Attorney General Ken Paxton asked a Texas appeals court to declare Austin's short-term rental ordinance unconstitutional on March 30, 2018, escalating a legal battle over municipal authority to regulate platforms like Airbnb and VRBO. The AG's office argued that the city's restrictions violate state constitutional protections for property owners and their guests.
Paxton's challenge centers on claims that Austin's ordinance exceeds municipal authority and infringes on property rights protected under the Texas Constitution. "The city of Austin's short-term rental ordinance is not only bad policy, but also unlawful and must be struck down," Paxton stated in announcing the legal action.
The specific details of Austin's contested ordinance were not outlined in the AG's announcement, but the case represents part of a broader statewide tension between local municipalities seeking to regulate short-term rentals and property owners asserting their rights to use their homes for vacation rentals.
This legal challenge fits into a pattern of conflicts between state and local authorities over short-term rental regulation across Texas. Cities including Austin, Dallas, and San Antonio have enacted various restrictions on short-term rentals, citing concerns about neighborhood character, housing availability, and public safety, while property rights advocates have pushed back against what they view as overreach.
The Attorney General's intervention signals the state's position that local ordinances restricting short-term rentals may run afoul of constitutional property protections. The outcome could establish important precedent for how Texas municipalities can regulate the growing short-term rental industry.
The appeals court proceeding will determine whether Austin's ordinance can withstand constitutional scrutiny or whether it represents an impermissible restriction on property rights. A ruling against the city could limit other Texas municipalities' ability to impose similar restrictions on short-term rental operations.