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Council directs staff to pursue third-party short-term rental registration and tax collection; consultant cost estimated $13,500'$21,000 annually
Summary
Council directed staff to prepare a procurement to hire a third-party consultant to establish and manage a short-term rental registration program, including collection of hotel occupancy taxes. Staff estimated consultant costs of $13,500 to $21,000 per year and annual recoverable HOT of roughly $40,000'$45,000 from identified units.
City staff sought direction March 4 on whether to hire a third-party consultant to establish a short-term rental (STR) property registration and hotel occupancy tax (HOT) collection program. Bobby Lewis, development services director, told council a 2021 internal review identified 72 STRs in Copperas Cove; a recent third-party check found 78 active STR properties.
Lewis said the city's code of ordinances authorizes collection of hotel-occupancy tax for short-term rentals under chapter 18.5; staff cited Texas Tax Code section 156.001, which defines 'hotel' to include short-term rentals. Lewis recommended allowing staff to proceed with a procurement (request for qualifications) to hire a consultant to create a registration program, verify listings, and collect hotel occupancy taxes on behalf of the city.
Staff estimated the consultant's annual management cost would range from $13,500 to $21,000 depending on the level of services. Lewis and a council member noted the third-party consultant estimated the currently identified STRs could generate roughly $40,000 to $45,000 annually in HOT if fully captured and taxed.
Council members asked questions about how the consultant would work, whether the program would charge a registration fee, how collections are reported and whether initial contractors are already identified. Staff said an RFQ process would solicit qualifications and proposals; staff would evaluate firms and bring a recommended contract back to council for approval with the program's parameters (fees, enforcement, reporting) defined in the contract.
Council provided direction to pursue procurement and bring the consultant contract and program details back to council for approval. No contract was executed at the March 4 meeting.
