Montezuma County staff to draft short-term rental permit after officials cite untracked listings and lost lodging tax revenue

Dawn, Planning Department staff, told the Montezuma County Board of County Commissioners that short-term rentals (STRs) in the county have grown since 2019 and that the county currently lacks a reliable way to identify, track or ensure compliance for those properties.

"We presented that, all short term rentals should be permitted, tracked," Dawn said, describing the planning department’s prior position. County officials said the volume of listings has increased since COVID and that the current lack of oversight may mean lodgers-tax and other revenues are not being collected.

Don (county official) said prior work in 2019 did not anticipate the present number of rental listings. He told the board he used AirDNA data earlier and found "over 240 in this county," and he described repeated public inquiries from people looking to buy property specifically for short-term rental income.

Planning staff and county counsel discussed legal scope and fee-setting. County counsel said the board has statutory authority to permit and regulate STRs but noted a fee must be tied to the county's cost of administering the program rather than being an arbitrary revenue measure. Staff said one preliminary figure derived from the land-use fee schedule is $9.78 per unit annually; staff also described potential ramp-up and compliance periods used by other counties.

Other points raised in the discussion: - Land-use and permitting concerns: staff said some short-term rental properties may not have been reviewed for septic permits, driveway permits or other land-use requirements and that the county has received noise and traffic complaints tied to STRs. - Tax oversight: staff said the state collects lodgers tax but county staff and members of the county’s Lodgers Tax Committee have estimated the county may be missing substantial lodging-tax revenue tied to STRs. - Enforcement options: staff noted other counties include annual permit requirements and mechanisms to revoke permits after repeated complaints; planning staff indicated such a mechanism could be part of a future ordinance.

Next steps: staff will draft a proposed permitting approach (including a recommended fee tied to administrative costs), return a draft ordinance and examine implementation timelines, including possible phased compliance (for example, a mid-year start and prorated fee for the first year). Commissioners asked staff to consult with the assessor’s office, the lodging-tax committee and the county attorney to clarify tax, assessment and enforcement implications.