Short-term rentals in Crosslake, explained properly.

Sec. 23-3(5): if the owner is not acting as the owner's authorized agent (property manager), each application must appoint a natural person who remains within a 30-minute distance of the rental and is available around the clock. The owner or agent must notify the City with new contact information at least five days before any change to the appointment. Sec. 23-11 requires the owner or property manager to resolve a complaint within 60 minutes, including visiting the site if necessary, and the property manager is jointly and severally liable for violations at the rentals it professionally manages (Sec. 23-10(c)).

Sec. 23-4 allows property liability insurance, commercial liability insurance or an endorsement to a homeowner's policy for coverage of short-term rental activities.

Sec. 23-6: requests for inspections go to the Crosslake Fire Department at least 60 days before the date of the initial license application and at least 60 days before the end of each subsequent year. Items inspected are working fire extinguishers, adequacy of egress, a posted egress plan, working carbon monoxide detectors and smoke alarms, extension-cord and electrical conditions, portable and outdoor heating appliances, and conspicuous posting of the physical address. A failed inspection requires a re-inspection at $100 per visit, scheduled in advance, which may take up to 30 days to complete.

Sec. 23-5(2) sets this limit for overnight occupancy while the rental is occupied. Sec. 23-8 prohibits advertising the rental as available to more guests than the occupancy limit identified on the license. A bedroom is a room designed or used for sleeping with egress, or a room or area with at least 70 square feet and access from the living area or hallway with egress (Sec. 23-2).

Sec. 23-5(6): all vehicles must be parked in designated parking areas with improved surfaces (asphalt, concrete, pervious pavers or gravel), and parking is prohibited in any landscaped area. A parking plan must be submitted with the license application (Sec. 23-3(6)).

Sec. 23-5(7). The standards in Sec. 23-5 apply while the rental is occupied.

Sec. 23-3(7): the owner or authorized agent must tell all property owners within 300 feet of the intent to rent short-term. The notice is in writing and gives the physical address of the rental and the contact information of the owner and/or property manager.

Sec. 23-3(3), (8) and (10). A new application is required when the property changes ownership (Sec. 23-3(9)).

Sec. 23-3(9). The chapter defines a sale transfer as any change of owner, whether for consideration or not, during the term of the permit (Sec. 23-2).

Sec. 23-7: the certificate or inspection must show the system was tested and is compliant for the number of bedrooms on the application; the compliance inspection report is due at least once every three years. Solid waste must be disposed of under the Crow Wing County Solid Waste Ordinance, stored in enclosed containers, with enough containers and service for the occupants, and containers must be removed from roadside within 24 hours of pickup.

Sec. 23-8: advertising includes the license number immediately after the description of the rental and must not exceed the occupancy limit on the license. Sec. 23-5(8) and (9): a City-approved sign inside the rental shows the license number, property manager contact information and physical address (with unit number if applicable), and a license number sign posted under the E911 address is visible from the exterior.

Sec. 23-5 requires that buildings, structures or rooms are not used for purposes other than those for which they were designed; structural components are kept in sound condition; an operable toilet, sink and tub or shower are in the same building and enclosed for privacy; and electrical panels are clearly labeled.

Sec. 23-10 makes it unlawful to violate the chapter and to offer to rent or operate a short-term rental without a City license. The owner is liable for all violations at the rental, and the property manager is jointly and severally liable for violations at the rentals it professionally manages. Sec. 23-12 says civil violations are subject to the fines in the City of Crosslake Fee Schedule (the amounts are not shown in the chapter), penalties are due within 14 days of citation, and unpaid penalties are certified to the owner's property tax in November. The third violation in any 12-month period for a single rental results in a one-year suspension from the date of the last violation, during which no license is granted for that rental.

Sec. 23-3(11): the notice must describe the violation and when the licensee can appear before the council. Sec. 23-12: a disputed violation requires a written appeal within 14 days of the citation, and the council holds a hearing within 30 days of receiving a notice of appeal. If a penalty is not paid and no protest is filed in time, the City may summarily suspend the license until it is paid, with written notice to the owner and property manager.

The Department of Revenue guide says residential short-term rentals (a home, a portion of a home, or any other property used as a temporary place to stay or live) are a form of lodging and related services, and that charges for them are subject to the general rate sales tax and any applicable local and lodging taxes. Revenue Notice 17-06 (published in the State Register on September 25, 2017) says state and local taxes are due on lodging if the lease or rental is for less than 30 days, or for 30 days or more if there is no enforceable written lease agreement that requires the customer to give prior notice of their intention to terminate the lease. The lodging guide's table for tips and service charges lists the state general rate sales tax as 6.875%. Sales of lodging that are isolated and occasional and not made in the normal course of business are exempt from sales tax under Minnesota Statutes section 297A.67, subdivision 23, as the notice states, and the guide adds that the income tax rule for renting out a home for 14 days or less does not carry over to sales tax. The guide says some cities administer their own lodging taxes and the state rate calculator leaves out special local taxes, so city taxes are shown on each place's page and this page does not total state and local taxes. The guide was last updated May 15, 2024.

Revenue Notice 17-06 says that if the residential property is in Minnesota, the owner must register as a retailer to collect, report and remit sales tax and applicable local taxes when both of these apply: the owner regularly furnishes lodging directly to a customer in the normal course of business (for the purpose of profit or producing income), and the customer makes the reservation with and pays the owner. The owner is not required to register or collect when the owner uses an accommodations intermediary to facilitate all sales of lodging at the property, or when the owner's rental is an isolated incident not made in the normal course of business. When an owner who regularly rents directly also uses an intermediary, both have liabilities: the owner collects on sales made without an intermediary, and the intermediary collects on the sales it facilitated. The guide says the owner must keep documentation of who facilitated each sale and was responsible for remitting the tax. It describes an isolated sale as one that happens once and an occasional sale as infrequent and not recurring with some degree of regularity.

Revenue Notice 17-06 says an accommodations intermediary that facilitates the sale of the short-term rental of residential property located in Minnesota must register as a retailer to collect, report and remit the taxes on the full sales price of lodging and related services, whether the intermediary or the renter is in Minnesota or not. Facilitating the sale includes collecting receipts from the customer and transmitting them to the owner, directly or through third parties, whether or not the intermediary deducts fees from those receipts. It does not include mere advertising that directs the customer to contact the owner to reserve and purchase. The full sales price includes all amounts the intermediary charges the customer. Statute section 297A.61, subdivision 47 defines the term accommodations intermediary, as the notice cites. The notice is dated September 2017 and the guide May 15, 2024.

Section 157.16, subdivision 1 says a license is required annually for every person, firm or corporation engaged in the business of conducting a food and beverage service establishment, youth camp, hotel, motel, lodging establishment, public pool or resort. Section 157.15 defines a hotel or motel as a building, structure, enclosure or any part of one used as, maintained as, advertised as or held out to be a place where sleeping accommodations are furnished to the public for periods of less than one week; a lodging establishment as sleeping accommodations furnished to the public as regular roomers for periods of one week or more with five or more beds to let to the public (or the health-care lodging described in the definition); and a resort as a place on or near a lake, stream, skiing or hunting area or other recreational area, held out to the public for recreation stays and having for rent five or more cottages, rooms or enclosures. The Department of Health's rules and guidance were not read, so whether a particular rental needs a state license should be confirmed with the Minnesota Department of Health. City licensing and registration are separate and are shown on each place's page.