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23147 Staff Report for the Short Term Rental Affirmative Obligations Text
Amendment, Ordinance 2131
Public Hearings:
Community Development – June 5, 2023
City Commission – June 27, 2023
Project Description: Amend Bozeman Municipal Code (BMC) Section 38.360.260. Short
Term Rentals to include regulation of hosting platforms that facilitate booking
transactions of short term rentals and revise administrative provisions.
Project Location: Revisions to the text are applicable City-wide in all zoning districts
where short term rentals are currently allowed per Division 38.310 – Permitted Uses.
Recommendation: Meets applicable criteria for approval.
Community Development Board Motion: Having reviewed and considered the staff
report, draft ordinance, public comment, and all information presented, I hereby
adopt the findings presented in the staff report for application 23147 and move to
recommend approval of Ordinance 2131.
City Commission Recommended Motion: Having reviewed and considered the staff
report, draft ordinance, public comment, recommendation from the Community
Development Board, and all information presented, I hereby adopt the findings
presented in the staff report for application 23147, and move to provisionally adopt
Ordinance 2131.
Report: June 22, 2023
Staff Contact: Nakeisha Lyon, Associate Planner
Agenda Item Type: Action – Legislative
23147, Staff Report for Short Term Rental Hosting Platform Obligations ZTA Page 2 of 15
TABLE OF CONTENTS
EXECUTIVE SUMMARY ...................................................................................................... 2
Project Summary ................................................................................................................. 2
Unresolved Issues ............................................................................................................... 3
Public Comment.................................................................................................................. 3
Community Development Board ........................................................................................ 4
Alternatives ......................................................................................................................... 4
SECTION 1 - RECOMMENDATION AND FUTURE ACTIONS ........................................ 4
SECTION 2 - TEXT AMENDMENT STAFF ANALYSIS AND FINDINGS ....................... 5
Section 76-2-304, MCA Zoning Regulations Criteria (A-K) ............................................. 5
PROTEST NOTICE FOR ZONING AMENDMENTS ......................................................... 12
APPENDIX A - DETAILED BACKGROUND AND PROJECT DESCRIPTION .............. 12
APPENDIX B - NOTICING AND PUBLIC COMMENT .................................................... 14
APPENDIX C - APPLICANT INFORMATION AND REVIEWING STAFF .................... 15
FISCAL EFFECTS ................................................................................................................. 15
ATTACHMENTS ................................................................................................................... 15
EXECUTIVE SUMMARY
This report is based on the proposed ordinance text and public comment received to date.
Project Summary
Starting in July 2016, The Bozeman City Commission began considering issues related to
short term rentals (STRs) within our community. This ultimately led to the adoption of
Ordinance 1974, which constitute the current standards for STRs denoted in Section
38.360.260 of the BMC. These standards set forth where STRs are allowed to locate based on
type, and require STR hosts to register their rental with the City of Bozeman (City) prior to
operation, and to submit annual renewals. Such registration includes submittal of
information, payment of a registration fee, and completion of a safety inspection prior to city
approval. Since the adoption of these provisions, the prevalence of STRs has increased, and
monitoring of online listings has revealed a significant number of unregistered STRs. The
City has undertaken enforcement efforts to bring more STRs into compliance; these efforts
are time-consuming and costly for city staff.
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Since 2020, the City Commission has received several public comments regarding STRs
from residents, primarily expressing concerns related to long-term rental availability in
Bozeman. Comments received from hosts and property management companies largely
focused on a desire for better enforcement of non-compliant STRs, while calling attention to
the role of STR income in hosts’ ability to meet their mortgage responsibilities and financial
security.
In an effort to balance these factors among other housing concerns, the City Commission
approved the Bozeman Community Housing Action Plan in November 2019, with
amendments in January 2020. This Action Plan recommends on-going evaluation of
regulatory policies related to STRs. Based on these recommendations, the Bozeman City
Commission held a work session in August 2022 to discuss short term rentals.
