HomeMy WebLinkAbout2.a. Rental Housing Code Density Requirements for Rental Units
EXECUTIVE SUMMARY
City Council Work Session: December 12, 2016
AGENDA ITEM: Rental Housing Code: Density
Requirements for Rental Units
AGENDA SECTION:
Discussion
PREPARED BY: Kyle Klatt, Senior Planner AGENDA NO. 2.a.
ATTACHMENTS: List of Cities Surveyed, Ordinance
Comparison Chart, Model Regulations
from West St. Paul, Winona, Northfield,
and Mankato, News Article (Winona
Ordinance), Rosemount Rental Housing
Map
APPROVED BY: ddj
RECOMMENDED ACTION: Review Ordinance Examples and Provide Comments.
ISSUE
Councilmember Demuth has asked staff to research options for including requirements in the City Code
concerning the concentration of rental housing within individual neighborhoods. In particular, there is a
concern that some single-family neighborhoods in the City have recently seen an increase in the number of
units that are being used for rental housing, and in some cases, rental units are concentrated very close or
next door to other rental units on the same block. Staff has made some inquiries regarding how other cities
regulate rental housing, and found some that have adopted specific regulations regulating the number and
density of rental housing within residential neighborhoods. A summary of staff’s research on the matter is
included for discussion at the Council’s December work session.
SUMMARY
In researching this question, staff was aware of a few cities that have adopted rental housing density
requirements. In part, this is due to recent court cases that have challenged the legality of the ordinances in
at least two of the cities where adopted. The four initial cities examined include West St. Paul, Winona,
Mankato, and Northfield. Not surprisingly, the latter three cities are college towns while the former has a
very high number of rental units as an inner ring suburb. Staff also researched other communities’
ordinances, including an inquiry that was sent to our neighboring communities asking whether or not they
have adopted rental housing density requirements. The cities polled have not adopted rental housing density
or spacing requirements other than the four noted above. For those that have such ordinances, they are
typically added as part of rental housing code that requires licensing of rental units. Rosemount has a rental
housing licensing code, but does not place a limit on the number of rental units allowed in the City or
require any spacing between units.
The research for communities that have adopted density standards is summarized on the attached chart and
includes each city’s name, summary of the ordinance requirements, and other notes. Some of the general
observation from this research:
2
• Density requirements are found in the rental housing code section of other cities’ ordinances, which
are usually grouped with other licensing requirements.
• These ordinances generally apply only to single, two-family, or other lower density zoning districts.
Higher density housing and mixed use zones (like downtown districts) which permit apartments are
typically exempt.
• Most of the codes use a block to define the area subject to rental spacing requirements, and for the
most part, the various codes surveyed use a similar definition for a block.
• For the cities that have adopted density requirements, there is an allowance for temporary licenses
for special circumstances (i.e. while a home is listed for sale or for personal emergencies). Each of
the codes surveyed listed different requirements to secure a temporary permit exemption.
• Some codes allow temporary licenses when the limitation on rental units on a block has been
reached.
• All codes include a phase out requirement, specifically, once a site ceases to be used as a rental
property for one year, its license cannot be renewed unless it complies with the ordinance.
In order to help the Council better understand the distribution of rental units within Rosemount, staff has
prepared the attached map that depicts all rental properties within the community. Please note that in some
cases the map does not show individual units (for instance, the Cambrian Commons site is depicted with
one red dot whereas a single-family home that is being rented will also show up as one red dot). Staff is
aware there is a neighborhood concern about the number and upkeep of rentals on 132nd Court. According
to the map there are numerous rentals in Harmony, particularly east of Brockway Avenue, along Banyan
Lane, and along Charleston Avenue. In other words there are various areas of the community that could be
impacted by a change in ordinance rental regulations.
The mapped information is derived from the City’s rental licensing permits active as of November of 2016.
