Based on the provided sources, here is a comprehensive guide for Short-Term Rentals (STRs) in Otsego County, MI (covering Otsego County and the City of Otsego, as no separate City of Otsego regulations were found):

1. Overview: Are Short-Term Rentals Allowed in Otsego, MI?

   • Yes, Short-Term Rentals are currently permitted in Otsego County. There is no active city-level or county-level ordinance specifically regulating STRs within Otsego County or the City of Otsego itself.
   • Important Caveat: Otsego County has proposed a new STR Ordinance (February 2025, Bagley Township-sponsored draft). This ordinance is not yet enacted or in effect. Therefore, investors must rely on existing state laws and local regulations.
   • Legal Context: Michigan lacks state-level permitting or comprehensive regulation for STRs. Statewide, STRs are generally considered legal where zoning permits residential use, though community association documents (Condo/HOA) or local zoning may impose restrictions. Crucially, the Michigan Court of Appeals has ruled that STRs violate standard residential use restrictions in community documents, treating them as commercial activities. This is a critical risk factor for investors in developments governed by such documents. (Reference: miCondoLaw article on state-level restrictions and court rulings).

2. How to Start a Short-Term Rental Business in Otsego County

   1. Verify Zoning: Confirm that STRs are a permitted use in your property's zoning district. While proposed county regs suggest they might be allowed in R2, R3, RR, FR, AR, and certain commercial/mixed-use districts with existing residences (B1, B2, B3, MUZ), you must verify current zoning with the Otsego County Planning & Zoning Department or the relevant township/zoning authority for the specific parcel.
   2. Check Community Documents: If the property is within a condominium or homeowners association (HOA), review the Master Deed, Bylaws, and Rules & Regulations for any prohibitions or restrictions on leasing, short-term rentals, or commercial activities. As ruled by Michigan courts, violations can lead to enforcement actions.
   3. Obtain Necessary Permits (Building/Safety):
      • Certificate of Occupancy (CO): Ensure the property has a valid CO for its current residential use. Proceed to otsegocountymi.gov/216/Building-Permits.
      • Safety Inspections: Comply with state and local safety standards. This includes installing/maintaining smoke detectors, carbon monoxide detectors, and fire extinguishers. The proposed county ordinance mandates a Building Department inspection to ensure compliance before issuing a permit. While not active, following these standards now is prudent. (Reference: miCondoLaw article on state safety requirements).
   4. Designate a Local Agent: While not currently required by county/city law, the proposed county ordinance mandates designating a Primary Agent (and optionally a Secondary Agent) residing within 30 miles, available 24/7. Identifying and documenting a local contact point for guest issues is essential for good neighbor relations and mitigating complaints.
   5. Understand State Tax Obligations: Register with the Michigan Department of Treasury and set up aUse Tax account (6% Use Tax on rentals ≤ 30 days). Do not assume local lodging taxes don't apply; some Michigan localities impose them. Verify potential local lodging taxes with the Otsego County Treasurer's office or the relevant municipality (e.g., City of Otsego Clerk/Treasurer) for the specific address. (Reference: Lodge Compliance article on Michigan STR tax rules).
   6. Obtain Insurance: Secure adequate liability insurance coverage for your STR operation.
   7. Prepare Guest Resources: Create and provide a "Good Visitor Guide" (as referenced in the proposed ordinance) with house rules, emergency contacts, quiet hours, parking instructions, and waste disposal guidelines.
   8. Market Responsibly: Ensure all advertising accurately represents the property and complies with any applicable platform requirements.

3. Required Documents, Permits, Licenses, and Guidelines

   • Current Requirements (No Active Local STR Ordinance):
     • Certificate of Occupancy (CO): From Otsego County Building Department (mandatory for any rental).
     • Use Tax Registration: With the Michigan Department of Treasury (mandatory for collecting/remitting 6% Use Tax on STR rentals ≤ 30 days). Form available on Treasury website.
     • Potential Local Lodging Tax Registration: Verify applicability with local authorities (e.g., Otsego County Treasurer, City of Otsego Clerk).
     • Insurance Policy: STR liability insurance.
     • Valid Driver's License/ID: For responsible party identification (standard requirement).
     • Property Deed/Lease: Proof of ownership or legal right to rent the property.
   • Current Guidelines:
     • State/Federal Laws: Adhere to all state and federal laws regarding health, safety, and non-discrimination.
     • Local Ordinances: Comply with all applicable local ordinances (zoning, noise, parking, waste, animal control, fire safety, etc.). Note: Active local noise, nuisance, and animal control ordinances still apply.
     • Building/Fire Codes: Comply with all applicable building and fire codes (detectors, extinguishers, egress, etc.).
   • Future Requirements (If Proposed Ordinance is Enacted):
     • Annual Otsego County STR License/Permit: Issued by the Zoning Administrator.
     • License Application Fee: Amount set by the Board of Commissioners (non-refundable once issued).
     • Detailed Application Documentation: (See Section 7 of the Proposed Ordinance for specifics - includes owner/agent info, bedroom count, septic/pump verification, CO verification, parking diagram, affidavit).
     • Septic System Compliance: Proof of pumping within the last 3 years and Health Department approval.
     • Building Safety Inspection: Verification by Building Department.
     • Adherence to Operating Standards: (Quiet hours, occupancy limits, parking, pets, waste, signage restrictions, etc.).

