Vail looks at ways to change short-term rental regulations

Additional fines and fees are likely

Vail officials are looking into changes to the town’s short-term rental regulations.
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As the Vail Town Council considers new regulations and fees for short-term rentals, one proposal stands out: Limiting new registrations.

The council looked at a number of proposals during its March 15 meeting. Those proposals were put together by the town’s finance department, along with consultants Economic & Planning Systems and RRC Associates.

The recommendation for limits applies to non-resort areas of town, and council members were given a couple of options.

One of those options is capping short-term rental registrations to current levels, with some exemptions.

The biggest exemption would be for units that have been continuously owned for five years by the same person or entity.

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Another option is to restrict short-term rental licenses to only 20% of units in any multi-unit building or complex with more than six units and governed by a homeowners association.

Exceptions would be fractional units or properties that have full-time front desk services.

Owners could still use individual rooms or accessory units in primary residences. The primary resident would have to be present during all short-term rentals.

Other recommendations include revising the current health and life safety regulations to mandatory fire inspections in all short-term rentals. That change would require adding staff and increased administrative costs.

Other recommended changes include requiring proof of adequate insurance for short-term rentals. That means most owners would have to obtain commercial insurance or adding an endorsement covering short-term rentals to existing homeowner policies.

Another big change could come in the fines assessed for violations of the regulations.

While there were only nine violations in 2020, the proposal would triple the fine for a first violation to $1,500. Subsequent violations would be even more expensive, and a third violation would result in suspension of an owner’s short-term rental permit.

Consultant Andrew Knudtsen of Economic and Planning Systems said the idea for increased fines and fees could help bolster the town’s housing funds.

“Cash is great,” Council member Travis Coggin said. “But our issue is stopping units from long-term rentals to short-term rentals.”

Coggin added that the real goal should be stopping the current flood of non-local buyers.

Knudtsen noted that additional fees could create impediments that may both limit future short-term rentals and generate revenue for housing solutions. Knudtsen added that the town is putting $420,000 per unit into the new Residences at Main Vail project.

It’s not getting easier or cheaper to build,” he added.

Resident Stephen Connolly said he heard some “positive steps” during the presentation. Connolly suggested that long-term rental registrations could be another tool in the town’s kit. And, he added, future regulations should ensure that commercial properties are “paying their fair share.”

Town staff will work on a draft ordinance based on input from the March 15 meeting. That ordinance will likely focus on fines and mitigation fees.

Four recommendations

Here’s a look at some of the recommended changes to Vail’s short-term rental regulations:

Tripling fines for the first violation of the regulations.

Imposing a $2,650 fine for operating without an approved town registration.

Imposing per-bedroom fees, with the money going into a housing mitigation funds.

Limiting new short-term rental registrations.

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