Louisville Short Term Rental Zoning Win

by | Jan 24, 2019 | Laws and Regulations

Short Term Rental Zoning

The Louisville Planning Commission awarded a major win for short term rental zoning in Louisville, KY today. In a unanimous vote of 7-0, the Planning Commission voted to recommend no changes or restrictions to current residential short term rental zoning requirements for non-owner occupied properties. This comes on the heels of a vote by Metro Council in December to not impose a moratorium on new non-owner occupied short-term rentals.

On 12/18/18 Metro Council tasked the Planning Commission with reviewing the current short-term rental zoning ordinance and making recommendations for changes or improvements. Public comment was gathered in August and September 2018, through the City’s website, and testimony was heard by the Planning Commission at two public meetings.

Today’s Vote

Today’s vote considered three options: Option 1 – Prohibit all non-owner occupied short-term rentals in residential zoning, Option 2 – Prohibit non-owner occupied short-term rentals in single-family residential zoning, Option 3 – continue to allow non-owner occupied short-term rentals in all residential zoning. Not being discussed tonight were owner-occupied properties and commercially zoned properties.

The second item for discussion was whether the Planning Commission should recommend limiting the total number of occupants in an STR to 10. This, too, was voted down siting occupancy limitations within the existing ordinance (two times the number of bedrooms plus 4), as well as the Board of Zoning Adjustments (BOZA) ability to restrict the number of occupants below the current standard based on the individual merits of a property. BOZA is the governing body who currently oversees the issuance of all conditional use permits (CUPs) for non-owner occupied STRs.

Additional Short Term Rental Zoning Recommendations

Additional regulations for STRs that were created by the Planning Commission, and recommended to Metro Council for consideration are:

  • An increase in the annual registration fee for all STRs from $25 to $100
  • Display a copy of the registration on the property in a visible location.
  • Contact information for the property owner and Management Company or host be sent by certified mail to tier 1 neighbors.
  • A requirement for the inspection of the property by the Fire Marshall or a licensed home inspector.

In addition to these recommendations, the Planning Commission unanimously passed a motion suggesting Metro Council consider a funding source for the operational expenses associated with enforcing current STR laws. Both side of the topic fully agree that the primary issue is enforcement of existing laws and adding additional legislation is not the solution.

Tonight was the second public meeting where additional public testimony was heard and the Zoning Commission was prepared to make a vote.

The first public meeting was held in early December where the audience was heavily in support of short-term rentals and opposed to any zoning restrictions. The Planning Commission requested a continuance following that hearing in order to further explore the topic and related law so an informed decision could be made. Tonight’s second public meeting was held in a moderately filled auditorium in the Old Jail Building. Twenty-three people spoke – twenty were in favor of short-term rentals without any zoning restrictions, one party was neutral, and only two were opposed.

Next Steps

Tonight’s recommendations will be passed to Metro Council, where it will be handed to the subcommittee on zoning and annexation for review and further discussion. Following that one of three things will happen: 1) Nothing, 2) They will vote to pass the recommendations as-is to Metro Council for a full vote, or 3) They will recommend certain parts to Metro Council and/or add additional elements to the recommendation for a full vote.

Short-term rentals are properties that are rented out for a period of 29 days or less. In Louisville, they can be single family or duplex residences, some condominiums, and almost all commercially zoned property meeting certain location criteria. Neighborhood groups, primarily in the Highlands and Cherokee Triangle Areas, have voiced concern over the number of non-owner occupied short-term rental properties that have become available in a short period of time.

Jonathan Klunk, CEO of short-term rental management company Key Source Properties weighed in, “Tonight’s vote was an informed vote by a fair and knowledgeable group of people who want what’s best for this city. I applaud them for being able to see short-term rentals on their merits and how vital they have become to our city. Hearing from the individual, responsible hosts is an important ingredient to having a well-rounded view on the matter.  We hope the city will appropriate the necessary funds to enforce existing laws and create common sense ordinances for controlled growth of short-term rentals throughout the city.”

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