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7.2 SR 09-18-2023Request for Action To Item Number Ma Tor and CinT Council 7.2 Agenda Section Meeting Date Prepared by Public Hearings September 18, 2023 Chris Leeseberg, Senior Planner Item Description Reviewed by Ordinance Amendment: Update Requirements and Zack Carlton, Communi r Develo ment Director Standards for Home Occupations Reviewed by Cal Pormer, Ci r Administrator Action Requested Open the public hearing, take comments, close the public hearing. Provide staff direction on the proposed ordinance and postponed indefinitelyT. Background/Discussion This past �Tear, staff held four work sessions with the Planning Commission to discuss updates to the cit�T's home occupation ordinance and based on their direction, staff drafted the proposed ordinance amendment The following key items have been recommended by the commission to be amended. Hours of O�eration ■ Establish a set time (7 a.m. — 7 p.m. MondayT through Saturday) that cannot be negotiated, as a residentiallyT based business should not detrimentally affect the use and enjoyment of residential neighbors using their propertyT in the evenings. Prohibited Uses MotoY vehicle Yepairs — This use has been challenging foY the past few �rears mostly because it occurs in residential outbuildings that were not built to commercial standards and include outdoor storage of vehicles. MotoY vehicle Yepairs were introduced as conditional use in the 2019 oYdinance update, prioY to that, the use �vas prohibited. Occupations in detached accessoryT structures — The commission continues to recommend that allowing home occupations in an accessoryT structure creates manyT frustrations for the public as well as difficulties for the applicant. For the applicant, architectural/engineering services likelyT `vould be required and recent applicants have indicated struggles finding architects to do small projects and the costs associated with it. HistoricallyT, manyT of the home occupation permits were in existing accessoryT structures not set up for commercial uses. Outdoor Storage — This use is more typical of larger operations that should be in industrial or commercial locations. Interim Use PeYmits (NP� ■ Any occupation that does not meet the permitted requirements would be reviewed only through the NP process. The intent of the NP is to evaluate, after a set amount of time, the impact a permitted home occupation is having on the neighborhood or the cit�T. In contrast, once a CUP is approved, it runs `vith the propertyT in perpetuityT. A new NP ma�T be applied for after the original NP has terminated. The Elk River Vision A 2a�elcolning co�nlnunity 2a�ith T evolutiona� y and spizzted T esou� cefulness, exceptional se�vice, and coln�nunity engagelnent that encou�ages and ins�iz•es pTo�pe�zty. rowEREo ar �I'1 ���� Update�l• January 2023 Staff also reorganized the ordinance, removed some redundancies, and added/modified regulations. The main goal of this amendment is to protect the qualityT of life in residential neighborhoods, protect the appearance of the neighborhood, and protect residents' investment in their properties. B�r limiting home occupations to only the home, the Commission believes these goals can be obtained. Staff Yeviewed 12 neighboring communities and 10 of the communities allow home occupations to be conducted only- in the home. Princeton and Ramse�T allo`v them in detached accessor�T structures. A secondar�T goal is to limit the outreach to elected officials b�T removing the frustrations (time, costs, and upgYades) the pYopeYt�r owneY will face when an aYchitect/engineeY is Yequired foY their business to opeYate in an accessoryT structure. Also, e�sting improvements mayT be in the ground, under concrete floors, and behind walls that do not meet commercial code requirements, and this is difficult for the building department to inspect / approve, short of having the owner demolishing the area(s) of concern. June 20 Council Work Session The Council agreed `vith most of the Commission's recommendations but `vas hesitant about not allo�ving home occupations to occur in accessor�T d`vellings. The Commission continues to recommend home occupations be prohibited in accessoryT structures and the attached ordinance reflects their recommendations. If the cit�T continues to allo�u home occupations in accessor�T structures, when `vould the cit�T require the applicant to show compliance with commercial codes? If required at the time of application, there are costs prior to knowing if theyT receive approval. If after approval, can they start/continue their operation while they work on sho`ving compliance? As the Council mayT know, manyT of our CUPs, not just for home occupations, occur after the fact This creates another layrer of difficultyr bet�veen the cityr and the applicant Should the cityr have the applicant cease operation of their business until the CUP is recorded and all applicable conditions are met? Should the cityT allow them to operate and give them X months to complete the conditions and record the CUP? CurrentlyT, practice has been to allow operations to continue `vith good faith until theyT complete their conditions. This approach historicallyT has had mixed results with staff continuallyT reaching out and reminding the applicant to finalize their conditions. Due to other sections of the ordinance