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HomeMy WebLinkAbout2026-06CITY OF LAKE ELMO COUNTY OF WASHINGTON STATE OF MINNESOTA ORDINANCE NO.2026-06 AN ORDINANCE AMENDING THE LAKE ELMO CITY CODE OF ORDINANCES BY AMENDING TITLE 105, ZONING PERTAINING TO SHORT TERM RENTAL PROPERTIES & REVISING THE 2026 FEE SCHEDULE FOR THE CITY OF LAKE ELMO SECTION 1. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.110 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined; deleted language is shown with stAkethr-ough): b) Use types and classifications. 1) Residential and related uses. a. Family living. Live -work unit means a dwelling unit in combination with a shop, office, studio, or other work space within the same unit, where the resident occupant both lives and works. Manufactured home park means a development on a site under a single ownership which consists of two or more spaces for the placement of manufactured homes for dwelling or sleeping purposes, regardless of whether or not a fee is charged for the utilization of such space. Multifamily residential means a building containing three or more dwelling units served by one or more shared entrance. The term "multifamily residential' includes cooperative apartments and condominiums, but not condominium -hotels. (See condominium and condominium -hotel under LEC 1.08.) Secondary dwelling means a residential dwelling unit, but not a manufactured home, located on the same lot as a single-family dwelling unit, either within the principal structure or above a detached garage. Short-term rental (STR) means the use of a dwelling unit, or any portion thereof, rented for a period of at least one night and less than 30 consecutive days. Each short-term rental is limited to a total of five guest rooms and 10 guests. Hotels, motels, bed and breakfasts, and other land uses explicitly defined and regulated separately are not considered to be short-term rentals. Single-family, attached, or townhomes, means a building containing independent dwelling units adjacently attached to each other, each with separate exterior entrances at the ground floor. Single-family attached must contain more than two units, but not to exceed eight total units. The units may be on the same, or separate, lots. Single-family, detached, means a building containing only one dwelling unit, surrounded by landscape area or yards on all sides. Two-family or duplex means a building on a single lot or adjacent lots containing two dwelling units, either side -by -side or stacked vertically. SECTION 2. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.500 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined: deleted language is shown with stAke" r-ough): a) Group home. A group home is a specific use type located within a single-family dwelling, and therefore shall meet all zoning standards applicable to single-family dwellings, including setbacks, lot area, lot coverage, and off-street parking. License capacity shall not exceed six persons per facility, plus support staff. b) Group residentialfacility, hayivay house. 1) In residential districts, the facility shall occupy a residential building type permitted within the district where it is located, and shall meet all zoning standards applicable to that building type. 2) On -site services shall be for residents of the facility only. c) Congregate housing (assisted living). 1) To the extent practical, all new construction or additions to existing buildings shall be compatible with the scale and character of existing building and surrounding neighborhood. 2) The site shall contain a minimum of 50 square feet of green space per resident, consisting of outdoor seating areas, gardens and/or recreational facilities. In cases of unique circumstances, the city may consider public parks or plazas within 300 feet of the site to meet this requirement. It is the responsibility of the applicant to demonstrate why the green space cannot be located on site. 3) An appropriate transition area between the use and adjacent property may be required, to include landscaping, screening and other site improvements consistent with the character of the neighborhood. d) Semi -transient accommodations (boardinghouses, roominghouses, etc). 1) The operator shall submit a management plan for the facility and a floor plan showing sleeping areas, emergency exits and bathrooms. 2) All new construction or additions to existing buildings shall be compatible with the scale and character of the existing building and surrounding neighborhood. 3) An appropriate transition area between the use and adjacent property may be required, to include landscaping, screening and other site improvements consistent with the character of the neighborhood. e) Temporary health care dwellings. Pursuant to authority granted by M.S.A. § 462.3593, subd. 9, the city opts -out of the requirements of M.S.A. § 462.3593, which defines and regulates temporary family health care dwellings. By exercising this authority, the city is prohibiting the use of temporary family health care dwellings within the city. f) Short-term rentals (STR). 1) License required. No person, partnership non-profit, or other business entity shall operate a short- term rental dwelling or short-term rental dwelling unit in the city without a license pursuant to this section The license application must be submitted on a form provided by the city. a. Property contact information. The license applicant must provide 24-hour contact information for the following people: 1. At least one owner of the rental dwelling property. 