Overview: Are Short-Term Rentals Allowed in Monteagle? Short-term rentals are allowed in Monteagle under the zoning ordinance. The Town regulates lodging businesses such as “bed & breakfasts, rooming houses, and boarding houses” within Chapter 5. These uses are permitted in specific residential and some commercial districts, with conditions that effectively govern STR operations (see Monteagle Zoning Ordinance, Section 510). In practice, hosts should treat a short-term rental as a Bed & Breakfast–type use and comply with the local conditions summarized below. In addition, hosts must obtain a short-term rental permit from the city, renew it annually, pass inspections, and collect and remit the local 7% occupancy tax and applicable state sales tax (per GoSummer’s Monteagle STR summary).

How to Start a Short-Term Rental Business in Monteagle Step 1: Confirm zoning and land use compatibility

• Confirm the zoning district of your property using the Town Zoning Map at Monteagle City Hall, and verify that “Bed & Breakfast, Rooming Houses, and Boarding Houses” is a permitted use in that district.
• Permitted in: R‑1, R‑2, R‑3, R‑4, and C‑1 (corridor commercial); also allowed in C‑2 and C‑3 subject to the Schedule of Permitted Uses (Section 501).
• In residential districts, “structures intended for use as temporary or permanent living quarters” are regulated as residential uses and must comply with the zoning requirements of that district (Section 213).

Step 2: Understand local operational constraints

• Operator occupancy: The proprietor must be a permanent resident of the dwelling (Section 510.C).
• Rooms and length of stay: No more than three bedrooms for rent at any one time, and lodging is limited to no more than 10 days during any one stay (Section 510.D–E).
• Parking: Provide off-street parking at least one space per room for rent plus at least two spaces for the household (Section 510.H).
• Appearance and signage: The residential character of the home may not be changed; signage must comply with Chapter 9 (Section 510.G–A). Town-wide sign permits and design review rules apply (Chapter 9).
• Code compliance: Federal, state, and municipal codes—including fire, building, and electrical—must be complied with as a condition of approval (Section 510.I).

Step 3: Obtain required approvals and permits

• Short-Term Rental Permit: Required from the Town; permit must be renewed annually and is subject to inspection (per GoSummer’s summary).
• Planning Commission approval: Required for Bed & Breakfast/boarding house operations (Section 510.A).
• Building Permit and Certificate of Occupancy: A building permit is required, and a Certificate of Occupancy must be issued after inspections. See Chapter 12 (Administration and Enforcement) and Appendix forms for the Certificate of Occupancy application.
• Site Plan (if applicable): For multifamily or commercial projects or if required by the planning commission, a site plan meeting Chapter 10 standards is required.

Step 4: Implement safety and infrastructure

• E‑911 Address: Display address numbers visible from the public ROW, minimum 4 inches in height (Section 203).
• Emergency access and utilities: Ensure fire hydrants, water mains, sanitary sewage disposal, and erosion control are adequate per Chapter 2 general provisions.
• Parking and landscaping: Design and install parking per Chapter 6 and landscaping per Chapter 7.

Step 5: Tax registration and collections

• Local occupancy tax: Collect and remit a 7% local occupancy tax on all bookings (in addition to state sales tax) (per GoSummer’s summary).
• State sales tax: Register and remit Tennessee sales tax to the Tennessee Department of Revenue. STRs are subject to sales tax and related business registration requirements when operating as a business (state-level context).

Step 6: Finalize operations and marketing

• Guest rules and house rules: Enforce the 10‑day maximum stay and occupancy caps. Communicate noise, parking, and emergency access rules to guests.
• Photography and listing: Follow Chapter 9 sign rules and keep listings accurate and code-compliant.
• Annual compliance: Renew the STR permit annually and be prepared for inspections.

Required Documents, Permits, Licenses, and Guidelines City-level (Monteagle):

• Short-Term Rental Permit (annual renewal; subject to inspection)
• Planning Commission approval (for Bed & Breakfast/boarding house)
• Building Permit
• Certificate of Occupancy
• Site Plan (if required for multifamily/commercial)
• Sign Permit (Chapter 9)
• E‑911 address assignment and posting
• Tax remittance records for local 7% occupancy tax

State-level (Tennessee):

• Tennessee sales tax registration with the Department of Revenue
• Business registration if operating as a business entity and if applicable

Specific Regulations: Zoning, Uses, Dimensional Standards, and Operational Rules Zoning and Permitted Use Context (Chapter 3 and Chapter 5)

• Permitted STR-type uses: Bed & Breakfasts, rooming houses, and boarding houses are allowed in R‑1, R‑2, R‑3, R‑4, and C‑1, and are shown on the Schedule of Permitted Uses for C‑2 and C‑3 (Section 501; Section 510).
• Residential character: Lodging structures are regulated as residential uses (Section 213), which can influence operational norms even when located in commercial corridors.

