A Sister Bay short-term rental wins its case against the village over its license renewal

SISTER BAY - A Door County judge granted a temporary injunction against the village of Sister Bay to allow a short-term rental property there to resume renting out its space until a final decision is made in a dispute over renewal of the STR's license.

Issuing the injunction, Circuit Court Judge David Weber said in a June 26 hearing the village didn't follow its own ordinances when it denied the owners of Captain's Cottage, LLC their license renewal and then obstructed the owners from appealing the denial. The previous year's license was valid through June 30, and the question over its renewal caused owners Adam and Brigid White to cancel all reservations they had received after July 1 in case they weren't licensed, which they said cost them $52,500.

The case drew more than local attention, as the Milwaukee-based Wisconsin Institute for Law & Liberty (WILL) became involved by working with local attorney Bjorn Johnson on the Whites' behalf. Johnson said he brought in WILL because of their expertise and experience in cases such as this involving people's rights with municipalities.

"I think everyone agrees due process is something that should have been in place from the beginning," Johnson said.

“This is a local government at its worst," WILL deputy counsel Luke Berg, one of two WILL attorneys on the case, said in a press release. "Wisconsin law clearly protects homeowners like our clients, yet the village not only unlawfully denied their license, but then refused to allow them to appeal the denial, as they have a right to do.”

The dispute mainly started over parking spaces. Other issues the village had with the property – a single-family residence the Whites rent out – were mentioned in an April 23 email to the Whites from village administrator Julie Schmelzer explaining why the village wouldn't issue a license, but "the most significant issue is your parking situation." The email and other correspondence is included in the complaint as evidence.

According to the complaint , Adam and Brigid White filed the application to renew their STR license March 1, the first day the application period opened. They've owned the property since 2020 and rented it out since, as the previous owner did starting in 2018, and have received or renewed an STR license since the village began requiring one in 2021.

The Captain's Cottage parking spaces don't meet the village's current codes for STRs, which requires two to four 10-by-20-foot asphalt parking stalls that aren't in the public right-of-way and with at least 10 feet of setback from the neighboring lot line. Schmelzer's email said the Whites' plan shows one stall adjacent to the road, but an inspection revealed no true stall or asphalt area, and the space indicated doesn’t meet setback requirements. The plan also shows "pull-over" parking space in the right-of-way.

However, in an April 29 reply email, Johnson asked the village to reconsider, saying code violations cannot be applied retroactively to pre-existing nonconforming conditions, according to state law and the village's own ordinances. The complaint said the home was built in 1919, the village adopted parking and setback codes related to the case between 1995 and 2006 and the parking situation hasn't changed at the property, so the parking stalls should be grandfathered in as acceptable. The complaint also noted the village issued the Whites a license every previous year.

The complaint further said it appeared the village's position was that the act of applying for a renewal constituted a change of use in the property from single-family residential to short-term rental, thus erasing the grandfathered protections and forcing owners to "update their property every year to conform to whatever changes the village has made to their zoning code," which would be in violation of state and local ordinances.

Following another exchange of emails, Johnson wrote the Whites would immediately begin an appeal of the nonrenewal, which the village allows within 14 days of the denial. Johnson said he requested an appeals form from the village but received no reply, and no such form existed on the village's website.

Johnson drafted an appeal and submitted it to the village, but a letter from village attorney Randy Nesbitt dated May 8 said the village wouldn't consider or schedule a hearing on it because it didn't receive the required fee for it. The complaint noted, however, that the village didn't have the amount of the fee posted on its website, didn't reply when asked what was the fee, and didn't appear to have such a fee in place at all until it the Village Board approved implementing one during its regular June 18 meeting.

Schmelzer had no comment other than saying the property was out of code and that Nesbitt has been discussing the situation with the Whites and Johnson, giving an update to the village board in closed session during a special July 5 meeting.

With the injunction now in place, Johnson said he'll wait for the village to decide on its next step. He is working on a potential appeal if the village decides to not renew the license.

"At this point, I think the ball is at least somewhat in (Sister Bay's) court," Johnson said. "(The Whites) are happy, I think, because they'll finally be able to get some answers. … We're going to go through their appeal rights, as they should have been given from the start."

C ontact Christopher Clough at 920-562-8900 or cclough@gannett.com.

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This article originally appeared on Green Bay Press-Gazette: A Sister Bay short-term rental wins its case against the village over its license renewal