2. At least one manager, if different from the owner, who is responsible for managing the property in compliance with this and any other Code requirement pertaining to the short-term rental dwelling. The manager must reside within 30 miles of the short-term rental property; or 3. If the owner uses a property management company for management of the short- term rental dwelling, the name and contact information of the person at the property management company responsible for managing the short-term rental dwelling. b. Fees. There shall be a licensing fee as established by the city's fee schedule. All fees shall be charged to and payable by the owner. c. Inspection report. The application must be accompanied by a satisfactory city ins ep ction report signed by the building official. The property shall be inspected annually during the three year term. d. License term. The term of the license is three calendar years. A license renewal application must be submitted to the city prior to the expiration date. The license expires on November 1" e. Changes in ownership or dwelling unit. A license is non -transferable. If there is a change in ownership of the short-term rental dwelling or short-term rental dwelling unit, a new license is required. If changes are made in the number or type of units, the agent or property manager, the licensee shall file an application to amend the rental license. Depending on the nature of the changes, the city may require a new propertinspection, Each unit used as a short-term rental property shall have its own short-term rental license. f. Responsibility for acts of the manager. Licensees and owners are responsible for the acts or ornissions of anger as it pertains to the short -tern rental dwelling. g. Exemptions. This section does not apply to, and no short -rental license is required for the following: 1. Hotels or motels; 2. Hospitals; 3. Bed and breakfasts, which are subject to requirements in Section 105.12.570; 4. State -licensed residential care facilities; 5. Nursing homes or assisted living facilities; and 6. Rental dwellings which are rented for a period exceeding 30 consecutive days. 2) Standards for licensing. a. STR license cap. For all zoning districts where short-term rental dwellings are allowed, no more than 20 licenses shall be active at one time. b. Homeowners' associations (HOAs)_opt-in. In zoning districts where short -term rental dwellings are allowed and an HOA exists, the HOA shall opt -in prior to the city accepting a short-term rental license application. c. Performance standards. 1. Zoning. A short-term rental shall only be allowed in specific zoning districts as set forth in LEC 105.12.(620, 710, 780, 870, and 1040). 2. Parking requirements. All short-term rentals must provide at least one off-street parking space per bedroom. However, no more than four off street parking spaces per short-term rental dwelling unit will be required, regardless of the number of bedrooms. All guest parking for a short-term rental dwelling or short-term rental dwelling unit must be on a durable drivewav or narking surface that is located on the property_ 3. Guest rooms. The number of rooms being used for short-term rental purposes in any building shall not exceed five. 4. Signage. No additional signage shall be provided. 5. The operator shall carry liability insurance, and shall provide proof of such insurance to the city upon request. d. Maintenance Standards 1. It is the responsibility of the licensee to ensure that every short-term rental dwelling is maintained in compliance with all city ordinances and state and federal laws. A violation of any of the following City Code titles or chapters constitutes a violation of this chapter and a public nuisance: i. Building Regulations Code (Chapter 105.08Z ii. Zoning Code (Chapter 105.12); iii. Animals Code (Chapter 9.2); iv. Nuisances (Chapter 9.28Z V. International Property Maintenance Code (Chapter 105.04-XVI),and vi. Solid Waste (Chapter 5.12). 2. Inspections. The building official, fire chief, sheriff, and their res ep ctive representatives are authorized inspectors who may enter short-term rental dwellings for p—Moses of making inspections reasonably necessary to enforce this chapter. All authorized inspectors have the authority to enter any short-term rental dwelling at all reasonable times with permission of the owner, occupants, or manager. All short-term rental dwellings shall be inspected at least once per calendar year, and authorized inspectors may perform additional inspections as needed to enforce this chapter. The licensee is responsible for scheduling the inspection and notifying any existing guest of the inspection. The licensee must provide access to the requesting city official at the date and time of the scheduled inspection. If an owner, owner's agent, or occupant of a short-term rental dwelling or short-term rental dwelling unit fails or refuses to permit entry to a short-term rental dwelling or short-term rental dwelling unit for an inspection pursuant to this section, the inspector may seek an administrative search warrant authorizing such inspection. Failure to provide access for any reason may result in a re -inspection fee, in addition to any other sanctions imposed for noncompliance, such as revocation or suspension of the license. 