Within this work session, the City Commission directed staff to update STR regulations in
two phases. The first phase included drafting an Ordinance regulating short term rental
hosting platforms as one measure to increase compliance with existing regulations and to
require regular reporting to obtain more information about STRs in Bozeman. The second
phase will include analysis of the STR types and where they are allowed.
As drafted, Ordinance 2131 (Attachment 1) implements the first phase – regulating hosting
platforms and other measures to increase compliance with existing regulations. It revises the
STR regulations within Sec. 38.360.260 to include obligations for hosting platforms such as
hosting permit requirements for booking transactions, quarterly reporting requirements, and
violation and enforcement provisions regarding the removal of listings from hosting
platforms without a hosting permit. The proposed revisions also include administrative
changes to improve compliance and support enforcement, such as changing the term
“registration” to “permit”, allowing the City to issue administrative subpoenas to obtain
information, requiring hosts to disclose on which platforms they have listed the STR,
requiring regular safety inspections of STRs every three years, and imposing specific civil
penalties for a violation.
Unresolved Issues
None.
Public Comment
Written public comment will be archived and available through the project folder in the
City’s Laserfiche archive. Comments provided orally at public meetings will be available
through the recordings of those public meetings. Links to recordings will be added to this
report as the review of the project moves forward. One written comment and three oral
comments specific to this amendment have been received to date.
Comments regarding this amendment include:
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1. Concerns regarding previous title of item on Community Development Board agenda
being misleading.
2. Concerns regarding the safety inspection requirement every three years by the Fire
Department. (See additional information on page 8).
3. Concerns regarding data collection and reporting requirements of Ordinance 2131.
4. Concerns regarding public engagement with STR hosts for drafting Ordinance 2131.
Community Development Board
The Community Development Board (CDB) met on June 5, 2023 to consider the proposed
amendments. The video recording of the meeting is available through the City’s website.
Discussion of the amendment begins at 7:28 in the recording. Questions to staff begin at
about 19:22 and board discussion at 1:04:19. Three oral public comments were received. The
Board voted 7-0 to recommend approval of the ordinance as written.
Discussion and concerns of the CDB included:
1. Overall support for Ordinance 2131 and the two-phased approach to short term rental
regulation changes.
2. Concerns regarding previous title of item on agenda being misleading.
3. Concerns regarding the safety inspection requirement every three years by the Fire
Department. (See additional information on page 8).
4. Concerns regarding data collection and reporting requirements of Ordinance 2131;
ensuring requested data is necessary for improved compliance.
Alternatives
1. Recommend ordinance not be approved based on findings of non-compliance with the
applicable criteria contained within the staff report;
2. Recommend amendments prior to adoption; or
3. Open and continue the public hearing on the application, with specific direction to staff to
supply additional information or to address specific items.
SECTION 1 - RECOMMENDATION AND FUTURE ACTIONS
Having considered the criteria established for a text amendment, the Staff finds the amendments
meet the minimum criteria for approval as proposed.
The Community Development Board in their capacity as the Zoning Commission held a public
hearing on these amendments on June 5, 2023, at 6 pm. The board recommended the amendment
be adopted.
The City Commission will hold a public hearing on the text amendment on June 27, 2023 at 6:00
p.m. and decide whether the proposed amendments should be codified or not.
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SECTION 2 - TEXT AMENDMENT STAFF ANALYSIS AND FINDINGS
In considering applications for amendment approval under this title, the advisory boards and City
Commission must consider the following criteria (A-D) and guidelines (E-K). As an amendment
is a legislative action, the Commission has broad latitude to determine a policy direction.
A zone text amendment must be in accordance with the growth policy (criteria A) and be
designed to secure safety from fire and other dangers (criteria B), promote public health, public
safety, and general welfare (criteria C), and facilitate the provision of transportation, water,
sewerage, schools, parks and other public requirements (criteria D). Therefore, to approve a
zone text amendment the Commission must find Criteria A-D are met.
In addition, the Commission must also evaluate guidelines E-K as factors for consideration, and
may find the zone text amendment to be positive, neutral, or negative with regards to these
considerations. To approve the zone text amendment, the Commission must find the positive
outcomes of the amendment outweigh negative outcomes for guidelines E-K.
