Evanston staff present two draft ordinances on vacation rentals; committee refers code changes for further review

The Housing and Community Development Committee reviewed proposed amendments to Evanston’s vacation‑rental regulations on Oct. 21 and voted to refer changes to Title 5, Chapter 9 of the city code for further review.

Anderson Roman, Building and Development Services Manager, presented two draft ordinance options. Both drafts broaden the definition of short‑term rentals to include furnished dwellings rented for less than one year, and both define an “owner‑occupied” unit as one occupied by the owner for 183 days or more. The two alternative drafts differ on whether to permit non‑owner‑occupied rentals: one option would prohibit them outright; the other would allow non‑owner‑occupied rentals subject to restrictions including a citywide cap and ward‑by‑ward limits.

Under the version that allows non‑owner‑occupied units, staff proposed caps that would permit up to 35 short‑term rental licenses per ward (a citywide theoretical maximum larger than the present inventory). The draft also raises renewal fees (renewal fee example raised from $150 to $500 in the draft), requires non‑owner‑occupied listings to have a property manager who resides within 10 miles of Evanston, and establishes an appeals route so applicants denied by staff could seek reconsideration from the Planning and Development Committee.

Council members asked clarifying questions about enforcement and equity. Committee members expressed concern that large, investor‑owned portfolios could concentrate licenses and urged the city to consider limits per owner (several members suggested no more than one or two non‑owner‑occupied licenses per owner). Anderson Roman said staff’s enforcement work uses newly acquired software to identify listings on hosting platforms and that platforms often collect hotel‑tax revenues regardless of whether a unit is licensed.

Committee members also requested legal analysis of the risk of litigation if non‑owner‑occupied rentals were prohibited outright; Mr. Roman said some jurisdictions have faced lawsuits under takings or commerce‑clause theories. Committee members discussed potential carve‑outs and geographic limits; staff said they had not included precinct‑level petition provisions or building‑level percentage limits but could consider them as the draft evolves.

After discussion, the committee voted to refer the proposed changes to Title 5, Chapter 9 to council for additional consideration and asked staff to return with legal exposure analysis, enforcement options, and an analysis of tax and revenue impacts. The committee also asked staff to model alternatives such as a per‑owner cap and building‑level limits on short‑term units.

No amendment of the code was adopted Oct. 21; staff will return with refined draft language and analysis before any final council vote.