Appleton considered changing rules for short-term rentals, but city stuck with status quo
APPLETON — Appleton is home to the most short-term rentals among the Fox Cities, but it doesn't have local rules in place beyond regulations required by the state.
A few years ago, neighbors pushed back against an Airbnb near Pierce Park, prompting the city to consider adding oversight for these kinds of properties — also down as "tourist rooming houses" and "VRBOs."
Ultimately, Appleton decided it was comfortable with what it already had.
The city hasn't reinvestigated the issue since then, and the recommendation previously made by city staff essentially remains the same, Kara Homan, Appleton's director of community and economic development, said last month.
The Post-Crescent is looking at how Appleton handles this topic as part of a series focused on short-term rentals in the Fox Cities. The newspaper previously explored Neenah's permit system, and why it's so tough to pinpoint exactly how many listings are operating in the area.
Articles in the coming weeks will delve into other issues, including the potential effects on hotels, neighborhoods and the housing market.
City sticks with code, licensing process already in place
In late 2020 and early 2021, neighbors raised concerns about a short-term rental on South Summit Street, claiming it changed the character of the neighborhood. They urged the city to put more controls in place.
Around that time, a group of alderpersons asked city staff for "a policy analysis," and "a recommendation" on what to do about Airbnbs, according to Homan.
A team of community development and public health employees "really dug into" what was already on the books, Homan said, as well as what issues they were trying to solve and what the city was allowed to do "from a statutory perspective."
In 2017, Wisconsin lawmakers limited local regulations of vacation rentals. Municipalities cannot prohibit rentals of seven to 29 consecutive days, according to the Wisconsin Hotel and Lodging Association, but they can:
Require a local permit;
Limit the total consecutive days rented, with a 180-day minimum; and
Prohibit rentals for less than seven consecutive days.
Appleton Health Department issues tourist rooming house licenses, as an agent of the Wisconsin Department of Agriculture, Trade and Consumer Protection. The license requires an inspection, checking for general sanitation and safety items.
Appleton's municipal code also has sections that would apply to issues with problem properties, Homan said, such as maintenance and noise.
So, city staff decided that "we had existing regulatory tools on the books that could alleviate or address most of what was being discussed" at the time, according to Homan. And "the way that state statutes are written really prohibit any extensive additional regulation of VRBOs," she said.
"Really, our hands were tied to do anything further."
Still, the staff recommended the city do a better job of educating short-term rentals about the licensing process, she said.
During the 2019-20 licensing year, Appleton's health department recorded 10 licensed tourist rooming houses, according to Steve Kihl, environmental health supervisor. In late 2023, there were about 82.
Appleton also wary of legal challenges, alderperson says
While reviewing its Airbnb policy, Appleton also looked how other communities handled the issue, according Alex Schultz, alderperson for the Summit Street residents. The city realized, he said, that other attempts to regulate "would likely result in legal challenges similar to those faced by the city of Neenah."
"I think any municipality is certainly adverse to finding themselves in court trying to battle some ordinance they put in place," Schultz said.
Neenah is one of the few municipalities in the Fox Cities that have implemented local rules. The city tried to "find a happy medium between no regulations and over regulating," when it put its tourist housing ordinance in place in 2017, according to Brad Schmidt, Neenah's deputy director of community development.
Not long after, state law was updated. In 2022, the Wisconsin Realtors Association, Inc., challenged Neenah's ordinance in court, arguing it violated state statute. In the end, the city had to make one tweak to its rules.
"I think, overall, the ordinance has done what it's intended to do, and I think it’s worked very well," Schmidt told The Post-Crescent in late 2023.
Recently, the Wisconsin Realtors Association also threatened legal action against Ashwaubenon over the village's vacation rental rules. The group has filed similar notices across Wisconsin, the Green Bay Press-Gazette reported.
Summit Street operator says his properties are quiet, professionally maintained
The disagreement on Summit Street has since calmed down, according to Schultz and Mark Biesack, whose company, Powerhouse Properties 920, manages the rental.
Biesack operates about 100 listings around in Wisconsin, he said. Of the roughly 82 licensed tourist rooming houses in Appleton, Biesack estimates about half are his. Biesack's team work closely with Kihl and the city's health inspectors to get listings licensed and inspected, he said.
It takes time, according to Biesack, to prove that short-term rentals are different than people might initially think. People hear horror stories about large parties at Airbnbs, but Biesack said his properties are respectable and professionally maintained. His team introduces themselves to neighbors and assures them that they're just a call or text away, he said.
Since the pushback a few years ago, Biesack said he's had residents on Summit Street reach out to book the short-term rental there for relatives to stay in while visiting for the holidays.