In determining whether these criteria and guidelines are met, Staff considers the entire body of
plans and regulations for land use and development. Standards which prevent or mitigate
negative impacts are incorporated throughout the entire municipal code but are principally in
Chapter 38, Unified Development Code.
The existing municipal code provisions regulating STRs were, at the time of adoption, found to
satisfy all of the required criteria. As such, the focus of this report is only on the amendments
proposed. Where a finding of neutral is presented, it represents that the criteria or guideline has
been considered and the change does not materially advance or detract from compliance.
Therefore, a finding of neutral is not necessarily an indication of a deficiency in the proposed
amendments or the existing standards.
Section 76-2-304, MCA Zoning Regulations Criteria (A-K)
Zoning regulations must be:
A. Be in accordance with a growth policy.
Yes, criterion is met. The proposed amendments are in conformance with the growth policy.
As the growth policy provides a high level vision of how a community hopes to develop over
time, it does not dictate uses or specific standards to the level of detail contained in this
ordinance. However, it does identify issues and priorities for consideration with specific
goals and objectives that are desired outcomes.
The Bozeman Community Plan 2020 (BCP2020), adopted in November 2020, establishes the
City’s policies for growth and regulation of land uses and development. It continues concepts
and community priorities that were established in several prior growth policies. Prior growth
policies encouraged creation of development standards that supported predictable review
processes and addressed areas of community concerns.
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The BCP2020 includes the following relevant goals and objectives:
R-1.1 Be reflective: use past experience to inform future decisions.
R-1.7 Be flexible: willingness and ability to adopt alternative strategies in response to
changing circumstances.
R-2.5 Technical Soundness: Identify solutions that reflect best practices that have been
tested and proven to work in similar local or regional contexts.
DCD-4.1 Implement a regulatory environment that supports the Community Plan goals:
Ensure that the Planning Department is supported with the resources required to
effectively implement this plan, to dedicate staff to long range and regional planning
efforts, and to process development applications expeditiously.
With the increased prevalence of STRs within our community, the amount of unregistered
STRs has become a time-consuming and costly challenge for city staff to monitor and
address. In accordance with goal R-1.1, the City continues to be reflective in its discussions
regarding the existing regulation of STRs in order to inform policy decisions that are
appropriate in addressing code compliance issues. Based on the discussion between staff and
City Commission during the Short Term Rental Work Session, platform compliance is one
unique policy option to help improve and increase compliance with existing regulations by
placing more of a burden for compliance on the booking platforms.
The proposed amendments to Sec. 38.360.260 establish platform liability which gives the
City the right to enforce and enact rules and ordinances that penalize hosting platforms that
do not comply with these regulations. The specific obligations on hosting platforms include
that each STR listing must include the City’s STR permit number prior to the occurrence of a
booking transaction, and hosting platforms are responsible for removing unregistered STR
listings from their software or portals to prevent the booking of unregistered STRs when the
platform knows or should know that the host is not in compliance with City regulations.
These proposed amendments strengthen enforcement mechanisms within the City’s STR
program to ensure platforms, hosts, and operators are in compliance with local regulations.
The proposed amendments demonstrate a willingness to adopt alternative strategies in
response to changing circumstances as it relates to STRs within our community per goal R-
1.7. With the rise in utilization of online booking agencies that facilitate STR transactions
such as AirBnB, HomeAway, and VRBO, municipalities across the nation have successfully
implemented affirmative obligation ordinances similar to Ordinance 2131 in order to verify
that homes offered as STRs are lawfully registered in accordance with applicable regulations.
The ability to identify a solution that aligns with national best practices and has worked in
jurisdictions with similar local and/or regional contexts per goal R-2.5 is also demonstrated
by the proposed amendments. Staff has reviewed the STR programs, ordinances, and hosting
obligation regulations of over a dozen municipalities as denoted within Attachment 2 in
order to draft Ordinance 2131 which incorporates best practices for hosting obligation
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regulations that serve to improve compliance and the ability to enforce regulations on
platforms, owners, and operators within our community.
