VRP to families and vacationers on a short-term basis and cause damages to VRP.

“The Commissioners passed a vindictive ordinance that will effectively prohibit certain types of vacation rentals in Flagler County,” said Milo. “We will vigorously fight for equal protection of all property owners and the privacy rights of the people we represent, and for all property owners who may want to rent their home at some point in the future.”

The lawsuit alleges that commissioners not only violated the right to equal protection provided under the Florida Constitution, but also violates a citizen’s right to privacy by requiring the government to collect the names and ages of anyone staying in certain types of vacation homes in the county, whether they are the renter or just a dependent child.

“Not only does the ordinance trample property rights, but now the commissioners want to trample personal privacy rights too, by forcing vacation rental owners to collect personal data on renters’ family members and hand that information over to the government,” said Peter Heebner, attorney for the plaintiff.

The lawsuit lists eight counts against Flagler County, including allegations that commissioners violated state laws that specifically protect property owners from local politician who pass laws that restrict or impinge their existing, legal vacation rental homes.

“This is a ham-handed attempt by Flagler politicians to please a small but vocal minority of constituents who don’t care if other people’s jobs are destroyed,” said Milo. “This community depends on tourism and the jobs it creates, and this ordinance will crush the livelihoods of those that depend on a thriving rental industry in Flagler County.”

The lawsuit, filed today in the Seventh Judicial Circuit Court in Flagler County, seeks declaratory judgment and injunctive relief. Plaintiffs also reserve their rights to pursue claims under Florida’s Bert J. Harris Fr. Private Property Rights Protection Act.

Heebner’s law firm recently won a $30 million judgment against the city of Ponce Inlet, Florida. A jury there found that city leaders stopped citizens from completing a development project after they had already invested substantial sums of money.

When contacted, Flagler County officials stated that they had not yet seen the lawsuit and therefore could make not comment.

reader comments
self serving interests only
Posted by anonymous
Mar 10, 2015, 4:29 pm
Mr. Milo claims to be suing Flagler County on behalf of the property owners he repesents. He assumes that any property owner that uses his company, VRP, to rent their home agrees with his point of view. This is a false assumption on his part. Many of the property owners that use his service of renting their home do not support the large rental properties in their neighborhood and welcome this short term rental ordinance to protect their communities from the large big box investor only rentals. Mr Milo's lawsuit is only protecting his interest and those of the people he has convenced to invest in large rental properties. Investments have risk involved. Mr Milo has been so unwilling to compromise at all, along the way. The community has had to turn to legislation to force him to stop distroying the community with his large vacation rental home vision.
93,000 Acres comprising the Palm Coast Project -
Posted by George Edward Chuddy
Mar 07, 2015, 10:38 pm

93,000 Acres comprised of 'Palm Coast Community Lands' for '
The Palm Coast Project' are encumbered by the REDRESS ordered for me / us pursuant F.T.C. Docket C-2854 and Federally Ordered ' 15 Year Compliance Report.
How are my/our Property Rights protected and affected by this ?
Driven by greed
Posted by Kathy
Mar 07, 2015, 8:18 am
Please examine this man 's history of filing lawsiuts across the state. He and his investors zero in on communities to exploit with short term rentals and use the court system and lawsuits as weapons of choice in an effort to protect and preserve their own personal business interests. He wants completely unfettered opportunity to run his mini hotels within single family communities and cares only about his own trumped up "property rights" with no regard to the property rights of those residents who reside near his mini hotels. He has no concern or interest for anything that would benefit the overall good of the majority of citizens of Flagler Co. He does not even live in Flagler Co. He is only looking out for his own profit and greed. The county commissioners have acted on the authority restored to them by the state legislature to effectively regulate the short term rental industry within Flagler Co. The commissioners have passed a well thought out ordinance that does not in any way restrict short term rentals but does serve to hold such rental property owners to a standard that maintains consistent safety precautions and reasonable occupancy limits. In other words, an acceptable balance between the property rights of short term rental owners and the property rights of residential owners who expect the quiet enjoyment of their homes. Apparently, this does not satisfy the out of control greed of this man and he chooses to sue in an attempt to allow his mini hotel business interests to remain unchecked; all to the overall detriment of the citizens of Flagler Co. Again I remind you, he and his investors do not live here.
Built a Home or a Motel ?
Posted by Kevin
Mar 06, 2015, 2:40 pm
This will be an interesting case to observe. Doubt that the builder's "specific purpose" of why homes are built is part of the ARB review process or the county's permitting process. In fact they are likely prohibited from even asking the purpose and must assume the purpose is for residential use. From the board or county's perspective the home might have been built for the family from the TV show "19 kids and counting" so why would the ARB or the county think that an 11 bedroom home was out of the realm of possibility for the all American family? The mere fact that the ARB approved a design and the county granted a building permit and certificate of occupancy does not imply that they approved any and all uses for a property. Hopefully the principle that supports zoning laws will apply here and support the ability of our government based on the will of the people to legally enact and enforce common sense laws. Property rights just like other rights are not without boundaries.

 
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Don "Toby" Tobin is a licensed real estate professional affiliated with Grand Living Realty. Toby is a member of the Flagler County Association of Realtors®, the Florida Association of Realtors, Enterprise Flagler, Flagler Home Builders Association, and the National Association of Realtors.

GoToby.com proivdes real estate news, commentary, and analysis for Palm Coast and Flagler Country Florida, as well as Realtor® referrals and consultation to buyers, sellers, and developers.