Prospect Heights CHAPTER 7 PROPERTY RENTAL CODE § 3-7-7

A. In addition to the requirements set forth for rental properties in this chapter of the code, short-term rental properties shall also meet the following standards and regulations:


1. The property's maximum occupancy limit established per the international property maintenance code shall not be exceeded.


2. No short-term rental property shall be rented for a period shorter than three (3) consecutive nights.


3. The owner shall not advertise or allow guests to book the short-term rental property for an occupancy greater than the established legal occupancy per city inspection.


4. The short-term rental shall be for the entire property. The owner may not rent out individual rooms or portions of the property.


5. The owner must provide at the time of application a copy of their insurance specifically covering short-term rental liability for their property with limits of not less than one million dollars ($1,000,000.00) per occurrence, for bodily injury and property damage arising in any way from the issuance of the license. Each policy of insurance required under this subsection shall; (i) be issued by an insurer authorized to insure in the State of Illinois, and (ii) include a provision requiring thirty (30) days' advance notice to the city prior to cancellation or lapse of the policy. The owner shall maintain the insurance required under this subsection in full force and effect for the duration of the license period for each short-term rental property. A single violation of this subsection may result in suspension or revocation of the license.


6. The short-term rental property must be offered through a short-term rental marketplace and the owner must provide documentary evidence of the marketplace platform that is used for their bookings to the city.


7. Any short-term rental property shall be subject to the Hotel and Motel Tax as set forth in this code, as may be amended from time to time. The owner shall fulfill all requirements of the Illinois Department of Revenue for operation of a short-term property rental, including the payment of any applicable taxes associated with such rental.


8. If the short-term rental marketplace used by the owner does not include services directing required payments to the city, the owner shall use a third party tax payor service to ensure all required forms and payments are received by the city. The owner must provide documentary evidence of such service.


9. The short-term rental property must be in good standing with the short-term rental marketplace. The owner shall only advertise a short-term rental that complies with all of the short-term rental standards and restrictions set forth in this chapter.


10. The short-term rental program shall be in good standing with the property rental licensing and inspection program.


11. If the short-term rental property is subject to regulations or restrictions by a homeowners' association or condominium association, the owner must provide documentary evidence that the applicable association or board has approved the use of the property as a short-term rental.


12. Any overnight parking for short-term rentals must be accommodated on the site or in another approved location, and parking, including overnight parking, shall be in conformance with this code and zoning ordinance requirements.


13. In order to ensure the safety and well-being of the city and its residents, the owner shall maintain security cameras at the short-term rental that show the driveway and parking areas, and each entrance door, with video storage/archive capability to provide such information to the city or police department at any time upon request.


14. The property rental must comply with all city building, fire, property maintenance and other code requirements including city and State regulations.


15. The owner shall be prohibited from permitting any criminal activity or public nuisance, including excessive noise, to take place on the property. If the owner knows or suspects that any criminal activity or public nuisance is taking place on or immediately adjacent to the property, the owner shall immediately notify the police department of such fact and cooperate with the police department in any investigation that may ensue. The city's building administrator and police chief shall have the authority to abate the nuisance at their discretion pursuant to their authority as officers for the city. Repeated violations at the property shall be cause for revocation as set forth in subsection (c).


B. License Prohibitions: No license to engage in short-term property rental shall be issued to:


1. Any applicant owner, if such applicant owner or any other person with an ownership interest in the property on which the short-term rental is located has ever been convicted in any jurisdiction of any felony that is rationally related to the individual's fitness or capacity to operate a vacation rental.


2. Any applicant whose license to operate a short-term rental or similar establishment at any location within or outside the City has been revoked for cause within the last three (3) years.


3. Any applicant where the applicant or any other person with an ownership interest in the property on which the short-term rental is located is in default to the city regarding payment of water and sewer charges, special taxes or assessments, parking and other city violation citations or judgments, Motor Vehicle Tax, or any other taxes or fees that are due and unpaid by such person to the city, pursuant to the city code, where there are delinquent property taxes owed to Cook County on the property on which the short-term rental is located, or any other property owned within the city by the applicant.


C. Revocation: Actions to suspend or revoke a short-term rental license issued under this chapter shall be in accordance with sections 3-7-4 and 3-7-5 . Additionally, if the short-term rental license is revoked for any cause, no license shall be granted to any person for the operation of a short-term rental at the property described in the revoked license, or to the revoked licensee, and his or her co-owners for a period of three (3) years from the date of revocation.


(Ord. O-23-04, 2-27-2023)