By meeting the three abovementioned goals, the City also is able to further goal DCD-4.1
which strives to implement regulatory environment that supports the Community Plan goals
by ensuring the Planning Department is supported with the resources required to effectively
implement this plan, to dedicate staff to long range and regional planning efforts, and to
process development applications expeditiously. The inclusion of obligations for hosting
platforms provides the necessary mechanisms needed for compliance by the Code
Enforcement Division under Community Development by allowing for a more proactive
administrative enforcement tool rather than only to assess violators after the fact. The ability
for violations to be placed on both hosts and hosting platforms alike promotes increased
awareness of local regulations and strengthens chances of compliance. These proposed
provisions also encourage hosting platforms to work closely with the City in order to ensure
listed STRs are in compliance and provides accurate STR reporting for comparison and
analysis against the City’s current monitoring and tracking software.
The proposed amendments furthers all four of the abovementioned goals by including
specific hosting permit and administrative changes to the existing regulations to provide a
more effective overall STR program. These proposed amendments improve the safety
inspection requirements associated with the STR hosting permit application process to create
a self-certification process for annual renewals, and a required three year fire inspection after
the initial application for active STRs. The incorporation of language regarding affordable
housing incentives and affordability covenants has also been included to ensure that
dwellings built under these affordability provisions may not be used as a STR. Additionally,
language to more effectively administered the program, remove redundancies, and clarify
provisions regarding renewal of a STR hosting permit, termination of the use of a STR and
procedures for lapsed STR hosting permits have been included.
Finally, the level of detail associated with the text amendment is beyond the specificity found
and intended in the Community Plan.
No element of the proposed ordinance affects the future land use map as the process
amendments do not change land use designations or zoning district boundaries. Therefore, no
analysis of correspondence to the future land use map is provided.
B. Secure safety from fire and other dangers.
Yes, criterion is met. Initial inspections by the City’s Fire department help ensure that
locations are safe to be used as a short term rental. As denoted in Sec. 38.360.230.H.3, a fire
inspection is required prior to the issuance of a hosting permit. As proposed with this
ordinance, subsequent inspections will occur every three years by the City’s Fire department
with a self-certification of compliance required during the years in which an inspection is not
required as part of the annual renewal of a STR hosting permit. If a permit lapses for any
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period of time, a new fire inspection is required upon reapplication for a STR hosting permit.
Additionally, upon evidence of non-compliance, the City’s Fire Marshal may require a fire
inspection as deemed necessary. For example, STRs which lack adequate egress from
sleeping areas, fire suppression or access, or compliance with other adopted safety standards
will not be approved.
Discussion by the Board and public comments received on this text amendment at the CDB
hearing expressed concerns on the new three year safety inspection requirement stating a lack
of justification for this requirement and increased cost to STR operators. The board also
questioned whether this requirement is more stringent than safety inspections associated with
hotels or motels, wanting to ensure if STRs are not being held to a higher level of scrutiny.
The incorporation of a three year safety inspection requirement for active STRs is based on
the expertise of the Fire Marshall and Fire Inspectors whom perform these inspections. Many
requirements of the City’s fire safety inspection checklist require ongoing maintenance (i.e.
smoke detectors and fire extinguishers in operable condition), or may be damaged by guests.
This change will allow the Fire Department to better ensure that compliance with fire and
safety codes continues after the initial inspection of the STR in order to reduce safety
hazards.
Regarding inspections of hotels and motels, the Fire Department performs annual inspections
on these establishments. As a commercial lodging use, hotels and motels are built to a higher
life safety standard than a residential dwelling unit because transient guests are not expected
to learn the patterns and functions (such as egress routes) of a structure on a permanent basis.
As short-term rentals do involve renting to transient guest, but may also involve longer
residential use between rentals, the Fire Department believes inspections every three years
will help ensure safe conditions while not being as onerous as the annual inspections required
of hotels and motels.