In total, there are 429 properties that have been licensed for rental use with 1,008 individual rental dwelling
units in the City. The highest concentrations of the rental units in the City, outside of multi-family buildings,
are in developments with townhouse rentals. The rental of single family homes is not uncommon in
Rosemount, and certain neighborhoods do appear to have a higher concentration of rental units than others.
At this point, staff does not have any specific recommendation concerning rental housing spacing, and is
presenting the attached information for discussion purposes.
RECOMMENDATION
Review the included ordinances and ordinance summary and provide any direction to staff concerning
rental housing spacing requirements.
City Contact List – Rental Housing Spacing Ordinance
City Spacing Required? Comments
Winona Yes 10% of a block
West St. Paul Yes 30% of a block
South St. Paul No Not found in online ordinances
Northfield Yes 20% of a block
Mankato Yes 25% of a block
Duluth No Did not find a 300’ spacing requirement
Burnsville No response Not found in online ordinances
Eagan No Email response
Ramsey No Online search
Chanhassen No Online search
Edina No Online search
Hastings No Online search
Apple Valley No response Not found in online ordinances
Inver Grove Heights No Email response
Lakeville No Email response
Cottage Grove No Online search
Prior Lake No Email response
Farmington No Email response, does not regulate rentals
Rental Unit Spacing Requirements
Review of Other Cities 12/12/16
Cities that have adopted density/spacing requirements for rental units:
City Requirements Districts Other Notes
West St. Paul No more than 10% of the single-
family lots on any block
R-1 - Temporary rental license allowed when max number is
exceeded
- Only R-1 units in a block are counted
- Legal non-conformities are not counted
Winona No more than 30% of the lots on any
block (including homes with
roomers or boarders)
R-R, R-S, R-1,
R-1.5, R-2
- Does not apply to state licensed facilities or existing
rental units
- Temporary rental license allowed with restrictions
(property must be up for sale)
Mankato Not more than 25% of the lots on
any block
By Map - Existing rental properties included in calculations
- Existing licenses may be renewed or transferred
- Temporary rental licenses are exempt
- State licensed residences exempt
- Exemptions for Office-Residential District
Northfield No more than 20% of the houses on
a single block
R-1, R-2 - House defines as a single structure containing one or
more rental units
- Does not apply to existing rental units, but those are
still counted
- Temporary licenses allowed (in cases of employment
leaves, foreclosure/bankruptcy, loss of employment, or
property listed for sale)
Other Comments:
• Temporary licenses generally range from 6-12 months and may be issued for properties currently listed for sale. Northfield lists other
exceptions for temporary licenses (see chart).
Definitions:
Block (West St. Paul): an area of land enclosed within the perimeter of streets, watercourses, public parks, municipally owned lots and city
boundaries.
Block (Winona): a group of properties bounded entirely by streets public land railroad rights of way zoning district lines corporate limit lines or
physical features such as rivers outcroppings ponds or lakes provided that final delineation of a block shall be made by City staff.
Block (Mankato): an area of land enclosed within the perimeter of streets, watercourses, railroad right-of-way; public parks, municipally owned
lands, and City boundaries, unless otherwise depicted on the attached map
Block (Northfield): the houses on both sides of a street between successive intersecting streets or between other such boundaries including
college campus boundaries, railroad rights of way, corporate limit lines, or physical features such as rivers, outcroppings, ponds or lakes.
West Saint Paul, MN Code of Ordinances
§ 150.037 LICENSE REQUIRED.
(L) Rental density for single-family rental dwellings.
(1) In an R-1 Zoning District, no more than 10% of the single-family lots on any block shall be eligible to
obtain a rental license, unless a temporary license is granted by the City Council as provided herein. Table 1
indicates how many single-family lots per block are able to be licensed as a rental property based on the
number of lots that exist in a block.
Table 1
Lots/Bloc
k
Rental Units
Allowed
1-14 1
15-24 2
25-34 3
35-44 4
45-54 5
55-64 6
65-74 7
75-84 8
85-94 9
(2) The following guidelines shall apply to determine eligible blocks and lots.
