Lake Geneva Lowers Short-Term Rental Fee, Property Owners Refunded

The News: The Wisconsin Institute for Law & Liberty (WILL) and the City of Lake Geneva agreed to settle a challenge to Lake Geneva’s short-term rental fee that WILL brought on behalf of short-term-rental property owners in Lake Geneva. Lake Geneva lowered the fee from $750 to $400 in response to WILL’s challenge. The property owners represented by WILL are receiving a refund of $350.

The Quote: WILL Deputy Counsel, Luke Berg, said, “State law gives homeowners a right to rent their home and prevents local governments from charging extreme fees. We are pleased that Lake Geneva lowered their fee after adopting the highest, by far, in the state.”

Background: In May of 2018, the Lake Geneva City Council established an annual licensing fee of $2,000 after the City adopted an ordinance regulating short-term home rentals. WILL sent a letter in the fall of 2019, on behalf of local residents, warning the City that the exorbitant licensing fee – the highest, by far, in the state – violated Wisconsin state law and may result in litigation.

In June 2020, the City Council amended their ordinance and dropped the annual licensing fee to $750 – still one of the highest in the state. Nearby communities in Walworth County charge far less. The villages of Walworth and Fontana, located just on the other side of Geneva Lake, charge $200 and $250 respectively for short-term-rental licenses. The Town of Delavan, a few miles down the road, charges only $100.

State law requires that “[a]ny fee … imposed by a political subdivision shall bear a reasonable relationship to the service for which the fee is imposed.” WILL filed a petition for review in July to the Wisconsin Tax Appeals Commission urging the body to require Lake Geneva to refund any portion of the $750 annual licensing fee that “exceed[s] [Lake Geneva’s] reasonable direct costs” associated with licensing short-term-rental properties.

Lake Geneva amended its fee schedule again in January, lowering the fee to $400, and refunded WILL’s clients the difference.

Read More:

• Settlement Agreement.
• Petition for Review.

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NOTE: This press release was submitted to Urban Milwaukee and was not written by an Urban Milwaukee writer. It has not been verified for its accuracy or completeness.