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Erie staff say lodging tax would apply to short‑term rentals under Colorado law; licensing, collection and enforcement questions remain
Summary
Staff told the council that Colorado lodging‑tax rules require coverage of stays of 30 days or less, meaning a town lodging tax would apply to short‑term rentals as well as hotels. Council members asked how collection, licensing and enforcement would work and asked staff to scope administrative costs before deciding whether to include a lodging tax on a near‑term ballot.
Town staff told the council that state law requires a lodging tax to cover any lodging rented 30 days or less, which alters the framing of a previously discussed ballot question that had been conceived to apply only to a future hotel.
"A lodging tax in the state of Colorado has to cover any lodging that is 30 days or less," Gabby Ray, the town’s director of communications and community engagement, explained. Staff and a departmental director present said that means a lodging‑tax question would necessarily include short‑term rentals if the town adopted such a tax.
A staff member who has researched neighboring practices (speaker 17) said many adjacent municipalities levy lodging taxes and that typical lodging‑tax rates in the area range from about 3% to 10% total, depending on local combinations of taxes. Several communities pair lodging taxes with licensing or registration programs for short‑term rentals to support enforcement and life‑safety requirements.
Council members asked whether the town would collect a lodging tax locally or whether a third party would handle collection; staff said the town would plan to collect the tax locally and that the administrative cost and staffing needs depend on how many licensed short‑term rental units exist. Staff said if only a handful of units are licensed, collection could be managed with spreadsheets, but a larger roll‑out would likely require software and additional staff.
Council also discussed how lodging‑tax licensing would interact with homeowner‑association covenants and enforcement. Staff said licensing and permitting would be separate from HOA enforcement and would enable the town to address neighborhood nuisance and code‑compliance issues where short‑term rentals currently operate without local regulation.
Members expressed different views about timing. Some said a lodging tax could be placed on the ballot alongside a ECC funding question because the two would affect different payers (residents vs visitors). Others urged caution given unresolved staffing and software questions and recommended staff return with a clear estimate of administrative costs, a registration plan, and engagement findings before committing to an early‑summer ballot decision.
No formal decision was made; staff said short‑term rental licensing work is on the department work plan and that the team will continue research and community engagement.