cross referencing home occupations, staff `vill bring Section 30-801 back foY review/adoption with the otheY peYtinent sections. Because of this, staff would like the Council to Yeceive feedback during the public hearing, revie`v the ordinance the Planning Commission recommended, provide staff direction, and postpone this action indefinitelyT. Staff will readvertise the ordinance amendment for all sections relating to home occupations. Financial Impact None Mission/Policy/Goal ■ Maintain livable neighborhoods ■ Protect the appearance of the neighborhood ■ Protect residents' investment in their residential properties Attachments Proposed Ordinance June 20, 2023, CityT Council iVlinutes Sec. 30-801. Home occupations. (a) PuT�ose. The purpose of this section is to provide a means, through the establishment of specific standards and procedures, b�T �uhich occupations can be conducted in residential homes, without jeopardizing the Yesidential characteY oY health, safetyr, and general ��elfaYe of the surrounding neighborhood as `vell as the users of the propert�r. In addition, this section is intended to provide a mechanism enabling a distinction bet�veen permitted home occupations and interim home occupations, so that permitted home occupations mayT be allowed through an administrative process rather than a quasi-judicial hearing process. (b) Prohil�ited activities. No home occupations (peYmitted oY interim) shall: (1) Be conducted outside of the dwelling unit (house). (2) Be conducted by an individual �vho does not reside on the propertyT and uses the residence as a primary address for legal purposes. i. Exception. An occupation foY a lessee, oY equivalent, Yesiding on the pYopert�r ma�T be allowed with approval of an Interim Use Permit The permit shall be valid for a ma�mum of three �Tears or until the lessee no longer resides on the parcel, whichever comes first. (3) Operate between the hours of 7:00 p.m. and 7:00 a.m. Monday through SaturdayT and all dayT on SundayT. (4) Constitute a fire hazard to neighboring residences, adversely affect neighboring pYopertyr values, or constitute a nuisance or otherwise be detrimental to the neighboYs because of excessive traffic, noise, g1aYe, odor, electrical inteYference, vibration, dust and otheY nuisance or safetyr hazards. (5) Involve any of the following: a. Ammunition manufacturing. b. BodyT shops. c. Escort businesses. d. Flea markets. e. Gun Yepair and/oY sales. £ Hazardous materials or activities, as defined b�r the iVlinnesota State Building Code. g. Machine shops. h. Motor vehicle repairs. i. 1�lotor vehicle sales. j. Outdoor storage. (not including employee personal vehicle parking) k. Repair of internal combustion engines. 1. Sexuallv oriented land uses. m. Wholesale or retail business, unless conducted entirel�T by courier, mail, or email. n. Welding. o. OtheY objectionable uses as determined by the cityr council. (6) Signage greater than four (4) square feet. (7) Adversel�T affect governmental facilities and services, including roads, sanitar�T se�vers, `vater, storm drainage, garbage service, electrical services, police and fire service, sensitive environmental features, including lakes, surface water and underground water supply and qualityT, wetlands, slopes, floodplains, and soils, or other. (c) PeT�nitted bolne occupations. PeYmitted Home occupations (occupation) shall be allo�ued subject to the conditions of this section, other applicable cit�T ordinances and state la�vs and statutes. If the cit�r denies establishment of an occupation to a Yesident, the Yesident mayr appeal the decision pursuant to the provisions of subdivision II of division 2 of this article. Permitted occupations are subject to the follo`ving criteria: (1) No noise, lights, odors, dust, gas, heat, vibration, glare, or other phyTsical manifestarions resulting from the occupation shall be evident beyond the boundaries of the propertyT on which the occupation is being conducted. (2) Use equipment `vhich is not normallyT found in a home (such as, but not limited to, stationaryT power tools and salon seats), except that equipment which is tyTpicallyT in an office matir be used. (3) The occupation shall not require internal or external construction features not customaril�T found in single-famil�r residential dwellings. (4) A maximum of one full-time employTee, or equivalent, other than those persons who customarilyT reside on the premises shall be employTed. (5) Occupations involving teaching shall not exceed t�vo pupils at a time. (6) Occupations shall not be serviced byT delivery vehicles larger than 26,000 pounds gross vehicle weight. (7) Occupations shall not create a parking demand more than that which can be accommodated in an e�sting drive`vayT or approved surface area, `vhere no vehicle is parked closeY than 15 feet to the curb line oY edge of the paved surface noY is parked within anyT right-of-`vayT. (8) On-site sales shall be limited to those clearlyr incidental to the seYvices provided. (d) Inte�zln ho�ne occupations. Home occupations that do not involve pYohibited activities but exceed the permitted residential occupation criteria mayT be allowed `vith approval of a Interim Use Permit by the city council puYsuant to the provisions of subdivision III of division 2 of this article. The intent of the Interim Use Permit is to evaluate, after a set amount of time, the