REGULATION:
This is not a new issue for Tourism areas: Many Ordinances have already been successfully  
implemented by Municipalities experiencing similar issues.  Many municipalities in WI allow rentals to
transients for less than 30 days in residential neighborhoods: click on links to see relevant documents
Wisconsin Dells
(Sauk Co)  has
allowed this activity in
Residentially Zoned
areas since 1968
through a board of
Adjustments
Exception permit
approval.
Sante Fe New Mexico short term rental ordinance
Wisconsin dells
(Sauk CO):   7.03,
see page 9
sante fe  short term rental Administrative Guidelines
lake tahoe short term rental ordinance
boulder colorado zoning staff report on short term rentals
town of milford ordinance
town of Otsego draft for transient rental license
Ridgeway CO short term ordinance
Stearns County Ordinance see page 114, section 6.51
ROOM TAX:
Municipalities (towns, villages, cities) can create an
ordinance to assess up to 8%room tax on short term
rental Activity in Addition to State Tax: 5%, and County
tax 0.5%
Wisconsin and Walworth County room tax info
Door County has more than 19 municipalities that allow  
more than 500  short term residential rentals  to date in
residential zoning districts as primary uses.  They are
licensed as "tourist rooming houses" with the State,   They
are required to be permitted for room tax collection at the
Tourism commission:
http://www.doorcountytourismzone.com/home/

Village of Sister Bay Transient Rental of Homes Regulations

Click here to see a summary of Door County Zoning
VACATION HOME OWNERSHIP AND VACATION RENTAL STATISTICS

  • Typical vacation home buyers: 9 in 10 vacation home buyers will use the home themselves. (investment property
    owners dont typically use the home themselves)

  • 26% of Vacation home buyers intend to make their vacation home a full time residence.

  • Nearly two-thirds (63 percent) of second home owners are able to cover at least half of their mortgage by
    renting out their vacation home to travelers, Less than 18% of second home owners generate enough income
    from the vacation rentals to cover 100% of their mortgage.

  • 2009:  Median Age for Vacation home buyers 46.  Median Income $87,000.  51% have Children

  • Vacation rentals represented a US $25 billion market in 2008

  • 89% of Vacation rental guests intend to rent again within three years

  • 87% of vacation rental guests would recommend a vacation rental to friends or relatives

  • In 2009 14% up from 11% in 2008

  • In 2009 family reunions have seen huge growth in the past year alone, with 23 percent of leisure travelers having
    named it as the primary reason for taking one or more trips during the past year, up 13 percentage points since
    2008.  (KEY REASONS MENTIONED, WANT TO BE UNDER ONE ROOF WITH FAMILY NOT SEPARATED BY
    ROOMS...)
  • Many families will not extend their stay unless can bring pets which are not allowed in most hotels/condos

    Sources (click on links to view documents)

         2010 NAR Investment and Vacation Home Buyers Survey   

HomeAway Vacation Rental Marketplace Report
Vacation Rental Trends
Vacation Rental Industry Position Statement

Examples of Regulation in Ordinance to Prevent Problems       (Adapted from other ordinances)

  • Zoning could work Collaboratively with our State Regulators just like in other Municipalities to enforce the state
    Regs, not utilizing zoning or taxpayer resources to regulate.  There are State Regulations already on the books
    that govern this activity: Transient residential rental properties that provide sleeping accommodations, aka
    furnished rentals  (regardless of duration of rental) must be licensed with  Dept of Health (DHS)  DHS State
    Statute 195.06  Some key provisions include: 1. All properties must pass building code compliance for single
    family homes for rental to single families (rather than a "weatherization inspection for non-transient rentals), or
    commercial building codes for rental to parties that don't meet the definition of single family.  2.All properties are
    subject to entry and audit  by state officials at any reasonable time, this includes weekends. 3. License can be
    revoked for violating statute.  4. This statute defines occupancy restrictions and septic and well regulations.  
    NOVEMBER 4TH. THESE REGULATORS WILL BE PRESENTING THE REGULATIONS AT THE LAKE GENEVA
    LIBRARY at 1pm link to announcement


