HomeMy WebLinkAbout2024-08-27 VLHA Agenda
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Vail Local Housing Authority Minutes
Tuesday, July 23, 2024
3:00 PM
Virtually on Zoom ONLY
PRESENT ABSENT
Steve Lindstrom Christine Santucci
Craig Denton
Dan Godec
Kristin Williams
STAFF
Jason Dietz, Housing Director
Martha Anderson, Senior Housing Coordinator
Missy Johnson, Housing Coordinator
1. Call to Order
1. 1 Call to Order The meeting was called to order at 3:05 p.m. with a quorum present.
Time: 5 Min.
1.2 Zoom Meeting
Time: 60 Min.
2. Citizen Participation
2.1 Citizen Participation
Time: 5 Min.
No citizens.
3. Approval of Minutes
3.1 VLHA June 25, 2024 Minutes
Presenter(s): Missy Johnson, Housing Coordinator
Time: 5 Min.
2024-06-25 VLHA Mintues.pdf
Kristen Kenny Williams made a motion to Approve as Amended with edits from Williams regarding
her statement that involved Habitat for Humanity, with her Habitat hat on.
MOTION: Williams SECOND: Denton PASSED: 4-0
3.2 VLHA July 12, 2024 Minutes - Special Session
Presenter(s): Missy Johnson, Housing Coordinator
Time: 5 Min.
2024-07-12 VLHA Minutes.pdf
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MOTION: Godec SECOND: Williams PASSED: 3-0-1
4. Main Agenda
4.1 A Resolution Approving the Purchase of a Deed Restriction Interest in Property
(Type III Deed Restriction) in the Town of Vail Legally Described as Subdivision:
Alpen-Glo Condo Unit: 5, Eagle County, Colorado with a Physical Address of
5115 Black Bear Lane #5, Vail Colorado; and Setting Forth Details in Regard
Thereto. Presenter: Missy Johnson, Housing Coordinator
2024-4 VLHA Resolution Purchase of a deed restriction 5115 Black Bear Lane Unit 5.pdf
This agenda item was initially tabled but Authority conversation ensued around the topic and
eventually there was a motion to approve the resolution with an amended dollar amount up to
20% of purchase price. Housing Staff agreed to revise the resolution for signature.
Executive Session is set for 12 p.m. on Wednesday, July 24 for further discussion.
Dan Godec made a motion to Approve as Amended.
MOTION: Godec SECOND: Williams PASSED: 4-0
4.2 Prepare for the State of Housing Meeting on August 6 with the Vail Town Council
Presenter(s): Steve Lindstrom, VLHA Chairman
Time: 30 Min.
Lindstrom recommends we present at the 2nd Town Council agenda meeting based on
current happenings. He suggested the housing staff to work on the numbers in the
background but hold off and look for a later Town Council meeting in August.
4.3 Discussion on VLHA Budget Supplemental Needs
Presenter(s): Martha Anderson, Senior Housing Coordinator
Time: 15 Min.
Anderson discussed the need to do a supplemental budget with Finance to cover the current
needs and future buffer for Professional Services to provide additional flexibility.
Lindstrom confirmed that $208,000 came in from grant funding to cover future projects and
future projects. He anticipates that happening in short order at which time we can revisit the
subject.
Lindstrom agrees Anderson's suggestion to put a place holder into the supplemental budget of
$30,000 to be classified to potentially cover pending professional services agreements.
Anderson confirmed the items and amounts that are currently allocated.
Anderson will confirm with Finance whom will present at the future meeting.
Williams moved that we approve the discussed budget on supplemental needs and the group
will vote on the revised budget at the next meeting. Denton seconded. This item will be reviewed
through finance at a future meeting.
MOTION: Williams SECOND: Denton PASSED: 4-0
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5. Matters from the Chairman and Authority Members
5.1 Matters from the Chairman and Authority Members
Presenter(s): Steve Lindstrom, VLHA Chairman
Ruther joined with inquiry around the Timber Ridge deed restriction and related compliance. Providing
a few examples, Ruther reviewed an example whereas the employment status, paycheck, comes
from an out of county company, but all of the services provided occur in Eagle County area. Because
these two applicants comply with the intent and the terms of the deed restriction, Ruther turned to the
Authority to determine if these situations are still applicable to policy from the Housing Authority.
Lindstrom confirmed that we have followed this approval process from the past and also
supports that many Vail Resorts employees receives checks from Broomfield, while meeting
the terms of the deed restriction.
Unanimously, the Authority approved these one-offs as mentioned by Ruther. Godec suggested
working with legal to provide a statement in clarification of the above.
Lindstrom suggested the Housing Staff work on some policy guidance for the Authority to
consider prior to formulizing the statements and legal considerations. Dietz agrees.
Housing staff will consider the above based on preparation for future, annual, EHU compliance
and bring the Authority discussion points for consideration prior to presenting policy to legal.
Lindstrom prefers to define the line between those providing goods and services here locally
and vs. the remote workers and Deitz agreed.
Ruther provided a quick update regarding Timber Ridge and upcoming agenda items 1)
resolution to approve the 2nd amendment to the development agreement; 2) resolution to
approve a tri-party agreement and 3) an ordinance allowing the Town of Vail to transfer the title
to Triumph Development upon closing of the construction lending. Ruther says we now have
agreement from all parties within the tri-party agreement and the development agreement.
Ruther provided an overview of the status of purchase and sale agreements and there is about
102 units under contract of the 194 total to sell to bulk buyers, individuals or businesses. There
is likely to see a slight price increase in the future.