(a) For the purposes of this subchapter, a BLOCK shall be defined as an area of land enclosed within the
perimeter of streets, watercourses, public parks, municipally owned lots and city boundaries.
(b) This subchapter shall apply to legally conforming lots of record and legally nonconforming lots of
record. For the purposes of this subchapter, lots of record may also be referred to as PROPERTIES,
PROPERTY or LOTS.
(c) If a block contains more than one type of zoning district, only R-1 Zoning District lots shall be
included in the calculation of the total number of lots per block.
(d) Legal nonconforming rental property shall not be included in the calculation of the total number of
lots per block, but shall be allowed to continue as long as the legal nonconforming use complies with § 153.006
of the Zoning Code.
(e) Commercial or industrial uses located in an R-1 Zoning District shall not be included in the
calculation of the total number of lots per block.
(f) Properties that are exempt pursuant to § 150.038 shall not be included in the calculation of the total
number of lots per block.
(3) If the number of rental properties meets or exceeds the permitted number of rental properties per
defined block on the effective date of this subchapter, no additional rental licenses shall be approved for the
block, unless a temporary license is granted by the City Council as provided herein. Existing rental licenses
may be renewed; however, should a rental license not be renewed, or if the rental license is revoked or lapses,
the rental license shall not be reinstated unless it is in conformance with this subchapter and other applicable
sections of the city code.
(4) If the number of rental properties meets or exceeds the permitted number of rental properties per
defined block on the effective date of this chapter, a property owner may request a temporary license to allow
an additional rental property for that block. The property owner must hire a licensed professional property
management company to manage the property. The Council may grant or deny a temporary license in its sole
discretion. Persons requesting a temporary license must make an annual application to the city. No property
owner shall hold a temporary license for the same property for more than two consecutive years.
Winona: Section 33A.03 (i)
Northfield: Article III – Rental Housing
Sec. 14-97. - Limitation on rental properties in low density neighborhoods.
In R-1 and R-2 districts in the city, no more than 20 percent of the houses on a single block shall be
granted rental housing licenses. For purposes of this section, the word house shall mean a single
structure containing one or more rental units. A single block shall be defined as the houses on both sides
of a street between successive intersecting streets or between other such boundaries including college
campus boundaries, railroad rights of way, corporate limit lines, or physical features such as rivers,
outcroppings, ponds or lakes. Corner houses shall be included in the count of houses on a single block,
regardless of which way they face or on what street they are addressed (corner houses may be counted
as part of more than one single block).
(1) Exception. This limitation shall not apply to rental properties which are validly licensed as of the
date of adoption of this article, including properties which have been sold and re-licensed as
provided in section 14-92, although they will be counted among the 20 percent of allowable
rental houses on a single block for purposes of determining whether new licenses may be
issued.
(Ord. No. 883, 8-18-2008)
Sec. 14-99. - Temporary rental license.
Notwithstanding section 14-97 ( Limitation on rental properties in low density neighborhoods ), the
building official may issue a temporary rental license under the following conditions:
(1) The property owner seeking a temporary rental license must submit a written
request/application for said license to the building official.
(2) In the written request/application filed with the building official, the property owner must state
that, during the term of the temporary rental license, one or more of the following circumstances
will, within the next 30 days, or currently does, apply to the property owner:
a. The property owner is currently taking, or will be taking, an extended leave of absence
from the property owner's place of employment for a duration of six months or more where
the property owner or the property owner's family do not reside at the property; or
b. The property owner is involved in a bankruptcy or foreclosure proceeding directly involving
the property and property owner; or
c. The property owner (i) is currently or will become unemployed, or (ii) has or will have a
change in employment status resulting in a loss of income or in the relocation of the
property owner more than 20 miles away from the city; or
d. The property is being or will be actively listed or offered for sale to the public by the
property owner.