3. Access by occupant. Each occupant of a short-term rental dwelling shall give the licensee, manager, or authorized city official access to any part of such short-term rental dwelling at reasonable times for the purpose of inspection which is necessary to comply with the provisions of this section. 4. Violations. A violation of this section is a misdemeanor. However, the city m use alternative enforcement methods, including suspension, revocation, or denial of a license. 3) Denial, suspension, or revocation of license. a. Any short-term rental license may be denied, suspended, or revoked for one or more of the following reasons: 1. There have been at least three substantiated and relevant complaints or violations of this section relating to the short-term rental within a 12-month period; 2. The property does not comply with a health, building, or building maintenance code, or other provisions of the City Code or state law; 3. The licensee has failed to pay the license fee or inspection fees that are required for the short-term rental; 4. The licensee has made fraudulent statements or misrepresentations in the license anplication, investigation of the license application, or in any information required by this section to be provided to the city; 5. The licensee has been operating or allowing the short-term rental property to be used in such a manner as to constitute a breach of the peace, a menace to the health, safety, and welfare of residents or the public, or a disturbance of the peace, comfort or safety of the residents or the public, upon recommendation of the sheriff, 6. The licensee has been operating the short-term rental property in a manner that is unauthorized or beyond the scope of the license granted; 7. The licensee's rental license to operate another short-term rental dwellingin 'n the City of Lake Elmo or in another jurisdiction has been denied, revoked, or suspended within the past year; 8. Failure by the licensee to schedule or allow inspections of the licensed premises for the purpose of ensuring compliance with short-term rental licensing requirements City Code requirements, state building codes, or other applicable state or federal law; 9. Failure by the licensee to continuously comply with all conditions required in the approval of the license; 10. Real estate taxes or city fees for the short-term rental property are delinquent; 11. Violation of any regulation or provision of the City Code applicable to the activity for which the license has been granted, or any regulation or state or federal law that maybe applicable; 12. Failure by the licensee to actively pursue the removal of guests who have violated the provisions of the City Code; 13. Failure by the licensee to cooperate with the city in identifying individuals with a lawful right to occupy the short-term rental dwelling or to be present on the short- term rental property; or 14. Other good cause as determined by the city council. b. The city council may revoke a license or suspend a license for a set period of time or until violations of City Code, or state or federal law are corrected and, in addition, impose a criminal penalty for each violation or impose a combination of these sanctions. c. Hearing The council or its designee must hold a hearing to deny, suspend or revoke a license or to consider other actions against the licensee. Denial, suspension, or revocation hearings shall be conducted pursuant to City Code Section 3.04.010. It is not necessary that criminal charges be brought in order to support a suspension or revocation of a license violation nor does the dismissal or acquittal of such a criminal charge operate as a bar to license suspension or revocation. 1. Temporary suspension. The city council may temporarily suspend a license ending a hearing on the suspension or revocation when, in its judgment, the public health, safety, and welfare is endangered by the continuance of the licensed activity. 2. Following the hearing, the council may revoke or suspend the license for all or M part of the licensed premises, ma+stay the revocation or suspension upon such terms and conditions as it deems reasonable and necessary to accomplish the purposes of this section, or grant or continue the license. The decision by the city council following a hearing is final. Upon denial, revocation or nonrenewal of a license, the owner may not reapply for a license for a period of six months. Upon expiration of the six-month period, the applicant must re -apply for a new license. d. Appeal of decision to deny or not renew license. If the community development director denies or does not renew a license, the licensee shall be notified in writing, pecifying the reasons for denying or not renewing the license. If the licensee corrects the conditions leading to the denial or non -renewal within seven days, the community development director shall issue the license. A licensee whose license has been denied or not renewed by the community development director may appeal the decision by filing with the community development director a written notice of appeal within seven days of receiving notice of the decision. The hearing will be conducted pursuant to Citv Code Section 3.04.010. 