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Monday, March 21, 2022

Court Upholds Village's Finding that Short-Term Rental Use Violated Zoning Code

We don't see a lot of zoning cases that make their way to the Illinois Appellate Court but last week, we saw two which we will report on this week. 

In Wortham v. Village of Barrington Hills, 2022 IL App (1st) 210888, the Village notified a homeowner who was renting out their home as a short-term rental more than 40 times on VRBO that the short-term rental use was not allowed in the R1 district which only permits single-family uses. The homeowner ignored the notice, and continued to rent out their home. The Village sent two additional notices before sending notice to appear before a hearing officer on the alleged Zoning Code violations. The hearing officer found the short-term rental use to be an unlawful commercial lodging use that was not a permitted use in the R1 district under the Village Zoning Code and imposed a fine of $26,250 and ordered the homeowners to cease renting their home out. When the homeowners continued to rent out the home, the Village cited them again, and the hearing officer imposed a second fine and another order to cease the illegal use of the property. The homeowners appealed both administrative hearing decisions to the trial court, which upheld the Village's decisions. The homeowners then appealed that ruling.

On appeal, the Appellate Court reviewed the Village's Zoning Code, specifically to determine whether the short-term rental use was permitted under the R1 regulations as the homeowners argued or constituted an unlawful commercial use as the Village argued. First, the Appellate Court held that the short-term rental use was not a permitted home occupation under the Zoning Code, which was the only lawful commercial use of R1 zoned property. The Court determined that the homeowners' advertisement of the use on VRBO, the parking of multiple vehicles in the driveway during the short-term rental use, and the installation of a keypad on the door gave an outward appearance of a vacation rental business, not a single family residence. Second, the Court found that the short-term rental use was not consistent with the "intent and purpose" of the Zoning Code which included the prevention of the harmful encroachment of incompatible and inappropriate uses into residential areas. Finally, the Court rejected the homeowners' argument that the fact that the Village prohibited short-term rentals but allows longer term leases was unconstitutionally vague because the Zoning Code did not define the appropriate time-frame for unlawful or lawful leases, finding it to be an impermissible facial challenge to the Zoning Code.

In sum, the Appellate Court upheld the Village's citation of the homeowners for improperly using their single family home as a short term rental use in violation of the Village's Zoning Code.


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