(3) Notwithstanding anything to the contrary in this section, the temporary rental license may be
issued for a period not to exceed 12 months, provided however, that upon written
request/application of the property owner to the building official a one-time extension of the
temporary rental license may be issued by the building official for a period not to exceed an
additional 12 months. The extension shall not be issued by the building official if the rental
property has had three or more blight notices, conduct violations or police reports filed against
the property in the first 12-month temporary rental period. The temporary rental license period
extension is subject to issuance of a new temporary rental license by the building official,
following the property's passage of city rental inspection and payment of the required license
fee.
(4) Subject to clause [subsection] (3) above, the temporary rental license shall terminate
immediately upon closing of a sale of the property to a bona fide purchaser or at the end of a
Page 1
Northfield: Article III – Rental Housing
bona fide lease agreement, but the rental occupancy may not exceed the temporary rental
license expiration date.
(5) A property may be issued a temporary rental license and extension as provide for in this section
only one time within a five-year time period.
(6) The property shall at all times comply with applicable city and state rental housing requirements,
property maintenance requirements, and all other laws and ordinances applicable to the
property.
(7) The fees for the 12-month temporary rental license and any extension thereof as provided in
this section shall be the same as the regular rental license with no prorating for the difference in
any rental duration.
Any property owner who is aggrieved by a decision or action of the building official pursuant to this
section may appeal in accordance with section 14-136 to the rental housing board of appeals.
(Ord. No. 933, § 3, 6-5-2012)
Page 2
Mankato – Section 5.42
Sec. 5.42. - Dwelling Unit Rental.
Subd. 20. Rental Density. Not more than twenty-five (25) percent (rounded up) of the lots on
any block shall be eligible to obtain a rental license or to be licensed as a rental property.
A. When determining the number of eligible lots on a block for rental license purposes, the number
shall be the lowest number that results in twenty-five (25) percent or more of the residential lots
being rental. The following table indicates how many lots are able to be licensed as a rental
property based on the number of lots that exist in a block.
Lots Rental
Lots Rental
Lots Rental
Lots Rental
Lots Rental
1-4 1
25-28 7
49-52 13
73-76 19
97-100 25
5-8 2
29-32 8
53-56 14
77-80 20
9-12 3
33-36 9
57-60 15
81-84 21
13-16 4
37-40 10
61-64 16
85-88 22
17-20 5
41-44 11
65-68 17
89-92 23
21-24 6
45-48 12
69-72 18
93-96 24
In cases in which one portion of the block is not subject to the application of this ordinance, only
the affected portion of the block is subject to this regulation.
B. The following shall apply to the determination of eligible lots:
1. For the purposes of this Subdivision, a block shall be defined as an area of land enclosed
within the perimeter of streets, watercourses, railroad right-of-way; public parks,
municipally owned lands, and City boundaries, unless otherwise depicted on the attached
map. The attached map depicts the boundary of blocks for the purpose of establishing the
number of lots in a block.
2. This Subdivision shall apply to legally conforming lots of record and legally nonconforming
lots of record, as defined in Chapter 10, in existence at that time of the effective date of this
ordinance or approved by new subdivision of unplatted and undeveloped property after the
effective date of this ordinance. For the purposes of this Subdivision, lots of record may
also be referred to as "properties", "property", or "lots".
C. For the purposes of this Subdivision, the following shall apply:
1. The Council hereby adopts the attached map that depicts the area of application of this
ordinance, and the boundary of blocks. The map may be amended by City Council
resolution and without public hearing.
2. Properties licensed for rental purposes on the effective date of this ordinance shall be
included in the calculation of the number of permitted rental properties in a defined block.
3. If the number of rental properties equals or exceeds the permitted number of rental
properties per defined block on the effective date of this ordinance, no additional rental
Page 1
Mankato – Section 5.42
licenses shall be approved for the block. Existing rental licenses may be renewed and
transferred per Section 5.423; however, should a rental license not be transferred or
renewed, or if the rental license is revoked or lapses, the rental license shall not be
reinstated unless in conformance with this Subdivision and other applicable Sections of the
Mankato City Code.