Dimensional Standards (Chapter 4)

• Residential districts (R‑1, R‑2, R‑3, R‑4, I‑D): See Chapter 4 for front, side, and rear setbacks, minimum lot sizes, height limits, lot coverage, and minimum dwelling unit square footage.
• Commercial and industrial districts (C‑1, C‑2, C‑3, I‑1): See Chapter 4 for dimensional requirements and setbacks, including special setbacks when abutting residential districts.
• Example: R‑3 allows higher-density residential with height up to three stories or 40 feet and lot coverage up to 60%; specifics vary by district and utility availability.

Operational Requirements for STRs (Section 510)

• Occupancy: No more than three bedrooms for rent at any one time.
• Stay limit: Lodging limited to 10 days per stay.
• Operator: Proprietor must be a permanent resident and maintain separate sleeping quarters from guests.
• Food service: Meals limited to breakfast for guests only, between 4:00 a.m. and 11:00 a.m.
• Parking: Minimum one space per guest room plus two spaces for the household.
• Appearance: Residential character cannot be changed; signage follows Chapter 9.
• Code compliance: Must meet municipal fire, building, electrical, and related codes.
• Additional conditions: The planning commission may impose conditions to protect neighborhood character (Section 510.J).

General Town Standards Relevant to STRs

• Emergency access: Buildings must be reasonably accessible for emergency vehicles (Section 202).
• E‑911 address visibility: Minimum 4‑inch numbers visible from the public ROW (Section 203).
• Parking standards: Chapter 6 governs access, loading/unloading, off‑street parking requirements, and design (including ADA accessibility) (Chapter 6).
• Landscaping and screening: Chapter 7 details street yard, percentage, and screening requirements for developments, including multifamily projects.
• Signage: Chapter 9 governs sign permits, design, and standards across districts.
• Administration: Chapter 12 covers the enforcement officer, building permits, certificate of occupancy, variances, special exceptions, violations, and penalties.
• Nonconforming uses and modifications: Chapter 11 addresses how changes to existing structures and uses are handled.

County and State-Level Regulations

• County-level: The provided materials do not include county-specific STR regulations for Grundy County. Investors should verify any additional county-level requirements with the County Clerk or Planning Department if applicable.
• State-level (Tennessee): As an STR operator, you should register for and remit Tennessee sales tax through the Department of Revenue. The state does not issue a dedicated “short-term rental license,” but STRs are subject to sales tax and business regulations depending on structure and activity (state-level context).

Taxes

• Local occupancy tax: Collect and remit a 7% local occupancy tax on bookings (per GoSummer’s summary), in addition to state sales tax.
• State sales tax: Register and remit through the Tennessee Department of Revenue.
• Recordkeeping: Maintain booking records and tax remittances to support inspections and annual permit renewal.

Local Authority Contacts and Permit Channels

• Monteagle City Hall
  • Phone: (931) 924‑2265
  • Email: monteagleinfo@blomand.net
  • Physical Address: 16 Dixie Lee Avenue, Monteagle, TN 37356
  • Mailing Address: P.O. Box 127, Monteagle, TN 37356
• Planning Commission
  • Meets the first Tuesday of each month at 6:00 PM (Central Time)
  • Applications typically require submission at least 14 calendar days before the meeting
  • Site plans and related documents are reviewed and approved by the Planning Commission (Chapter 10)
• Enforcement Officer (Building Inspector)
  • Administers building permits and Certificates of Occupancy (Chapter 12)
• Tennessee Department of Revenue (State tax registration)
  • Website: www.tn.gov/revenue.html

Links to Source Pages and Documents

• Monteagle Zoning Ordinance (Adopted Aug 13, 2018; Updated Mar 25, 2019): www.townofmonteagle-tn.gov/wp-content/uploads/2021/05/Monteagle-Zoning-Ordinance-March-25-2019.pdf
• GoSummer Market Page for Monteagle, Tennessee (STR overview and permit/tax notes): www.gosummer.com/vacation-rental-management/monteagle-tennessee

Important Notes for Investors

• The zoning ordinance does not contain a standalone “short-term rental” chapter; STRs must be operated under the Bed & Breakfast/boarding house framework and meet all operational conditions (occupancy, length of stay, parking, signage, etc.).
• While the provided sources indicate the need for a short-term rental permit with annual renewal and inspections, the town-level fee schedule and inspection checklist details are not included in the provided documents. Confirm fees and inspection procedures with City Hall.
• Zoning verification is critical: use the official Town Zoning Map and, if necessary, seek a zoning determination or variance through the Board of Zoning Appeals (Chapter 11).
• Local occupancy tax is 7%; state sales tax applies. Register with the Tennessee Department of Revenue and set up remittance processes before listing.
• Because the bed & breakfast stay limit is 10 days, investors should design business models that align with this restriction or seek a planning commission determination on any proposed alternative structures.

This guide is based solely on the provided documents and market summary. Always confirm current requirements with the Town of Monteagle before starting or modifying an STR operation.