In Biesack's experience, people eventually get on board with short-term rentals. They may not be full-out supporters, he said, but they start to see the value.
Local resident still thinks city should still take action
Bryan Moran lives on Summit Street, and the people who stay at the nearby Airbnb are kind and considerate, he said.
What Moran takes issue with, he said, is that third-party property managers operate these rentals in residential neighborhoods. Sometimes, the homes are owned by people who live outside the area or the state, and Moran worries that takes away opportunities for local residents to buy a house.
Moran's focus now is on the city, "and my frustration with them not having regulation or code that is adequately regulating these."
"My opinion is that they're way behind on this," he said.
Moran understands that Appleton is probably "hesitant to put anything strong in place with teeth because they don't want to get sued." Still, he said, he'd like to see "more stringent" rules, similar to Neenah's.
Airbnb-type properties aren't technically doing anything "wrong," he said. But Moran has found that "if you live right next to a short-term rental, you're more likely to have strong feelings regarding those," he said, "as opposed to somebody who lives down the block from them, or even in a neighborhood that doesn't have any.”
Essentially, Moran said, “if it’s not next to you, it doesn’t affect you.”
More: It's tricky to tally up all of the short-term rentals in the Fox Cities, but here's what we found.
Appleton alderperson has since opened an Airbnb
Alderperson Schultz and his wife currently operate a short-term rental called SevenTwenty on West Front Street in Appleton, which is licensed with Appleton Health Department as a tourist rooming house. The Airbnb listing notes that Shultz "serves on the City's Common Council."
Schultz said they welcomed their first guest in June 2022, after Appleton decided to stick with the status quo in regulating Airbnbs.
"That outcome had no bearing or influence on my decision to create" a short-term rental, Schultz told The Post-Crescent last month.
By operating an Airbnb, "I certainly gained another perspective," Schultz said, "but I still feel like STR ownership and massing should have constraints balanced with the needs of the community and the locality of close-knit neighborhoods."
"That hasn't changed," he said.
Schultz's listing "showcases the rich history of Appleton," he said, and the property highlights local entrepreneurs by offering guests coffee from ACOCA, beer from McFleshman's Brewing Co., and bread from Stuc’s Pizza, among other items.
"Of course, we were anxious about our neighbors' reactions to creating a (short-term rental home) since we all had a rich and memorable history with the previous owners," Schultz said in an email, "but this neighborhood has been accepting and delighted that we chose to convert the home and preserve its charm for others to experience."
Short-term rentals need to pay fees, get inspected in Appleton
It's difficult to identify exactly how many short-term rentals are operating in the Fox Cities, but there are likely more than there are licensed.
The Post-Crescent identified about 85 listings in Appleton in late 2023 by compiling data from state and local agencies. Meanwhile, The Fox Cities Convention and Visitors Bureau determined there may be as many as 277 in Appleton, based on 2022 market estimates. The city recorded 82 licensed tourist rooming houses late last year.
When Appleton Health Department learns about a short-term rental operating without a tourist rooming license, Kihl said the agency contacts the property about the steps it needs to take.
People can learn more about the process and find the license application at appleton.org/residents/health/short-term-rental. There is a $200 one-time, pre-inspection fee and $220 annual license fee, according to Kihl.
Properties also need an inspection before getting licensed. Kihl said his team generally looks at cleaning practices, smoke detectors, fire extinguishers and other items outlined in Wisconsin Administrative Code ATCP 72.
Appleton will continue to monitor rentals in city
Most of the Airbnbs that Schultz is aware of in Appleton are pretty quiet, without a lot of issues. There may be a car parked on a street once in a while, he said, but no major conflicts. Similarly, Homan said her department isn't really receiving complaints about these kinds of properties.
Still, short-term rentals are a "challenging" issue, with pros and cons, according to Schultz. The city needs to continue to monitor these, he said, and respond if things get out of hand.
“But at this point, I think where we are right now and how we're operating based on state statute is a good place to be," Schultz said.
Biesack, of Powerhouse Properties 920, agreed. Appleton has a good policy, he said, and the city stays on top of inspecting and licensing properties and collecting room tax.
For the amount of short-term rentals the city has, Biesack said "personally, I think that's enough."
Editor's note: This article is part of a series about short-term rentals in the Fox Cities that will publish in the coming weeks. Do you have experience with such rentals, either as an owner, customer or neighbor, that you'd like to share? The Post-Crescent wants to hear from you.
Reach Becky Jacobs at bjacobs@gannett.com or 920-993-7117. Follow her on Twitter at @ruthyjacobs.
This article originally appeared on Appleton Post-Crescent: Appleton relies on existing code, state license for short-term rentals
