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Duluth's 300-foot rental rule could become permanent

DULUTH -- It's back.

The controversial 300-foot rule is again coming up for debate, as the city is proposing to make it a permanent part of the new zoning code.

The rule, which bans new rental licenses in college neighborhoods within 300 feet of an existing one, with few exceptions, has been the subject of fierce debate since it was passed more than three years ago. Advocates say it protects residential neighborhoods from rental expansion, while opponents say it is legislation that has prevented people from selling their homes.

The 300-foot rule is set to expire in 2012. The city, along with the consultant hired to develop the new zoning code, recommended making the 300-foot rule permanent and renaming it the "Homeowner Protection Area" after studying the issue and getting feedback from residents.

"The whole point of the zoning code is to implement the vision of the comprehensive plan," said Cindy Petkac, the city's Land Use Supervisor. "And part of that is recognizing and protecting the single-family neighborhoods -- homes constructed for families and not really for rentals."

To make room for students, the code would include new language that would encourage development of more student housing in eight areas, including construction of housing of buildings that would allow up to 20 units and four stories per a 20,000-square-foot lot. The city would require that at least 80 percent of the occupancy in the units be students.

The incentive for developers is they will be able to construct buildings in the area regardless of underlying zoning restrictions, Petkac said.

However, the proposal from the city has led to push-back from property owners and some city councilors.

"It's akin to doing knee-surgery on the wrong knee," said 1st District Councilor Todd Fedora. "The city should be focusing on controlling behaviors in that area rather than restricting what people can and cannot do."

Fedora notes that he has been told several horror stories of people who couldn't sell their homes in the neighborhood because they weren't able to obtain a rental license because of the 300-foot rule.

Amy Skar, a real estate agent with Edina Realty, said she had a house sit on the market for months for a client who was doing military training in Germany and looking to get out of his mortgage. Her client was eventually able to get a license, but only after twice going through the Building Appeals Board.

Skar said it's a process that needs to be tweaked.

"I've seen it become a lengthy process," she said. "And there are situations where it's clearly a need, but licenses are denied."

Petkac said that's an issue that will be addressed and a process that will be streamlined as advocates for both sides meet to discuss the issue at a meeting Thursday. While the meeting is open to the public, she said the public won't get a chance to comment on the code then but probably will be able to after the consultant has come up with another draft of the code.

The city council also will have to approve the final zoning code, but Petkac said they won't be able to vote on pieces of it or make amendments.

"The council will have to approve the new code," she said, "but it will have to be the entire code."