Council amends lodgers tax code to include short-term rentals

The Rio Rancho City Council approved on first reading an ordinance amending municipal code Chapter 37.02 (lodgers tax) to treat short-term rentals as taxable premises and to add associated licensing requirements.

Deputy City Manager Peter Wells explained the amendment follows the council’s recent decision to allow short-term rentals to operate legally in the city effective July 1, 2025. Wells said the ordinance language updates mirror applicable state statute where necessary and removes redundant language from the code.

Wells described lodgers tax in lay terms: it is a “bed tax” applied to nightly stays that cities can use for specific purposes under state law, such as marketing, administering the tax, improving facilities used by visitors (for example, the Rio Rancho Event Center) and related tourism functions. The city will collect the tax from operators and must follow state rules about allowable uses of the revenue.

No members of the public were signed up to speak on O-5 at first reading and councilors offered no substantive discussion before the roll call. The first reading passed by roll call vote; councilors voting yes included Dabson, Tyler, List, Weimer, Culbreth and Deputy Mayor Linentine.

The ordinance will proceed through any additional required readings before becoming final; Wells reiterated the effective date tied to the council’s prior zoning/policy action to permit short-term rentals beginning July 1, 2025.