Oak Grove, Kentucky Short Term Rental Regulations Guide for Airbnb hosts

Executive Overview

Short-term rentals ARE ALLOWED in Oak Grove, Kentucky, subject to specific regulatory requirements. The city has established a comprehensive framework governing short-term rental operations, including business licensing, tax collection, and enforcement mechanisms. Investors should note that Oak Grove is actively monitoring and enforcing compliance, with recent city council actions targeting unlicensed operators.

What do Airbnb hosts actually earn in Oak Grove?

Oak Grove hosts earn a median $25,433/year with $124 ADR and 73% occupancy.

Top performers pull in $33,464+ per year.

See the full Oak Grove market breakdown

How to Start a Short-Term Rental Business in Oak Grove

Step-by-Step Process

Obtain Business License
- Contact Visit Oak Grove (Tourism Commission) to obtain a business license
- This is mandatory for operating any short-term rental within city limits
Register for Transient Room Tax Collection
- Register with the Oak Grove Tourism Commission
- Set up systems to collect the 4% transient room tax
Ensure Zoning Compliance
- Verify your property zoning allows for short-term rental use
- Obtain any necessary zoning permits
Establish Tax Reporting Systems
- Implement monthly reporting procedures
- Set up monthly tax remittance schedule (due by 30th of each month)

Required Documents, Permits, Licenses, and Guidelines

Mandatory Requirements

Business License

Required from the City of Oak Grove
Contact: Visit Oak Grove / Tourism Commission

Transient Room Tax Registration

Register as a taxpayer with the Oak Grove Tourism Commission
Monthly tax reporting required (Form provided by Commission)
Weekly reporting required if delinquent

Zoning Compliance

Zoning permit may be required
Property must comply with zoning district requirements
Certificate of occupancy may be needed

Key Definitions for Compliance

Short-Term Rental (per Oak Grove Ordinance):

A dwelling or dwelling unit rented for less than 30 consecutive days
No meals served
Each separate unit in multi-unit structures counts as individual STR
Excludes: Hotels, motels, extended stay facilities, bed & breakfasts, boarding/lodging houses

Specific Regulations

City of Oak Grove Regulations

Transient Room Tax (4%)

Imposed on all short-term rental occupancies
Tax may be added to rent at taxpayer's option
Funds support the Tourism Commission's operations
Effective since August 1, 2007

Payment Requirements

Monthly payments due by 30th of each month
If 30th falls on weekend/holiday, due next business day
Must be accompanied by detailed report
Reports are confidential but may be compiled statistically

Enforcement and Penalties

Delinquency Penalties: 10% penalty plus 12% annual interest
Weekly Reporting: Required if delinquent
Criminal Penalties:
- Theft by failure to make required disposition (KRS 514.070)
- Class A misdemeanor (under $500)
- Class D felony ($500-$10,000)
- Class C felony ($10,000+)
Collection: Tourism Commission may seek enforcement through Christian County Court, City Police, Code Enforcement

Kentucky State Requirements

House Bill 8 Compliance

All short-term rental properties must collect and remit transient room tax
State-level requirement that supplements local ordinances

County-Level Regulations

No specific Christian County short-term rental regulations were identified in the provided materials. County-level requirements would apply as needed for general business operations.

Current Enforcement Situation

Recent City Actions

City Council identified 50+ homeowners operating STRs without business licenses (November 2024)
City is implementing tracking systems through tourism app
Ordinances being adjusted to specifically address short-term rentals
Focus on non-compliant operators who don't pay required taxes

Compliance Expectations

All STR operators must obtain business licenses
Many non-compliant operators identified as out-of-state residents
City pursuing back tax collection

Contact Information

Primary Contacts

Oak Grove Tourism Commission / Visit Oak Grove

Executive Director: Traci Cunningham
Phone: (270) 439-4646
Email: Contact through city administration
Address: 8505 Pembroke Oak Grove Rd., P.O. Box 250, Oak Grove, KY 42262-0250
Website: www.oakgroveky.org

