Steamboat passes first reading of short-term rental ordinances with few tweaks |

Steamboat passes first reading of short-term rental ordinances with few tweaks

The Steamboat Springs Planning Commission has recommended a short-term rental overlay zone map for city council’s approval. The map would divide the city into three color zones with different restrictions on short-term rentals operating in each one of the zones. City council made some adjustments to the map and policies during a meeting on Tuesday, May 17, 2022.
City of Steamboat Springs/Courtesy photo

Editor’s Note: This story was changed at 1 p.m. on Thursday, May 19 to correct the number of units capped in Shadow Run and to reflect that all short-term rentals will require a license.

After nearly a year in the hands of the Steamboat Springs Planning Commission, the three ordinances that would implement both a short-term rental licensing process and a short-term overlay zoning map were brought before Steamboat Springs City Council on Tuesday, May 17.

City council approved all three ordinances unanimously on the first reading but disagreed on some of the specifics.

During Tuesday’s meeting, council members performed straw polls on several of the rules in the ordinances. The votes adjusted the ordinances and will be reflected when the proposals come up on second reading.

City council will do a second reading of the ordinances on June 7. If adopted, city council hopes to start the licensing process around the same time the city’s moratorium on vacation rental permits expires at the end of June.

The short-term overlay map would put a limit on the number of short-term rentals operating in different color-coded zones — red, yellow and green. Red zones would prohibit short-term rental licenses from being issued in those areas. Yellow areas would have limits on the number of licenses issued, and green zones would have no limits.

Hosted short-term rentals, or short-term rentals where the owner of the property lives in the house while renting out a space on site, will be unaffected by the zoning restrictions.

Old Town’s placement into a yellow zone was disliked by all six council members who weighed in — Michael Buccino was recused because of potential conflicts of interest — so they voted unanimously to change Old Town to red.

“It’s where our schools are located,” council member Gail Garey said.

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Next in council’s sights was the issue of response time, or the amount of time short-term rental owners would be given to respond to a complaint.

The ordinance would give owners an hour to respond after a complaint is filed with the 24/7 hotline, which would be established as part of the licensing ordinance.

Failure to respond to a complaint within that time frame would result in a penalty of some kind, and repeat offenders could have their short-term rental license suspended or even revoked.

Council members Garey, Joella West, Dakotah McGinlay and Heather Sloop voted in favor of a 30-minute response time, instead of the default 60-minute time frame, while council members Ed Briones and Robin Crossan supported keeping the response time at 60 minutes.

Ultimately, council decided to keep the 60-minute response time during the day, while having a 30-minute response time from 10 p.m. to 6 a.m.

Shadow Run Condominiums has been well represented during public comments, as it was placed in a red zone across the street from a green zone. According to representatives from the Shadow Run homeowner’s association, the HOA has declarations that have permitted short-term renting for decades.

Shadow Run was placed in the red zone because the planning commission viewed the complex as an affordable housing option for low- to middle-income renters and first-time home buyers.

Crossan voted to change Shadow Run into the green zone, but pressure from other council members created a consensus to change Shadow Run to the yellow zone with a cap at 17, about half of the 33 short-term rentals that the city has counted to be currently operating there.

At first, council members split their votes on whether HOAs should be allowed to write declarations in their charters that would permit a higher number of short-term rentals than the city’s zoning.

Briones, Crossan and Sloop all supported allowing HOAs to apply to be rezoned, while McGinlay, Garey and West opposed the idea.

McGinlay made the case that the zoning map should offer clarity and predictability, but constantly rezoning neighborhoods could cause a lot of stress on the community. Sloop agreed and changed her vote.

The deadlock was then broken with a 4-2 vote saying HOAs should not be given paths to rezone.

City council unanimously voted in support of spot checks on properties as part of the terms of the short-term rental licenses. Spot checks would not be guaranteed to happen, but the city would have permission to conduct them.

“It doesn’t obligate us to do spot inspections,” West said. “At least, we wouldn’t have to change an ordinance or have some legal disputes.”

The ordinances would allow current lawful short-term rental owners to qualify for legal nonconforming status, meaning they can have their rentals grandfathered in regardless of their zoning.

The ordinance draft would have allowed legal nonconforming properties to continue operating as long as they can provide proof the property has been rented out within the past six months. However, city council agreed that 12 months would be a better time-frame as many short-term rental owners operate seasonally. McGinlay wanted to include language that would offer incentives for short-term rental owners to rent their units to seasonal workers in the months between nightly rentals.

Under the ordinance, all short-term rental use would require a license. Getting caught operating a short-term rental without a license could yield a fine of up to $2,650 per day of unlawful use.

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