All applicable development standards and building code standards for fire resistance, exiting,
and other protections remain in place and are applicable to receive a short tern rental permit.
Building and fire standards and codes are designed to mitigate impacts, provide a safe
environment, and protect from various dangers. Please see response to Criterion C also.
C. Promote public health, public safety, and general welfare.
Yes, criterion is met. The existing standards addressing this criterion remain in place such as
floodplain protections, provision of water and sewer services, and similar. Standards remain
for setbacks, light and air, emergency services, and other issues to protect public health and
physical safety. In addition to the fire inspection required prior to STR hosting permit
approval and issuance, the Health Department’s implementation of state law requires a public
accommodation license for all STRs. A public accommodation license requires an inspection
from a local sanitarian which addresses health and safety standards applicable to this use per
Montana Code Annotated § 50-51-301. Any structure which does not pass these inspections
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will not be allowed a STR permit. The City continues to coordinate its review process for
STRs with the Health Department to ensure that all required inspections have been passed
prior to approval of use of an STR.
Sec. 38.360.230.K.1 includes additional suspension, revocation, and administrative and civil
remedies regarding the operation of a short term rental that may fail to comply with the
Bozeman Municipal Code; create a public nuisance or breach of peace, cause danger to
public health, safety, welfare, or morals; cancellation of any associated licenses or
registrations; and securing a STR permit by fraud or misrepresentation. Civil penalties
denoted in Sec. 38.360.230.K.3 may be applicable to any violation not to exceed $500.00 per
day per violation which is applicable to an owner of any STR and a hosting platform.
Additional standards within the BMC remain unchanged by this ordinance; including a
previously adopted noise ordinance to ensure adequate public safety and a healthy
environment. Applicable noise standards are in Chapter 16, article 6, as applicable. See also
responses to Criteria B and D.
D. Facilitate the adequate provision of transportation, water, sewerage, schools, parks
and other public requirements.
Yes, criterion is met. Standards for the provision of municipal transportation, water,
sewerage, schools, parks, and other public requirements are not being altered with this
ordinance. STRs are the use of an existing dwelling within a residential or non-residential
zoning district. All dwellings must demonstrate adequacy of services at the time of site-
specific development review. The use of a residence as a STR does not materially change the
essential use of the property, demand for services, or the physical characteristics of the
residential use as it applies to this criterion. Therefore, any proposed STR has previously
demonstrated compliance with public requirements. Additionally, billing for sewer or water
consumption will follow standard practice and offset public expenses.
The city shall also consider:
E. Reasonable provision of adequate light and air.
Yes, criterion is met. No changes within these amendments impact basic standards for
setbacks, maximum building height, dedication of parks, on-site open spaces, or similar
standards The City’s development standards and building code ensure adequate provisions of
light and air through window and air circulation/venting provisions, as well as building
setbacks. The maximum occupancy standards for each STR type remain within Sec.
38.360.260.I. 3 & 4 in order to limit excessive occupancy within a residence. Considering the
code as a whole, the standards listed in this criterion are not being changed with these
amendments. These amendments serve to support and reinforce the existing standards
applicable to this criterion, therefore the standard continues to be met.
F. The effect on motorized and non-motorized transportation systems.
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Yes, criterion is met. No changes within these amendments impact basic standards for
parking, sidewalks, dedication of right of way, provision of and construction of streets, or
similar standards. Transportation impacts and parking compliance are addressed at the time
of site-specific development review through an associated planning application and/or
building permitting process. During the application process for a STR hosting permit, the
number of provided off-street parking spaces available for guests’ use must be demonstrated.
Considering the code as a whole, the standards listed in this criterion are not being changed
with these amendments. These amendments serve to support and reinforce the existing
standards applicable to this criterion, therefore the standard continues to be met.
