Annapolis city officials just made it a lot more painful to run an illegal short-term rental. The City Council voted to raise the maximum civil fine for short-term rental violations from $1,000 to $5,000, a fivefold jump that officials say finally makes the penalty sting more than the profit an unlicensed rental brings in.
The vote, reported by The Baltimore Banner, caps off a year of escalating efforts by the city to rein in an industry that residents say is reshaping historic neighborhoods. Mayor Jared Littmann said city staff recommended the increase after growing frustrated that the old $1,000 fine wasn't deterring unlicensed operators, according to the Banner's reporting. Littmann said the point is to make sure the penalty exceeds whatever an unlicensed rental could earn.
The new fine schedule, enacted as Resolution R-33-26, amends City Code Section 17.44.090 and applies the $5,000 cap equally to first-time offenses and repeat or continuous violations, according to Alderman Rob Savidge. The change took effect immediately, and the city has determined that staff will assess the seriousness of each violation when setting the penalty within that range.
A Year-Long Crackdown Builds to This Moment
The fine hike is the latest piece of a broader strategy Annapolis has pursued since late 2025. The city first capped short-term rental density at 10% of homes per city block, then followed in March 2026 with a 12-month moratorium on new non-owner-occupied rental licenses. That moratorium, formally Resolution R-50-25, was co-sponsored by Littmann and Alderwoman Karma O'Neill and is set to run through next March, according to Patch.
Littmann had campaigned on getting short-term rentals under control and included the moratorium in his plan for his first 100 days in office. When the city enacted its blockface density cap in late 2025, it set a 10% threshold, Patch reported at the time. Not every council member backed the pause: Ward 1 Alderman Harry Huntley, who authored the original density cap, opposed the moratorium in December 2025.
Hundreds of Unlicensed Rentals, Dozens of Violation Cases
The scale of the compliance problem is significant. The Annapolis Department of Planning and Zoning estimated in a 2025 city report that only about half of the city's roughly 560 short-term rentals were properly licensed. As of Tuesday, the city had 376 licensed short-term rentals, a category that includes units reserved exclusively for citywide events like the annual boat shows and the U.S. Naval Academy commencement, according to the Banner.
Enforcement has been active since the moratorium began. City spokesperson Mitchelle Stephenson reported that there have been 59 code violation cases for unlicensed short-term rentals since March 9, the Banner noted. Planning and Zoning Director Chris Jakubiak has also been assigned to deliver monthly progress reports to the City Council tracking licensing data and enforcement actions, giving lawmakers ongoing visibility into how the crackdown is playing out.
Residents Cite Changing Character, Officials Say Fine Targets Bad Actors
At the heart of the debate is a familiar tension in tourist-heavy cities: Annapolis residents have complained that short-term rentals are changing the character of their neighborhoods, while property managers and tourism advocates point to the tax revenue legal rentals generate. Local firm iTrip Annapolis has 45 managed properties.
Short-term rentals in Annapolis are subject to a 7% Anne Arundel County occupancy tax, according to BNBCalc. Short-term rentals also require an operating license.
City Council members were careful to frame the fine increase as targeted, not punitive toward hosts who make honest mistakes. Alderman Brooks Schandelmeier said most people who rent out their homes follow the rules, but acknowledged that some deliberately ignore them — and he supported raising the maximum fine to address those cases. Council members similarly said the harsher penalty isn't meant to punish people who unknowingly violate short-term rental rules, but rather to stop operators who treat the old fine as a routine cost of doing business.
Whether that threat translates into actual $5,000 penalties, or mostly functions as leverage to push unlicensed operators into compliance before the moratorium expires next March, remains an open question for code enforcement officers to answer in the months ahead.