4. Specific Regulations for Short-Term Rentals in Otsego County

   • Current Regulations: There is NO active Otsego County or City of Otsego-specific STR regulation.
     • State Law: Michigan has no active statewide ban on STRs (the COVID-era bans are long expired). STRs must comply with general state laws (taxes, building/fire codes, anti-discrimination).
     • Local Ordinances: Standard local ordinances regarding noise, nuisances, parking, animal control, fire safety, and waste management still apply to STR occupants and operations. Violations can result in fines or other enforcement under existing codes.
     • Zoning: STRs must occur in a zoning district where the land use is permitted. Check with Zoning Admin.
     • Community Documents: Condo/HOA covenants may prohibit STRs under Michigan court precedent.
   • Proposed Regulations (Future - Not Active): The proposed Otsego County STR Ordinance (Draft Feb 2025) outlines detailed future regulations (See Section 1 of the response for the full scope of the proposed ordinance if enacted). Key proposed points include:
     • Annual licensing/permitting.
     • Cap on total number of STR licenses issued per year.
     • Requirement to post permit number on all advertisements and at the property.
     • Specific occupancy limits (e.g., 2 people per bedroom + 2, max 5 per 100 sq ft during non-quiet hours, no outdoor sleeping).
     • Designated quiet hours (10 pm - 8 am).
     • Mandatory local Primary Agent.
     • Septic system maintenance and verification requirements.
     • Restrictions on events, signage, recreational equipment use.
     • Enforcement mechanisms and escalating fines.

5. Contact Information (Phone, Email, Website) for Local Authority in Charge of STRs

   • Current Authority (No Active STR Ordinance):
     • Otsego County Planning & Zoning Department: Responsible for zoning verification. *See Otsego County Directory: www.otsegocountymi.gov/Directory.aspx*
     • Otsego County Building Department: Responsible for COs and building/fire code inspections. *See Otsego County Directory: www.otsegocountymi.gov/Directory.aspx*
     • Otsego County Sheriff's Office: For noise/nuisance complaints during stays. Phone: 989-732-6484 (Main County Number).
     • Michigan Department of Treasury: For Use Tax registration/compliance. *Website: www.michigan.gov/treasury*
     • Otsego County Treasurer: For potential local lodging tax questions. *See Otsego County Directory: www.otsegocountymi.gov/Directory.aspx*
     • City of Otsego Clerk/Treasurer (if property within city limits): For city-specific info (though no specific STR regs found). Contact City Hall directly.
     • Local Township Zoning Administrator: For zoning questions specific to townships.
   • Proposed Authority (If Proposed Ordinance is Enacted):
     • Otsego County Zoning Administrator: Designated as the primary authority for administering/enforcing the proposed STR ordinance (issuing permits, enforcing violations).
     • Otsego County Building Department: For safety verification inspections.
     • Northwest Michigan Health Department: For septic system verification inspections.

6. Links to Source Pages

   • Proposed Otsego County STR Ordinance: bagleytownshipmi.gov/wp-content/uploads/2025/02/STR-Ordinance-Proposed.pdf
   • Otsego County Official Website (Government/311/Online Services): www.otsegocountymi.gov/
   • Otsego County Building Permits: otsegocountymi.gov/216/Building-Permits
   • Otsego County Landlord/Tenant Info: www.otsegocountymi.gov/311/Landlord-Tenant
   • Otsego County Directory (Contact Info): www.otsegocountymi.gov/Directory.aspx
   • MiCondoLaw Article (State-Level STR Restrictions, COVID Ban Context): micondolaw.com/2020/05/18/executive-order-2020-92-michigan-maintains-ban-on-short-term-rentals-and-areas-of-public-accommodation/
   • Lodge Compliance Michigan STR Statewide Tax Overview: www.lodgecompliance.com/states/michigan

Action Steps for Investors:

1. Verify zoning and HOA/Condo documents immediately.
2. Obtain/ensure a valid Certificate of Occupancy.
3. Register for Michigan Use Tax and set up collection/remittance systems.
4. Investigate potential local lodging taxes.
5. Implement robust safety measures (detectors, extinguisher).
6. Designate a reliable local agent/manager.
7. Develop a comprehensive Good Visitor Guide.
8. Monitor Otsego County government websites and legal notices closely for progress/updates on the proposed STR ordinance. Be prepared for potential significant regulatory changes (licensing, caps, inspections) in the coming months/years.