Council delays vote on STR ordinance

Possible vote on January 17

By Alissa Johnson

The lengthy discussion on how to regulate short-term rentals (STRs) in Crested Butte continued last week and will continue next Tuesday. The Crested Butte Town Council held a public hearing on the proposed STR ordinance on Tuesday, January 3, but ultimately decided not to vote on it that evening.

The topic once again drew a crowd, with public comment lasting roughly an hour and a half before the council answered questions and discussed their viewpoints. With councilmember Jackson Petito absent, the council more or less divided on how many nights per year STRs should be allowed, and new information and questions coming to light, the council continued the public hearing to January 17.

The ordinance, among other things, addresses health and safety issues, parking, providing a local contact in case of emergency, and the number of nights that an STR can be rented. Public comment will be limited, however, to specific aspects of the proposed ordinance, including the number of nights that STRs should be allowed to rent and whether parts of the T zone should be excluded from short-term renting.

New understandings: Who’s grandfathered in

Prior to opening the public hearing, town staff and the council clarified just how many current STRs will be grandfathered in to current regulations. Zoning for a significant portion of the blocks in town allows for unlimited short-term rentals—that represents 199 of the 255 STR licenses currently held (see map).

“There seems to be a consensus that because those licenses were issued under the existing zoning we cannot then further restrict them by number of nights through the new ordinance,” Bob Gillie, building and zoning director, said.

Mayor Glenn Michel confirmed, “If you’re in one of these zones… and you have a current BOLT [business occupancy license tax] license, as long as you maintain it you have unlimited short-term rental nights going forward.”

Houses that rent for 30-day blocks (or more) would also be unlimited. And according to information provided by town manager Dara MacDonald, the license could transfer between owners in these zones. If a license is not maintained, however, or the property is not rented for a period of six months or more, the STR would then fall under the proposed ordinance and be subject to whatever limit the council puts in place.

“It’s not as onerous as people are thinking it might be,” Michel said, later adding, “This represents 78 percent of all current STR licenses in this unlimited zone… So what we’re trying to do is look further down the road. This isn’t going to be solved this year with this ordinance. This is going to be something that takes many, many years and hopefully helps the community not become one ginormous hotel.”

Public comment 

Nearly 20 people spoke during public comment, many of them reiterating points that have been raised over the last few months. Some fear they or other locals will no longer be able to afford their homes if the amount they can short-term-rent is limited. Others remain convinced that limiting short-term rentals will not solve the real problem at hand: a lack of affordable housing.

The question of whether short-term-rental limits could be seen as rent control was raised, and residents wanted to know how the town would enforce the regulations. They also expressed concern with a lack of accountability for renters who are loud or inconsiderate, and worried that the community feel of Crested Butte would be lost. And a couple of people spoke up regarding loss of income if STRs are limited.

The public did bring a few new ideas to the table. Crested Butte resident and STR committee member Dan Escalante wanted to know why there was one limit for STRs when they impact single-family residences and multiple-unit dwellings differently. He also suggested an alternative to caps, referring to Chaffee County’s approach.

“If your house is available this many days or more, you’re now a commercial entity… That could deter people from wanting to be wherever in the world that they are and have a business in Crested Butte that could otherwise be a residence.”

That idea resonated with several others. Former town planner John Hess particularly liked the idea of taxing STR units as commercial entities, and believed that if STRs were allowed only in primary residences there would be no need to talk about limiting the number of nights.

Resident Molly Murfee wanted to see different regulations for primary residences and investment properties. Roman Kolodziej wanted to know if it was possible to use cost of entry (i.e. make it expensive to short-term rent) to limit the desire to short-term rent, and Alex Fenlon questioned the need for an employee to manage short-term rentals if the town wasn’t going to limit the number of licenses.

“If you’re not limiting the number of licenses I don’t know that there’s even a need for an employee,” he said. “I just think that’s more bureaucracy and government paychecks.”

Fenlon also wanted to know why STR restrictions in the M and T zones were being rolled back. He saw the condos there, including Meadows and Silvanite, as valuable, local free-market housing.

Real estate broker Molly Eldridge referenced a report from the National Association of Realtors, acquired through the Gunnison County Realtor Association, which looked over the proposed ordinance. She felt that issues they raised needed to be addressed, including the provision for a local contact. Did that mean those contacts would be expected to go into unsafe situations, like domestic disputes?

And retired attorney Jim Starr said that the new information regarding the number of STRs excluded from new regulations changed the whole picture. “What you’re doing is 30 percent of the whole puzzle here…we shouldn’t be looking at 120 days, 90 days, 75 days—we should be looking at 50 days because you have so many areas of the town already able to rent as long as they want, 365 days a year.”

Council discussion

After taking time to answer various questions, councilmembers shared some of their thoughts. While councilmember Jim Schmidt said he was a “compromise guy” and could potentially vote for the proposed ordinance with a 120-day limit, he took exception to some of the ideas presented, particularly the letter from the realtor association.

“I’ve been on council for over 26 years and this afternoon I was more disappointed in the absolute greed that was flowing out than I’ve ever seen before. We got an 11-page letter from our county Realtor board that every other sentence to me said greed, greed, greed,” he said.

Schmidt challenged the notion that requiring a local contact person was too much—the idea was to ensure a contact if someone needed a toilet unplugged, not to send anyone into an unsafe situation.

“When I read that, I just said the rest of this is junk,” Schmidt said. He also challenged the notion that the ordinance had anything to do with rent control. “We aren’t trying to control rent, we’re trying to control use.”

Councilmember Laura Mitchell favored the 120-day limit. “We spent a lot of time and energy to realize that everything in the green zone [where units are grandfathered in] is unlimited. I’d be comfortable with 120 days in these other zones and moving forward. There are no easy answers to this. It’s a cultural phenomenon,” she said.

Chris Ladoulis wondered if the question regarding the M and T zones had been fully addressed. He was inclined to exclude the zones or be more restrictive. Councilmember Roland Mason still liked the idea of 90 days with unlimited renting during the off-season, but since that hadn’t gained traction, he was okay with the 120-day limit.

“What I see in this ordinance and the restriction to at least 120 days is that… in five to 10 years someone can’t come in and buy five, six, seven, or eight homes in a block,” Mason said. He felt that 120 days was a good place to start.

“Given the fact that we’re able to grandfather and that we’re satisfying current demand, I could be comfortable with 90,” Ladoulis said.

“I think everyone knows where I’m at. I’ve spoken extensively and probably too much—Paul rolls his eyes when I speak—I’m at 90 and I’m fine with the rest of the ordinance,” mayor Michel said, laughing.

Councilmember Paul Merck was comfortable with 120 days, suggesting that people in the audience needed to take a closer look at the ordinance. He felt that many of their concerns would be impacted by the ordinance, and even countered one audience member’s assertion that the council had been blowing in the wind in regard to the issue.

“I don’t think we’ve been blowing in the wind. We’ve been getting people to come in and talk to us,” he said.

Attorney John Belkin asked the council if it wanted any information on the legal questions raised during the meeting, such as rent control. He also reminded them that it was okay to take time with this issue.

Council ultimately liked that idea, as well as having more time to consider whether blocks 55 and 37 in the T zone, but not the M zone, should be excluded from STRs. The public hearing was continued to January 17, when public comment will be limited to the number of days and the question of the T zone.