Planning commission recommends owner-occupied short-term rental rules to City Council

The Fountain Green Planning and Zoning Commission voted to recommend that the City Council adopt an ordinance allowing short-term rentals on an owner-occupied basis, with additional operational conditions and a requirement that a local responsible party be available within 30 minutes.

Commissioners said the body reached that recommendation after discussing three options: prohibit short-term rentals, allow only owner-occupied rentals, or allow non-owner-occupied rentals. Commissioners favored starting with the more restrictive owner-occupied approach so the city can “test the water” before loosening rules. One commissioner summarized the compromise as starting restrictive and moving to less restrictive later if community feedback supports it.

The recommended rules, as discussed, include: defining owner-occupied as the owner’s primary residence for at least 180 days (roughly 51% over a 12-month period); requiring a designated local representative able to respond within 30 minutes during a rental period; and tying guest limits to the size and accommodations of the dwelling rather than a fixed arbitrary number. Commissioners also asked staff to clarify language so the ordinance applies to residential units that may exist within commercial buildings (for example, apartments above Main Street businesses) if those spaces meet dwelling standards such as smoke alarms and egress.

Commission discussion raised local concerns and use cases. Some commissioners said owner-occupied rules would discourage investors buying multiple properties for continuous short-term rentals, while others noted seasonal family needs and local events that make short-term rentals desirable. Commissioners also discussed enforcement mechanisms tied to business licensing and inspections.

At the end of the discussion the commission passed a motion to recommend the proposed short-term rental ordinance to the City Council with the changes noted (clean the document, ensure owner-occupied wording is clear, and incorporate the occupancy/size accommodation language). The commission asked staff to produce a single, cleaned final draft for the council showing those edits.

Commissioners said they expect to re-evaluate the ordinance after a trial period and to consider loosening restrictions later if problems do not arise.

"Start with the more restrictive. It's always easier to go less restrictive later than the other way around," said one commissioner during the discussion, reflecting the majority view.

The commission did not set a firm citywide cap on the number of short-term rentals; members discussed that limiting ADUs or rentals by number may not change overall resource demand, but traffic and transient usage patterns would be a consideration for enforcement and licensing.