01/08/2018 - Short Term Rental CommitteeMemo
To: Councilmembers Meg Tilley and Paul Bakken
From: Dave Osberg, City Administrator
Date: January 8, 2018
Subject: Short Term Rental Study Committee Meeting
The first meeting of the Short Term Rental Study Committee is scheduled for Thursday, January
11, 2018 at 10:00 a.m. in the Second Floor Conference Room. Community Development
Director Jill Hutmacher, City Planner Mike Ridley and I will be in attendance for the meeting.
Staff has not asked anyone from the City Attorney’s office to attend the meeting: that may take
place at future meetings.
Staff would propose the following topics for the Committee to discuss at this first meeting:
A.) Establish a meeting schedule and timeline for submittal of the findings from the
Committee to the full City Council. In other words, what workshop do we want to target
for presenting to the full City Council.
B.) Frequency and scheduling of meetings: How often does the Committee want to meet,
and other logistics related to coordinating the meetings.
C.) Staff has included all the attachments from the December 12, 2017 City Council
workshop when this topic was last discussed by the full City Council. Is there any
material in particular the Committee would like to review in further detail during the
meeting?
Staff has also included information from the City of Burnsville as their City Council
recently voted to allow short term rentals.
D.) Staff has prepared an attachment entitled: “Short Term Rental Policy Considerations”.
Consider this a checklist of policy questions for the Committee to review as it
contemplates the elements that might be included in an ordinance that would allow for
short term rentals. These have been compiled from the plethora of information available
regarding short term rentals , and they also reflect certain elements of the questions the
City Council has addressed during its discussion on short term rentals. Imagine this as
a checklist of topics to cover during the Committee deliberations.
E.) Finally, the Committee may wish to provide direction to Staff on what additional research
is needed in advance of the next and future meetings. Perhaps the discussion on the
policy considerations above will lead to additional research needed.
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Agenda Information Memo
December 12, 2017 Special City Council Meeting
V.Short-Term Residential Rentals – City of Eagan
Direction to be considered:
Direct staff to work with the City Attorney on a City Code amendment accommodating
Short-Term Residential Rentals.
Or
Direct staff to retain the minimum 30-day rental requirement.
Facts:
The City Council most recently discussed short-term rentals at their July 11th
Special Meeting.
In addition to background information provided by staff and some letters of
support, the Council had dialogue with two residents (Murphy McCann and
Rosemary Ndupuechi) that are proponents and purveyors of the activity.
Reference was made at the special City Council meeting on July 11, 2017 to
various State of Minnesota and MN Department of Health (MDH) regulations
that could affect the operation of short-term rental (STR) uses.
A “hotel/motel” or “lodging establishment” license from the MDH is required for
the rental of a home for public lodging accommodations as those terms are
defined in MN State Statutes and MN Rules.
In 2015 Staff communicated with MDH and confirmed that it deems short-term
rentals to fall within the lodging license requirements.
The City is not required to enforce the MDH license or other State regulations.
Yet, the City may require that any lodging rental operating within the City have a
valid MDH lodging license.
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The Minnesota Sales tax and local lodging tax also applies to STR’s, as all lodging
rentals in the City are required to pay the City lodging tax.
Enforcement and collection of Eagan’s lodging tax would be the City’s
responsibility.
Should the City license STR’s, the City would be required to obtain the individual
STR’s Minnesota Tax identification number and submit the same to the MN
Department of Revenue.
On July 11th, the City Council directed staff to research policies and regulations
on short-term rentals enacted by other cities. San Francisco is a popular short-
term rental destination as well as the headquarters of Airbnb. A handout
describing San Francisco’s regulations is attached. Minneapolis, St. Paul and
Duluth each recently revised their short-term rental ordinances and a table
summarizing their ordinances is attached.
Information received from the public since July 11 is attached.
Finally, previous information provided by the ECVB, the City Attorney and a staff
summary memo are also attached to provide additional background.
