Unlicensed short-term rental owners must act fast to house guests in ‘22 | AspenTimes.com

Unlicensed short-term rental owners must act fast to house guests in ‘22

Property owners hoping to rent out their Aspen residences for terms of fewer than 30 days in 2022 might want to make sure they’ve got their paperwork in order. And probably now.

One aspect of an emergency moratorium, which Aspen City Council will look at passing at a special meeting beginning at 7 p.m. Wednesday, prohibits the issuance of any new short-term rental permits for 2022. Once approved, the prohibition would take effect immediately.

Those with short-term rental licenses for 2021 are in good shape for most of 2022. City officials agreed in principle, during a regular meeting Tuesday, that the 2021 licenses would remain in effect through around Labor Day, provided the moratorium passes.

If the moratorium is approved, those who apply for licenses for 2021 by the close of City Hall business hours Wednesday also can rent out their properties on the short term through Labor Day, said city officials.

People who lease their properties on a short-term rental basis of fewer than 30 days don’t just need a permit; officials urged them to make sure they also have their city business licenses secured for next year or they’ll be out of compliance.

Mayor Torre emphasized his hope is the prohibition is lifted sooner than Labor Day, which is what he said will happen if city leaders can get a handle on the booming industry and find ways to regulate it.

They met counter-arguments, however, ranging from brokers who work on behalf of residential owners as well as residential owners themselves.

Some Aspen property owners said renting out their homes is one way they make a living.

One of them, homeowner Scott Writer, said banning short-term rentals would “obliterate a class of longer term residents who consider Aspen their only home.”

“I don’t know how many people are like my family,” he said. “We have struggled to make Aspen our home for decades. We are the lucky ones.”

Yet Torre and Councilwoman Rachel Richards, trying to temper push back, said their goal isn’t to outlaw short-term rentals outright. But they said they need to get a grip on how to regulate an industry that Pete Strecker, the city’s head of finance, said generated $50 million in taxable revenue from January through September. That equates to about $2 million in tax collections for the city, he said.

From where the short-term rentals are located, be them in a residential neighborhood or the downtown core, the city also wants to understand if they are in compliance with their zoning districts, are in line with the Aspen Area Community Plan’s vision, and are being properly taxed, for instance.

But their goal is not to put the kibosh on short-term rentals across the board, the mayor emphasized.

“Those that are full-time residents are at the deepest of our concerns,” said Torre.

Richards said, “This is not about a ban on (short-term rentals), it’s about appropriate balance in the community, and it’s important we take a look at it.”

City officials believe they have been able to get a better sense of short-term rentals’ impact since the council in October 2020 adopted legislation requiring all property owners who rent their condos or homes on a short-term basis to have a business license and a permit filed with the city.

The business licenses require the property owners to pay the city’s 2% lodging and 2.4% sales taxes.

More than 1,200 properties have operated as short-term rentals since permits were required, but some people questioned the city’s data and said there would be unintended consequences as a result of the prohibition.

While short-term rentals have been pinned with blame for the scarcity of housing that locals can afford, as well as a changing character of the town since the pandemic, people in the business disputed those claims and said the council wants to examine an industry that has been unfairly portrayed.

They also said the ban is being rushed, and owners of high-end properties won’t rent them out to local workers if they can’t do short-term rentals.

“Those of us in the industry have felt like this has been rushed and pushed as an avalanche, and in my opinion as a business professional but also a person who handles things in the fiscal world, rushing is very detrimental to business,” said Elizabeth Selzer, who works in finance and accounting in the vacation rental industry.

Critics also cautioned that a ban will only expand the black market for short-term rentals in Aspen while those playing by the rules would suffer.

“I think it will backfire,” said broker Ashley Chod.

While council members gave indications they were set on banning new licenses for 2022, they pushed the expiration date from what was originally May 31 until the time around Labor Day. That way bookings during the summer season won’t be shelved and create industry confusion.

The process to get to this stage has been nuanced.

Council unanimously approved the first reading of an ordinance Tuesday that would ban new short-term rental licenses for 2022, with a public hearing and final approval scheduled Dec. 14.

However, with the emergency moratorium — proposed as Ordinance 27 — also introduced and approved on first reading, it advances for approval at Wednesday’s special council meeting.

The moratorium also would stop the filing of land-use applications for residential properties, among other measures.

With the moratorium passed, there would be no need for a Dec. 14 hearing as the issue would be moot, according to City Attorney Jim True.