There is an insidious trend in the Miller community. The City has allowed the invasion of short-term rentals and multi-family conversions into our single-family Community. A quick look at the City of Gary Zoning Map shows the zoning classification of the Miller Section of the City:

Map is interactive. Click on map to show zoning classification.

The Zoning Map reveals most of the Miller Section is zoned R-2, Single-Family Residential District. The R-2 District allows for the following uses according to the posting on the City Website:

Of note is the limitation to Single-Family detached dwellings. While special uses include a variety of additional possibilities these require additional approvals before being permitted. Omitted is any mention of duplex or multi-family, short-term rentals or commercial uses, which are not permitted uses. However, despite the use limitations afforded by the Zoning Ordinance, the City has not addressed short-term rentals and multi-family conversions that continue to increase unabated by any enforcement action. Many dwellings located in Miller, wholly in the R-2 District, are now being leased through AirBnB and VRBO; or are being converted into multi-family rentals without any attention or action by the City. The invasion of short-term rentals and multi-family conversions are destroying the single-family character of Miller and altering the quality of life for many residents who appear powerless in the face of the onslaught. Various numbers have been quoted as to the magnitude of these short-term rentals, anywhere from 50, to over 100, and likely growing. Many residents have complained and even the Gary Police have taken notice of the added burden of dealing with complaints. Nevertheless the City appears to condone these uses, which the Supreme Court of Indiana has ruled are commercial uses, for-profit, that are not permitted in single-family districts.

The Supreme Court of Indiana opinion follows and clearly outlines how these uses are to be identified:

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Zoning ordinances exist to separate uses which are deemed incompatible and to serve the public health, safety, and general welfare. For example, commercial and industrial uses are not permitted in residential districts. Similarly, duplex and multi-family residential uses are not permitted in single-family districts. These are quality of life issues that impact residents who seek to live in a particular community because of the amenities available and character of the community.

As the Indiana Supreme Court has ruled, short-term rentals are not compatible with single-family uses, which are not designed or established for rental purposes (income production) but for single family occupancy. The neighboring community of Ogden Dunes has recognized that the quality of residents' lives is negatively impacted by the invasion of for-profit uses. Unfortunately the City of Gary continues to ignore the issues related to this problem, which continues to grow. One can only guess at the motives, but a public official has been heard to say that property values are too low in Miller. This statement suggests a mechanism is needed to increase values. This mechanism appears to be allowing short-term rentals and multi-family conversions, which will increase property values and generate tax dollars for the City.

How is this accomplished?

Residential properties are valued based on a comparison with similar properties that have sold recently. This is the method employed by Assessors throughout the State of Indiana. However, commercial uses are valued based on the income they produce. With the unregulated invasion of short-term rentals and multi-family conversions, many homes are being sold based on their income potential and not based on the single-family qualities they offer and that homeowners seek. The effect is to distort the residential market in Miller with higher and higher prices being obtained based in part on the income these properties produce. This is unfair to residents who live in the community; not only are they impacted by higher property taxes based on the income short-term rentals and multi-family conversions provide, they also experience a degraded quality of life brought by these incompatible uses.

The question arises as to what can be done?

It is clear from the existing City of Gary Zoning Ordinance and the Indiana Supreme Court decision in Siwinski v. Town of Ogden Dunes that the legal basis for limitations exist. The only missing element is the political will to do so. Unfortunately despite these matters being brought to the attention of the City of Gary, it appears the decision is to ignore residents concerns in favor of those who seek to profit from it; including the City.

An examination of many short-term rentals available in the public record reveals many, many, owners do not even live in the community, but rather live elsewhere and appear to own homes strictly as investments profiting off the attraction of the Miller area. While, the re-gentrification of the Miller Community is a part of what is happening, there is an odious element in which people are profiting at the loss of residents; the people who actually live here.

Short-term rentals are a Nationwide issue; so then, how are other communities dealing with the invasion of short-term rentals? Here are just a couple of examples in addition to Ogden Dunes:

In Greenville, SC they deal with the issue as follows:

As in the case of Ogden Dunes, short-term rentals are limited to districts in which Hotel/Motels and Bed & Breakfast Inns are allowed, commercial uses. All classified as "C" Commercial Districts, not "R" Residential Districts.

Closer to home, the Town of Michiana Shores has another approach. A short-term rental permit is required. However, in order to obtain a short-term rental permit one must be subject to the requirements of a Zoning Variance, which requires approval from the Board of Zoning Appeals (BZA). In addition Town Council approval is another requirement before such a use can be pursued.

The process is presented on the Michiana Shores Website as follows:

Apparently many municipalities are taking action to preserve the character and quality of their communities while the City of Gary does nothing but allow the continued invasion of incompatible commercial uses, short-term rentals and multi-family conversions, into the community.

Are the owners of short-term rentals paying the required State Sales Tax and Innkeepers Tax?

In Indiana commercial uses are taxed at three percent (3%), but
are the short-term rentals being taxed as the obvious commercial, for-profit, uses they are?

These forces may have the power of the purse to influence decision makers in the City, but residents have the power of the vote. If you don't make your voice heard you have no one to blame but yourself. Act now to preserve the single-family character and quality of life Miller has offered for decades.

Save Miller!