Steamboat voters aren’t just mountain folk weighing in STR taxes this fall

Following approval by Steamboat Springs City Council on Tuesday, July 19th, the question of whether to impose a 9% tax on short-term rental stays is in the hands of voters.
John F. Russell/Steamboat Pilot & Today

Steamboat Springs won’t be the only mountain town deciding whether to introduce new taxes on short-term rentals in November.

Voters in AspenDiillonGlenwood Springs and Carbondale will all decide whether to raise additional taxes, with at least a portion of those funds going towards affordable housing in each municipality.

In Summit County, where many short-term rentals fall outside a community‘s boundaries, commissioners are asking voters to support an additional 2% tax that could bring in up to $5 million a year.

“This vital funding would help provide more housing for workers and childcare, and help us manage the impact of our high attendances throughout the year,” Summit County Commissioner Elisabeth Lawrence said in August.

These attempts to levy taxes on STRs to help locals hose down follow similar attempts to raise taxes on these rentals in Frisco, Silverthorne and Avon. All these measures were passed with more than 60% approval.

Frisco’s tax was passed in April with 64% of the votes. It adds a 5% consumption tax on short-term rentals, bringing the tax rate for those units to 15.725%.

Silverthorne increased his lodging tax from 2% to 6%, with nearly 75% of voters in favour, bringing the rate for STRs to 14.375%.

Avons 2% tax passed with around 70% support in November, bringing the tax rate there to 14.4%.

If Steamboat voters agree to the proposed 9% tax, it would raise the tax rate for STRs in the city to 20.4%, although councilors have stressed that the measure allows them to be taxed up to 9% and not so high rate requires .

Opponents of Steamboat’s tax proposal say the new tax would make Steamboat less attractive to visitors, as places like Vail would have lower tax rates on STRs.

Similar arguments were made in Aspen. Still, a July poll conducted by the city found that 63% of respondents supported taxing STRs.

Last month, the Aspen City Council approved an election question this would impose an additional 5% or 10% tax on STRs depending on whether the unit is owner-occupied. That would bring the tax rate for an STR to 21.3% if voters accept the measure.

“Voters believe STRs negatively impact neighborhoods, community spirit, and the availability and price of housing in Aspen,” said a summary of the July poll conducted by Frederick Polls of Salt Lake City. “They also feel that short-term renters are not paying the full cost of their impact on Aspen services.”

The poll also showed that 75% of STR owners surveyed in Aspen opposed the introduction of a tax.

Dillon voters will be faced with two questions about the lodging tax. The first would introduce a 5% consumption tax specifically on STRs and the second would increase the city’s lodging tax from 2% to 6%. Hotels and motels are exempt from the consumption tax but would pay the increased occupancy tax if passed.

If both measures are passed, Dillon officials have estimated that the city will raise about $3 million in the first year, which would be used for city projects including workers’ housing projects and road and parking lot improvements, among other things.

Glenwood Springs proposed 2.5% occupancy tax would apply to all accommodation and not just short term rentals. This tax grew out of months of work by the Glenwood Springs Community Housing Coalition to find a funding mechanism for sustainable housing.

Along with an additional 2.5% lodging tax and other local sales taxes, STR stays in Glenwood would be taxed at 13.6%.

In Carbondale, city leaders opted not to increase the lodging tax this year in favor of a 6% excise tax on short-term rentals. The city doesn’t have as many STRs as Steamboat and other resort towns, but Carbondale Trustee Colin Laird said the tax is expected to bring in up to $180,000 a year if passed, and that’s a start.

“Everybody’s doing something related to it,” Laird told the Glenwood Springs Post Independent. “We’ve talked about small steps that build into bigger steps, and this is one of those first steps.”

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