The City Attorney will attend Tuesday’s meeting
Attachments: (8)
SPCC V-1 Table illustrating recently adopted local regulations
SPCC V-2 07-11-17 Council Minutes
SPCC V-3 McCann slides supporting STRs
SPCC V-4 Grinde letter and materials in opposition to STRs
SPCC V-5 San Francisco Short-Term Rental Regulation Summary
SPCC V-6 ECVB research and comments
SPCC V-7 07-05-16 STR Summary Memo
SPCC V-8 04-02-15 City Attorney Memo regarding transient lodging
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Comparison Table
Short-term Rental Ordinances in Minneapolis, St. Paul, and Duluth
Minneapolis St. Paul Duluth
Owner-occupied
Rentals
License not required Allowed with license,
but cannot be used for
commercial or social
events. For multi-
family buildings, 50% of
units can be short-term
rental but no more
than 4 units/building.
City Accessory Home
Share Permit and MN
Dept of Health Lodging
License are required.
Non-owner-occupied
rentals
Tier 1 or Tier 2 rental
license required
(regulated as an
apartment or other
rental unit)
Same as owner-
occupied rentals.
City Vacation Dwelling
Unit Permit required –
limited to 60 permits
issued. MN Dept of
Health Lodging License
also required
Short-term rental
hosting platforms
Annual license: $630
for platforms with <150
listings, $5,000 for
platforms with 150 or
more listings
Hosting platform
license required
($10,000). Platform
required to remove all
hosts not in
compliance with city,
state, or federal laws.
Not addressed.
Fire Safety Inspection Required as part of
regular rental license
program with
frequency dependent
on tier
Fire Certificate of
Occupancy required for
non-owner-occupied
units.
City Fire Operational
Permit required.
Insurance Not addressed Must provide
certificate of liability of
at least $300,000 with
city listed as certificate
holder OR use platform
that provides equal or
greater coverage
Not addressed.
Local Taxes Not regulated as hotels Keep lodging log and
provide annual proof of
lodging and sales tax
payment.
Duluth tourism tax is
applied
State Taxes Not addressed Remit all local, state,
and federal taxes
unless the rental
platform does so on
host’s behalf
State Tax ID must be
included on application
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Short-Term Rentals
City of Eagan, Minnesota
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Purpose
The purpose of this presentation is to discuss not only the importance of
allowing residents to be able to rent their homes for financial reasons but
also the advantages that it can bring to the City of Eagan without taking
away from existing businesses.
To work through and propose an approach to allow Short-Term Rentals
Not to lose sight on the fact that many of those that are doing Short-Term
Rentals in the city of Eagan, including myself, financially need to do it to
avoid creating a hardship.
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What we know about Short-Term Rentals
Airbnb alone now has listings in almost 200 Countries and ~35,000 Cities. Airbnb is a useful source for travelers and homeowners looking for new vacation experiences for the right price tag that they would not do within a hotel.
Short-Term Rentals are gaining such an amazing speed that organizations such as Delta Airlines are promoting Airbnb when booking a trip and providing points
34% of Americans would be less likely to visit a destination where short-term rentals are banned (Goldman Sachs Consumer Research Survey 2016)
There are always Pros and Cons to everything, but working to minimize the issues is easier than running from them
It is often discussed that Short-Term Rentals are the source of problems such as noise complaints, when in fact those problems are just as prone to occur with long-term renters or residents living in their homes full-time
We personally pre-screen all our guests before allowing them into our home and we have a very strict list of rules that are to be followed.
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Benefits to the City of Eagan
With the Rapid growth of short-term rentals, allowing such rentals increases
Eagan’s economic impact (shopping, eating, drinking, etc.) without
necessarily taking away for our local hotels.
Our house only rents to between 10-12 guests. Many guests have stated they
would never have come to Eagan if they couldn’t have kept their family in the
same house.
Short-Term Rentals support Tourism
Increases supply and diversity of visitor accommodations
Provides needed capacity for peak seasons and major events
With the proximity of the MOA, Airport, and Viking Training Center as well as the
new stadium, allowing visitors to stay in Eagan helps promote this resulting in an
increased financial gain
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Benefits to the City of Eagan (cont.)
