Regulating Short-term rentals in your Colorado Community
Short term rentals are defined generally as a rental that lasts for less than 30 consecutive days. Airbnb and VRBO are just a few of the many companies who are trying to profit off homeowners renting empty rooms or empty homes to vacationers. While that may seem like an appealing way to make money for the homeowner, neighbors rarely feel as positively. The frequent turnover of renters next door often leads to an increase in traffic, trash, and noise. While, ideally, renters would politely follow the same rules as any other homeowner, that frequently isn’t the case. This leaves communities often looking for ways to restrict and control short term rentals either through local rules or through their homeowners association.
The first step for any person objecting to a Colorado short-term rental should be checking whether the renter has a license from their Colorado County. Jefferson County, for example, only allows short term rental of a single-family residence once the homeowner has first gotten approval of a Special Exemption from the Board of Adjustment and then a Short-Term Rental Permit from the Planning and Zoning Division. (Section 2.D.4 of the Zoning Resolution). In order to receive that permit, the owner must notify each adjacent property owner in writing by certified mail of the name and contact information for the 24-hour local primary and secondary contacts, must receive a sales tax license from the Colorado Department of Revenue, and must have passed a review of all complaints made to the Sheriff’s Office regarding that property (e.g. for noise, improper parking, any active zoning violations or other impacts that cause the short-term rental to become incompatible with the surrounding land uses).
Even once an owner receives a Short-Term Rental Permit, they are not allowed to go on their merry way and rent as they please. Once the short-term rental permit has been issued, the owner must provide all rental dates to the Jefferson County Planning & Zoning Division. In turn, Planning & Zoning shall provide this information to the Jefferson County Assessor and the Colorado Department of Revenue. A report containing these dated must be filed quarterly.
Any interested citizen can file a complaint if these rules aren’t being followed. Jefferson County will investigate all complaints to see if a violation has occurred. If they discover a violation, they can revoke the Short-Term Rental License, have the Court impose a misdemeanor conviction on the owner, and/or impose fines. CRS 30-28-124.
Homeowners Associations are another group that can regulate and largely prevent short-term rentals. Unfortunately, it is not easy to outright prohibit short term rentals. The Colorado Court of Appeals has issued a ruling that for short-term rentals to be prohibited by an HOA, the covenants themselves must specifically address the issue or be amended to specifically address the issue. (Houston v. Wilson Mesa Ranch Homeowners, 360 P.3d 255 (Colo.App. 2015)). Amending covenants is often a difficult process.
If short term rentals are a serious issue for your community and your covenants do not specifically prohibit rentals, there are some steps the HOA can take to regulate short term rentals and fine owners who violate those regulations. For example, many covenants contain a specific provision requiring compliance with all zoning regulations. Many Colorado counties regulate short term rentals much like Jefferson County and Summit County. The HOA could adopt a policy and fine structure based upon the specific covenant to comply with all zoning regulations. Other examples include covenant restrictions on parking, trash, insurance, rental contracts, and noise. So, while prohibiting the short-term rental may not be possible absent amending the covenants, specific policies regarding rentals can probably be enforced if specifically supported in the covenants.
