SANDPOINT — The Planning and Zoning commission voted 3-1 to table a proposed overhaul of the city’s short-term rental code until its meeting Dec. 16.

Commissioner Ivan Rimar made the motion to postpone the commission’s decision and said he’d like to see the city take more time to fully evaluate the changes after hearing public comment. Commissioner William Mitchell, the lone dissenting vote, said he was in favor of moving the change forward to avoid any potential litigation. 

Zachary Jones, the city’s legal counsel, said postponing it doesn’t practically open the city up to a lawsuit, but in theory an organization could bring a legal challenge as long as the ordinance is on the books. 

"It’s like a can of water, you spill it on the ground you’re not going to be able to get that water back in the can,” Rimar said. “There isn’t a whole lot that we can do by law, but there could be some nuance, that’s why I’m asking for a motion of postponement.” 

The concerns about the changes primarily center around the city’s cap of 35 non-owner occupied STRs in residential zones. Planning and Community Development director Jason Welker said the cap opens the city up to potential litigation based on an Idaho Supreme Court Ruling in the case of Idaho Association of Realtors v. City of Lava Hot Springs. 

In that case, the Supreme Court ruled Lava Hot Springs’ ban on STRs in residential zones was unlawful and in violation of state law 67-6539. Jones said the Supreme Court ruled cities could regulate, but not prohibit, STRs within city limits. 

"Clearly, the 35 units disallows or practically prohibits short-term rentals within the city,” Jones said. “That one in and of itself is a prohibition because it prohibits anything more than 35 units within the city and I think it would be a difficult one to defend.” 

A district court case, Scott v. City of McCall, upheld a city’s right to regulate STRs to preserve neighborhood character. Jones said the Supreme Court would be hearing that case early next year and as such the ruling may change. 

In the proposed overhaul, the city calls for separating STRs by occupancy, with any building in a residential zone meant for 12 or more people will be required to apply and receive a conditional use permit from the commission in addition to its STR permit. 

Also included in the proposed changes were an increased parking requirement to two off-street parking spaces for each room in the STR and the requirement that STRs have a local representative who resides within 20 miles of Sandpoint city limits. 

Welker said staff modeled the revised ordinance after McCall’s, and he feels the revised ordinance remains one of the strongest in Idaho. 

"Ours is currently the most restrictive, but also unlawful,” Welker said. “We are bringing it into compliance with state law, and we will remain the model for other cities on how to regulate STRs for the benefit of residential character.” 

In the commissions’ agenda packet, there were over 30 emails from residents who opposed moving forward with amending the ordinance. Erik Yingling, a Sandpoint resident, said the city should hold its ground and that caving to potential legal challenges was “surrender.” 

Mayor Jeremy Grimm said at the Nov. 5 City Council meeting that organizations were “teeing up” lawsuits against the city. Welker said there was a private meeting held by the Idaho Vacation Rentals Association in search of a plaintiff for a case against Sandpoint. 

The IVRA told the Daily Bee in August it was evaluating legal challenges against Sandpoint based on the city-wide 35-unit cap. Grimm said no lawsuits have been filed against the city as of Nov. 17. 

City Council-elect Joshua Torrez spoke in opposition to the changes and floated the idea of a moratorium on the ordinance, giving the city time to watch the legal battle play out at the state level. Jones said the city would need to declare a state of emergency to enact a moratorium, which is not possible at this time. 

During public comment, Mary Wilkos said she used to operate an STR at her home and disagreed with the increased parking requirement. She said that in her experience as an owner of a one-bedroom STR, guests only used one parking space. 

In the motion for postponement, the commission directed staff to look over the parking requirements as well as potentially lowering the occupancy of STRs that need a CUP. Rimar said he wanted to ensure the ordinance was as restrictive as possible without prompting a lawsuit.  

The overhaul of the STR ordinance is set to be brought back before the commission with a new public hearing Dec. 16 at 5:30 p.m. at City Hall.