A Walworth County official says the rollout of new ordinances governing short-term rental properties has gone more smoothly than expected, despite a recent court ruling against the county’s previous ordinances.
Shannon Haydin, deputy director of the Walworth County Land Use and Resource Management Department, said officials have issued eight licenses since the county board passed the ordinances in April.
Although that’s a fraction of the short-term rental units operating in rural parts of the county—estimated to be around 170—Haydin said 28 applications have been submitted, exceeding her initial expectations.
The new ordinances establish a $904 application fee, a seven-day minimum stay requirement and occupancy limitations determined by a property’s septic system.
For years, short-term rentals have been a litigious topic in Walworth County. An abundance of lakefront properties make the area attractive for tourists, many of whom prefer to stay in short-term rentals rather than hotels.
With the rollout of new ordinances, the county has hoped to ease tensions with rental property owners—some of whom have sued the county over unreasonable requirements—and transition from code enforcement to ensuring code compliance.
Linda Hoff-Hagensick, who owns a short-term rental unit near Lake Geneva, led the charge against the county in a 15-person joint lawsuit filed in 2016. On June 14, a court ruled in favor of the rental owners, who sued the county over ordinances approved in 2014.
In the June 14 ruling, Walworth County Judge David Reddy said the county’s previous ordinances were “arbitrary” and “unreasonable,” according to online court records.
Reddy said the 15 short-term rental property owners had displayed an intent to turn their homes into investment properties. He said the homeowners would have experienced significant financial losses under the county’s 2014 ordinances, adding that they would be grandfathered into to the county’s new ordinances.
“I’m just very sad for the misunderstanding in the community and the bad feelings that were stirred up,” Hoff-Hagensick said. “We’re not wealthy people. I think it was a very polarized situation. And I do think there were some bad apple private landlords. I don’t think that’s a majority of us.”
Hoff-Hagensick said she doesn’t take issue with the county’s new ordinances. She supports code enforcement and said she has been licensed with the state since 2014. She said she will complete her county license soon.
Attorney Martin Murphy, who owns three short-term rental units near Lake Como, has filed a lawsuit against the county in federal court, contending that some aspects of the ordinances are unconstitutional.
Despite the pending lawsuit, Haydin said the county will have some precedent and clarity with enforcement as a result of the June 14 ruling.
Haydin said the county will now consider how its code enforcement will fare in court. If the county thinks a short-term rental owner might be grandfathered under the new ordinance—which would dismiss the seven-day minimum stay requirement—county officials will not pursue enforcement.
“This will be a summer of pruning people,” Haydin said. “I’d suspect the people who have gone to litigation ... will probably be left standing for the long term.”
Applicants for the county’s short-term rental license must first obtain their state licenses, which Haydin said has led to fewer applications being submitted to the county.
In April, Haydin said 50 percent of short-term rental owners in the county remained unlicensed with the state.
Other small issues that have cropped up with county applications include questionable septic systems and missing site plans.
So far, the county has not issued any citations to those who rent their properties to tourists, Haydin said. She said county officials are willing to work with property owners who are compliant.
“I was a little bit discouraged the first couple of weeks,” Haydin said of the ordinance rollout. “I’m starting to feel a little more optimistic that people are getting around to it. I would grade it a ‘C.’ I would’ve expected an ‘F.’”