Economic Benefit to Local Businesses
Increase in Revenue from Daytime spending
90% or more of our guests are families that come together and find a centrally
located place to have family reunions. When they are in our city, they spend
money in our city.
Offers affordable accommodations for military family, job interviewing,
travelling nurses
Provides opportunity to earn income to make homeownership more
affordable.
Residential properties are better and maintained and controlled when
they provide short-term rentals
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Goal
Work in partnership to achieve safe and livable neighborhoods
Create and sustain a resilient and economically prosperous city
Bring forward a framework for a comprehensive ordinance to allow for and
regulate short-term rentals
Recognizes vacation rentals as an important source of visitor
accommodations while understanding legitimate community concerns
associated with the use
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Added Protection from
Airbnb/VRBO/HomeAway
Rental Protection – $1 Million in liability insurance
Security – Company maintains all guest bookings as well as deposits and
provides all Customer Service
Online Reviews - When debating whether or not someone that rents out
their home is providing reputable service, all guests have the ability to
provide a review of their stay as well as communication and cleanliness.
This alone would weed out those that are inexperienced or simply bad
renters/hosts.
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Proposal
Allowance of Short-Term Rentals by establishing regulations
Possibly including a limit on the number of dwelling an individual operates
The ability to implement a more limiting local ordinance leads to greater
compliance
Require Short-Term Rental Registration/License
This will week out those that are not serious about it
Establish a process for the enforcement of such licensing requirements
Request certain reporting be filed
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Proposed Approach
More consistently regulate short-term rentals
Help protect the rights and safety of owners, guests, and neighbors
Protect the livability of residential neighborhoods
Implement rental policies such as:
Providing guest safety provisions
Emergency contact information
Neighborhood parking restrictions, etc.
Promoting the City of Eagan
Posting of license #
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Closing
Given that the Short-Term Rental is already all around us, I believe it’s
imperative that we work to support and manage it and not just say no
I vote to bring forward a framework for a comprehensive ordinance to
allow for and regulate short-term rentals
Please don’t hurt those wanting to be in compliance, be fair and regulate it
I believe that allowing Short-Term Rentals will ultimately lead to a good
balance of respecting neighborhoods and allowing hosts to share their
home in a way that benefits both them and Eagan and the visitors to our
city
FYI…Minneapolis adopted Short-Term Rentals and started accepting
licenses Dec 1, 2017 and charges $70/year for licensing
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Thank You!
John and Murphy McCann
1601 McCarthy Road
MurphyM2@me.com
651-338-3998
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President, Board of Supervisors
District 3
DAVID CHIU
邱信福邱信福邱信福邱信福
市參事會主席市參事會主席市參事會主席市參事會主席
City and County of San Francisco
Short-Term Rental Regulation Summary
Supervisor David Chiu introduced legislation to regulate short-term rentals. The legislation reinforces the
prohibition against the conversion of residential housing into full-time de-facto hotels. It would only
allow primary residents that live in their apartment to rent short-term on a limited basis to help
supplement their housing costs. Secondary or vacation homes that do not have permanent residents
occupying them would not be granted permission, so that the residential housing stock is protected in the
midst of the current affordability crisis.
CORE COMPONENTS OF LEGISLATION
Primary Residency
Resident must live in the unit as their primary residence for no less than three-quarters of the year.
Registration
Resident must apply for permission every two years by providing documentation to demonstrate that they
meet primary residency, insurance, and tax requirements. Resident must maintain good standing by
complying with all city laws, including rent control laws, or their permission would be revoked and the
unit would be placed on a blacklist.
Taxes
Resident must pay transient occupancy taxes on short-term rental activity, and hosting platforms must
collect and remit those taxes, or be subject to enforcement by the Treasurer’s Office.
Insurance
Resident must maintain liability insurance or be covered by hosting platform insurance policy.
Private Contracts
Resident must adhere to the terms of their private contracts. Application does not interfere with leases,
homeowner association agreements, and covenants, conditions or restrictions on the property.
Enforcement
Residents that fail to register, violate the terms of their permission, or don’t maintain good standing are in
violation. Hosting platforms that fail to notify their users of short-term rental laws and collect and remit
taxes are in violation. Complaints alleging violations of the law would be investigated and deliberated
through an administrative hearing. Violations are subject to administrative and civil penalties.
