Michigan City workshop highlights rise in short‑term rentals, enforcement gaps and neighborhood strain

Michigan City Common Council members, short‑term rental hosts and neighborhood residents gathered May 13 for a workshop focused on the scope of short‑term rentals in the city and gaps in enforcing existing rules.

Councilman Greg Holter opened the meeting by tracing the local history of short‑term rentals and reading the city ordinance passed in February 2021: “If three or more citations for ordinance violations are issued to an owner of a permitted property within a calendar year, the Michigan City Planning and Inspection Department may revoke the permit,” Holter said as he summarized the rule and its stated enforcement mechanism. Holter and several speakers said that the ordinance has not been consistently enforced.

Residents and hosts gave examples of nuisances they link to transient guests — noise, litter and late‑night parties — and described uneven impacts across neighborhoods. One neighborhood study shown at the workshop found roughly 38% of homes in a Canada Park study area were short‑ or long‑term rental properties, a figure neighbors said has contributed to a felt loss of full‑time residents and community continuity. At the same time, hosts and other residents said short‑term rentals have spurred investment in previously dilapidated properties and generated business for local restaurants, cleaners and tradespeople.

Council and other speakers offered several data points and clarifications during the discussion. Holter said the LaPorte County innkeeper’s tax totaled about $2.5 million in 2024 and that roughly 45% of that revenue came from short‑term rentals; he also noted that when the city passed its 2021 ordinance there were about 345 permitted properties and that count has risen to roughly 574 properties in LaPorte County. City staff reported a low registration compliance rate among known listings and said someone on staff has been assigned to identify all short‑term rental properties in the city.

Speakers described practical enforcement limits. A person identifying themself as a Police Department staff member said police handle noise and similar complaints while code enforcement handles ordinance citations, but that code enforcement is “overwhelmed” and lacks the staffing to pursue many violations. Workshop attendees proposed operational changes that could be implemented or considered, including requiring a local, on‑call property manager or owner within a set distance, a minimum‑stay requirement (two nights or longer was suggested by several hosts), occupancy limits set by the fire marshal and neighborhood density caps (one attendee noted a model that limits new permits in a high‑density area).

Short‑term‑rental hosts in the room described internal controls they use — vetting, guest ID checks and requiring neighbor contact information — and some hosts argued market forces will reduce problematic listings over time. “Supply and demand steers the market, not regulation,” said Ian Osborne, who identified himself as an Airbnb superhost and long‑time host; Osborne also urged the council to focus enforcement on harmful behavior rather than a categorical prohibition.

There were no formal votes or ordinance changes at the workshop. Instead, staff and council members said they would return with legal guidance about what the city may do in light of recent state actions and would bring possible regulatory options to a follow‑up workshop. Holter closed the session by scheduling the next workshop for June 10 and inviting written comments and data from residents and stakeholders.

The meeting left several specific questions unresolved: how many noise calls can be cross‑matched easily to registered short‑term rental addresses, whether any portion of county innkeeper tax revenue could be allocated to local code enforcement on peak weekends or holidays, and how strictly the city can limit permit density or require owner proximity under state law and local precedent. Council members said city attorneys are reviewing those questions before potential ordinance language is drafted.