4. Temporary rental license issued per Section 5.42, Subdivision 21, shall be exempt from
this Subdivision.
5. Rental licenses for State Licensed residences shall be exempt from this Subdivision. If the
property is no longer licensed by the State of Minnesota, a new rental license application
shall be submitted and reviewed for compliance with this Subdivision and other applicable
Sections of the Mankato City Code.
6. In the Office-Residential District located within the City Center Planning Area, as defined in
the adopted City Center Renaissance Plan, a rental license may be issued to a lot within a
block that exceeds the 25 percent permitted number of rental licenses, provided the ground
floor(s) of all principal and accessory buildings on the lot, and any other floors below the
ground floor, are occupied and used for a non-rental permitted and/or conditional use and
the rental use of the property is confined to floor areas located above the ground floor(s).
(Ord. of 3-23-2009; Replaced Ord. 6-9-2008)
Subd. 21. Temporary Rental Licenses.
A. Temporary rental license may be granted by the City for unlicensed properties to an owner of
property for a period not to exceed six (6) months for the following circumstances:
1. The property is being sold and the owner and the owner's family are not residing at the
property.
2. The owner and the owner's family are not residing at the property and the occupants are
providing a caretaking function for the property.
Six (6) months from the date of issuance, the temporary rental license shall expire and is not
subject to renewal, unless otherwise approved by the City Council. The Council may approval
additional extensions provided the property is being actively marketed for sale. Temporary rental
licenses are not transferable to new owners.
(Ord. of 3-23-2009)
The issuance of temporary rental licenses shall conform to all standards of Chapters 5, 10, and
13, except the Building Official may grant variances from Chapter 13 provided critical life safety
requirements are met.
Page 2
LOCAL
Court of Appeals upholds Winona's
rental limits
An ordinance that limits rental housing to 30 percent of properties
on the block was under fire for restricting rights.
By Jenna Ross (http://www.startribune.com/jenna-ross/10645826/) MARCH 1, 2014 — 2:46PM
Winona's cap on rental housing won the blessing of the Minnesota Court of Appeals in a
case that cities across the state are watching closely.
On Monday, the court upheld Winona's ordinance limiting rentals to 30 percent of the
properties on a block. The so-called "30 percent rule" was meant to ease parking woes
and protect neighborhoods from being overtaken by rental units. But some homeowners
challenged the cap, arguing that it's unconstitutional for a city to restrict homeowners'
rights to rent and sell their properties.
"We easily conclude that the public has a sufficient interest in rental housing to justify a
municipality's use of police power as a means of regulating such housing," Judge
Michelle Larkin wrote in the opinion, which affirms an earlier district court ruling.
The decision makes clear that "the court will not interfere with cities' reasonable
judgments and ordinances that are neutral and fairly applied," said George Hoff,
attorney for Winona.
The city passed its ordinance in 2005 after a task force found that rentals made up about
39 percent of total housing units. It worked: "It is undisputed that the 30 percent rule has
limited the number and location of converted properties, as it was intended to do," the
opinion says.
But there have been consequences. The four plaintiffs, who sued in 2011, were owners of
three houses they bought separately after the 30 percent rule but for different reasons —
including military duty in Afghanistan — weren't able to live in. They plan to ask the
Minnesota Supreme Court to consider the case, said their attorney Anthony Sanders.
"This isn't just a college town issue," said Sanders, with the Minnesota chapter of the
Institute for Justice. "This is an issue of whether you can take a perfectly safe home and
rent it out to perfectly safe tenants, of whether you can be denied that right because your
neighbor's already done it."
But the court found that Winona's rule "establishes a neutral, numerical limit on the
number of lots that are eligible to obtain certification as a rental property and applies
uniformly throughout the affected districts on a first-come, first-served basis."
Hoff compared it to a city offering a limited number of liquor licenses.