4) Summary Action a. Emergency. When the conduct of any owner or owner's agent, representative, employee, or guest, or the condition of the short-term rental dwelling or short-term rental dwelling unit, or the property in or on which it is located, is detrimental to the public health, sanitation, safety and general welfare of the community, or guests of the short-term rental dwelling or short-term rental dwelling unit so as to constitute a nuisance, fire hazard or other unsafe or dangerous condition and thus give rise to an emergency, the building official has the authority to post individual short-term rental dwelling units or areas of the short-term rental dwelling as uninhabitable as the building official deems necessary. b. Posted to prevent occupancy. Whenever any short-term rental dwelling or short-term rental dwelling unit is found to be unfit for human habitation under paragraph (a) of this section, it shall be posted by the building official on the door of the short-term rental dwelling or short-term rental dwelling unit, whichever the case may by e, to prevent further occupancy. No person, other than the building official or their designee, shall remove or alter any posting. The building official will post the date the short-term rental dwelling or short-term rental dwelling unit must he vacated, and no person shall reside in, occupy or cause to be occupied that particular short-term rental dwelling or short-term rental dwelling unit until the building official permits it. 5) No Warranty by City a. By enacting and undertaking to enforce this section, neither the city nor its council, agents or employees warrant or guarantee the safety, fitness or suitability of any short- term rental dwelling in the city. Licensees and occupants should take appropriate steps to protect their property, health, safety, and welfare. SECTION 3. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.620 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined; deleted language is shown with strikethrough): 105.12.620 Permitted Conditional And Interim Uses Table 9-1 lists all permitted, conditional, and interim uses allowed in the rural districts. "I'" indicates a permitted use, "C" a conditional use, and "P' an interim use. Uses not so indicated shall be considered prohibited. Cross- references listed in the table under "Standard" indicate the location within this section of specific development standards that apply to the listed use. Combinations of uses. Principal and accessory uses may be combined on a single parcel. Table 9-1: Permitted, Conditional, and Interim Uses, Rural Districts RT A RR RS RE Standard Residential Uses Household Living Single-family P P P P P LEC detached dwelling 105.12.650(a) Secondary P LEC dwelling 105.12.650(d) Short-term rental P P P P P LEC 105.12.500(fl SECTION 4. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.710 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined; deleted language is shown with strikethr-engh): 105.12.710 Permitted And Conditional Uses Table 10-1 lists all permitted and conditional uses allowed in the urban residential districts. "P" indicates a permitted use, "C" a conditional use. Uses not so indicated shall be considered prohibited. Cross-references listed in the table under "Standards" indicate the location within this chapter of specific development standards that apply to the listed use. Combinations of uses. Principal and accessory uses may be combined on a single parcel. A principal and secondary dwelling unit may be combined according to the standards of LEC 105.12.750(c). Single-family attached or multifamily complexes designed for rental or condominium occupancy, typically include multiple units and buildings on a single parcel. Table 10-1: Permitted and Conditional Uses, Residential Districts Residential Uses GCC LDR MDR HDR Standard Household Living Single-family detached dwelling P* P P P LEC 105.12.740 (B), (E), *(0) Two-family dwelling P P LEC 105.12.740 (F) Single-family attached dwelling P* P** LEC** 105.12.740 (G), (J) Multifamily dwelling (rental or condominium) C* P** LEC * 105.12.740 (h), (k) Secondary dwelling C C C C LEC 105.12.740(c) Live -work unit C LEC 105.12.740(1) Manufactured home park C LEC 105.12.170-- LEC 105.12.340 Short-term rental P P P P LEC 105.12.500(fl SECTION 5. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.780 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined; deleted language is shown with strilfethreugh): 105.12.780 Permitted And Conditional Uses Table I 1-1 lists all permitted and conditional uses allowed in the village districts. "P" indicates a permitted use, "C" a conditional use. Uses not so indicated shall be considered prohibited. Cross-references listed in the table under "Standards" indicate the location within this section of specific development standards that apply to the listed use. a) Combinations of uses. The following use types maybe combined on a single parcel: 1) Principal and accessory uses may be combined on a single parcel. 2) Permitted or conditional uses allowed within the district may be combined on a single parcel, provided that a unified and integrated site plan is approved. If one or both of the uses is/are conditional, the entire development must be approved as a conditional use. b) Combination of uses, VMX distriet. 