Ames City Council discussed a controversial rental cap proposal for neighborhoods surrounding campus and numerous zoning issues at their May 22 meeting.

The six council members passed the proposal on a 5-1 vote;  At-Large Representative Amber Corrieri was the sole vote against it. 

The rental cap, which limits the number of homes that can be rented out in a specific neighborhood, will affect seven neighborhoods as defined by the City of Ames: South Campus Area North (SCAN), College Creek/Old Ames Middle School, Oak-Wood-Forest, Colonial Village, Oak-Riverside, Old Edwards and Westside. 

In October 2017, the City Council put a moratorium on new rental properties to preempt their decision on a later rental cap. According to the council, 42 people got their letter of compliance, the license that allows people to rent their home, before the moratorium could pass.

This moratorium was put in place with the intent of making a decision on the rental cap at a later time after public input had been given. 

The Council attorney advised members to not postpone a vote on the rental cap or else they would have to extend the moratorium deadline. 

Gloria Betcher, one city council member who supports the cap, said that rental properties are hurting homeowners.

“It is a hard situation for homeowners who are surrounded by rentals,”  Betcher said. “The studies I have read suggest that the closer you are as a homeowner to other rental homes, the lower your property value is.”

Others, like Corrieri, say the cap has too many unknown consequences.

“When several people have hardships as a result of what we are doing here, it isn’t the market’s fault,” said Ward Four Representative Chris Nelson. “Due to the moratorium and what we are doing, many people can’t sell their house, and I really struggle with that.”

The majority of the meeting was spent talking about ways they could mitigate harms to people in financially tight situations who were planning on renting out their property.

The City Council discussed three options.

The first option was to allow people to rent out their property for two years if they had been trying to sell their property to no avail.

Homeowners would be able to qualify for this if they had lived in Ames for a minimum of five years, the house has to be appraised and on sale for a reasonable price and the house must be adjacent to at least three rental properties or two if the “geography is unusual.”

The second option would be the same as option one but it would only allow for nine months of renting and wouldn’t require any number of adjacent rental properties.

Between these two options, council members leaned more towards the first option but said they could consider reducing the amount of time allowed to rent out a residence.

Council members Tim Gartin, Amber Corrieri and Chris Nelson supported an amendment that would allow a separate definition for fiscal hardship to include people who have had their houses on the market for a shorter period of time, and they had a recent life event that has caused them to face hardship.

Members Browyn Beatty-Hansen, Gloria Betcher and David Martin did not support the “life event” part of the amendment arguing it would cause a lack of objectiveness and the case by case basis would undermine the the idea of the cap.

Betcher used this same reasoning when arguing against the exceptions as a whole.

“With any of those exceptions, we basically are giving people permanent [letters of consent] or as permanent as they can be,” Betcher said. “At that point why bother to have the cap, because every exception would undermine the cap.”

The third option was to allow a window for any property owner to get a letter of compliance within the next six months to help grandfather in homeowners and smooth the transition process.

Gartin and Beatty-Hansen said they were wary of this plan as it could be abused. To solve this, Beatty-Hansen proposed a sunset clause, a requirement that the homeowner turn their residence into a rental property by the time the letter of compliance gets renewed at risk of losing the letter, to be heard at next City Council meeting.

Ames Mayor John Haila stated that the hardship exceptions would not be grouped with the full vote, rather it will have public comments and a vote at the June 12 meeting. 

Members of the Ames community were given time to make comment on the neighborhoods that are subject to the cap.

Sarah Conaway, an Ames resident living on Baker Street, said the neighborhood west of Lynn Avenue has 76 percent of its residents against the cap with 8 percent for it.

She proposed splitting the SCAN neighborhood west of Lynn Avenue to ensure people are being represented.

The proposal to split the SCAN North neighborhood into two districts was voted down with four members of City Council saying the cap would be compromised by splitting the two apart.

In addition to the original six neighborhoods that are part of the cap, the City Council voted to add the neighborhood west of campus between neighborhoods two and three.

One member of the “West” neighborhood supported this situation telling the Council it was “ridiculous” that all neighborhoods near campus except the closest one would be part of the cap.

The city is also considering rezoning over a section of Lincoln Way.

The rezoning changes would require businesses to change their layout with the goal of increasing efficiency and allow for long term development of businesses.

Business and property owners in the area were opposed to the changes saying that new requirements could raise business costs higher than they already are for little benefit.

The changes passed on a 4-1 vote: Betcher voted no and Nelson abstained.

The city council will convene again on June 12 at City Hall.