Landlord training, reemphasis on rental registry part of Sioux Falls' latest push to regulate vacation home industry

Officials say city lacks means to effectively enforce rental registry requirement under existing ordinance

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CORRECTION: The proposed ordinance does not call for a three year renewal, as an earlier version of this article reported. The Dakota Scout strives for accuracy and regrets the error.

Thousands of Sioux Falls rental properties could soon be subject to new regulations — including mandatory landlord training — being proposed by the Sioux Falls City Council.

About 7,700 rental properties here are registered as part of City Hall’s rental registry program, according to the Planning and Development Services Department.

But it’s unclear how many rentals in the city aren’t on the list, in part because City Hall has lacked an enforcement mechanism, according to city officials. And that’s made the rental registry what some officials say has become essentially a voluntary program.

However, proposed rule changes coming from the Sioux Falls City Council aim to change that while also creating a regulatory framework around short-term rentals in residential neighborhoods.

“One of the main goals of the permit system is it allows us to protect neighborhoods from bad actors,” Councilor Rich Merkouris said Tuesday. “By no means are the majority of the landlords in our city bad actors, … but we need to have a process in place that says ‘ you know what, that’s not the way we do business in Sioux Falls, South Dakota.”

Right now, the rental registry ordinance — adopted in 2003 before undergoing a series of modifications in 2011 and again in 2017 — does not require an application fee or any renewal after initial issuance. Merkouris’ proposal, though, would establish a one-time $50 application fee, which could be done in person or through an online portal. The proposed ordinance would also mandate that short-term rentals have both a sales tax license and lodging permit through the state, requirements already found in state law.

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