Court Upholds Hood River’s Short-Term Rental Ordinance
From The City of Hood River:
By Dustin Nilsen
Hood River, Ore., April 8, 2025 — The City of Hood River’s “Hosted Homeshares and Vacation Home Rental” code was recently upheld in federal court. The City welcomes the recent ruling affirming Ordinance 2026, which places restrictions on short-term rental (STR) licenses in residential zones.
Ordinance 2026, which took effect in October 2016, amended Hood River’s existing zoning regulations by adding provision 17.04.155, titled “Hosted Homeshares and Vacation Home Rentals.” This provision requires that STR license holders in residential zones either reside on the property as their primary residence or have a designated lessee who does. The ordinance granted nonconforming STR license-holders a seven-year grace period to come into compliance. As of October 2023, license holders who did not meet the residency requirement were no longer eligible to renew their STR licenses.
“We are pleased with the court’s decision, which confirms that the City acted within its legal authority to prioritize our community and full-time residents over vacation rentals,” said Hood River Mayor Paul Blackburn. “This outcome supports our ongoing efforts to address the housing crisis in Hood River and to limit the spread of vacation rentals in our neighborhoods.”
The plaintiffs argued that the ordinance’s residency requirement violates the Dormant Commerce Clause by discriminating against out-of-state homeowners, thereby limiting their ability to participate in the vacation rental market. However, Judge Adrienne Nelson of the United States District Court for the District of Oregon found this argument without merit. The ruling clarified that out-of-state homeowners may still lease their properties to long-term residents and negotiate contracts that permit continued STR use. The residency requirement applies equally to in-state and local homeowners who do not use the property as their primary residence.
In her ruling, Judge Nelson stated:
“Plaintiffs have not met the threshold requirement of showing that the ordinances impose a substantial burden on interstate commerce… The Court accepts the explanation provided in the ordinances that their purpose is to ensure housing supply, promote quality of life, avoid clusters of vacation rentals, and reduce hardship on out-of-state property owners.”
The City is committed to fostering a thriving, year-round community and addressing the housing shortage head-on. Restricting STR use is not the only action the City has taken to preserve and increase housing inventory. For more information on City-led housing efforts, please visit: https://cityofhoodriver.gov/housing-projects/
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