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AMENDMENTS TO THE LEGISLATION
Following hearings at the Planning Commission and Land Use Committee and deliberation by the Board
of Supervisors, Supervisor Chiu and his colleagues amended the legislation to strengthen enforcement,
protect affordable housing, maintain quality of life in neighborhoods, and ensure building safety.
Strengthening Enforcement
Enforcement Agency - Consolidate enforcement
function from two agencies into one with the Planning
Department. Planning would administer registration,
investigate violations, and report annually to the Board
of Supervisors. (Planning Commission
recommendation, Chiu amendment)
Registration Number - Require Planning Department
to issue registration number to accompany approvals,
and require resident to include registration number with
all short-term rental postings. (Planning Commission
recommendation, Chiu amendment)
Annual Self-Reporting - Require resident to report
number of days of short-term activity annually to
maintain good standing on registry. (Planning
Commission recommendation, Chiu amendment)
Multiple Violations - Raise administrative penalties for
repeat violations, so that fines are doubled for second
offenses and tripled for third and multiple offenses.
Violations that are not corrected would have permission
revoked. (Chiu amendment)
Online Advertisements - Deem posting online
advertisements without registering for permission as
violation subject to administrative and civil penalties.
(Planning Commission recommendation, Chiu
amendment)
Interested Party - Include homeowner association and
property owner in definition of interested party allowed
to file lawsuit after violation is rendered through an
administrative hearing. (Kim, Farrell amendments)
Funding - Require annual evaluation of application fee
to assess administration and enforcement costs, and
include Planning Commission hearing in evaluation.
Direct all administrative and civil penalties back to
Planning to fund enforcement. (Planning Commission
recommendation, Chiu amendment)
Protecting Affordable Housing
Affordable Housing Exclusion - Exclude single room
occupancy hotels, below market rate units, and any
subsidized housing with restrictions on subletting and
short-term renting from short-term renting. (Planning
Commission recommendation; Chiu/Kim amendment)
Single-Family Homes - Include single-family homes in
regulation by requiring registration for permission and
compliance with residency and all other good standing
requirements. (Planning Commission recommendation,
Chiu amendment)
Principal Residence - Define principal residence as
one residential unit that is associated with one
permanent resident. Registration is allowed for only one
permanent resident per unit. (Chiu amendment)
Maintaining Quality of Life
Code Compliance - Require compliance with Police,
Health and Public Works Codes for approval and good
standing. Permission is revoked if any outstanding
noise, dumping, and other quality of life violations.
(Planning Commission recommendation, Chiu
amendment)
Ensuring Building Safety
Liability Insurance – Increase coverage requirement to
$500,000 and require coverage to indemnify tenant and
owner for bodily harm and property damage. (Planning
Commission recommendation, Wiener/Farrell
amendment)
Property Owner Notification - Require Planning to
notify property owner and homeowner association if
tenant or homeowner has completed an application to
rent short-term. (Wiener/Farrell amendments)
Code Compliance - Resident must be in compliance
with Building and Fire Codes to be granted permission
and maintain good standing. Permission is revoked if
any outstanding building, electrical, plumbing,
mechanical, fire, health, housing, or planning code
violations, including notices of violation, notices to
cure, orders of abatement, cease and desist orders, or
other correction notice. (Planning Commission
recommendation, Chiu amendment)
Fire Safety Posting - Resident must post fire safety
information in their unit like location of fire
extinguisher, alarm and exits. (Cohen amendment)
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Eagan Convention & Visitors Bureau
Research Prepared for the 7/11/17 Eagan City Council Workshop
Research Topic:
Impact of Airbnb Industry on Tourism and Eagan’s Hospitality Community
Overview:
Since its inception back in 2008, the Airbnb phenomenon has grown exponentially from
a few hundred rentals in a handful of cities into its current inventory of over 3 million
lodging listings in approximately 65,000 cities worldwide. While the Airbnb industry has
richly rewarded countless homeowners and provides convenient and incredibly
affordable accommodations to millions of travelers, a host of issues ranging from health
and safety concerns to crime, privacy and tax avoidance fears have also surfaced. As
Eagan and municipalities across the nation look to regulate the Airbnb industry, we’ve
explored the topic from a tourism point of view and have gathered some information
which you’ll hopefully find useful as you revisit our local regulations.