G. Promotion of compatible urban growth.
Yes, criterion is met. An STR is a use of a previously approved dwelling. Any zoning district
that allows homes has been reviewed and found to be consistent with this criterion. These
amendments do not change any development standard which would relate to urban growth
within the City nor impede on the expansion of the City through urban development
practices. Existing standards have been adopted by the City to identify and avoid or mitigate
demonstrable negative impacts of urban growth within the applicable subdivision review
processes, site plan applications, and/or building permitting processes. Therefore,
considering the code as a whole, the standards listed in this criterion are not being changed
with these amendments and therefore the standard continues to be met.
H. Character of the district.
Yes, criterion is met. All zoning districts provide for a variety of principal and conditional
uses which vary by intensity and likely size dependent upon the intention of the district. No
single use defines the entirety of any zoning district. Residences, in some form, are a
principal use within all residential zoning districts. Within commercial, mixed use, and
industrial zoning districts, residential uses may be a principal, special or accessory use. Short
term rentals (STRs) are a form of a residential use and were previously determined to be
consistent with the overall character of each district at the time the adoption of Ordinance
1974. As the proposed “affirmative obligations” ordinance does not change where STRs are
allowed, this criterion remains met.
Structures that contain a STR must abide by the same physical standards for setbacks,
building heights, lot coverage and others which apply in each zoning district. The inclusion
of hosting platform obligations within Sec. 38.360.260.J adds reporting requirements for
hosting platforms to provide STR information to the city and obligates hosting platforms to
remove listings in violation per Sec. 38.360.260.J in addition to other enforcement provisions
within Sec. 38.360.260.K previously mentioned within criterion C. These reporting and
enforcement measures will enable better compliance with city requirements and will serve to
support the maintenance of the character of each zoning district. The combination of uses and
other characteristics remain intact and were previously found to be consistent with this
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criterion. These amendments serve to support and reinforce the existing standards applicable
to this criterion, therefore the standard continues to be met.
I. Peculiar suitability for particular uses.
Yes, criterion is met. Any zoning district that allows homes and STR has been reviewed and
found to be consistent with the criterion. The proposed amendments do not change any
zoning districts, boundaries, or uses within the land development regulations. STRs are the
use of an existing dwelling within a residential or non-residential zoning district which have
previously been found to be appropriate based on their location and conformance with
existing standards. The authorized use tables which denote the types of STRs allowed within
the City are not changing with this ordinance, and have been previously reviewed for
consistency with the intent and purpose of individual districts and found to be appropriate.
These proposed amendments revise the text only and not the zoning map. Placing affirmative
obligations on STR hosting platforms will support compliance with all laws and should result
in removal of listings of STRs that are not in compliance with laws. These measures will help
the City better be able to monitor the compliance of active STRs and ensure the regulatory
requirements are being met which were relied upon in finding zoning consistent with this
criterion. Therefore, considering the code as a whole, the standards listed in this criterion are
not being changed with these amendments and therefore the standard continues to be met.
J. Conserving the value of buildings.
Yes, criterion is met. The proposed amendments do not change any districts or uses which
would cause buildings to become non-conforming to the district in which they are located. The
hosting platform obligations for STRs do not alter the standards for building location, size, or
other physical development standards. The existing standards for STRs offset or prevent the
physical effects of their use. Adequate services such as parking and utilities must be provided
prior to approval of a hosting permit. Considering the code as a whole, the standards listed in
this criterion are not being changed with these amendments. These amendments serve to
support and reinforce the existing standards applicable to this criterion, therefore the standard
continues to be met.
K. Encourage the most appropriate use of land throughout the jurisdictional area.
Yes, criterion is met. The proposed amendments do not alter the allowed uses in zoning
districts nor growth policy designations adopted in the Community Plan 2020. The zoning
map and future land use map of the growth policy identify areas where specific uses, such as
varying forms of residences, are generally appropriate. The use of a dwelling as a STR has
been previously found to be an appropriate use and has similar impacts to other uses allowed
in the zoning districts as denoted in Criterion H. The types of STRs allowed remain
unchanged with this ordinance.
As both the zoning map and future land use map do not authorize construction of residences,
the existing site specific development processes serve to evaluate the appropriateness of a use
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of land in this regard and ensure the use conforms to the necessary development standards.
