Salida City Council voted unanimously Tuesday to approve an ordinance, with amendments, updating the municipal code Chapters 6 and 16 in regard to short-term rentals.

Councilman Justin Critelli, owner of Simple Lodge and Hostel, recused himself.

About 12 people were either present at the meeting or online to speak during the public hearing.

Several speakers encouraged the council to “press pause” on this issue and allow the Chaffee County Housing Authority to work on a solution.

Becky Gray, county director of housing, spoke to the council, citing a study by the Economic Policy Institute that stated the “economic and social cost of unregulated short-term rentals outweighs the benefits,” and 97-98 percent of interested vacationers would still come to an area if they could not get a short-term rental.

Others speakers said they had bought property recently in the city with plans to live here part-time and rent it out part-time to help pay their bills, and they felt betrayed by the city because of the changes.

The city also received several letters and emails with comments about the issue, all of which are available in the council meeting packet.

Bill Almquist, community development director, reported there are currently 210 short-term rental licenses within the city. 

They break down as follows:

• 75 in residentially zoned areas, which are capped at 3.5 percent of total units and currently at capacity.

• 130 in uncapped commercial, residential mixed unit and industrial zoned areas.

• Five in areas that were eligible to due to previous agreements.

The city began licensing short-term rentals in 2016. Since that time, the percentage of units in nonresidential zones has risen from 9 percent to about 25 percent, with the majority of growth occurring in the historical downtown area, where about 50 percent of all units are short-term rentals, Almquist said.

The new ordinance caps the number of short-term units allowed in various zoned areas around town.

The new caps will be:

• The commercial-2/historical downtown area will be limited to 99 short-term rental units or 70 percent of total units. Currently 70 short-term rental units are in the area.

• The Colo. 291/First Street corridor will be limited to 71 units or 25 percent of total units. This was changed from 35 percent on the recommendation of the Planning Commission. Currently 48 short-term rental units are in the area.

• Industrial corridor will be limited to 16 units or 35 percent of total units. Currently eight short-term units are in the area. 

• The U.S. 50 corridor will be limited to 46 units or 70 percent of total units. Currently four short-term units are in the area. 

Another aspect of the ordinance limits new short-term licenses to residents of Chaffee County. Council discussed the issue and decided to keep it in the ordinance as written but asked staff to look at some other options, such as setting 75 percent of licenses for county residents and 25 percent for out-of-county.

The county defines residency as at least two of the following documents: valid driver’s license with Chaffee County address, current voter registration, valid motor vehicle registration or a document that designates a residence for income tax purposes.

Some other changes to the municipal code in the ordinance include:

• A change to off-street parking standards, requiring one space for the first two bedrooms in the unit, plus one-half space for each additional bedroom.

• Any development that has two or more primary units on the same lot shall have no more than 50 percent of its units as short-term rental units.

• The name of the short-term license applicant must match the name of the owner on the deed of the property, or the person with controlling corporate interest in the property.

Council also unanimously approved an extension of the moratorium on new short-term rental licenses to Nov. 8, which was set to expire Oct. 18.

The original moratorium began July 20 and runs for 90 days.

Council also passed a resolution resolving a difference in cost for commercial and residential short-term rental licenses.

Commercial licenses originally cost $270 for a new license, while residential licenses cost $470. Now all short-term rental licenses will cost $470.

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