Minneapolis City Council proposes ordinances on home-sharing

Light beams through the skylights in Tess Galati's Airbnb rental space.
Tess Galati's Airbnb rental space in Saint Paul. Council members in both Minneapolis and St. Paul have been working on regulations for home-sharing in the Twin Cities.
Ellen Schmidt | MPR News

Updated: 6:30 p.m. | Posted: 5:39 p.m.

Minneapolis City Council members approved a set of proposals regarding home-sharing on Tuesday, however, city staff will likely tweak the measures before the final vote.

One of the proposed ordinances distinguishes between three kinds of short term rental hosts.

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First, there's the people who stay at home while renting out part of their residence — they will not be regulated at all.

The second type are people who rent their home but don't stay with their guests. Regulatory Services Director Noah Schuchman said that these hosts will have to pay a one-time, annual registration fee of $46 to help offset the cost of the short-term rental license, which will include a city inspection.

The third type of host is someone who has an investment property which he or she never stays in but rents to visitors on a short-term basis. Those people will have to get a rental license, which can cost a few hundred dollars.

Another proposal would regulate host platforms, like Airbnb and VRBO. These companies would pay $5,000 — with part of that fee going to the city to help it recoup staff costs.

But council members learned that not every host platform is a big, international corporation.

"That is a cost prohibitive type of fee," said Lance Bondhus, who is part of a small organization which helps connect out-of-town visitors to local hosts. "I'd have to make $100,000 in bookings just to be able to pay that $5,000. Just to break even."

Council member Lisa Goodman offered a staff direction that would distinguish between large and small platforms. However, city staff members will have to determine what large and small means.

The council may vote on the proposed ordinances by the end of October.

Meanwhile, the St. Paul City Council is voting on a set of regulations for home sharing on Wednesday.

Correction: A previous version of this story incorrectly identified who offered changes to the law on large and small host platforms. The copy above has been corrected.