The town has reached a pivotal stage in its controversial, yearlong pursuit of regulations that could reverberate up and down the peninsula
The question of how much is too much can divide tourism communities such as Door County. On one hand, tourists pumped $374.4 million of direct spending into the local economy in 2019, with another $106.2 million injected through indirect spending.
On the other hand, the lines of traffic, overcrowded beaches and trails, and preoccupied businesses and services cause aggravation for local residents. When some of that desirable-yet-inconvenient industry shows up next door, patience can run out. There, in the middle, lie local municipalities.
Several municipalities in Door County are considering ordinances that seek to regulate a balance between property owners who are legally allowed to use their properties as short-term rentals (STRs), and property owners who seek protection for their quality of life and neighborhood stability.
“People who want the town to take some action caused this whole effort to be taken in the first place,” said Dan Woelfel, Sevastopol Town Board chair. “They started us down this path.”
That path is an STR ordinance that the Sevastopol Plan Commission has been working on for more than a year. The town will take public comments on it May 11 during a public hearing at the town hall.
Also known as “tourist rooming houses,” STRs are any residential dwellings offered for rent for a fee and for fewer than 29 consecutive days. They are required to be licensed, and their owners pay income and room taxes that are put back into the community. They’re owned by property owners who are legally allowed to rent those properties. They contribute to family incomes as well as the tourism industry while supporting other local business operators such as landscapers, cleaners, electricians, plumbers and contractors.
Some accuse STRs of destroying the quiet culture of local neighborhoods through a revolving cast of transient neighbors who change every few days, of taking affordable housing and long-term rentals off the market, and of threatening the environment by allowing the number of people in the home to surpass the septic system’s demands. Some STR owners also skirt the law that requires them to obtain a license to operate from the state’s Department of Agriculture, Trade and Consumer Protection, as well as a permit from the Door County Tourism Zone Commission (DCTZC).
Sevastopol’s ordinance seeks to correct these issues by addressing septic systems, noise and pets, for example. It establishes minimum standards for human occupancy and adequate levels of maintenance, and it determines the responsibilities of owners, agents and property managers.
These are objectives many STR owners embrace. That’s the frustrating part of Sevastopol’s process, said Kimberly Hazen, who owns two STR cottages in Liberty Grove and 16 long-term housing units in Sister Bay. When she began her Home Sharing Hosts Facebook page a couple years ago – the page now has 338 members – it was so that STR operators could support and learn from each other. She worked with the DCTZC to help develop the Good Neighbors Best Practices policy.
“Basically, it’s all the things that people visiting Door County need to know,” Hazen said. “Nobody wants a bad guest.”
Where STR owners say the ordinance goes too far is in the controversial regulation that restricts how often the STR can be rented. Wisconsin law allows a municipality to prohibit rentals for fewer than seven consecutive days in a residential dwelling, or to limit the total consecutive days it can be rented to 180.
Instead, Hazen said her take on Sevastopol’s ordinance is that it’s a knee-jerk reaction to a few rogue hosts and bad guests.
“All of us need to make sure we clearly identify the problem we’re trying to solve,” Hazen said. “To this end, STR owners would love a chance to be part of the solution.”
In an earlier draft, the ordinance would have required guests to stay a minimum of six consecutive nights. When the average stay at an STR is between two and four nights, the six-night minimum would have achieved two things, said Rob Esposito, a Sturgeon Bay resident and owner of DoCo Vacation Rentals. His company manages 11 vacation properties in Baileys Harbor, the Village of Egg Harbor and Sturgeon Bay.
“There would be no off-season rental business,” Esposito said, because a drive-to destination such as Door County draws off-season visitors for a short getaway. Secondly, “it would put an end to a lot of cottage rentals. If that’s their goal, it’s a good way to do it.”
The Sevastopol Plan Commission changed that language. The latest draft says rentals may not begin until at least seven days after the first day of the preceding rental, unless the subsequent rental is for a period of at least seven consecutive days.
“We’re trying to find some common ground,” said Linda Wait, chair of the Sevastopol Plan Commission and town board supervisor.
STR property owners don’t see the new language as any less restrictive.
“It effectively limits the ability of someone renting their home,” Hazen said. “That was essentially the problem with the first iteration.”
The two STR ordinances already adopted in Door County, within the City of Sturgeon Bay and the Village of Egg Harbor, don’t use regulatory authority to limit rentals. Sevastopol’s ordinance would be the first to do so if it were adopted, and it could then serve as a model for other Door County communities. That’s why the stakes extend beyond the 66 STRs located within the town’s borders.
“The ordinances we’re layering on are not going to solve the problems we’re trying to solve and will just hurt Door County in the long run,” Hazen said.
She and other STR owners are fighting the ordinance. They started two online petitions, hired an attorney and set up a GoFundMe page to cover legal expenses. They’ve also formed a new member-based nonprofit corporation called the Door County Vacation Rental Association.
Mediation Offers Rejected for Now
Some STR owners have sought ways to bridge the chasm between the town and STR community. Mike Kahr, a Sevastopol resident and local contractor who owns a couple of STRs, presented a resolution to the town with others during the annual meeting in April.
“Why can’t we just sit down and talk?” Kahr asked.
The resolution directed the town board to engage with short-term-rental operators and a mediator through Destination Door County. The advisory resolution passed, 10-5. Town Chair Woelfel said he handed it to the town’s plan commission.
“The entire STR effort is at the plan commission level” at this stage, Woelfel said. “We’re just going to let them decide what their thoughts are [about the resolution].”
It wasn’t the first time mediation had been introduced. Jack Moneypenny, Destination Door County’s executive director, said his organization extended an offer to pay for an unbiased, third-party mediator to sit down with the town leaders and the STR community.
