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PHOTO ILLUSTRATION: During the UCI Road World Championship this fall, home owners may be looking to make money renting out their home, apartments or rooms. Transient rentals remain illegal in Richmond. Photo taken Friday, July 17, 2015.

Virginia Gov. Terry McAuliffe has signed legislation that gives local governments more power to regulate short-term rentals, such as rooms offered for rent by homeowners on the popular online platform Airbnb.

McAuliffe on Friday approved Senate Bill 1578, which was sponsored in the recent General Assembly session by Senate Majority Leader Thomas K. Norment Jr., R-James City.

The legislation enables local governments to adopt ordinances requiring people to register if they want to offer their property for short-term rentals. Registries would give local governments information needed to regulate and tax the rentals.

Norment’s bill was backed by the state’s established hospitality industry, including hotel chains and many owners of bed-and-breakfast businesses. The legislation passed both the House of Delegates and the Senate by wide margins.

However, some property owners who use online platforms such as Airbnb have expressed concerns about the legislation, fearing that local governments might impose costly fees or regulations. Thousands of Virginians use sites such as Airbnb for temporary property rentals.

Localities could impose fees and penalties of up to $500 on people who fail to register, or whose rentals don’t comply with state, federal or local laws. The legislation also clarifies that people who offer property for short-term rental must obtain a bed-and-breakfast ABC license if they want to serve alcoholic beverages to guests.

“We want to thank Gov. McAuliffe for supporting this legislation and recognizing the importance of establishing a framework for local governments to welcome short-term rentals, such as those rented through Airbnb, into their communities,” said Eric Terry, President of the Virginia Restaurant, Lodging & Travel Association, in a statement on Monday.

Terry said the legislation protects neighborhoods “by allowing localities to create a fair and reasonable system for registration and accountability where the industry feels welcome and residents feel safe.”

An alternative proposal offered by Airbnb did not advance during the General Assembly session.

It would have included a mechanism for Airbnb to collect local and state taxes on behalf of hosts in Virginia and remit those payments to the state.

“During 2016, nearly 7,000 residents of Virginia used Airbnb to share their homes with travelers from across the globe — making supplemental income to support their families and bringing millions in economic activity to the commonwealth,” Airbnb said in a statement Monday. “We look forward to continuing to work with the commonwealth and localities to develop policies that embrace innovation and economic opportunity.”

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