Wayzata’s Planning Commission took another step toward prohibiting new short-term rentals Nov. 2, while neighbors and city officials discussed what the changes would mean for rentals already operating.

Commissioners directed staff to prepare a recommendation supporting amendments to the city’s zoning code. The recommendation will return for review Nov. 16 before going to the City Council. The commission’s vote did not enact the changes.

The proposal comes as Wayzata appeals a district court ruling that voided its earlier short-term rental ban. For neighbors hoping to end disruptive stays and owners seeking to continue lawful operations, the outcome matters.

What would change

Planner Haily Hedblom presented changes to Chapters 902 and 937 that would distinguish short-term rentals from state-licensed hotels and motels. A short-term rental would be lodging that is not state-licensed as a hotel or motel and is occupied for fewer than 30 consecutive days.

The zoning use table would retain a category for hotels and motels. Short-term rentals would be omitted, with added language making clear that unlisted uses are prohibited throughout the city.

Hedblom said qualifying existing rentals with active licenses could continue as legal nonconforming uses, provided their licenses do not lapse and they meet other requirements. Operators would still need annual license renewals.

Five people spoke at the public hearing, all supporting restrictions. Jeffrey Nelson described the effect of frequent guest turnover on neighborhood character. Mark Jones discussed a neighboring rental with a shared driveway. Others raised concerns about traffic, noise and unfamiliar visitors, and asked why existing rentals could continue.

Chair Blake Cameron supported the changes. “Residential is someplace that you live, not someplace that you stay,” he said in remarks.

Existing rentals and the court case

In the March 30 district court ruling, Judge Joseph R. Klein found that the earlier ban functioned as zoning, although the city adopted it through its rental-licensing code. He declared the ordinance void because Wayzata had not followed the required zoning-adoption process.

The city filed its appeal Aug. 4. Meanwhile, a 12-month moratorium on new short-term rentals, effective April 7, allowed the city to study zoning changes.

If the city loses its appeal and adopts the zoning approach staff described, qualifying existing, lawfully established rentals would be able to continue as grandfathered uses, subject to licensing and operating requirements. A ban on new rentals would not automatically end those existing operations.

Owners argued in their lawsuit that they invested in properties for lawful rental use and that a later prohibition could not erase their existing rights. State law generally protects lawful uses that predate new zoning controls, while allowing reasonable nuisance and public-safety regulations.

Klein did not decide each property’s grandfathered status. After voiding the ordinance, he found the nonconforming-use claim premature and did not reach the owners’ takings claim.

City Attorney David Schelzel told commissioners that zoning protections do not excuse code violations. “Licenses and permits are not an entitlement,” he stated. Existing operators must meet renewal requirements and could lose a license for violations or nuisances, he said. A successful city appeal would restore the earlier licensing restrictions, he added.

Asked why proceed while the appeal is pending, Schelzel said the city is pursuing both licensing and zoning regulation.

A familiar balance in a lakeside town

Visitor lodging has long been part of Wayzata. Earlier Wayzata.com coverage described the Arlington House and other hotels and boarding houses that welcomed summer guests during Lake Minnetonka’s resort era.

The Historical Society also describes a summer-cottage era beginning in the late 1890s. A historical survey documents cottages and bungalows in older neighborhoods south of Wayzata Boulevard. Seasonal cottages and modest homes are part of that history, although not every cottage was a vacation property.

Commercial and residential uses continue to meet in today’s Wayzata. The Hotel Landing borders a residential neighborhood, and the city-owned Bar & Grill sits alongside residential blocks. Downtown projects such as Westway and 200 Lake Street East combine housing and commercial space.

That proximity can bring benefits and friction. Disruptive visitors next door can create a nuisance: loud parties, late-night noise or blocked access can interfere with neighbors’ enjoyment of their homes. The presence of visitors alone, however, does not establish a nuisance, and different businesses and rental arrangements can have different impacts.

The city has also explored visitor-related revenue. A May 2025 staff report identified a possible lodging tax. Wayzata continues exploring a food and beverage tax to help fund services used by visitors and residents; 2026 legislation sought authority for a tax of up to 1%. Those discussions are separate from the zoning proposal.

The commission’s motion passed with no opposition voiced. Separate licensing and nuisance-code changes will be considered by the City Council, Hedblom said.