§ 150.037  LICENSE REQUIRED.
   (A)   General rule. No person, partnership, business entity, or corporation shall operate a rental dwelling or rental dwelling unit in the city without a license for each building pursuant to Chapter 110. No property owner shall be permitted to license more than three single-family residences as rental properties, unless the property owner:
      (1)   Hires a property management company who is licensed by the Commerce Department; or
      (2)   Is a public housing agency; or
      (3)   Obtains a special exception from the City Council.
   (B)   Applications. In addition to the application information requirements of § 110.03, the license application must contain the following information:
      (1)   Property owner information.
         (a)   The name, address and complete information of the property owner, if the property owner is an individual.
         (b)   The name, address and complete information of at least one officer, manager or director, if the property owner is a business entity.
      (2)   Property contact information. For single-family residential dwellings, the license applicant must provide 24 hour contact information for one person in any of the following categories. For all other types of dwellings, the license applicant must provide 24 hour contact information for two people in any of the following categories:
         (a)   At least one owner of the rental dwelling or rental dwelling unit;
         (b)   At least one person, if different from the owner, who is responsible for compliance with this and any other code requirement pertaining to the rental dwelling or rental dwelling unit, such as a property manager, who must reside in the Twin Cities 7-County metropolitan area;
         (c)   Any of the owner’s agents responsible for management of the rental dwelling or rental dwelling unit, such as a property management company and the name and contact information of a person at the property management company; or
         (d)   Any vendors and all vendees, if the rental dwelling or rental dwelling unit is being sold pursuant to a contract for deed.
         (e)   The City Clerk must be notified in writing of any changes to the name(s) provided on the application.
      (3)   Number and type of units. The license application must contain the number of units and types of units (condominium, apartment, town home and the like) within the rental dwelling.
      (4)   Inspection report. The license application must be accompanied by a satisfactory city approved inspector’s report or an alternative inspection report.
         (a)   For owners with one to three dwelling units, the inspection report is required every 36 months and due upon annual renewal of the license. Alternative inspection reports must be dated within the 36 months preceding the application date. For owners with one to three dwelling units, an inspection is required if there is a change in ownership and the inspection report is dated more than 18 months prior to the date of the application.
         (b)   For owners with more than three dwelling units, the inspection report is required every 12 months and due upon annual renewal of the license. Alternative inspection reports must be dated within the 12 months preceding the application date. An owner with more than three dwelling units shall submit annual inspection reports for at least one-fourth of the total number of dwelling units for each building. Every four years, all dwelling units in each building must have undergone an inspection. An inspection is required if there is a change in ownership and the inspection report is dated more than six months prior to the date of application for owners with more than three dwelling units.
      (5)   Inspection scheduling. The City Clerk or designee shall schedule the initial inspection for all new and renewal applications. A property owner or agent is required to be onsite during the scheduled inspection. A property owner or agent may cancel or re-schedule an inspection no less than 24 hours of the scheduled inspection time or a re-inspection fee will apply.
   (C)   Investigations.
      (1)   For all new applications, a background investigation will be conducted on the property owner listed on the application, pursuant to § 110.03(C)(5). The city may request additional information from the license applicant regarding all property owners, if the property is owned by individuals or regarding all officers, managers or directors, if the property is owned by a business entity, and may conduct additional background investigations as it deems necessary. The applicant shall pay a background investigation fee for each background investigation conducted.
      (2)   For renewal applications, background investigations are not required and no background investigation fee shall be required, however, the Police Department or other city staff may conduct a background investigation at its sole discretion.
   (D)   Changes in ownership. A license is non-transferable. If there is a change in the ownership of the rental dwelling or rental dwelling unit, a new license is required.
   (E)   Changes in the rental dwelling or rental dwelling unit. If changes are made in the number or type of units, the owner shall amend its license.
   (F)   Annual license. Persons wishing to let rental dwellings or rental dwelling units must make an annual application to the city, provide the information required by this subchapter and pay the applicable license fee, as set forth in § 150.041. Renewal applications that qualify for a license in Category A, as defined in § 150.041, may be approved administratively by the Community Development Director. All other license applications must be approved by the City Council.
   (G)   License term. The term of the license is a 12-month rolling calendar. For renewal applicants, the license period shall commence on the first day of the month after the expiration of the previous license period, as determined by the City Clerk, or for new applicants, the license period shall commence on the first day of the month after the license is approved by the City Council. All licenses expire at the end of each 12-month period.
