The Petoskey City Zoning Board of Appeals convened on June 3, 2025, to discuss a contentious case involving a short-term rental operated by local residents, the Powells. The meeting focused on the legitimacy of the Powells' claim to a vested right to operate their rental, despite ongoing disputes regarding building permits.

The Powells argued that they had transformed a previously bare office space into a rental property, catering to a growing demand for pet-friendly accommodations in the city. They contended that their renovations established a vested right under the old zoning ordinance, which allowed for short-term rentals. Their attorney emphasized that the Powells had made significant progress in their renovations before a moratorium on short-term rentals was enacted in July 2023, and thus should be allowed to continue operating under the previous regulations.

A key point of contention arose regarding the absence of building permits. The city maintained that the lack of permits disqualified the Powells from claiming a vested right. However, the Powells' attorney argued that their contractor had misled them about the status of the permits, asserting that they believed they were in compliance with local regulations. The attorney highlighted that the Powells had proactively sought permits and were working with the county to resolve the issue, indicating that they were not willfully ignoring the law.

The discussion also touched on the role of the city and county in the permitting process. The Powells claimed that the city had reported them for operating without a license while being aware of their ongoing renovations. They expressed frustration over what they perceived as a coordinated effort by city and county officials to build a case against them, despite their attempts to comply with regulations.

As the meeting progressed, board members raised questions about the nature of the renovations and whether the Powells had indeed reached a point in the construction process that warranted permits. The Powells maintained that they had acted in good faith throughout the process and were eager to rectify any misunderstandings regarding their compliance.

The board's decision on the matter remains pending, with significant implications for the Powells and the broader community regarding the future of short-term rentals in Petoskey. The outcome will likely influence how similar cases are handled in the future, particularly in relation to the enforcement of zoning regulations and the rights of property owners.