“We did think mediation was a good option, and to invest some dollars to build a bridge and help people with this,” Moneypenny said.
That offer is still on the table and codified in a letter, Moneypenny said, but it has been declined for now.
“They said, ‘Thank you, but no thank you; we’ll proceed with the public hearing,’” Moneypenny said.
Woelfel said they declined the offer because the May 11 public hearing should precede any mediation efforts.
“The whole idea of the hearing is to gain continued input,” Woelfel said, because the town has already collected feedback from both sides via email, phone calls, letters and public participation for more than a year.
County Involvement Not Likely at This Stage
As more Door County municipalities wrestle with the STR ordinance process, some have called upon county government to take the lead to create consistency among Door County’s municipalities.
STR regulation is not currently on the county’s agenda, according to Door County Board Chair Dave Lienau, other than watching what other counties may be doing. Mariah Goode, director of Door County Land Use Services, said the Door County Resource Planning Committee’s members discussed STRs back in January because they knew towns were looking at ordinances, and the staff receives many calls about STRs.
But there are several barriers to county action. First, there’s the problem of license monitoring and complaint-based enforcement on some 1,500 units. Second, not all the towns would be on board with a county solution.
“Let’s say the county did figure out how to regulate and magically did find the staff or money to enforce,” Goode said. “I think it’s very unlikely the county would do the minimum-night stay or the maximum-night stay over the course of a year.”
Sevastopol is considering outsourcing compliance. One company, Granicus, made an offer, good until June 2021, of $7,032 annually for address identification, a 24/7 hotline, and compliance and rental-activity monitoring.
Hosting Door County Guests a ‘Centuries-Old Business’
Esposito takes a different approach to his STR business. He said he won’t put one in any of Sturgeon Bay’s residential neighborhoods.
“The affordable-housing market is hard to come by, and anything going to vacation rentals doesn’t help,” he said.
He believes Northern Door communities should be more lenient when it’s “literally a centuries-old business” to rent the family cottage to guests. And of the 66 residential STRs that Sevastopol has identified within the town, 91% were located near the Green Bay and Lake Michigan shores.
“To me, there’s a difference between a neighborhood and Bay Shore Drive,” he said. “And let’s face it: A house on Bay Shore Drive is not going to freeze someone out of affordable housing.”
Growth in Short Term Rentals
Short-term rental (STR) properties are the fastest-growing category in the local tourism-lodging sector. According to the Door County Tourism Zone Commission (DCTZC), revenue from these homes, cabins and cottages grew 228.71% from 2009 to 2020: from $8.1 million in 2009 to $21.7 million in 2020.
STR properties have multiplied as their popularity increases among travelers who want to live like a local for a few days. STR availability in Door County increased 51.48% from 2009 to 2020, a time frame that saw availability in the traditional lodging sectors slide backward or stagnate.
“The growth in the lodging industry is STRs,” said Kim Roberts, DCTZC administrator.
About 1,500 STR units in Door County fall into the STR category. Fueling their growth are online home-sharing platforms, predominantly Airbnb and Vrbo, which have made it easier than ever for property owners to rent their homes to guests. In October 2013, a guest could find 15 properties marketed on Airbnb, Roberts said. As of April 2021, there were 710 Airbnb listings for Door County properties and another 627 on Vrbo. Many of those properties are listed on both platforms.
If You Want to Participate
The Town of Sevastopol Plan Commission will hold a hearing to take public input on its draft Short Term Rental Ordinance on Tuesday, May 11, 5:30 pm, at the Sevastopol Town Office, 4528 Hwy 57.
Those who wish to speak are encouraged to sign up in advance by contacting Amy Flok, Sevastopol town clerk/treasurer, at 920.746.1230 or [email protected].
The advance sign-up is being done because the town office can seat only 25 people under social-distancing guidelines. Only those who are there in person may comment. If the 25-person maximum is reached, additional participants will be asked to wait outside, and Flok will call them when it’s their turn to speak.
Speakers will each have three minutes to comment. Plan commission members will not respond to comments. Voting residents will speak first. Those who do not sign up in advance will speak last.
People can watch the hearing on the town’s live Charter channel, at the Institute Saloon and livestreamed on the town’s YouTube channel, Shermanbay. (Search on YouTube or Google. The logo is a photo of a cat.) The town is in the process of acquiring its own channel, which may happen before the hearing. Visit townofsevastopol.com for the latest information.
The hearing is allowed to last until midnight. If more time is needed, the hearing will be reconvened the following day.
After the public hearing, the plan commission will meet May 13 to discuss the input. The Sevastopol Town Board will then hold its regular meeting May 17, when the ordinance may be on the agenda for a vote.
At a Glance
The Town of Sevastopol’s Short Term Rental (STR) draft ordinance would not allow rentals until at least seven days after the first day of a preceding rental, unless the subsequent rental is for a period of at least seven consecutive days.
The ordinance requires a licence from the town; regulates parking, pets, signage and noise through existing town ordinances; prohibits campers and tents on the property; and limits occupancy to the type of sewer system serving the home. Fireworks are strictly prohibited. The property owner must live within 75 miles of Door County, or if there’s a manager, the manager must live within Door County. All neighbors living within 200 feet of the STR must be provided with 24/7 contact information.
STRs are already required to be licensed through the Wisconsin Department of Agriculture, Trade and Consumer Protection; and to have a permit from the Door County Tourism Zone Commission.
Proof of both of those licenses would be required to obtain the Sevastopol permit. The initial application fee for Sevastopol’s permit would be $500, and $350 annually thereafter, with a $100 fee for inspections as needed.
If the Sevastopol Town Board passes the ordinance, which could happen as early as this month, it could be activated as soon as July.