  • Each Municipality could create a yearly license renewal review process or conditional use process.  They could
    create a mechanism  to Revoke Privilege and Registration of Property if they are problematic.  WI State Statute
    195.06 has a clause in it that allows for non-renewal or revocation of license if you violate the statute.   So
    problematic properties, or poorly managed properties would be at risk of losing their license if notified of violation
    by a local municipality. One example: exceeding occupancy is a violation.  Violation of DHS 195.06 can be
    referred to district attorney for prosecution for fines and jail time.  Being untruthful to a DHS official can result in a
    $5,000 fine. Example of enforcement from Santa Fe ordinance


  • Require Properties to have a 24 Hour Local Property Manager and registration with Municipality and County,
    w/Contact Numbers.  Required Notification to Neighbors of Proposed Activity, Give Neighbors 24 Hour LOCAL
    Property Manager phone numbers

  • Property Owners need to use Common Sense and become responsible property managers: Don't rent to a group
    intending to cause a problem (a single family residence should not be renting to groups anyway). Make your
    expectations and policies clear in your lease, and enforce them or lose your privilege to rent.   Indicate how many
    cars allowed, occupancy restrictions and where to park in your lease for some examples.  

  • Conditional Use Permit  with Public Hearing approvals neighbor notification. Boulder Colorado has 3 different
    options for a conditional use option based on density and frequency of rentals. See Table 1 of Boulder Co.

  • Proof of Insurance covering “rental” use.

  • Limit to 7 day minimum Duration for Consecutive  Rentals to single families only in single family residential
    neighborhoods, NIGHTLY RENTALS NOT ALLOWED, rentals to unrelated groups of people not allowed. THIS IS
    FOR HOTELS/MOTELS AND BED & BREAKFASTS.  Some Municipalities Limit # of residential rentals allowed per
    year to NO MORE THAN 17/year and limit the number of permits granted:  Santa Fe . Some define commercial
    indoor lodging as rented for more than 16 weeks: Villiage of Sister Bay WI. .Some Municipalities have created a
    new designation "Casual non commercial use"  Hotels and Motels & Bed and Breakfasts have 365 days, 52
    weekends to rent to unrelated groups of people.    Unlike most income properties (which are businesses in
    residential neighborhoods), most vacation homes or second homes are occupied by owners some of the year.
    Most hotels cannot accommodate more than 4 adults in one room.  Most hotels dont take pets. Some Bed and
    Breakfasts dont recommend small children.  There is limited affordable housing available in Lake Geneva for
    families traveling with pets and small children that want to stay 1 week or longer.
    .
  • Required Property Owner to have Lease Verbiage, showing restrictions, ordinances

  • Tenant Education on Natural Resource Protection

  • Verbiage allowing local planning commission to require buffers or conditions to protect neighbor's privacy.
    (already in many conditional use permit verbiage)
TOURISM IS MAJOR SOURCE OF
REVENUE FOR  WALWORTH COUNTY
In 2008 Walworth County ranked #7 in state.
(surpassed by Door County in 2007)  Tourism revenue
impacts all residents directly and indirectly: business,
residential property taxes, employment opportunities
(click on link to see data)
Counties in Wisconsin Tourism impact
Potential concerns with short term rentals:

  • Parking problems  
  • Too many people
  • Noise ordinance violations  
  • Excessive Garbage  
  • Fireworks  
  • Full time resident’s objections  “don’t like seeing new people in and out”  
  • Competition concerns from some local lodging owners

Potential Benefits of Regulation to Neighbors/Full-time Residents:
  • Regulation/control of what goes on at your Neighbor's house.
  • 24 Hour Contact Mechanism for complaint resolution, immediate complaint resolution. long term renters cant be
    resolved so quickly, compared to a 30 day eviction process.
  • Transparency creates good behavior
  • Ensures Occupancy Limits Observed
  • Provides mechanism to shut down properties operated in an irresponsible manner

