An investigation by the Office of the Inspector General in Montgomery County, Maryland, has revealed that more than 85% of short-term rental properties in the area are unregistered, despite regulations put in place in 2017. This has resulted in a significant loss of potential revenue from licensing fees and taxes that could have been collected by the county. The report also highlighted that the Department of Health and Human Services, responsible for enforcing the regulations, made minimal effort to do so, leading to thousands of dollars in missed revenue. In response to these findings, County Executive Marc Elrich submitted legislation in 2023 that was signed into law to strengthen enforcement of short-term rental regulations. The county has hired additional staff to oversee compliance and enforcement, and is taking steps to address the issues raised in the report. Recommendations include conducting audits to verify tax payments, enforcing compliance, and educating hosts and guests on program requirements. The county’s Chief Administrative Officer, Richard Madaleno, has indicated agreement with most of the findings in the report and pledged to address staffing issues related to carrying out routine audits. The county is committed to ensuring that short-term rental properties are properly registered and in compliance with regulations to avoid further loss of revenue and ensure the safety and legality of the rentals in Montgomery County.
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Inspector General’s report uncovers lax administration of short term rentals costing Montgomery Co. hundreds of thousands of dollars
