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Chamberlain passes residential Vrbo, AirBnB ban, will accept exemptions until Dec. 31

City officials originally brought forth the ordinance as a potential mitigation measure to Chamberlain’s housing shortage

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Chamberlain City Commission meetings are held at the Chamberlain City Offices at 715 N. Main Street. (Hunter Dunteman / Mitchell Republic)
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CHAMBERLAIN — The City of Chamberlain has passed an ordinance essentially banning the future use of some residential properties as short-term vacation rentals — but city officials are giving residents seeking an exemption until the new year to apply.

The Chamberlain City Commission on Nov. 1 passed an ordinance that prohibits “transient commercial use” of residential properties in low- and moderate-density residential zones. The ordinance bans homes in these zones from operating as a lodging establishment for tenants or guests that plan to stay fewer than 30 days.

After hearing public commentary at both of the ordinance’s readings — the first of which came on Oct. 18 — commissioners approved a motion to allow currently operating transient housing properties to apply for a conditional use permit through Dec. 31.

City officials originally brought forth the ordinance as a potential mitigation measure to Chamberlain’s housing shortage.

“We are in an incredible housing crunch right now, and family homes are very hard to come by,” Chamberlain’s mayor, Chad Mutziger, said in October. “Each one of these that gets taken up by a VRBO takes away from family housing.”

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Local realtor and vacation home owner Karri Swenson opened up public discussion at the second reading with a counter to Mutziger’s theory. She pointed out that she knew of eight homes for sale in Chamberlain, and she believes the city needs more entry-level housing.

Mike Wise, who moved to the area in 2015, told the commission he spent six months trying to find a home in Chamberlain, and doesn’t understand why the commission is just now addressing short-term rentals.

“(Wise) asked why the city is now recognizing these rentals,” the Nov. 1 meeting minutes read. “He stated that the city is barking up the wrong tree with this transient housing and it is not going to fix the housing shortage by cancelling a few VRBO’s.”

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A sign on S. Main Street welcomes guests and residents to Chamberlain as they exit the interstate. (Hunter Dunteman / Mitchell Republic)

According to Wise, the city has a new development with housing lots available.

Commissioner Hannah Ruhlman said the commission doesn’t disagree with the economic value to these rentals, but noted the city’s biggest issue surrounding the ordinance is “to adjust the housing shortage.” Mutziger added that employers in Chamberlain said they’re struggling to convert applicants to employees because they can’t find housing.

The way the ordinance was written doesn’t outright ban short-term rentals in the city — it rather solidifies the city’s zoning laws to keep residential neighborhoods as a place for residents instead of tourists.

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“This is why we have zoning, if we didn’t have zoning then you could have a hotel next you,” Ruhlman said. “In a residential space, we want residential homes, and in a commercial space, you can have a VRBO or a hotel, and there is a spot in the community for it.”

After members of the public, at the ordinance’s first reading, sought an exemption for high-traffic timeframes for the city — such as the Fourth of July and hunting openers — Mutziger turned the conversation toward exemptions. He said he’s received multiple calls from short-term rentals requesting conditional use permits. He suggested a Jan. 1, 2022, effective date.

The commission ultimately approved the ordinance, effective at the dawn of the new year, with a clause requiring an impact evaluation on Nov. 1, 2022.

Mike Lauritsen, city administrator, told the Mitchell Republic that the Jan. 1 effective date was implemented as a compromise for those seeking an exemption over the Fourth of July and hunting openers.

He said anybody who receives a conditional use permit by that date would be able to operate year-round, and believes a two-month period is enough for interested property owners to submit an application to the city.

Related Topics: CHAMBERLAINTRAVELTOURISM
Dunteman covers general and breaking news as well as crime in the Mitchell Republic's 17-county coverage area. He grew up in Harrisburg, and has lived in South Dakota for over 20 years. He joined the Mitchell Republic in June 2021 after earning his bachelor's degree in journalism from the University of Minnesota Duluth. He can be reached at HDunteman@MitchellRepublic.com, or on Twitter @HRDunt.
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