Springfield Short Term Rental Regulation: A Guide For Airbnb Hosts

Short Term Rental Regulations in Springfield, Illinois

Springfield categorizes short term rentals (STRs) into three types with different regulations for each:

Type 1

Owner-occupied primary residences: Allowed in single-family residential zoning districts, Can be rented up to 95 days per year when owner is not presentMust obtain city approval and business license

Type 2

Not owner-occupied; Allowed in multi-family residential zoning districts, No limit on rental days, Maximum 2 units per property. Must obtain city approval, business license, and certificate of occupancy

Type 3

Not owner-occupied: Allowed in commercial/mixed use zoning districts. No limit on rental days. Maximum 2 units per property. Must obtain city approval, business license, and certificate of occupancy.

All STRs in Springfield must register with the state department of revenue and charge guests the 6% state hotel tax plus the 2% city hotel tax.The city plans increased enforcement efforts against illegal unregistered STRs. Fines can be issued for violations of STR regulations.

Overall, Springfield takes a balanced approach welcoming short term rentals while enacting common sense regulations to ease neighbor concerns. The three tiered structure provides flexibility for different types of STR properties.

Starting a Short Term Rental Business in Springfield

Getting started with a short term rental business in Springfield requires following a few key steps:

Determine if your property qualifies - Review the city ordinances to understand which zoning districts permit short term rentals. Single family homes and historic carriage houses in R-SF and R-TH residential districts typically qualify as Type 1. Properties in other districts may fall under Type 2 or 3 depending on factors like owner-occupancy.

Apply for a business license - All short term rental operators need an annual business license from the city. Fees range from $25 to $350 based on rental income. The license application process helps ensure properties meet requirements.

Register for hotel/motel and sales tax - Short term rental income over $2500 per year must pay state, county, and city taxes. Registration ensures proper tax collection and remittance.

Comply with regulations - Maintain compliance with all short term rental regulations for your license type. This includes factors like occupancy limits, parking, trash policies and more. Review the full ordinance for details.

Market and manage your rental - List your property on sites like Airbnb and VRBO. Enforce rental contracts, collect payment, clean between guests, respond to reviews and maintain your calendar. Consider hiring a professional management company to handle these tasks.

Following these key steps allows short term rental hosts in Springfield to operate legally and successfully. The city ordinance creates structure around this industry to limit impacts while still permitting this popular lodging option. Review all regulations before getting started.

Short Term Rental Licensing Requirement in Springfield

Operating a short term rental (STR) in Springfield, Missouri requires obtaining a business license from the city. There are three categories of STR licenses:

Type 1

Allowed in single-family residential (R-SF) and residential townhouse (R-TH) zoning districts. For owner-occupied primary residences or historic carriage houses

Type 2

Allowed in other residential zoning districts besides R-SF and R-TH. Requires a special use permit on top of the business license. Special use permit has an initial $350 fee.

Type 3

For non-owner occupied residences in any residential zoning district. Requires a business license only.

All STRs, regardless of type, must pay licensing fees based on gross rental receipts. Fees typically range from $25 per year (for $0-$10,000 in receipts) up to $350 per year (for over $500,000 in receipts).

In addition to obtaining a license, STR hosts must comply with various city regulations on safety, parking, noise, trash collection and more. Failure to maintain license requirements can result in fines or suspension/revocation of the license.The city plans to increase enforcement efforts against STR owners operating without a license.

Over 500 licensed STRs currently operate in Springfield, but many more unlicensed rentals fly under the radar. Stricter enforcement aims to level the playing field for properly licensed hosts losing business to illegal operators.

Required Documents for Springfield Short Term Rentals

Operating a legal short term rental (STR) in Springfield requires proper licensing and documentation. Hosts should ensure they have all necessary paperwork in order before listing their properties.