City of Oak Grove

Phone: (270) 439-4646
Fax: (270) 439-1201
Address: 8505 Pembroke Oak Grove Rd., P.O. Box 250, Oak Grove, KY 42262-0250
Website: www.oakgroveky.org

Mayor Jackie Oliver

Contact: Through City Clerk's office

Code Enforcement Officer

Contact: Through City Hall at (270) 439-4646

Important Links and Sources

Primary Documents

Oak Grove Transient Room Tax Ordinance: oakgroveky.org/wp-content/uploads/2024/12/OG-Ordinance-Transient-Room-Tax.pdf
Oak Grove Zoning Ordinance: comdev-services.com/wp-content/uploads/2019/09/Oak-Grove-zoning-ordinance-with-cover.pdf
Christian County Now Article: christiancountynow.com/news/267762-oak-grove-city-council-discovers-dozens-of-homeowners-avoiding-airbnb-business-licensing/

State Resources

Kentucky Department of Revenue (House Bill 8 Information): revenue.ky.gov/Business/Transient-Room-Tax/Pages/default.aspx

Investment Considerations

Market Dynamics

Strong enforcement environment with active monitoring
Significant number of existing non-compliant operators
Local hotels/motels concerned about competitive advantage
Tourism Commission actively tracking compliance

Financial Implications

4% transient room tax affects pricing competitiveness
Business license fees and compliance costs
Potential back tax exposure for non-compliant operators
Criminal penalties create legal risk for serious violations

Compliance Strategy

Obtain business license before operations
Implement robust tax collection and reporting systems
Monitor city ordinance updates closely
Consider professional property management for compliance

This regulatory environment requires careful attention to compliance from the outset of any short-term rental investment in Oak Grove, Kentucky.

Next step

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Ask the AI Advisor about Oak Grove

Oak Grove is a small city in Christian County in southwestern Kentucky, with a population of roughly 7,500 residents. It sits directly adjacent to Fort Campbell, a major United States Army installation that straddles the Kentucky–Tennessee line and is home to the 101st Airborne Division. The community has a quiet, working-class feel, drawing much of its identity and economy from the steady flow of military personnel, families, and visitors connected to the base. Oak Grove lies about 60 miles north of Nashville and approximately ten miles south of Hopkinsville, the Christian County seat, giving it a convenient position between two larger hubs in the region.

Fort Campbell is the single biggest draw in the area and the reason many travelers find themselves passing through Oak Grove in the first place. The installation supports family readiness events, graduations, and ceremonies that draw visitors from across the country, and the surrounding community has built a small but steady service economy around that traffic. It is essentially at Oak Grove's doorstep, with the main gate only a few minutes from the city center.

Just across the state line to the south lies Clarksville, Tennessee, the larger of Oak Grove's two nearest neighbors and the main source of restaurants, shopping, and entertainment for area residents. Downtown Clarksville, roughly a fifteen-minute drive south, sits along the Cumberland River and offers a riverwalk, a restored historic district, and a growing craft beverage scene, with venues such as Beachaven Vineyards and Winery and Old Glory Distilling Co. just outside the city core. Dunbar Cave State Park, a short drive southeast of downtown, provides an easy nature outing with a walking trail that leads to a large cave entrance once used by prehistoric peoples.

About twenty-five minutes to the north, Hopkinsville adds another layer of regional character. The town is the seat of Christian County and serves as a service hub for the surrounding farmland, and it is closely associated with the annual celebration of the 1918 solar eclipse that passed directly overhead. A short drive west of Hopkinsville brings visitors to the Jefferson Davis State Historic Site at Fairview, a small state park marking the birthplace and childhood home of the only president of the Confederate States.

Oak Grove's appeal as a short-term rental base comes from this particular mix: a small, affordable Kentucky town that is nonetheless within easy reach of a major military installation, the amenities of Clarksville, the regional services of Hopkinsville, and a comfortable one-hour drive to Nashville. For visitors attending events at Fort Campbell, exploring the Cumberland River region, or using the area as a quieter, less expensive alternative to a big-city stay, Oak Grove offers a practical and well-located home base.