Northfield, Mankato and West St. Paul have set similar caps of various percentages. In
its brief supporting Winona, the League of Minnesota Cities said that the Appeals
Court's decision would "have a significant, statewide impact on Minnesota cities …"
While the judges rejected the homeowners' arguments, "we in no way diminish the
impact of the 30 percent rule on the appellants' ability to use their properties as they
would like," Larkin wrote, "and we are sympathetic to their circumstances."
Plaintiff Ethan Dean owned a Victorian house near Winona State University but had to
leave it for stretches of time to serve in Iraq and Afghanistan as a corrections trainer and
analyst with the U.S. Army.
He tried to sell the place for two years but potential buyers — some of them parents with
a son or daughter going to the university — backed down when they learned they
wouldn't be able to rent it. More than a year ago, "I gave it back to the bank," Dean said,
in lieu of foreclosure.
"I'm at the point where it's not so much about winning or losing the case," he said. "It's
about standing up and saying, 'This is wrong.'"
Dean has since married and moved to Missouri. Before buying a house outside of Kansas
(http://stmedia.startribune.com/images/ows_13937067991758
Caption Caption
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}
City, he did his homework.
"Oh, yeah. We sat down with the mayor, went to the City Council and everything," he
said. "They were like, 'As long as you don't have rusted cars outside and aren't growing
pot, we don't care.'"
jross@startribune.com 612-673-7168 ByJenna
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O'LEARY'SPOND
WENNSMANPONDERICKSON PONDWACHTERLAKE
VALLEYOAKPOND
SHANNONPOND
HAWKINSPOND
COPPER POND
SCHWARZPOND
MARE POND
BIRGERPOND
KEEGANLAKE
MAREPOND
KEEGANLAKE
MCMENOMYPOND
WILDELAKE KIRSCHNERMARSH
GERONOMIEPONDM
e
a
d
o
w
s P
a
r
k
CentralParkInnisfree ParkBirchPark
B lo om field P arkClaretPark
EricksonPark
CarrollsWoodsPark
Charlie's Park
JayceePark
LionsPark
ShannonPark
Winds ParkTwin PuddlesKidderParkBiscayne ParkConnemaraPark
Schwarz Pond Park
Tw in PuddlesDallaraPark
Innisfree Park
Schwarz Pond Park
FamilyRes Ctr
ChippendalePark
CamfieldPark
BrockwayPark
BrockwayPark
Ames SoccerComplex
UMore BallPark
Ailesbury Park
Flint HillsAthletic Complex
WiklundPreserve
Horseshoe Park
(STH 3)160TH ST W (CSAH 46)BISCAYNE AVE(CSAH 38)MCAN DRE WS R D W
D O D D
E
V
ERMOORPKWY155TH ST W DODD BLVD1 5 1 S T S T W
N E160TH ST W (CSAH 46)TH ST W (CSAH 42)DIAMOND PATH (CR 33)E M A RDODD BLVDBISCAYNE AVET
R
L
DIAMOND PATH (CSAH 33)TRL (STH 3)150DODD BLVDA
CHIPPENDALE AVES
ROBE
RT
T
RL DODD BLVDS ROBERT TRL (STH 3)MARA(STH 3)AKRON AVE (CR 73)BLVD160TH ST W (CSAH 46)BACARDI AVEEVERMOOR
AUTUMNBONAIRE PATH W
145TH ST W
SHANNONPATHAUBURNAVE AKRON AVE (CR 73)S ROBERT TRTRLPKWYCONNEMARA
145TH ST W SHANNONPKWY125TH CT
CON
AKRON AVEBLOO M F IELDPATH
TRL CONN
S ROBERT150TH ST W (CSAH 42)BISCAYNE AVEPKWY!
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!Path: T:\GIS\City\Maps\Departmental Maps\CommunityDevelopment\Rentals\Rentals_Potrait.mxd1,600 0 1,600800 FeetRentals