Airbnb Impact on Eagan’s Hospitality Community:
Given that only a handful of Airbnb options have surfaced in and around the Eagan
area during the past 9 years, the effect from an economic impact standpoint has been
virtually nonexistent. From a tourism perspective, as you can imagine, we currently see
it doing very little in terms of bringing additional tourists
to our destination.
Concerns Raised by Eagan Hotel Owners and General Managers:
While our destination currently has little to offer on the Airbnb front, we feel it would be
naive to ignore the fact that Airbnb options are fairly popular along the East and West
Coasts of the country. Given this, we’ve spoken to a number of our Eagan hospitality
community leaders about how they would feel if an abundance of Airbnb options would
begin surfacing in our region. Here’s a summary of the main concerns that were shared
with us:
Owners and general managers of our 16 Eagan hotels pride themselves on
guest safety. The fact that the average Airbnb is currently not held to the same
strict safety standards to which all of our Eagan hotels are held is a concern. In
addition to state and local regulations, all of the brands representing our Eagan
hotels also perform their own rigid inspections aimed at making certain guests
enjoy a safe and comfortable experience while staying in Eagan. Should the
Airbnb inventory begin growing exponentially in Eagan, this could potentially
become a huge issue of fairness.
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Another concern shared by our hospitality leaders centers around our overall
Eagan brand. Our hoteliers are very proud of the high standards they’re all held
to as exemplified by the myriad renovations and other exciting improvements
that are always taking place in an effort to keep our des tination vibrant. Heaven
forbid, if a serious injury or death would ever occur resulting from an Airbnb stay,
our stakeholders would be very concerned about the negative PR Eagan ’s entire
hospitality community would receive from a safety concern standpoint.
Hospitality leaders also feel Airbnb’s go far beyond the boundaries of simply
“renting a room.” Should the concept truly catch on in our region, the feeling is
that they should be considered more on par with bed and breakfasts and that
lodging tax would need to be collected.
National Trends:
As cited above, Airbnb options in more populous regions such as the East and West
Coasts continue to be prevalent. However, the Midwest continues to maintain far fewer
options while also posing more regulatory hurdles for Airbnb hopefuls. Areas such as
Chicago are making it more difficult for Airbnb owners to do business citing pushback
from neighborhoods and hospitality leaders. While the majority of tourism experts
seem to think that the Airbnb inventory will continue to grow, they also feel more
regulations, inspections and tools used to combat privacy concerns will also be
introduced.
How Other Area Communities are Handling Airbnb Growth:
St. Paul: The Capital City recently proposed rules which would limit the number
of people allowed to stay in a home and how many apartments or condominiums
people could rent out in a building. Property owners would have to follow zoning
and licensing rules, pay sales and lodging taxes, have appropriate insurance
and, in some cases, a fire certificate of occupancy.
Burnsville: Burnsville’s ordinance effectively bans Airbnb: According to their
ordinance, “rental of private homes for temporary occupancy threatens the
essential character and stability of residential neighborhoods because short -term
tenants have little interest in the welfare of the local community.” It also states
that this type of rental “is often undertaken without adequate on -site
management, compliance with state and local codes for commercial lodging
establishments, and other safeguards for those renting the hom e.”
Lakeville: While Airbnb business is allowed in Lakeville, homeowners who rent
single-family homes for short periods of time must abide by a set of regulations
that include prohibiting more than two separate rentals within a 30 -day period.
Savage: The Savage City Council passed an ordinance barring anyone from
renting their homes out for fewer than 15 days taking the possibility of an Airbnb
off the table.
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Apple Valley, Blaine, Stillwater and Woodbury all consider homes “single-
family dwellings,” effectively forbidding an Airbnb from existing in these
communities.
