When the Pagosa Springs Town Council considered the second reading of Ordinance 958 — establishing new limits on the licensing of vacation rentals (aka STRs, Short-Term Rentals) within the Town boundaries — at least a couple of folks were confused about where, exactly, those municipal boundaries might be.
A couple who live in the Lake Hatcher community pleaded, with some obvious passion, asking if the Council would establish even more strict limitations on vacation rentals — when the rental unit is located on a lake, where the sound from enthusiastic tourists in a neighboring home “that sleeps 20 people” carries easily across the water at various inconvenient times of day and night.
Mayor Don Volger finally interrupted the suppliants to inform them that the Hatcher community is located outside the town limits (in fact, about 5 miles outside the town limits.)
For our readers who might also wonder where the Town boundaries are located, here’s a zoning map for the municipality.
You can click the map for a larger version.
As we see, the Town’s jurisdiction does not typically extend more than about 1/2 mile north or south of Highway 160, except in the case of the historical downtown and the Piedra Estates/Pagosa Hills subdivisions (pale green) east of the County airport.
The red line indicates areas that might someday be annexed into the town, but as Mayor Volger told the Hatcher suppliants, there are no current plans to annex any of these unincorporated areas.
Which is to say, Ordinance 958 — approved on September 7 — controls only the areas of the community indicated by the colored zoning areas in the map above. And the ordinance applies only to ‘residential zoning districts’. And the ordinance does not apply to vacation rentals operated in owner-occupied homes.
Nor do the new rules apply to existing, licensed STRs, which are considered to be ‘grandfathered in’ so long as the property ownership does not change hands.
So there are certainly limits to the new limits.
Here’s the good news, for the community members who have found the unrestricted licensing of vacation rentals to be detrimental to Pagosa’s character and future prospects. (And perhaps, bad news, for folks hoping to obtain an STR license, in the future, within the town limits.)
According to Ordinance 958, no new STR will be licensed if it is within 250 feet of an existing licensed STR — measured radially from property line to property line.
No new STR will be licensed in any residential zoning district if the density of existing, licensed STRs in that district exceeds 10%. Town Planning Director James Dickhoff told the Town Council that the density in every residential zone currently exceeds the 10% limit — implying that, currently, no new licenses can be issued in those zoning districts.
In the case of condominiums or apartments, no more than 10% of the units in a multi-family building can be licensed. (Meaning, apparently, that the 250-foot buffer does not apply in to multi-family buildings.) An STR cannot, however, be immediately adjacent to another STR in a multi-family or townhome development.
If new licenses could be issued (which, as we just noted, appears to be currently impossible) the property owner must have owned the property for at least two years prior to applying for a license.
Only one dwelling unit per parcel can be licensed.
These new rules are effective as of September 7. License applications that were already ‘in process’ and had paid their fees to the Town, prior to September 7, will be allowed to proceed through the approval process.
Here at the Daily Post, I’ve been expressing my concern about unlimited STR licensing for about 5 years, primarily because I’m concerned about the supply of affordable housing for the folks who actually live here full-time. According to the website AirDNA, about 1,100 residential homes in the community are now operating as STRs. Whether the conversion of homes into mini-motels is largely responsible for our community’s current housing crisis, or whether it has played only a minor role in the crisis, is not clear. I have yet to find a compelling study that answers that question.
We are left to guess. But Colorado communities appear to be making an effort to control STR growth.
- A citizen petition in Frisco would ban short-term rental properties with non-resident owners.
- Three Telluride residents submitted a petition for a vote in November that would slash the number of short-term rentals in town.
- In June, Steamboat Springs’ city council suspended new short-term rental applications for 90 days.
- Crested Butte, which in 2017 capped short-term rentals at 30% of all the homes in town, has approved a 12-month suspension of all vacation rental permits.
- Breckenridge town leaders are considering a significant increase in fees for the town’s 3,800 vacation rentals.
And now — finally — Pagosa Springs has taken steps to establish STR limitations.
Unfortunately (for concerned citizens like myself) the vast majority of residential dwellings in Archuleta County are located outside the municipal limits, and are thus regulated by the County government and by various homeowner associations.
Those neighborhoods will not be affected directly by the Town Council approval of Ordinance 958. But they may be indirectly affected. If new licenses are unavailable within the town boundaries, that could drive eager STR investors to purchase units in the unincorporated county, where the Board of County Commissioners have so far refused to place any caps on STR licensing.
I suspect the attempts to control vacation rentals will not end with Ordinance 958. The Town Council and the Town Planning Commission have also been discussing an excise tax on vacation rentals, with two apparent purposes. First, an excise tax on vacation rentals would serve to ‘level the playing field’ between traditional motels and bed-and-breakfast operations — which pay substantially higher property tax rates here in Colorado — and STRs, which pay at the lower ‘residential’ property tax rate.
Secondly, an excise tax on STRs could be used to support the development of workforce housing — something we desperately need in Pagosa Springs.