Council defeats increase to rental license fees

Talk about it

Rental property owners turned out in force at the Hastings City Council meeting Tuesday night to oppose a proposed increase of the license fees the city charges for rental properties, some of which were proposed to triple in price.

The rental fees were just part of an overhaul of the city’s license fees. Some were lowered, some were eliminated, some stayed the same, and others were proposed to be raised. None, however, drew as much ire as the proposed rental license fees.

The council ended up passing all the proposed license fee changes with the exception of the rental license fees, which the council agreed were too high. It ordered the Administrative Committee to take up the issue in the coming year and bring a new proposal back to the council for consideration.

Single unit and owner-occupied licenses were proposed to raise from $25 every two years to $50 per year. Duplex licenses would have gone from $50 every two years to $100 per year. Triplexes were proposed to be raised from $59 every two years to $100 every year. And four-plexes would have gone from $62 every two years to $125 every year.

“The proposed cost is astronomical,” said Betty Sieben, who owns about 20 rental properties in Hastings.

The costs were changed, according to the city, to bring them closer in line to what other cities with similar populations charge for rental licenses, but the property owners who spoke at the meeting said those comparisons shouldn’t have been based on population, but on economic factors such as average income and average rents. Golden Valley, Minn., was one city used in the comparison, and Tom Jung, who owns rental properties in Hastings, said rents are twice there what they are in Hastings.

Tony Berens, who owns two buildings on East Second Street in downtown, spoke at the public hearing and listed off the fees surrounding cities charge for duplex licenses, starting with the proposal from Hastings of $100. He said Rosemount charges $25, Red Wing charges $50 and Cottage Grove charges $80.

“You haven’t put it in line (with other cities), you’ve put it to the front of the line and that’s not a good thing,” he said.

Property owners wondered why the increase was so drastic, and questioned if it reflected an increase in the city’s cost for doing rental inspections. Vince Teuber, who owns one rental property in Hastings, said if the city was looking to save money, it should reduce the amount of inspections and requirements it places on rental property owners, not double the amount of paperwork it has to do by going from a biannual renewal process to an annual one.

“If you were a private business, you’d be putting yourself out of business,” he said.

City Administrator Dave Osberg said the changes in the fee schedule, from a biannual basis to an annual basis, were done to bring all the permits in the city into line with one another.

Rental licenses were created in Hastings so renters could be assured safe places to live, he said. Every licensed rental property is inspected by the city biannually. No property owner said they were against the inspections, only the proposed increases to their license fees.

The council voted unanimously to approve the changes to the license fees, with the exception of the proposed rental licenses fees. It also approved the changes to the fee schedule for all licenses except the rental licenses, which will remain on a biannual basis for the time being. The Administrative Committee will likely bring a new proposal forward in a year. Mayor Paul Hicks said it would be good to involve some property owners in that discussion once it begins.

Tags: local news, local government, rental license, news, fee