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Council seeks enforceable approach to homeowner-occupancy in new developments; staff outlines deed-restriction plan
Summary
Council members discussed requiring deed restrictions and CC&Rs to prohibit rentals for an initial ownership period as a legally enforceable alternative to requiring owner occupancy; staff said enforcement will rely on deed-recorded restrictions and stronger fines.
Provo City staff and councilors described a new enforcement approach the council is testing to limit investor-owned rentals in certain new developments: instead of requiring owner occupancy, future development agreements would require recorded CC&Rs or deed restrictions that ban renting for an initial period.
Bill (staff) and Brian Jones, City Attorney, explained the legal rationale. Jones said it is difficult to craft a development agreement that requires an owner to live in a unit, but it is more straightforward to prohibit rentals during a fixed period. Under the proposed approach, the developer would record deed restrictions and the city would condition permitting so buyers receive notice; the city would refuse to issue a rental-dwelling license during the restricted period and pursue enforcement against owners who rent contrary to the deed restriction.
Participants noted enforcement challenges. Commissioners and councilors asked how the city would detect violations, how bans would affect renters already in place, and whether short restriction windows (for example, one year) would meaningfully deter institutional investors. Staff said the city is experimenting with technology and civil enforcement that includes daily fines rather than a single criminal citation. They also said Utah state law limits local landlord–tenant authority and that some proposed remedies would require state legislative change.
Council members discussed potential side effects: a one-year prohibition creates the risk of vacant properties for that period if an owner chooses to hold rather than occupy; longer restrictions may better deter investors but present other trade-offs for buyers. Several councilors suggested deed-recorded prohibitions should be paired with effective civil enforcement (daily fines) and improved detection methods so that tenants are not the principal victims of enforcement actions.
Staff described past city actions: the planning commission had recommended denial in recent cases where proposed ownership percentages fell short of the council’s objectives. Jones said the council and commission must still decide policy thresholds (for example, what percentage of units must be for sale) and that staff will continue to bring enforcement and code-change proposals back to the council.
