A potential hike to vacation rental license rates will be settled next month, the Marathon City Council decided in its first meeting of 2026.
A draft resolution to increase annual license fees by $1,000 per home drew around a dozen rental owners, managers and industry professionals to the Jan. 13 session, several of whom asked the council to consider the economic boon and tax benefits of rentals before, in some cases, doubling their annual fees paid to the city.
A state law passed in 2011 prevents Marathon from capping the number, duration or frequency of vacation rentals, but allows the city to raise fees if they are justified by rental-related costs. As proposed Tuesday night, the new fees would be set at $2,100 per year for a new one-bedroom rental ($2,000 per year to renew), all the way up to $3,000 for a new 10-bedroom rental.
Costs factored into the city’s analysis include a portion of Marathon’s legal team salaries, vacation rental agents, vehicles, software, office spaces and code officers. The new proposal would also include 10% of the city’s parks and recreation and fire and emergency medical services budgets ($198,982 and $877,931, respectively). If passed as proposed, the rate hike would generate $1,229,000 for the city’s budget.
“This is not a penalty for vacation rentals – this is just to pay your cost to taxpayers and staffing,” said councilman Kenny Matlock. He requested the resolution after pushing for a change to fees throughout 2024 and 2025 as Marathon’s only legal avenue to account for the effect of rentals. “It’s a numerical calculation.”
Both he and mayor Lynny Del Gaizo said they were surprised by the level of community pushback to the proposal, which Matlock said he viewed as a simple numerical calculation and minor increase for rentals that could generate thousands per week in revenue.
Photos by ALEX RICKERT/Keys Weekly
But councilman Lynn Landry said additional data to justify the changes was sent by city staff to the council via email at 5:30 p.m. the night before Tuesday’s meeting. He asked for time to review justification for the change, adding that the significant hike could be a political risk for the city.
“There’s a very, very small difference between a regulation fee and a tax,” he said. “With the political climate we have in Tallahassee, somebody might sue us just out of principle, and we need to make sure we protect our vacation rental ordinance.”
“(The resolution) takes into account direct costs, but it does not take into account things such as revenues to local businesses paid by those people coming here, (or) other associated businesses – vacation management, house cleaners, pool cleaners, yard maintenance,” said full-time resident and local rental owner Michael Clark. “I don’t begrudge getting costs more in line, but more than 100% increase all at once seems excessive, and I’d love to see the analysis.”
“I’m glad to hear that this discussion is going to be about cost recovery … (but) what I’m here to argue for is fairness,” Coldwell Banker Schmitt Real Estate Co. owner Brian Schmitt told the council. “A 100% increase is not fair, in my view, when you don’t have the data to support it.
“We are a tourism-based economy, and the only way this town can compete with other tourist destinations in the Keys is vacation rentals.”
City Attorney Steve Williams told the council that Marathon has amended its fee structure four times since Florida’s 2011 crackdown – in 2015, 2016, 2018 and 2022 – without legal challenges.
“Vacation rentals are always a hot topic. We’ve added staff, we’ve stepped up enforcement, and that’s helped a lot,” said Matlock. “But … costs have gone up to keep these under control. We have not increased the fee in four years, and since then we’ve spent a lot more money on it.”
Vice Mayor Debbie Struyf said she hadn’t had a chance to review the additional data, and that flat-rate fee increases would have disproportionate effects on smaller rentals. Councilwoman Robyn Still said she would favor a more gradual increase over multiple years to recover costs.
The council unanimously agreed to table the resolution for consideration at February’s regular meeting.
In other news:
- At the request of multiple council members, Marathon’s Jan. 27 council workshop will be an open-format question-and-answer session, with residents encouraged to bring any and all questions or pressing issues for discussion. The workshop begins at 5:30 p.m. at City Hall.
- Marathon Fire Rescue officially welcomed three new firefighters in Brandon Alvarez, Giancarlo Rodriguez and Aroldo Zuriarrain. The department honored Lieutenant Shana Rogers for 21 years of service to the city.
- City leaders recognized code enforcement administrative assistant Maria Thorley for 20 years of service to Marathon.
- Resolutions 2026-01 and 2026-02, both unanimously approved, provide for Marathon to accept and distribute $1.5 million in grant funding for the demolition and code-compliant reconstruction of 15 affordable housing units on Coco Plum’s Avenue D by VC Seaview Ltd.
- Struyf asked city staff to move forward with all open code cases, saying the city’s efforts to work amicably with violators could give the appearance of selective code enforcement.
