Phil Gents, Communications Manager, told the Discover Cottage Grove board that the Minnesota Department of Revenue began collecting the city’s lodging taxes in July and that the city is using Deckard Technologies’ Rentalscape software to identify short-term rentals.

Gents said staff are monitoring collections and noted a lag in state remittances of about 40 days. For quarter 3, he reported lodging tax collections of $15,392 and a year-to-date total of $62,955; projected Q3 lodging tax in the approved budget was $18,000, and staff said outstanding September collections are expected before year end.

On Rentalscape, staff reported the software has identified 11 licensed short-term rental properties, 10 unlicensed short-term rental properties and 22 total unlicensed properties (which may include long-term rentals that are not licensed). Gents said the city’s code compliance officer will send compliance letters to unlicensed properties to bring them into compliance and that it is not yet clear whether bringing properties into compliance will change lodging-tax receipts.

Board members asked for the exact statutory cutoff between short- and long-term rentals; City Administrator Levitt cited the code and said the cutoff is 30 days — stays under 30 days are short-term for lodging-tax purposes. Staff agreed to follow up with year-over-year comparisons when asked by a board member.

Gents said staff will continue to monitor collections and Rentalscape results and report back to the board.