Show Nav
View printable PDF    |   

May/June 2025 Issue

Also in this issue: Oitzinger v. City of Marinette – A Closed Session Cautionary Tale     |     Court of Appeals Upholds County Board Denial of Rezoning Petition Based on Inconsistency with Town Comprehensive Plan     |     Arrest Record Discrimination Includes Protections for Records of Civil Forfeitures

Short-Term Rental Regulation – Litigation Uncertainty

Eric B. Hagen | 06.05.25

Over the last decade, many Wisconsin municipalities have seen a significant increase in the proliferation of short-term rentals, driven by the growth of marketplace providers like Airbnb and VRBO. In response to this increase, some municipalities have sought to prohibit or restrict short-term rentals. In an attempt to strike a balance between municipal regulation and individuals’ property rights, the Wisconsin Legislature created Wis. Stat. § 66.1014 in the 2017 WI Act 59, Biennial Budget Act.

This statute provides two significant limitations on municipal regulation of short-term rentals:

  1. Municipalities cannot prohibit the rental of a residential dwelling1 for 7 consecutive days or longer. See Wis. Stat. § 66.1014(2)(a).
  2. Municipalities can limit the total number of days within a 365-day period in which a residential dwelling may be rented to 180 consecutive days, but municipalities cannot specify when that 180-day period will be. Such limitation only applies to residential dwellings rented for periods of more than 6 but fewer than 30 consecutive days. See Wis. Stat. § 66.1014(2)(d)1.

While these restrictions certainly limit municipal regulation, they also provide important openings for municipalities to regulate short-term rentals. Based on the statute, municipalities have the power to prohibit short-term rentals for less than 7 consecutive days. Municipalities also have the power to limit short-term rentals of 7 to 29 consecutive days to a consecutive 180-day period within a 365-day period. These are substantial limitations on the operation of short-term rentals.

The statute also provides municipalities with authority to regulate short-term rentals in two additional respects:

  1. Municipalities can enact an ordinance requiring those who maintain, manage, or operate short-term rentals for more than 10 nights each year to obtain a license or permit for such activities. See Wis. Stat. § 66.1014(2) (d)2.b.
  2. Municipalities can enact an ordinance regulating short-term rentals that is not inconsistent with the limitations on municipal regulation in Wis. Stat. § 66.1014. See Wis. Stat. § 66.1014(2)(c).

These provisions allow municipalities to impose permit or licensing requirements on short-term rentals and provide an opening to impose other restrictions and requirements that are consistent with the statute’s limitations. As long as a restriction does not effectively prevent short-term rentals of 7 consecutive days or more for at least 180 consecutive days in a 365-day period, it should comply with the statute. However, municipalities should still be mindful of other potential limitations on their power to regulate short-term rentals, such as the prohibition on regulating the amount of rent or fees charged for the use of a residential dwelling unit pursuant to Wis. Stat. § 66.1015. Municipalities should also be mindful of whether a regulation requires the use of their zoning or police powers.

Even with Wis. Stat. § 66.1014, municipal regulation of short-term rentals remains a flash point for litigation, with the Wisconsin Realtors Association’s (WRA) Legal Action Program and the Wisconsin Institute for Law & Liberty (WILL) pursuing lawsuits against municipalities for their short-term rental ordinances. Despite this plethora of litigation, there remains limited case law to guide municipalities.2 Until the courts are able to weigh in, municipalities may find it helpful to consider the following issues that have led to litigation when crafting their own regulations:

  • Requiring short-term rental property to be the owner’s primary residence.3
  • Limiting rental days to 120 days per year.4
  • Requiring a tourist housing permit to operate a shortterm rental, which could be revoked for cause.5
  • Requiring rentals of no more than 7 days per month within the months of May through September.6
  • Requiring short-term rentals to be owner occupied for at least 175 days per year.7 
  • Requiring a conditional use permit to operate a shortterm rental.8
  • Limiting the number of occupants to 8 regardless of the number of bedrooms.9
  • Requiring the owner or designated agent to reside within the county.10
  • Requiring authorization for municipal staff/​officials to enter and examine any short-term rental for purposes of ensuring compliance.11
  • Refusal to issue a short-term rental license until non-conforming driveways are brought into compliance with zoning requirements.12
  • Limiting short-term rentals to 4 bedrooms and prohibiting the use of other rooms for sleeping purposes regardless of whether more bedrooms are present.13

While circuit courts have upheld some of these regulations, municipalities should be mindful that these decisions are being appealed. Therefore, municipalities should consider the uncertainty such appeals pose and the potential risk of litigation when contemplating short-term rental regulations. Municipalities are encouraged to work with their attorneys when contemplating short-term rental regulations.

[1] "'Residential dwelling' means any building, structure, or part of the building or structure, that is used or intended to be used as a home, residence, or sleeping place by one person or by 2 or more persons maintaining a common household, to the exclusion of all others.? Wis. Stat. § 66.1014(1)(b).[2] As of writing this article, there are only 2 potentially citable cases that even reference Wis. Stat. § 66.1014 (City of Wautoma v. Marek, 2024 WI App 32, 7 N.W.3d 718 and Sullivan v. Town of Stockholm, 402 F. Supp. 3d 534 (W.D. Wis. 2019)), and neither of those cases provide any clarification on municipal regulation of short-term rentals under the statute.[3] Upheld by circuit court, appeal pending in WRA v. City of Neenah, Winnebago County, Case No.: 22-CV-707. Proceedings stayed by stipulation in WRA v. Village of Plover (Portage County Case No.: 23-CV-314).[4] Found to be in violation of Wis. Stat. sec. 66.1014 in WRA v. City of Neenah, Winnebago County Case No.: 22-CV-707.[5] Upheld by circuit court, appeal pending in WRA v. City of Neenah, Winnebago County Case No.: 22-CV-707.[6] Upheld by circuit court, appeal pending in WRA v. Polk County, Polk County Case No.: 23-CV-72.[7] Dismissed by stipulation in WRA v. Town of Rib Mountain, Marathon County Case No.: 23-CV-660. Ordinance remains unchanged.[8] Case pending - WRA v. Columbia County, Columbia County Case No.: 24-CV-364.[9] Case pending - WRA v. Columbia County, Columbia County Case No.: 24-CV-364.[10] Case pending - WRA v. Village of Ephraim, Door County Case No.: 25-CV-17.[11] Case pending - WRA v. Village of Ephraim, Door County Case No.: 25-CV-17.[12] Temporary injunction enjoined enforcement of short-term rental ordinance while owner pursues appeal of municipal denial of short-term rental license due to non-conforming driveway (case pending ? Adam White et al v. Village of Sister Bay et al, Door County Case No.: 24-CV-81).[13] Case pending - Hunter Clinton, et al v. Village of Sister Bay et al, Door County Case No.: 24-CV-119.

This newsletter is published and distributed for informational pur- poses only. It does not offer legal advice with respect to particular situations, and does not purport to be a complete treatment of the legal issues surrounding any topic. Because your situation may differ from those described in this Newsletter, you should not rely solely on this information in making legal decisions.

Author

More from Municipal Law Newsletter