Potential Benefits of Regulation for Municipalities:
  • Transient rentals can be taxed.  Rentals to full time residents cannot be taxed.  This creates revenue sources to
    offset tax burden to full time residents including:  Room Tax, licensing and inspection fees and indirect revenue
    such as sales tax and spending in our community.  This is a "Pass Through Tax"  Pass on the Taxes to Visitors!!
  • Click on this link for one example of Economic impact of one Vacation Rental on our community.
  • Capitalize on Unique Direct & Indirect Revenue  Source Unique to Tourism  Communities Only: Advertised activity
    in Walworth County
  • Increased revenue for Marketing Exposure for Businesses/Lodging properties
  • Natural Resource Protection Education
  • Capitalize on Growing Niche in Tourism Trends, remain competitive with other Municipalities
  • Recessionary Economy Relief, no government assistance
  • Encourages Investment in Real Estate and Responsible Property Management.  link to Natl Assoc of
    Realtors 2010 Survey       Home Away 2010 Vacation Rental Survey
  • Occupancy numbers easy to enforce for Zoning in Single Family Residential Zoning
  • Short term renters spend their money, go home, don’t increase use of municipal services such as schools
  • Ensure Safety of Visitors
  • Prevention of unfair competition to Hotels/Bed & Breakfasts
  • State Officials can help regulate. No Need to use County Zoning Officials or Taxpayer resources
Shortage of full-time single family residents in Walworth County that can afford to pay $1000+ per
month for housing expenses!!!!

Source 2035 Wa Co Comprehensive Plan:
  • 2000: less than 3% of residents paid gross rent including utilities of  $1,000 or more. The median gross rent for
    renter occupied housing units in the County was $588 in 2000.
Source: Fed Stats.gov:
  • 2006 per capita income: $30,688 vs WI $34,405  (affordable housing is 30%= $767)        
  • Average Adj income of non-migrant tax payers in 2005: $55,766  (affordable housing is 30%=$1394)
  • Median household income: $54,084 vs WI $50,567
Walworth County Housing and employment Demographics
WI Room Tax Statute: 6.0615
Some example ordinances outside of Wisconsin in
other Resort Areas that regulate short term rentals:
Walworth County Economic Development Study
Short term rentals Bans have been overturned by Courts and Litigation is Expensive for
Municipalities to Defend

Sedona Gets Slapped with Lawsuit over short term rental ban


Short term rental ban overturned by Indiana Appeals court
Second Home Ownership and Interest in Vacation Rentals Continue to Remain Strong Through Economic
Recession, According to New HomeAway Report.   http://www.homeaway.com/info/media-center/press-
releases/2010_pressreleases/q110-vrmr

Vacation Home Sales Up but Investment Sales Down, NAR.COM, Natl Assoc Realtors, March 31, 2010 http://www.
realtor.org/press_room/news_releases/2010/03/invest_vac_2009

Frustrated Homeowners turn homes into vacation rentals, Housing Watch, AOL.COM July 23, 2010 http://www.
housingwatch.com/2010/07/23/frustrated-sellers-turn-homes-into-vacation-rentals

Homeowners using “Air bnb room renting site to pay Mortgage”, Bloomberg.com July 18,2010 http://www.
bloomberg.com/news/print/2010-07-18/homeowners-use-airbnb-room-renting-site-to-pay-mortgage-dodge-
foreclosure.html
“Rent out your home as a vacation property and make Money”, AOL Real Estate July 16, 2010 http://realestate.
aol.com/blog/2010/07/16/rent-out-your-home-as-a-vacation-property-and-make-money/

“How To Hunt  A Midwest Vacation Rental”, CHICAGO TRIBUNE APRIL 14 2010  http://articles.chicagotribune.
com/2010-04-18/travel/ct-trav-0418-midwest-rentals-20100416_1_vacation-rental-managers-association-
vacation-home-family-vacation

HomeAway Launches iPhone Application to Search for Vacation Rentals, Home Away, Aug 9, 2010 http://www.
homeaway.com/info/media-center/press-releases/2010_pressreleases/iphone-app
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Walworth County
Solicited Feedback on
Allowing Short term
rentals:
letter to municipalities

4 Townships & one
lake mgt district
supported, but wanted
regulations:
Town Feedback