Health staff report rise in short-term rentals, outline licensing, safety and enforcement steps

City health staff on March 12 briefed the Board of Health on the department’s tourist rooming house (TRH) licensing effort, reporting substantial growth in listings and describing inspection priorities and enforcement steps.

Todd Schmidt, environmental health technician, told the board that five years ago the city had about 10 licensed short-term rental properties and that the number had grown to about 85 last year. Using the city’s host-compliance software, staff identified listings that remain unlicensed; Schmidt said the software showed about 254 listings last summer and 209 listings in February. He said the department has increased licensing through notification letters and inspections and expects roughly 125–150 licensed properties by the end of the current licensing period.

Schmidt said the primary goal of licensing is “the health and safety of people who live there, or the people that are staying.” Inspections focus on working smoke alarms, carbon monoxide detection, slip-and-fall hazards, adequate egress from sleeping rooms and bed-bunk safety. He said a frequent issue is smoke alarms with missing batteries or nonfunctional units and that many compliance fixes are relatively minor, such as relocating an alarm or installing a handrail.

Schmidt also described a regulatory gray area between state TRH rules and building-code requirements. Wisconsin administrative rule ATCP 72, which applies to tourist rooming houses, defines short-term rentals as stays of less than 60 days; by contrast, the International Building Code has different thresholds (about 30 days) that can affect conversion and building-code triggers. The health department is coordinating with building inspections and the fire department when a property’s use change triggers an R-1 occupancy classification; that classification can require more extensive upgrades such as fire-alarm panels, sprinklers or other building improvements.

As part of the compliance effort, Schmidt said staff mailed five cease-and-desist letters to properties that could not be licensed without building- or fire-code work; he said those properties covered 37 units of lodging. The department has also developed a one-page application and inspection checklist; Schmidt said the current TRH application fee, including pre-inspection, is $520. He estimated that a non-primary short-term rental with typical occupancy and nightly rates could produce roughly $30,000 annually, a figure he used to illustrate economic incentives for some operators.

On enforcement, staff told the board that the department has an operating-without-a-license fee and that citation authority exists, but that no citations had been issued as of the meeting. The department said it is developing policies and workflows for citations and that staffing is currently limited (one full-time equivalent assigned to the work), which affects how fast the city can bring all licensable units into compliance.

Board members asked about guest counts, parking and how hotel-motel licensing differs from TRH licensing. Schmidt said single-family residential short-term rentals typically are limited to 10 guests or fewer; properties that host greater numbers or multiple units converted to short-term rentals may require hotel-motel classification and additional building/fire upgrades. He also said some operators listed properties across multiple platforms and the city’s software consolidates those listings for enforcement and licensing purposes.

Schmidt concluded that licensing preserves neighborhood character, raises safety standards and helps put units back on the long-term market, which staff said may ease housing supply pressure over time. The board received the report for information; no board action was taken.