Jeanne Donahue

Members of the Committee, Thank you for the opportunity to submit testimony in opposition to HB 1068. I am a New Hampshire property owner who operates a small short-term rental. I am not a hotel chain, not a corporate operator, and not an institutional investor. I am a New England resident who maintains a single-family, residential property, pays full property taxes, collects and remits meals and rooms tax, and relies on local trades and services to operate responsibly. While HB 1068 is framed as a clarification of definitions, in practice it dramatically expands the scope of what constitutes a “hotel,” an “occupant,” and an “operator.” This expansion creates serious unintended consequences that will negatively impact small property owners, full-time residents, and local communities across New Hampshire. 1. HB 1068 Treats Private Homes as Hotels - Ignoring Important Distinctions Under this bill, private homes, apartments, cottages, accessory dwelling units, and even individual rooms are explicitly defined as “hotels.” This is a fundamental shift in policy. A single-family home or owner-occupied property does not operate like a hotel: * It does not have on-site staff * It does not offer daily services * It does not generate commercial-scale revenue * It is often someone’s primary or future retirement home By erasing the distinction between commercial lodging and residential housing, this bill imposes hotel-style tax logic onto ordinary homeowners. That approach is disproportionate and ignores the reality that many short-term rentals are small, locally owned, and deeply embedded in residential neighborhoods. 2. This Bill Creates Confusion and Risk for Long-Term and Seasonal Residents HB 1068 expands the definition of “occupant” to include any stay under 185 days, regardless of purpose. This creates serious ambiguity for: * Traveling nurses and medical professionals * Seasonal workers * Families displaced during renovations or insurance claims * Residents in temporary housing between home purchases * Snowbirds or dual-residency households These are not tourists, yet under this bill they are treated as transient occupants subject to meals and rooms taxation. This will increase housing costs for people who are already struggling to find flexible housing options and may discourage homeowners from offering mid-term rentals altogether. 3. Increased Costs Will Be Passed On to Residents and Local Workers Short-term rental owners already collect and remit meals and rooms tax. HB 1068 increases compliance complexity and liability by expanding who qualifies as an operator and what qualifies as taxable occupancy. As costs rise: * Rental rates increase * Fewer owners participate in the market * Availability of flexible housing declines This does not just affect tourists - it directly impacts local workers, seasonal employees, and residents who rely on short- or mid-term housing options. 4. Small Property Owners Will Exit the Market - Reducing Housing Supply Many small operators will determine that the regulatory risk and administrative burden is no longer worth it. When that happens, properties are likely to: * Sit vacant * Be sold to out-of-state or institutional investors * Be removed from both short- and mid-term rental markets This further tightens housing supply and drives prices up, which directly harms full-time residents. Ironically, legislation intended to regulate short-term rentals often accelerates the very affordability problems it aims to solve. 5. This Bill Does Not Clearly Benefit Communities or Municipal Budgets HB 1068 does not introduce new funding mechanisms, nor does it guarantee increased revenue for municipalities. What it does guarantee is: * More disputes over classification * Greater enforcement burden * Increased confusion for property owners and renters alike Local communities benefit most from clear, predictable rules that encourage compliance - not from overly broad definitions that blur residential and commercial activity. Conclusion HB 1068 is not a simple clarification. It represents a substantial expansion of meals and rooms taxation into private residential life, with consequences that extend far beyond short-term rental owners. By treating homes as hotels and residents as transient occupants, this bill: * Increases costs for residents and workers * Shrinks housing availability * Pushes out responsible, local property owners * Creates administrative confusion without clear public benefit I respectfully urge the committee to oppose HB 1068 and instead pursue thoughtful, targeted policy that recognizes the difference between commercial lodging and residential housing - while preserving flexibility, fairness, and local economic stability. Thank you for your time and consideration. Respectfully submitted, Jeanne & Justin Donahue