The key documents Springfield STR hosts need include:

Business License

All short term rental operators must obtain a business license from the city. There are separate license types depending on if the rental is owner-occupied (Type 1) or not (Types 2 and 3). Fees range from $25 to $350 annually based on rental income.

Certificate of Occupancy

The city requires a certificate of occupancy (CO) for the property to ensure it meets building codes and is safe for guests. If you are renting out part of your home, an inspection may be required. Newer homes likely already have a CO.

Proof of Insurance

Hosts must show $500,000 in liability insurance coverage for their rental. This protects owners if issues like injuries or property damage occur. Some home insurance policies already include coverage for short term rentals.

Sales Tax ID

To properly collect and remit occupancy taxes, hosts need a sales tax ID number. This is easily obtained by contacting the city's finance department.Keeping these documents current and providing them upon request is crucial for maintaining licensing.

Fines and revocation of permits can occur if requirements lapse. Check with the city if you have any questions about paperwork needed to operate your STR legally.

Springfield Short Term Rental Taxes

Short term rentals in Springfield, Missouri are subject to the same 5% lodging tax that was previously only applied to hotels, motels, and tourist courts. This tax rate is the result of a ballot measure approved by Springfield voters in April 2023, which consolidated three existing hotel/motel taxes into one unified 5% lodging tax also covering short term rentals.The 5% lodging tax on Springfield short term rentals includes:

• 2% tax approved in 1979 based on gross receipts
• 2.5% tax approved in 1998 funding Jordan Valley Park and related debt service
• 0.5% tax approved in 2004

Prior to July 2023, short term rentals were not taxed at all by the city of Springfield. The April 2023 ballot measure bringing short term rentals under the purview of the lodging tax went into effect July 1, 2023.

This change levels the playing field between licensed hotels/motels and short term rental hosts operating legally with a license compared to unlicensed hosts potentially dodging regulations and taxation. All licensed short term rentals in Springfield now contribute tax revenue supporting city services, sports complexes, arts funding, and more.

The 5% lodging tax applies to the entire gross receipts of anyone renting out a short term rental for less than 30 days in Springfield city limits.

This includes major short term rental platforms like Airbnb, VRBO, and more.The city estimates 400-450 total short term rentals operating in Springfield, although currently only around 265 hosts have obtained the required licenses.

Increased enforcement efforts are now underway to crack down on unlicensed short term rentals to boost compliance with regulations and ensure proper tax remittances.

Illinois-wide Short Term Rental Regulations

Illinois has statewide regulations that apply to short term rentals across the state, in addition to any local rules that individual cities and counties may impose. Here is an overview of the key statewide short term rental rules in Illinois:

Registration and Tax Requirements

All short term rental hosts in Illinois must register with the state Department of Revenue and obtain a certificate of registration. This applies if you rent out a room, apartment, house, or other dwelling.

Short term rental hosts must also collect and remit all applicable state, county, and municipal taxes. This includes hotel taxes in many areas. Make sure you understand the tax obligations in the specific jurisdictions where your rental properties are located.

Safety and Legal Use Requirements

Short term rentals must comply with all building codes and zoning regulations. Many municipalities prohibit short term rentals in certain residential areas or require special use permits.

Rentals must have working smoke detectors, carbon monoxide detectors, and fire extinguishers. Properties must also meet other safety standards typical for hotels and other lodging establishments.

Home sharing through services like Airbnb and VRBO must meet requirements for legal home businesses. This includes registering the business appropriately, reporting income, and more.

Good Neighbor Policies

The state encourages short term rental hosts to implement good neighbor policies. This includes quiet hours, parking arrangements, trash policies, and more.

Hosts should provide a local emergency contact to neighbors and be responsive to any concerns. This helps maintain positive community relationships.

Make sure you understand both state regulations and local short term rental rules before operating this type of business. Also consult with professionals like lawyers, accountants, insurance agents, etc to ensure full legal compliance.

Does Springfield strictly enforce STR rules?

