Short-term Rental Business Licenses Proposed

One of the agenda items scheduled for the April 19 city council meeting is a new business license requirement that would apply to short-term vacation rentals. The business license number would need to be included in all public advertising and would include webhosting services such as Airbnb, Home Away, Trip Advisor, VRBO, etc.

Requirements to obtain a license include the completion of an application form, payment of a license fee and successful completion of a business inspection by the Salida Fire Department. Staff would also verify the business is registered for sales tax through the Colorado Department of Revenue and for occupational lodging tax directly with the City.

The subject of short-term vacation rentals had been raised as a concern in the community from time to time and, specifically, was highlighted as a campaign issue by some residents during the last council election. The city council has discussed the situation in previous work sessions. They have reviewed information provided by staff regarding the number of identified vacation rentals and examples of regulations implemented in other communities.

For more information, readers may review information presented to the city council during the February 8, 2016 and March 14, 2016 work sessions. Packet materials in the document library were linked above or you may watch the work session on the City’s YouTube channel.

A new Article V of Chapter 6 would implement business licensing for short-term rentals. Its adoption requires an ordinance be passed by the city council. If passed on first reading April 19, a public hearing and the second reading will follow, most likely to be scheduled on May 3rd. This new license would apply to all privately owned residential dwellings, such as, but not limited to a single-family detached or multiple-family attached unit, duplex, condominium, townhome, apartment, or any portion of such dwellings, rented for occupancy for dwelling, lodging, or sleeping purposes for any period less than thirty (30) consecutive days. Motels, hotels, bed-and-breakfast facilities, and hostels would be exempted from the licensing requirement.

A resolution establishing the four new fees will be brought to council along with the second reading of the ordinance. These preliminary proposed fees are listed below.

  • New Business License – $50.00 (would apply to businesses not already paying the occupational lodging tax)
  • Renewal of Existing License – $25.00 (would apply to businesses already paying for the occupational lodging tax and future renewals)
  • Late Renewal Fee – $10.00
  • Penalty for Operating without a License – $250.00

In addition, a business inspection will be required at a cost of $35 per hour or any part thereof for the initial visit. There is no charge for the first follow up visit. Additional follow up visits would cost $17.50 per hour.

Staff plans to prepare communication materials similar to examples seen in other communities. These will be distributed through the city website and local business organizations to roll out this new business license and explain its benefits to both our local citizens and visitors to Salida.