Screenshot of Airbnb homes in Door County.
The Town of Baileys Harbor has asked the Door County Tourism Zone Commission (Zone) to implement a program that would allow short-term rental (STR) property owners to apply at one time for both their Zone permit and their town license.
The consolidation would eliminate a step in what the town has heard is a cumbersome and confusing process for STR owners, according to the official letter of request from the Baileys Harbor Town Clerk, Haley Adams.
Dave Eliot, Baileys Harbor Town Board chair – and publisher/co-founder of the Peninsula Pulse – proposed the program during the Zone’s Sept. 15 full board meeting.
“By allowing the STR owner to have one place to go to get all their licensing eliminates confusion and helps a lot,” Eliot said.
More Efficiencies, More Zone Revenue
Currently, STR owners must receive a permit from the Zone. The free permit asks for basic information, and for the Tourist Rooming House License number the owner must receive from the Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP).
Separately, the STR owner is also required to get a license from the municipality where their property is located if the municipality has an STR ordinance. The application for the Baileys Harbor license collects a lot of the same data as the Zone, as well as additional information on the Private Onsite Wastewater Treatment System permit that determines an STR property’s occupancy limit.
Under the proposal, the Zone would collect all the information required for its permit and the town’s license. Once the applications are complete, the Zone would notify the municipality and the town would take it from there – issuing the license and assuring ongoing compliance with the town’s ordinance.
“We’re not asking the Zone to enforce anything,” Eliot said. “We’re asking them to collect the data and the funds. Period.”
Baileys Harbor charges $500 for an STR license for the first year, $250 for renewal years, and has approximately 110 STRs currently. The town would pay the Zone’s costs related to the development, implementation and operations of the program, which could range initially between $24,000-$36,000, said Juliana Behme, Zone administrator.
The additional revenue would also enable the Zone to hire additional help. Currently, the Zone collects more than $11 million annually in room tax with two, full-time staff members.
“It’s actually finding a way to get that third body in there and fund it,” Eliot said.
If other Door County municipalities also used the service, it would generate even more revenue for the Zone, while reducing costs of the service for individual municipalities.
“We’re 19 different municipalities,” Eliot said. “Why don’t we combine our resources and instead of paying our staff to do that, let’s find a way to automate this with the group that already automates this.”
The Zone does not require proof that an STR owner has received a municipal license, though the municipal license does require proof of the Zone permit. This can, and does, cause discrepancies between the Zone’s and town’s lists of STRs.
“We have coordinated with the Zone to get their list and compare it with our own and it was fruitful for us to do it,” said Cathy Ward, a Zone commissioner representing Liberty Grove. “We came up with 40 STRs that were permitted by the Zone but not the town.”
Zone board chair Josh Van Lieshout, a commissioner with the City of Sturgeon Bay, said he believed the proposal would help achieve efficiencies for all concerned.
“In my perspective, it’s an opportunity with fewer touch points for both the municipality and the STR,” Van Lieshout said. “It’s probably a good thing for all concerned.
Objections and Questions
The Zone’s mission is to collect the 8% room tax on behalf of all Door County municipalities. It then distributes 30% of it back to the municipalities where it came from, and contracts with Destination Door County to spend the rest on tourism-related spending, as is required by state statutes.
That mission is authorized by an inter-governmental agreement signed by all Door County municipalities. Not all commission members were convinced that agreement allowed the Zone to provide the service Baileys Harbor was requesting.
“We’re being asked to provide another service,” said Bill Weddig, a commissioner who represents Gibraltar. “Even though it might be related, I have some concerns that we’re working outside what our charge really is.”
Linda Wait, a commissioner who represents Sevastopol, agreed.
“The mission of the Zone is to collect room tax and not act as an independent contractor for municipal government,” she said.
Ken Nelson, a commissioner with the Village of Ephraim, said their clerk would not want to give up control of the process. Van Lieshout said they wouldn’t have to.
“The ultimate responsibility does come back to the municipality,” Van Lieshout said. “So somewhere in the process, there would be a button that says, ‘issued permit,’ and after that, it’s up to the municipality. The way I’ve thought about this, the STR owner would know ‘Here’s where I go to fill out my form and make my payment.’”
Conversation to Continue Once Answers Received
Behme said she could foresee other municipalities interested in the service and wanted to explore the concept further to understand how it would work.
“Some communities, they don’t have the staff and I think it would lighten their load,” she said.
She also said she wasn’t sure how much time the new municipal applications would take and wanted to get the perspective of some of the municipal staff members.
“In Sister Bay, we dedicate about three months to receiving, reviewing, issuing and following up on violations,” said Julie Schmelzer, a commissioner with the Village of Sister Bay. “If it works for Baileys Harbor, that’s great, but my only concern is, I don’t think it’s going to be as easy as you think.”
Eliot said he would wait for Behme’s endorsement before making an official motion for approval and Van Lieshout asked commissioners to table the idea long enough to get some answers to the questions about the legal aspects with the intergovernmental agreement.
“I really don’t want to end the conversation at this point,” Van Lieshout said. “I’d like to get some answers and continue the conversation. I see the Zone heading in this direction; it’s coming up.”
The commission tabled the issue until its next full meeting, scheduled for Oct. 17.