   (H)   Tenant register. As a condition of the license, the applicant must, as a continuing obligation, maintain a current register of tenants and other persons who have a lawful right to occupancy of rental dwellings or rental dwelling units. In its application, the applicant must designate the name of the person or persons who will have possession of the register and must promptly notify the City Manager of any change in the identity, address or telephone numbers of such person. The register must be available for inspection by city officials at all times.
   (I)   Notification requirements for public hearings. The owner must, as a continuing obligation of the license, provide written notice to tenants or in the alternative, post the written notice in the lobby or common area of the rental dwelling for any public hearing received by the owner that pertains to the property on which the rental dwelling is located or any adjacent rights-of-way.
   (J)   Display of license certificate. Pursuant to § 110.08, the license certificate must be exhibited in a conspicuous place at or near the entrance to the rental dwelling. One license certificate must be displayed for each building. For buildings containing one to three dwelling units, the certificate must be visible from the street. For buildings containing more than three dwelling units, the certificate must be displayed in the rental office or other common area accessible to all tenants of the licensed building.
   (K)   Compliance with Minn. Stat. § 211B.20, as it may be amended from time to time. Owners must comply with the requirements of Minn. Stat. § 211B.20, as it may be amended from time to time, and allow access to candidates who have filed for election to public office and seek admittance to the rental dwelling solely for the purpose of campaigning.
   (L)   Rental density for single-family rental dwellings.
      (1)   In an R-1 Zoning District, no more than 10% of the single-family lots on any block shall be eligible to obtain a rental license, unless a temporary license is granted by the City Council as provided herein. Table 1 indicates how many single-family lots per block are able to be licensed as a rental property based on the number of lots that exist in a block.
 
Table 1
Lots/Block
Rental Units Allowed
1-14
1
15-24
2
25-34
3
35-44
4
45-54
5
55-64
6
65-74
7
75-84
8
85-94
9
 
      (2)   The following guidelines shall apply to determine eligible blocks and lots.
         (a)   For the purposes of this subchapter, a BLOCK shall be defined as an area of land enclosed within the perimeter of streets, watercourses, public parks, municipally owned lots and city boundaries.
         (b)   This subchapter shall apply to legally conforming lots of record and legally nonconforming lots of record. For the purposes of this subchapter, lots of record may also be referred to as PROPERTIES, PROPERTY or LOTS.
         (c)   If a block contains more than one type of zoning district, only R-1 Zoning District lots shall be included in the calculation of the total number of lots per block.
         (d)   Legal nonconforming rental property shall not be included in the calculation of the total number of lots per block, but shall be allowed to continue as long as the legal nonconforming use complies with § 153.006 of the Zoning Code.
         (e)   Commercial or industrial uses located in an R-1 Zoning District shall not be included in the calculation of the total number of lots per block.
         (f)   Properties that are exempt pursuant to § 150.038 shall not be included in the calculation of the total number of lots per block.
      (3)   If the number of rental properties meets or exceeds the permitted number of rental properties per defined block on the effective date of this subchapter, no additional rental licenses shall be approved for the block, unless a temporary license is granted by the City Council as provided herein. Existing rental licenses may be renewed; however, should a rental license not be renewed, or if the rental license is revoked or lapses, the rental license shall not be reinstated unless it is in conformance with this subchapter and other applicable sections of the city code.
      (4)   If the number of rental properties meets or exceeds the permitted number of rental properties per defined block on the effective date of this chapter, a property owner may request a temporary license to allow an additional rental property for that block. The property owner must hire a licensed professional property management company to manage the property. The Council may grant or deny a temporary license in its sole discretion. Persons requesting a temporary license must make an annual application to the city. No property owner shall hold a temporary license for the same property for more than two consecutive years.
   (M)   Crime-Free Lease Addendum. As a condition of the license, the applicant must use the Minnesota Crime-Free Lease Addendum or its equivalent, as part of its leases.
   (N)   Phase One - Management Training. As a condition of the license, the applicant or manager of each licensed building must complete Phase One - Management Training of the three phases of the Minnesota Crime Free Rental-Housing program, as defined in § 150.042(A)(1)(e), within 12 months of City Council approval of the rental license.
   (O)   Tenant background checks and lease agreements. Upon request, provide a copy of third party or comparable background checks for tenants and a copy of the lease.
   (P)   Contracts for deed. A property sold pursuant to a contract for deed must be recorded against the property or the property will be deemed rental property and a license will be required.
(2001 Code, § 435.05)  (Ord. 06-16, passed - -; Ord. 11-12, passed - -; Ord. 15-09, passed 9-14-2015)