1) A mixed -use building that combines permitted or conditionally permitted uses may be developed meeting the form standards of this subchapter. c) Non -Residential Uses. 1) On property zoned V-HDR, allowed non-residential uses shall be located on the street level (first floor) only. Such use shall have its primary entrance from the front or side of the building. Table 11-1: Permitted and Conditional Uses, Village Districts LDR MDR HDR VMX Standard Residential Uses Household Living: Single-family detached dwelling P P P P LEC 105,12.820 Two-family dwelling P P Single-family attached dwelling C C LEC 105.12.920 Multifamily dwelling C C LEC 105.12.820 Secondary dwelling P P P P LEC 105.12.820 Live -work unit C P LEC 105.12.820 Short-term rental P P P P LEC 105.12.500(fl SECTION 6. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.870 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined, deleted language is shown with str-iketlueugh): 105.12.870 Permitted, Conditional And Interim Uses Table 14-1 lists all permitted and conditional uses allowed in the commercial areas of the MU-C and MU -BP zoning districts. "I'" indicates a permitted use, "C" a conditional use and "I" an interim use. Uses not so indicated are prohibited. Cross-references listed in the table under "Standards" indicate the location within this chapter of specific development standards that apply to the listed use. Combinations of uses. The following use types may be combined on a single parcel. a) Principal and accessory uses. b) Single-family attached or multifamily complexes designed for rental or condominium occupancy, since these typically include multiple units and buildings on a single parcel. c) Other permitted or conditional uses allowed within the district may be combined on a single parcel, provided the city approves a unified and integrated site plan. The city must approve the entire development as a conditional use. d) A mixed -use building that combines permitted or conditionally permitted residential, service, retail and civic uses may be developed meeting the form standards of this section. Office or studio uses on upper stories of such buildings are encouraged. e) Compatible uses. In the event of any question as to the appropriate use type or compatibility of any proposed land use or activity in a mixed -use development, the planning director shall have the authority to determine if the city should consider the use or activity as permitted, conditional or prohibited from a location in a mixed -use zoning district. In making such a determination, the planning director shall consider the operational and physical characteristics of the proposed use or activity in question. In addition, the planning director shall consider the specific requirements of the use in common with those included as permitted or conditional uses in the zoning district. Where a question or conflict arises as to the appropriateness or compatibility of a proposed use or activity, the planning director shall refer the matter to the planning commission. The planning commission shall make a recommendation about the matter to the city council, who shall make the final determination as to whether the city will allow (or not allow) a proposed use; is compatible as a permitted use or as a conditional use; is compatible as an accessory use; or is a use that may be added to a specific mixed -use development within the zoning district. Table 14-1: Permitted, Conditional and Interim Uses, Mixed -Use Commercial and Mixed -Use Business Park Districts MU- C MU- BP Standard Residential Uses Household Living: Single-family detached dwelling P P LEC 105.12.900(a) Single-family attached dwelling P P LEC 105.12.900(b) Multifamily residential dwelling P P LEC 105.12.900(c) Secondary dwelling C C LEC 105.12.900(d) Live -work unit C C LEC 105.12.900(e) Short-term rental P P LEC 105.12.500(fl SECTION 7. The City Council of the City of Lake Elmo hereby ordains that Title 105, Section 105.12.1040 of the City's Code of Ordinances is hereby amended by changing the following section (Proposed language is underlined; deleted language is shown with st-rilwthreugh): 105.12.1040 Uses Within Open Space PUDs a) Primary uses. 1. Permitted. a. Single-family, detached; b. Preserved open space; c. Conservation easements; d. Agriculture; e. Suburban farms; f. Private stables; g. Single-family, attached and Townhouses (no more than 25 percent in any development); h. Wayside stand; and i. Public parks and trails; and j. Short-term rental 2. Conditionally permitted. None. 3. Interim permitted. None. SECTION 8. Fees. The City Council of the City of Lake Elmo ordains that the following fees related to Short - Term Rentals are adopted and the 2026 Fee Schedule is to be amended; APPLICATION/FEE/PERMIT TYPE 2026 FEE ADDITIONAL CHARGE, ESCROW or NOTES Short -Term Rental License $1,500.00 Three-year license term Re -inspection Fee Short -Term Rental $75.00 SECTION 9. Effective Date. This ordinance shall become effective immediately upon adoption and publication in the official newspaper of the City of Lake Elmo. SECTION 10. Adoption Date. This Ordinance 2026-06 was adopted on this 5th day of May 2026, by a vote of 3 Ayes and I Nays. LADE ELMO CITY COUNCIL ATTEST:Charles Cadenhead, Mayor pp Y This Ordinance 2026-06 was published on the 22dday of 2026.