St. Joseph council adopts short-term rental rules, sets licensing fees

The St. Joseph City Council on Feb. 18 adopted a final ordinance amending local rules for short-term rentals and approved associated licensing fees and summary publications.

City staff presented the final draft ordinance and a separate fee schedule tied to the new short-term rental licensing process. Staff said the ordinance clarifies the definition of "owner occupied" by specifying a principal residence as a dwelling the owner occupies at least 183 days a year and sets where short-term rentals are allowed by zoning and what approvals are required.

The ordinance requires short-term rentals in most residential and agricultural districts to obtain a conditional use permit (which involves a planning commission public hearing and council approval) followed by a short-term rental license and inspection. In commercial districts the rules differ: if short-term rental activity is secondary to an existing commercial use, only a rental license and inspection are required; if the property’s primary use will be short-term rental, it must obtain a conditional use permit and then the license and inspection. Staff described this approach as consistent with how the city treats hotels and motels in commercial zones.

The ordinance also requires short-term rental operators to display their license at the front exterior of the property and to make emergency contact information available; staff said the display is intended to let public safety personnel and city officers find contact information during after-hours calls. Council members discussed privacy concerns raised by residents and noted a possible option of a laminated license with a flip side for contact details so information is not immediately visible from the street. The council did not change the requirement at the meeting.

Staff told council that the Minnesota Department of Health requires inspections of lodging establishments statewide and that county inspectors perform many of those inspections. Council members raised a public concern that state or county inspections might duplicate city inspections; staff replied that some overlap is likely but that city inspections are intended to ensure compliance with local ordinance requirements such as display of the license and local contact information.

At a separate agenda item, the council approved a fee schedule for the new short-term rental license. The adopted fees are an annual $100 license for the first short-term rental unit at a property, $25 per additional unit on the same property, and a $50 reinspection fee (the reinspection fee follows the city’s standard rental reinspection policy). Staff said those fees were set to be minimal and to cover city administrative costs; land-use approvals (for example, conditional use permits) would carry additional fees where those processes apply. Lodging tax collection remains in place: staff said a 3% lodging tax applies to short-term rental stays.

Why it matters: The ordinance changes how the city regulates short-term rentals by clarifying owner-occupancy, adding licensing and display requirements, and requiring conditional use review for most residential uses. The new fee schedule creates recurring licensing revenue and a reinspection charge intended to cover administrative costs; it also sets expectations for owners and operators about local compliance steps.

Votes at a glance: The council approved the short-term rental ordinance (identified in the meeting as ordinance/resolution 20 25 0 0 1) by voice vote; the council also approved the ordinance summary publication (20 25 0 0 5). The council approved the short-term rental license fee ordinance (20 25 0 0 2) and its summary publication (20 25 0 0 7) by voice vote. The meeting record does not show a roll-call tally; actions were approved by majority voice votes.

Next steps and implementation: Staff will publish the ordinance summary as required and implement the licensing and inspection process. The city indicated short-term rental license renewals will be scheduled to coincide with the city’s standard rental-license renewal cycle so notices and renewals can be handled together.

Speakers and public input: Staff member Nate presented the ordinance drafts and fee proposal. Finance Director Lori Bartlett answered questions about lodging-tax reporting. Several council members asked questions about parking, paving requirements, privacy of posted contact information, and potential inspection duplication. One resident raised privacy concerns about posting contact information at the front exterior. No citizens spoke in opposition specifically at the time of the vote; staff said four individuals had contacted the city previously with interest in operating short-term rentals or with questions about the rules.

Ending: The council approved the ordinance and fee schedule and directed staff to proceed with publication and implementation as drafted.