Future Trends:
According to airbnbcitizen.com, “a regulatory pattern is emerging from our
conversations with policymakers—that they frequently divide home sharing into three
categories: 1) shared spaces, 2) primary residences, and 3) vacation rentals and
commercial accommodations. Generally speaking, governments are creating light -touch
home sharing rules for shared spaces and primary residences, and more significant
frameworks for vacation rentals and commercial accommodations. This pattern of light -
touch regulation of shared spaces and primary residences reflects elected officials’
growing appreciation of how Airbnb creates economic opportunity for working families.”
This statement certainly coincides with our research – the emerging patterns seem to
be municipalities either taking a hardline stance against potential Airbnb operators or
they’re exploring creative ways in which Airbnb’s can potentially and legally coexist with
existing hotels and neighborhoods – there does not seem to be any middle ground
whatsoever.
Contact Information:
Needless to say, the Airbnb industry is ever-evolving and poses a unique set of
challenges to Eagan and countless other communities. We stand ready to assist in any
way we can and would be happy to answer any additional questions you may have
about this topic. Best of luck with your policymaking.
Brent Cory, President/CEO
Eagan Convention and Visitors Bureau
Phone: 651-675-5544 (direct)
Email brent@eaganmn.com
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14985 Glazier Avenue
Suite 525
Apple Valley, MN 55124
(952) 432-3136 Phone
(952) 432-3780 Fax
www.dmshb.com
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MEMORANDUM
To: Mike Ridley, City Planner
From: Sharon Hills, City Attorney
Date: 4/2/2015
Re: B&Bs and Vacation Rental Home Regulations
On March 4, 2015, Jon Hohenstein sent an email with several questions relating to the regulation
of bed & breakfast or similar lodging operations within residential homes/condos. The following
are Jon’s questions with my responses immediately following.
Do any of the conclusions change if the transient lodging is an Airbnb unit v. a more
substantial, traditional Bed and Breakfast? That is, if it is essentially one room, bedroom
or suite in a residence that is rented for less than 30 days at a time? If yes, how do they
change? If no, then …
ANSWER: The focus is the operation, not the amenities offered to the traveler, for purposes
of the city’s regulations for zoning or lodging tax: Lodging offered in a single family home,
whether it is a single room or the entire home, to a transient occupant (i.e. traveler) in
exchange for money/consideration. Any property or any portion therein offered for short-
term rental to transient occupants (travelers) falls within the same type of activity and needs
to be treated similarly. Whether food is offered does not change the commercial lodging
operation on the property for zoning purposes, albeit the offer of food to the guest, whether
it is breakfast or dinner, will trigger state health code requirements.
A traditional hotel is subject to periodic fire inspections, health inspections and possibly
other requirements; would those also be required of a B&B?
ANSWER: Yes, a “bed and breakfast” establishment is subject to a state restaurant license
and state “hotel/motel” license, subject to various health and safety requirements and
inspections by the state. A vacation rental home or home with rooms for rent to travelers
that provide food to the guest, even if the operation is not referred to or name as a “bed and
breakfast” would fall within the Minnesota Dept. of Health’s statutory definition of “bed
and breakfast” establishment for purposes of licensing. A licensed B&B is allowed to only
serve breakfast.
However, please be advised the state statute and Minnesota Rules are not clear if or when a
state license is required for a vacation home rental or overnight accommodations of rooms
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or “suites” offered to the public within a home when no food is provided. Our review of the
state statute and Rules leads us to conclude that a license may be required depending on the
length of the rental. For example, rental of a room or rooms for sleeping accommodations
offered to the public for period less than a week would fall within the definition of
hotel/motel lodging which requires a license, or if the owner provides rent for periods of one
week or more, and having five or more beds to let to the public, then it is a “lodging
establishment for which a state license is required. But the statute and Rules do not cover a
scenario when the owner rents out the entire home as a “vacation home rental” for less than
a one-week period or rents out a room to a traveler for 8 days so the period is not less than a
week. Further the Rules refer to a “lodging house” in its safety regulations and license fee
provisions, but neither the statute nor the Rule defines the term, “lodging house.” It appears
that these are unintended gaps in the legislation.
