On my rental properties I only rent to older people with no pets and no kids.

I personally think the cyclone fence is quite ugly and would be one of the things I would want to remove if I want to improve the curb appeal, but the agent that seems to be familiar with the area advised against it as he says it's desired by renters in the area, if not for the reason alone that they may have a pet dog and it this would be their running around space.

Neighborhood pets may eat the rat and become sick or die.

Am I able to charge him a pet fee in MN?  

While I agree with Thomas S. on the business side of things, I've made it a pet project to get good at negotiating, and its paying off handsomely.  

The landlord is requiring a 2 year lease, no pets, no smoking.

Landlords and Property Managers cannot treat emotional support animals as pets.

For example,  "NO PET" policies have different rules under ADA and the Fair Housing laws that mean you have to allow the animal because it's not considered a pet, but a necessity.  

I think I will do a refundable pet depsit and add a small pet fee to the rent each month.

That said, millennials ARE starting families and let's face it ~ when that happens, having extra space for kids/pets becomes more of a priority.