Whitefish City Council will reconsider a 60-unit condominium project that it previously approved for property on U.S. Highway 93 south of the Mountain Mall pond.

Council in May reluctantly approved a request from Schumacher Interests Inc. for a planned-unit development overlay to develop the property despite concerns that the units would be used for vacation rentals. However, during its June 4 meeting Council voted to remove the item from its consent agenda and move it to the regular agenda for another vote during the June 18 meeting.

During public comment last week, Council heard from a few folks asking that the item be reconsidered while disagreeing that the project should be allowed.

Attorney Lindsey Hromadka, speaking on behalf of the South Whitefish Neighborhood Association, said her client disagrees that WB-2 zoning allows short-term rentals as a permitted use.

“WB-2 zoning allows hotels, motels and other hospitality uses,” she said. “Staff has interpreted the definition of hospitality including short-term rentals, however, hospitality does not include short-term rentals.”

She disagreed that short-term rentals could fall under the city zoning code definition of hospitality, by pointing out that the zoning code defines short-term rentals separately as a “distinct use.”

Councilor Richard Hildner said significant questions have been brought up regarding the project and moved for Council to reconsider the matter at its next meeting.

“I had heartburn about this two weeks ago,” he said. “There needs to be further study of whether condos are hospitality uses.”

Planning Director David Taylor, in his staff report on the condo project, said that the WB-2 zoning district “permits all hospitality uses, including short-term rentals and the applicant has indicated this is a potential for owners within this development.”

Hromadka argued that the developer has the right to create a hotel or motel on the property through the zoning, but not create a residential development that could include short-term rentals.

“You have the ability to prohibit short-term rentals with the PUD,” she told Council. “City policies discourage short-term rentals and encourage workforce housing.”

City Attorney Angela Jacobs said she understood the argument by those opposing the application, but would have to look into the issue further before providing an opinion on whether Council could condition a PUD to prohibit vacation rentals.

While Council in May had concerns about the units being used as vacation rentals, it said then that it had little choice but to approve the project because the application for the project had been submitted prior to a revision of the city’s short-term rental regulations. The property is zoned as WB-2, which the new regulations eliminated as a zone that would allow short-term rentals.

Schumacher Interests Inc. plans the condos to be constructed in 10 buildings with a range of five to 10 units per building and the density of the project is 7.8 units per acre.

The developer was required to do a PUD to place a residential development on the property.