Regardless, the city may include any type of operation providing lodging accommodations to
the public in residential uses in its licensing or zoning regulations under the City Code. It
may also adopt the state health Rules to apply to any and all of the lodging types regulated
by City Code.
Would any property providing transient lodging need to conform to ADA
requirements? Are there other similar building standards that would apply to transient
lodging properties?
ANSWER: Depends. Under the ADA, “hotels, motels, inns and other places of lodging
designed or constructed after January 26, 1993,” must comply with ADA standards. The
ADA rules do not apply if the house was occupied prior to January 26, 1993 and no
construction or building permit has been issued since that date. Also, the ADA standards
apply only to those portions of the home that are used by the guest, including front entry
ways. In short, the application of the ADA rules will be case specific to each operation.
However, if a state license is required, the state regulations will dictate ADA, building code,
fire code, etc. compliance.
Are there other lodging requirements in statute that would apply to B&Bs? Are those
different from what would apply to hotels or other lodging facilities?
ANSWER: The lodging standards or requirements under the state statute and Rules are
applicable to licensed lodging operation. Hence, those applicable hotels are applicable bed
and breakfast operations. Additionally, all licensed lodging establishments are subject to the
same fire and health inspections.
If food is served, would a B&B need to have a restaurant license? Does it matter how
many rooms it has or how many meals are served?
ANSWER: Yes, a license is required~see first bullet above. Any lodging establishment that
serves food or beverage or both to its guests must obtain a “restaurant/food license” from
the Minnesota Department of Health. The number of guests or number of meals served has
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no relevance to a license requirement. It’s merely whether food or beverage is served to
guests. However, the number of guests that may be accommodated, not number of rooms,
dictates the extent of health department requirements (e.g. small, medium or large
establishment dictates type of kitchen facilities).
In closing, we note the following considerations for the City in addressing bed & breakfast
operations or any other lodging accommodations offered to the public in residential dwellings:
Lodging accommodations in residential dwelling to travelers (the public) for
consideration ($$) for short term, whether it be for overnight or a week or two weeks, is
a commercial operation in a residential district. It is not a permitted or conditional use in
Eagan’s residential districts.
Any home or rooms therein offered to the public for sleeping accommodations falls
within this commercial lodging operation. It is irrelevant whether the operation is a
“traditional B&B,” a single room or several rooms without any breakfast offered, or a
“vacation home rental”—all three provide overnight lodging accommodations to the
public for money and thus, all are commercial lodging operations.
These lodging accommodations are subject to the Eagan lodging tax and the tax must be
imposed and collected.
A bed and breakfast operation is subject to a state restaurant license and a lodging licens e
which have state performance standards and inspections. The other types of home rental
operations may be subject to state lodging license. The city may regulate all home
lodging accommodations to ensure all are subject to the same rules. The city may
regulate by license, conditional use permit or both.
If the city regulates, then it must decide conditions/regulations of the operation.
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Short Term Rental Policy Considerations
1.) Determine where the short term rentals will be allowed: R-1; Estate; R-2; Other
2.) Shall the ordinance requirement include owner occupied/homesteaded property?
3.) ADA Accessible requirements?
4.) Confirmation that no on street parking will be allowed
5.) License must be approved by the City….determine for how long the license is valid
and fee
6.) Fire Safety inspection by the City…..how frequently?; require smoke detection,
carbon monoxide detection and emergency exit(s)
7.) To what extent will the City require and monitor private homeowner insurance
requirements.
8.) Limit the number of individuals who can stay in the unit
9.) Limiting the hosts of short term rental to only one (1) listing in the City
10.) Must submit on an annual basis, with license application, verification of tax
Payments: sales, lodging and property tax.
11.) Limit the number of short term rental allowed in condo or apartment building;
…would not be allowed, if owner occupied/homesteaded is required.
12.) “Strike Three” policy to cancel short term rental license, if violations
13.) Identify certain public safety requirements, such as no commercial or social
Events.
14.) No exterior signage allowed.
15.) Must notify the abutting neighbors (Burnsville requires this)
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