These standards will continue to be required, therefore, if a dwelling has not already been
approved and deemed appropriate for an area, a STR will not be allowed under this
ordinance. The proposed amendments do change the review process for a STR and includes
additional obligations for hosting platforms which provide specific violation processes to
help ensure that this criterion is met.
PROTEST NOTICE FOR ZONING AMENDMENTS
IN THE CASE OF WRITTEN PROTEST AGAINST SUCH CHANGES SIGNED BY THE OWNERS OF 25% OR MORE OF THE AREA OF THE LOTS WITHIN THE AMENDMENT AREA OR THOSE LOTS OR UNITS WITHIN 150 FEET FROM A LOT INCLUDED IN A PROPOSED CHANGE, THE AMENDMENT SHALL NOT BECOME EFFECTIVE EXCEPT
BY THE FAVORABLE VOTE OF TWO-THIRDS OF THE PRESENT AND VOTING
MEMBERS OF THE CITY COMMISSION. The City will accept written protests from property owners against the proposal
described in this report until the close of the public hearing before the City
Commission. Pursuant to 76-2-305, MCA, a protest may only be submitted by the owner(s)
of real property within the area affected by the proposal or by owner(s) of real property that
lie within 150 feet of an area affected by the proposal. The protest must be in writing and
must be signed by all owners of the real property. In addition, a sufficient protest must: (i)
contain a description of the action protested sufficient to identify the action against which the
protest is lodged; and (ii) contain a statement of the protestor's qualifications (including
listing all owners of the property and the physical address), to protest the action against
which the protest is lodged, including ownership of property affected by the action. Signers
are encouraged to print their names after their signatures. A person may in writing withdraw
a previously filed protest at any time prior to final action by the City Commission. Protests
must be delivered to the Bozeman City Clerk, 121 North Rouse Ave., PO Box 1230,
Bozeman, MT 59771-1230.
As of the writing of this report, no written protest against the changes have been received. APPENDIX A - DETAILED BACKGROUND AND PROJECT
DESCRIPTION
The City Commission spent considerable time on the regulation of STRs in 2016 and 2017
culminating in the adoption of Ordinance 1974 (creating the current standards for STRs
found in the Bozeman Municipal Code in Sec. 38.360.260). The City Commission received a
memo from the Economic Development Department prior to the Short Term Rental Work
Session on August 9, 2022 which has a detailed background of the history of the
Commission’s discussion and direction on STRs, the regulatory structure of the City’s
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existing STR policies, and any previous public outreach and research conducted. This work
session was held with the Commission to discuss short term rentals and their influence on the
local housing market and affordability.
During this discussion, staff presented several policy options for consideration by the City
Commission. This included policies regarding enhancing STR compliance, analyzing the cost
of services for administration of the STR program, further researching potential impacts on
limiting STRs by zoning districts or types, and other regulatory methods. The City
Commission supported improving compliance of STRs with existing regulations by placing
more of the burden for compliance on the STR hosting platforms. Placing affirmative
obligations on STR hosting platforms, like Airbnb and VRBO, require compliance with all
laws, remove listings of STRs that are not in compliance with laws, include the City permit
number and the permit for all STR listings, and provide a quarterly report to the City about
STRs listed on their platforms within City limits. These measures will help the City better be
able to monitor the compliance of active STRs and ensure the regulatory requirements are
being met.
Based on this discussion, the City Commission directed staff to draft an Ordinance regulating
short term rental online booking platforms as one measure to increase compliance with
existing regulations. Since this direction was given, Staff has conducted additional research
in evaluating how imposing affirmative obligations on hosting platforms has been
implemented and functions in other communities, other hosting platform responsibilities, and
recommendations for the City Commission to consider which is detailed in Attachment 2.
This memorandum provides four key recommendations that the City should pursue which
have been incorporated into Ordinance 2131.