impact a permitted home occupation is having on the neighborhood or the cit�r. An approved Interim Use PeYmit shall be valid foY a ma�mum of three years oY until the propert�T is sold, �vhichever comes first To maintain a home occupation after the termination period, a new Interim Use PeYmit must be applied foY. This application must be received at least 120 da�Ts prior to the termination date on the existing Interim Use Permit. (e) Inspections. The cityr may at any reasonable time inspect the residential occupation to determine if the applicant is strictly adhering to the criteria for a permitted residential occupation or the conditions placed on a conditional residential occupation. (� Bevocation oz� expi� ation of a conditional use pe�7nit fo�� ho�ne occupations. (1) Expirations of conditional home occupations shall be as set forth in section 30-656. (2) Revocation of conditional use permits for home occupations shall be as set forth in section 30-659. (g) Preexisting l�usinesses. The cityT recognizes that e�sting home businesses may have been in operation, without approval, prior to DATE OF r1DOPTION and therefore may allow their continuation, if theyT show proof, theyT have been a valid business in the State of Minnesota prior to DATE OF r1DOPTION, do not involve prohibited activities, and receive an Interim Use PeYmit. (h) The propertyT o�vner is responsible for the operations of the home occupation and anyT liabilit�T related thereto. 10.1 Home Occupations M�. Leesebexg presented the staff xeport. The Council discussed state statute and the direcrion to move towards. Mr. Leeseberg stated 10 of the 12 peer cities only allow home occupations in homes and the otheY two cities allow accessory buildings with limits on the size of the building. The Council discussed the topic of intensity of use for home occuparions and possibly limiting the size of the accessory structures. The Council decided to go forwaxd with the Planning Cointnission's recommendations xegaxding business hours of opexation, no outdoor stoxage in residential aYeas, having an architect required and they decided to discuss the motor vehicle Yepairs soon. They agreed to start using Interim Use Permits instead of Conditional Use Pexmits. The Council also agreed to not allow semi-deliveries in residential areas. �OdERE� er ���V�� City Council Minutes )une 20, 2023 Page 7 These �ecommendarions will be going back to the Planning Coininission once more for discussion and then back to the Council for final approval. Back rou nd g ■ Four work sessions PC (Feb-May) ■ One work session CC (June) ■ Drafted ordinance based on PC direction ■ Key components are: ■ Hours of Operation ■ Prohibited Uses ■ IUP's Hours of O eration p ■ Prohibited between 7:00 p.m. - 7:00 a.m. Mon-Sat ■ Prohibited all day on Sunday ■ With many people getting home from work around 5-6:00 p.m., ■ A residentially based business should not detrimentally affect the use and enjoyment of residential neighbors using their property in the evenings Prohibited Uses ■ Motor vehicle repairs and/or sales ■ Has been challenging for the past few years ■ Outdoor storage of vehicles - difficult ■ Added with 2019 amendment but prohibited prior ■ Occupations in accessory structures — attached or detached ■ Outdoor Storage I nteri m V se Perm it I V P ■ An occupation that does not meet the permitted requirements (staff approval) would be reviewed only through the IUP process ■ Timeframe to evaluate any impacts ■ No more CUP option ■ Runs with property, not user Housekee in p g ■ Reorganized ■ Removed some redundancies G oal s ■ Protect ■ The quality of life in residential neighborhoods ■ The appearance of the neighborhood ■ Residents' investment in their properties ■ By limiting home occupations to only the home, the commission believes these goals can be obtained G oal s ■ A secondary goals ■ Limit the outreach to elected officials by removing the frustrations (time, costs, and upgrades) property owner will face with architect/engineer ■ Existing improvements that do not meet commercial code requirements ■ May be in the ground ■ Under concrete floors ■ Behind walls ■ Difficult for the building department to inspect/approve Cou nci I Work Session ■ Agreed with most of the PC's recommendations ■ Hesitant about not allowing home occupations to occur in accessory dwellings ■ PC continues to recommend home occupations be prohibited in accessory structures Com I iance - if i n Accessor Structu res p y ■ When is the applicant required to show compliance with commercial codes? ■ Time of application? Costs prior to knowing if approved ■ If after approval, can they start/continue their operation while they work on showing compliance? Com I iance p ■ Many CUP's occur after the fact 1. Cease operation until the CUP is recorded and all applicable conditions are met? 2. Continue and give them X months to complete the conditions and record the CUP 3. Current practice has been to allow operations to continue with good faith until they complete their conditions ■ This has mixed results Action Re uested q ■ Due to other sections of the ordinance cross referencing home occupations ■ Staff will bring Sect 30-801 the other pertinent sections ■ Open the public hearing ■ Take comments ■ Close the public hearing back for review�adoption with ■ Provide staff direction on the proposed ordinance ' Postponed indefinitely