1. Overview – Are Short‑Term Rentals Allowed in Ottumwa?

Short‑term rentals are permitted in Ottumwa, IA, provided the activity complies with the city’s zoning ordinances, the state lodging statutes, and any required fire‑safety and health inspections.

• The city does not publish a dedicated “STR ordinance” in the materials you supplied; therefore, STRs are governed by state‑wide Iowa statutes (see Iowa Code §§562A.5, 562B.5 – transient occupancy is excluded from the Iowa Uniform Residential Landlord‑Tenant Act).
• If a property is located in a zoning district that expressly allows “short‑term lodging,” “guest‑house,” or “hotel‑type use,” an STR may operate without a conditional‑use permit. If the property is in a district where STRs are not listed as a permitted use, the owner must obtain a conditional use permit (CUP) from the City of Ottumwa Planning & Zoning Department.

Bottom line: Investors can legally operate an STR in Ottumwa, but they must verify that the property’s zoning permits that use and obtain any required permits or licenses before taking bookings.

2. How to Start a Short‑Term‑Rental Business in Ottumwa

| Step | Action | Why It Matters | |------|--------|----------------| | 1. Market research & property selection | Choose a property in a STR‑friendly zone (e.g., R‑2 “Multi‑Family Residential with Guest‑House allowance,” C‑1 “Commercial” or a designated “Tourism” district). | Guarantees the first regulatory hurdle is met. | | 2. Verify zoning compliance | Contact Ottumwa Planning & Zoning (see Contact section). Request a Zoning Verification Letter for the parcel. | Confirms that STRs are an allowed use or identifies the need for a CUP. | | 3. Obtain required permits / licenses | • Iowa Bed & Breakfast / Lodging License (if you provide on‑site breakfast or amenities) – issued by the Iowa Department of Inspections, Appeals, and Licensing (DIAL).<br>• City STR Registration (if the city adopts a registration system; check the latest City Code).<br>• Fire‑Safety Inspection Certificate (Ottumwa Fire Department).<br>• Health & Sanitation Approval (Wapello County Public Health, if required). | Licenses demonstrate legal compliance and protect against citations. | | 4. Register the business | File a Business Registration with the Iowa Secretary of State (optional for LLCs) and obtain a State Sales‑Tax Permit from the Iowa Department of Revenue (required to collect lodging tax). | Enables collection/remittance of Iowa Sales Tax (5 %) and Hotel/Motel Tax (up to 7 %). | | 5. Secure insurance | Obtain Commercial General Liability (≥ $1 M) and Property insurance covering short‑term guest occupancy. | Protects the owner against guest injury, property damage, and loss of income. | | 6. Prepare the property | • Install smoke‑detectors, carbon‑monoxide alarms, fire extinguishers.<br>• Ensure compliance with the Iowa Fire Code (e.g., egress, dead‑bolt locks).<br>• Verify that the unit meets habitability standards (running water, heat, proper plumbing). | Compliance is checked during the fire‑safety inspection and may be required for the lodging license. | | 7. Set up tax collection & reporting | Configure your booking platform (Airbnb, VRBO, etc.) to collect Iowa Sales Tax and Hotel/Motel Tax. File returns quarterly with the Iowa Department of Revenue. | Non‑compliance can result in penalties and back‑tax assessments. | | 8. Guest‑management & policies | Draft a guest agreement that outlines house rules, occupancy limits, check‑in/out times, and cancellation policy. While the Iowa Landlord‑Tenant Act does not apply to transient guests, the agreement still helps manage expectations and reduces disputes. | Improves guest satisfaction and limits legal exposure. | | 9. Launch & ongoing compliance | List the property, monitor occupancy, and maintain records (guest registry, inspection certificates, tax filings). Renew permits/ licenses as required (annual fire inspection, lodging license renewal). | Keeps the operation legal and protects against municipal enforcement. |

3. Required Documents, Permits, Licenses, and Guidelines

| Document / Permit | Issuing Authority | Typical Timeline | Renewal | |-------------------|-------------------|------------------|---------| | Business Registration (optional for LLC) | Iowa Secretary of State | 1‑2 weeks | Ongoing (no expiration) | | State Sales‑Tax & Hotel/Motel Tax Permit | Iowa Department of Revenue | 1‑2 weeks | Ongoing (renew only if business ceases) | | Iowa Bed & Breakfast / Lodging License (if providing breakfast/amenities) | Iowa Dept. of Inspections, Appeals, & Licensing (DIAL) | 4‑6 weeks | Annual | | City Zoning Verification Letter / Conditional‑Use Permit | Ottumwa Planning & Zoning Dept. | 2‑4 weeks | 5‑10 years (permit duration) | | Fire‑Safety Inspection Certificate | Ottumwa Fire Department | 1 week (appointment) | Annual | | Health & Sanitation Approval (if required) | Wapello County Public Health | 2‑3 weeks | Annual | | STR Registration (if city adopts a program) | City of Ottumwa (Business License Division) | 1 week | Annual | | Commercial Liability & Property Insurance | Private insurer (e.g., Allstate, State Farm) | 1 day | Annual | | Guest Registry / Occupancy Log | Property owner (self‑maintained) | Ongoing | – |

Key Guideline: Even though “transient occupancy” is exempt from the Iowa Uniform Residential Landlord‑Tenant Act (see Iowa Code §§562A.5,