In addition to the City Commission’s direction to draft this Ordinance, staff was also directed
to engage with STR owners about potential interest to convert STRs into long term rentals
(LTRs) in order to gather feedback on motivations, incentives, and barriers to converting
STRs to LTRs. This focus group was held on January 18, 2023 between city staff from
Communications, Legal, Planning Division, and Community Housing Program and 13 STR
owners. Further details on these discussions are provided in Attachment 3. One of the main
concerns denoted within these discussions focused on the lack of enforcement and
compliance with existing STR regulations.
With these priorities and discussions in consideration, Ordinance 2131 revises the STR
regulations within Sec. 38.360.260 to include obligations for hosting platforms and
administrative changes to improve compliance and enforcement as discussed below:
Enforcement
• Inclusion of Sec. 38.360.030.J. Hosting Platform Obligations
o Quarterly reporting requirements of hosting platforms to the City of Bozeman
Reports to include; addresses of STRs that have conducted a booking
transaction, the name of the owner or responsible person associated
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with said booking transaction, length of stay for said booking
transaction, and price paid for said booking transaction
o Requirement of the city STR permit number prior to booking transaction.
o Duty to remove STR listings which are in violation of these provisions and
others within the Bozeman Municipal Code
• Inclusion of Additional Violation Opportunities
o Addition of City’s ability to impose administrative remedies and civil action
proceedings
o Addition of civil penalties to be recovered on a violation by an owner or
hosting platforms
Hosting Permit
• Language change from STR Registration to STR Hosting Permit
• Changes to Safety Inspections
o Inclusion of fire inspections every three years after initial for an active STR
o Self-certification on an annual basis
• Removal of noticing requirements for Type 2 STRs
• Removal of City requirement to maintain an online listing of all STR Hosting Permits
• Clarification on renewal process, termination of use, and requirement for new hosting
permit if lapsed
Administrative Changes
• Residences receiving affordable housing incentives and under affordability covenants
may not be used as a STR
• Inclusion of application to include all hosting platforms in which the STR will be
listed
• Addition of ability of the City to issue administrative subpoenas if necessary to obtain
information regarding a STR or booking transaction
Definitions
• Inclusion of booking transaction definition
• Expansion on hosting platform definition
• Inclusion of evidence to be provided for owner occupancy
• Removal of furnishing characteristic related to transient occupancy
APPENDIX B - NOTICING AND PUBLIC COMMENT
Notice for text amendments must meet the standards of 38.220.410 & 420. Notice was
published in the Bozeman Daily Chronicle on 5/20/2023, 6/03/2023, and 6/17/2023. These
notices contain all required elements. Notice was provided at least 15 days before the public
hearing conducted by the Community Development Board in their capacity as the Zoning
Commission, and not more than 45 days prior to the City Commission public hearing.
Hearing dates are on the first page of this report.
23147, Staff Report for Short Term Rental Hosting Platform Obligations ZTA Page 15 of 15
One written public comment and three oral public comments ha been received so far on this
Ordinance. Comments are available through the Laserfiche archive and the video recording
of the CDB meeting starting at 54:23.
Comments regarding this amendment include:
1. Concerns regarding previous title of item on agenda being misleading.
2. Concerns regarding the safety inspection requirement every three years by the Fire
Department. (See additional information on page 8).
3. Concerns regarding data collection and reporting requirements of Ordinance 2131.
4. Concerns regarding public engagement with STR hosts for drafting Ordinance 2131.
APPENDIX C - APPLICANT INFORMATION AND REVIEWING STAFF
Applicant: City of Bozeman, PO Box 1230, Bozeman, MT 59771
Representative: Department of Community Development, City of Bozeman, PO Box 1230,
Bozeman, MT 59771
Report By: Nakeisha Lyon, Associate Planner
FISCAL EFFECTS
None at this time related to this Amendment.
ATTACHMENTS
The full application and file of record can be viewed at the Community Development
Department at 20 E. Olive Street, Bozeman, MT 59715.
Attachment 1: Draft Ordinance 2131
Attachment 2: STR Affirmative Obligations Memo - January 3, 2023
Attachment 3: Short Term Rental Focus Group Summary - February 7, 2023