Tourist Home Designation & Unintended Impacts

                                                                                                            November 29, 2023

The Livability Task Force has set as one of its Phase 1 objectives to “Develop a plan to phase out the Tourist Home Designation”.

Before developing a plan to phase out the Tourist Home Designation, it is necessary to have clarity on the purpose of the objective. This clarity is important to ensure that any unforeseen impacts, and the associated costs, of this significant decision are justifiable.

Canmore heavily relies on tourism as its main economic driver, despite ongoing efforts towards diversification. In 2022, visitors to Canmore spent over $750,000,000 in the area. Approximately 48% of these visitors choose to stay overnight in various short-term accommodation options, including hotels, motels, bed and breakfasts, Visitor Accommodation Units, and Tourist Home Units. Canmore has a total of around 4,169 accommodation units, with approximately 2,036 being Non-traditional Rooms (Bed and Breakfasts, Visitor Accommodation Units, and Tourist Home Units). Source: Tourism Canmore Kananaskis.

Conservatively estimated, overnight visitors spend a minimum of $161,000,000 annually, or approximately $38,000 per accommodation unit per year. Taking this into consideration, if 100 Non-traditional units were removed from the Non-traditional hotel inventory, it could potentially have a direct negative impact of $3,800,000 per annum on tourism spending in Canmore.

The phase out of the Tourist Home Designation should only be considered in areas that do not have existing Area Structure Plans or existing entitlements permitting Tourist Home uses.

BOWDA’s understanding is that the Alberta Bill of Rights and Personal Property Bill of Rights guarantee "the right of the individual to liberty, security of the person, and enjoyment of property, and the right not to be deprived thereof except by the due process of law." Removing existing entitlements granted under land use bylaws can be seen as a "constructive taking" or "de facto expropriation," which would entitle the property owner to compensation.

It is incorrect to assume that all properties that lose short-term rental rights, or are downzoned, would immediately be converted to long-term rental housing, or placed back into Canmore's housing inventory for resale. Some Tourist Home units may be used sporadically to supplement income on a short-term basis when the owner is not in town (the original intent of the Tourist Home designation). In these cases, it is unlikely that the unit owners will convert the unit into a long-term rental if short-term rental is no longer an option. The unit will simply remain vacant when the owner is absent from town. Understanding the split between owner use and short-term rental frequency would be helpful in assessing the likelihood of a unit being converted to a long-term rental.

Taking any action to "downzone" areas with existing entitlements without compensation goes against current Alberta legislation and policies.

It can be potentially costly economically, as it may impact tourism spend, and will likely result in the need to pay compensation. Furthermore, there is no guarantee that the units will be converted into long-term rentals.

BOWDA encourages the powers that be to thoroughly assess the long-term impacts of phasing out the Tourist Home land use designation.

BOWDA Housing Action Committee