Gunnison County commissioners support regulations on STRs

Senate Finance Committee hearing February 20

By Katherine Nettles

Gunnison County commissioners have been in support of getting state-wide short-term rental (STR) regulation and taxation legislation up and running, and there is now a draft bill, SB24-33, under consideration at the Colorado General Assembly to that effect. The bill could increase the property tax rate of STR properties by up to four times their current residential rate of almost 6.8%

County commissioners first discussed the possibility of taking part in the STR legislation discussion back in November 2023 when commissioner Liz Smith brought it up, asking the board to pool with other counties for a lobbyist to work on pushing forward state-wide STR legislation with the Counties and Commissioners Working Together (CCAT) organization. 

Commissioners discussed it at the time and voted unanimously to allocate up to $5,000 of the county’s discretionary funds to the lobbying effort. 

CCAT advocates for its member counties at the statehouse on various nonpartisan items, and Smith said the issue of charging commercial tax rates to STRs is one that resonates with several mountain communities, but not as much with the Front Range. She described potential legislation that would make exceptions for primary residents occasionally renting out their own homes for a few weeks or a month to help make ends meet, while taxing those with accessory dwellings or dedicated STR properties at a higher, potentially commercial rate.  

County commissioner chair Jonathan Houck wanted to make sure this was not setting a precedent of paying for additional lobbyists on other issues, but Smith was confident this was an exception, since many of the CCAT communities, particularly in the Front Range, do not identify with this issue and the testimony coming from companies such as Airbnb and VRBO has been robust in favor of protecting STR interests. 

County manager Matthew Birnie noted there was plenty of money available in the discretionary fund, and commissioners unanimously approved the expenditure.

That bill has now materialized in SB24-33, the Lodging Property Tax Treatment. The bill establishes that, beginning in January 2026, a short-term unit (defined as a non-primary residence rented for less than 30 days at a time and used as such for more than 90 days in the previous tax year) will be classified as a lodging property for property tax purposes. 

It is not stated what that will mean for tax rates, however.

The bill would require assessors to send notice to STR owners of the number of days during the prior property tax year the assessor had determined the property was leased for short-term stays, and owners would be required to sign and return the notice or provide evidence to dispute it. 

The bill also proposes establishing a pilot program to develop a statewide database and uniform reporting system to track STR units. The bill is sponsored by state senator Chris Hansen and state representative Mike Weissman. 

Smith reported at the county commissioners’ regular meeting on February 6 that she had recently testified against another bill related to STRs, SB24-24. She said she found the bill concerning in that it would have prohibited local governments from requesting data from companies like Expedia, Airbnb and VRBO, as well as people who own STRs and use those sites for bookings. “And it would be tied to STR licenses at local government levels in the absence of a state portal, which Airbnb/VRBO etc. are vehemently against,” she told the Crested Butte News. “Some of the initial legal analysis from other counties suggested it would erode some of the authority local governments have in their resolutions and ordinances related to STRs as well.”

Smith told the News that such a bill is counteractive to the effort Gunnison County and many other mountain towns are making to create transparency and accountability. 

“Crested Butte has tried to audit its lodging facilitators and not been able to,” she said as an example. 

“We are in a state-wide housing crisis,” said Smith. “Slamming the door shut on data is a way to prevent regulation. And not at the expense of our communities are we going to allow people to build their generational wealth or out-of-state property portfolios.”

Smith was referring to another piece of STR legislation under development which would allow STR owners to avoid commercial property taxes if they declared the property as their “second” home. “It was unclear to me how this would work for out-of-state property owners. But the context of these being targeted to second homes as a way to allow Coloradans (primarily on the Front Range) to build generational wealth when our rural resort communities are facing dire housing shortages is what I found most untenable,” she said.

Smith said that she wants STRs to be treated fairly, however, and a compromise from both sides might be in order whether in terms of what tax rate STRs receive or how they are classified. 

“Any STR legislation that happens has to be done right, because we don’t want to pull our economy apart. We’re being thoughtful about it and we want to be engaged in the nitty gritty details of it,” she said. 

Either way, she said it has been an uphill slog to get anything STR-related through the legislative process, and this legislative season may be no different as the STR industry has been lobbying intensely and formed its own counter-bill of SB24-24.

“It’s not like we’re lobbying and no one else is. It’s more the opposite,” Smith said. 

SB24-33 will be considered in the Senate Finance Committee on February 20. 

On a local level, Smith hopes the county can  begin working toward a short-term licensing program later this year and she said she has been meeting regularly with constituents on both sides of the issue.