Traverse City News and Events

City To Revisit Vacation Rentals, Tall Building Lawsuit

By Beth Milligan | Jan. 5, 2019

Traverse City commissioners will kick off 2019 by tackling several high-profile items – including possible changes to the city’s short-term rental policy and choosing a law firm to represent the city in a Proposal 3 lawsuit – at their 7pm meeting Monday at the Governmental Center.

Commissioners will once again revisit the city’s short-term rental ordinance following more than two years of debate about changing the rules. At the center of the discussion are two types of rental properties: hosted rentals (called tourist homes in Traverse City), which are allowed but heavily restricted by the city, and unhosted rentals – such as those typically found on Airbnb – which are banned in the city, except in commercial areas.

Officials have focused mostly on changing the rules for the city’s existing tourist home policy, rather than looking at creating new rules that would allow unhosted rentals. That has frustrated some residents, including a group called Responsible Home Sharing, which advocates for allowing homes to be rented out without owners having to stay on-site. Group leader Dave Durbin has publicly questioned how long it’s taken the city to make progress on policy changes, recently telling the Northern Express – sister publication of The Ticker – that “it feels like another attempt to drag this issue out so that we lose another summer.”

Both types of rental properties are on Monday’s agenda, however – potentially opening the door to unhosted rentals in the city. City commissioners Michele Howard, Brian McGillivary, and Richard Lewis serve on an ad hoc committee studying short-term rentals and held five meetings in recent months with public input. They’re now recommending a revised tourist home policy to city commissioners for approval, with possible enactment scheduled for January 22. The city’s current ordinance allows homeowners to obtain a license to rent out no more than three rooms in their homes for up to seven days at a time. The entire residence can’t be rented out, and residents must meet several requirements to obtain the licenses, including living on-site. Tourist homes also have to be more than 1,000 feet apart, limiting the number that can operate in the city.

Under the new policy, there would be two categories of tourist homes: high-intensity and low-intensity. High-intensity tourist homes, or those with 85-plus guest stays a year, could rent up to three rooms to two adults per room for a maximum two-week stay. Such homes would still be required to be at least 1,000 feet from each other and have the owner on-site. Low-intensity tourist homes, or those with 84 or fewer guest nights a year, could rent up to two rooms to two adults for two-week stays. Low-intensity homes must be 300 feet apart. The revised rules also require off-street parking for each guest room, a city inspection every three years, and an annual fee ranging from $150-$200. Tourist homes would be allowed in both single-family and two-family districts, but only single-family homes could actually host the rentals.

City commissioners are also being asked to weigh in Monday on what they’d like to do about vacation/unhosted rentals. Options available to the board include asking the planning commission to make a recommendation on whether or not to allow vacation rentals in Traverse City, considering allowing vacation rentals under a limited scope (such as up to 14 days per month), or abandoning the issue and not considering it further. The ad hoc committee also asked commissioners to consider whether vacation rentals should be regulated in commercial districts, where they are currently allowed and not overseen by the city. “(These owners) are not required to obtain a license from the city clerk,” the ad hoc noted. “The city commission should discuss if we want the planning commission to make a recommendation on if they should be licensed.”

City commissioners Monday will also consider hiring one of at least three firms that have submitted proposals to represent the city in a lawsuit brought by developer Tom McIntyre over Proposal 3, the city charter amendment requiring a public vote on buildings over 60 feet. City Attorney Lauren Trible-Laucht has recommended the city obtain outside counsel in the case, with the Thirteenth Circuit Court providing the city an extension until January 31 in order to hire a firm and respond to McIntyre’s complaint.

Two prominent attorneys well-known to the city have thrown their hats in the ring to represent TC in the case. They include Doug Van Essen, an attorney who’s previously represented the city in Proposal 3 litigation, and attorney Christopher Cooke, who’s represented Grand Traverse County in multiple municipal cases. Former Traverse City mayor and attorney Chris Bzdok also offered to represent the city, but later withdrew his name from consideration. Trible-Laucht said in a memo to commissioners that she anticipated receiving additional proposals by Monday’s meeting time; commissioners will review all of the submitted proposals and their associated costs and make a decision as to who will be hired to represent the city.

Also on Monday’s meeting agenda: consideration of extending a contract with Influence Design Forum to provide management services to the city’s Arts Commission for another year for $25,000; transferring brewing and distilling licenses from Right Brain Brewery to Roak Brewing Company on Sixteenth Street as part of a merger between those two companies; and a short presentation from staff regarding the latest updates on the FishPass project planned for the Union Street Dam.

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