Springfield takes a balanced approach to enforcing short-term rental regulations. The city legalized short-term rentals in 2019 and established a licensing system to regulate operations.

Over 500 licensed rentals currently operate in compliance with city ordinances.However, a recent analysis by Host Compliance identified over 1,000 active short-term rental listings in Springfield, indicating a significant number operating without required licensing.

To address this issue, the city now plans to increase enforcement efforts against illegal operations.The city categorizes short-term rentals into three license types with varying rules on location, density limits, owner-occupancy requirements, and caps on rental days when the owner is absent. Licensing fees range from $25 to $350 based on gross rental receipts.

Operators must also obtain an annual business license and certificate of occupancy to remain compliant.Enforcement has previously focused on responding to neighbor complaints about problem properties.

But unlicensed short-term rentals represent lost tax revenue for the city, which recently began levying a 7% lodging tax on stays under 30 days. Identifying and shutting down illegal operators will be a renewed focus going forward.The city takes rule violations seriously and monitors online listings to identify unpermitted rentals.

Fines for non-compliant operators start at $100 per violation and quickly escalate with repeat offenses. Revoking a short-term rental's business license is also an enforcement option.So while Springfield initially took a light-handed approach to give the short-term rental market time to adapt to new regulations, the city now plans strict enforcement actions against those flaunting the rules.

This crackdown aims to create a fair playing field for licensed operators following regulations and paying required taxes.

How to Start a Short Term Rental Business in Springfield

Starting a short term rental business in Springfield requires following several key steps:
Determine the type of rental you want to operate.

Springfield has 3 categories:
Type 1: Owner-occupied residence rented out less than 95 days per year
Type 2: Non owner-occupied residences with no night limits
Type 3: Accessory dwellings rented out with no night limits

Apply for a business license from the city of Springfield.

The license costs $25-$350 depending on projected gross rental receipts.

Register for a Short Term Rental Type 2 permit if operating a non owner-occupied rental.

This involves hosting a neighborhood meeting and getting support from 55% of adjacent homeowners.

Obtain certificate of occupancy after inspection of the rental unit.

This verifies safety and zoning regulations are met.
Comply with all operational requirements like parking, trash, noise rules. Fines can be issued for violations.

Collect and remit required taxes on rental receipts like sales tax and lodging taxes.

Renew license and permits annually to continue legally operating the short term rental. Market listing on platforms like Airbnb, VRBO once licensed and permitted. Comply with platform rules too.

Starting a compliant short term rental business takes research, planning, and working through licensing steps. But thousands find it a worthwhile investment in Springfield. Reach out to the city licensing office with any questions.

Who to contact in Springfield about Short Term Rental Regulations and Zoning

City of Springfield, Missouri
Development Review Office
840 Boonville Ave
Springfield, MO 65802Phone: 417-864-1611

What do Airbnb hosts in Springfield on Reddit and Bigger Pockets think about local regulations?

The online discussions among Springfield hosts on sites like Reddit and BiggerPockets provide some insight into their views on local short term rental regulations:

Overall, the regulations seem reasonable but can still be challenging to navigate. Getting licensed and complying with rules adds complexity for hosts. But many understand the rationale behind regulation.

The licensing fees, taxes, and fines for violations are seen as burdensome by some. Hosts debate whether the city revenue merits the bureaucracy created. However, most comply given enforcement efforts.

The neighborhood approval requirement for non owner-occupied rentals draws mixed reactions. Some hosts secured support easily while others struggled through opposition. Overall, hosts encourage working cooperatively with neighbors.

Hosts widely agree more education from the city would help improve compliance and experience. Common pain points like occupancy limits, parking restrictions, and noise rules trip up even experienced hosts.While not always in full agreement, Springfield hosts generally accept short term rental regulations as a necessity of operating.

Most aim to follow the rules, but also vent frustrations on discussion forums. Improved communication from the city could ease difficulties hosts face in achieving full compliance.