The team is still working to hold the end date schedule, anticipating a 30-day shift in final
product completion, even with the recent delays.
Ruther exited the meeting.
Anderson mentioned the development fund available to the Authority as well as the
registration opportunity for Authority members to attend the Housing Colorado Conference
in Keystone.
Williams expressed her excitement in the recent Vail InDEED interest recently but if we
anticipate a cadence to need one- off special meetings, it could be helpful to set calendar
inclusions for 15 minutes and then cancel them if they are not needed. Anderson confirmed that
it is abnormal to need the one-off meetings as we have executed recently.
6. Adjournment
6.1 Adjournment 5:00 PM (Estimate)
Kristen Kenny Williams made a motion to Adjourn Meeting adjourned at 3:51 p.m.
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MOTION: Williams SECOND: Godec PASSED: 4-0
7. Future Agenda Items
7.1 Housing 2027
Land Banking
8. Next Meeting Date
8.1 Next Meeting Date August 13, 2024
Vail Local Housing Authority Meeting Minutes of July 23, 2024
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Vail Local Housing Authority Minutes
Wednesday, July 24, 2024
12:05 PM
Special Session - Zoom Only
SPECIAL SESSION
PRESENT ABSENT
Steve Lindstrom Christine Santucci
Dan Godec Kristin Williams
Craig Denton
STAFF
Jason Dietz, Vail Housing Director
Martha Anderson, Senior Housing Coordinator
Missy Johnson, Housing Coordinator
1. Call to Order
1. 1 Call to Order
Presenter(s): Steve Lindstrom
The special session was called to order at 12:14 p.m.
1.2 Zoom Meeting Pre-Executive Session
1.3 Zoom Meeting Post-Executive Session
2. Citizen Participation
2.1 Citizen Participation
No citizen participation.
Motion to leave regular session and enter executive session at 12:15 p.m.
MOTION: Denton SECOND: Godec PASSED: 3-0
3. Executive Session
3.1 Executive Session per C.R.S. §24-6-402(4)(a)(e) - to discuss the purchase,
acquisition, lease, transfer or sale of real, personal or other property interests
and to determine positions relative to matters that may be subject to
negotiations regarding: Vail InDEED application and an EHU Exchange.
Presenter(s): Martha Anderson, Senior Housing Coordinator and Missy Johnson, Housing
Coordinator
4. Any Action as a Result of Executive Session
4.1 Any Action as a Result of Executive Session
At 1:08 p.m., the Authority left executive session and re-convened the special session. Motion
to direct Housing Staff move forward as discussed regarding discussed topics of the Vail
InDEED application.
MOTION: Godec SECOND: Denton PASSED: 3-0
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5. Matters from the Chairman and Authority Members
5.1 Matters from the Chairman and Authority Members
Presenter(s): Steve Lindstrom, VLHA Chairman
Lindstrom suggested the Authority revisit current and future lending as related to EHUs.
6. Adjournment
6.1 Adjournment
The Special Session of the Vail Local Housing Authority adjourned at 1:09 p.m
MOTION: Denton SECOND: Godec PASSED: 3-0
7. Future Agenda Items
7.1 Vail Housing 2027
Land Banking
8. Next Meeting Date
8.1 Next Meeting Date August 13, 2024
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Vail Local Housing Authority Minutes
Tuesday, August 13, 2024
3:00 PM
Town Council Chambers
PRESENT ABSENT
Steve Lindstrom Dan Godec
Craig Denton Kristin Williams
Christine Santucci
STAFF
Jason Dietz, Housing Director
Martha Anderson, Senior Housing Coordinator
Missy Johnson, Housing Coordinator
1. Call to Order
1. 1 Call to Order
Meeting called to order at 3:10 p.m. with a quorum present.
1.2 Zoom Meeting
2. Citizen Participation
2.1 Citizen Participation
No comments.
3. Approval of Minutes
3.1 VLHA July 23, 2024 Minutes
Presenter(s): Missy Johnson, Housing Coordinator
Moved to next meeting for approval based on Authority members present.
3.2 VLHA July 24, 2024 Minutes
Presenter(s): Missy Johnson, Housing Coordinator
Moved to next meeting for approval based on Authority members present.
4. Main Agenda
4.1 Resolution No. 5, Series of 2024, A Resolution Adopting a Budget and
Making Appropriations to Pay the Costs, Expenses and Liabilities of the
Vail Local Housing Authority, for its Fiscal Year January 1, 2024 through
December 31, 2024 Approve, approve with amendments or deny Resolution No.
5, Series of 2024.
Presenter(s): Martha Anderson, Senior Housing Coordinator Time:
VLHA 2nd Supplemental.pdf
VLHAres#5 for 2024 2nd Supplemental.pdf
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Anderson presented supplemental budget items to the Authority for review and motion to
approve. The authority approved a $47,500 to extend a contract with Social Impact Advisors,
appropriate funds to engage with Mauriello Planning group and amount to hold for potential
future needs.
MOTION: Denton SECOND: Santucci PASSED: 3-0
4.2 VLHA Q2 2024 Financial Update
Presenter(s): Jake Shipe, Budget Analyst
Time: 15 Min.
VLHA Q2 2024 Financial Update.pdf
Shipe provided and overview of the financial updates for the Authority's income statement,
balance sheet and the Town of Vail Housing Funds through the second quarter.
Lindstrom reminded the group that the Authority's funds are completely separate from the
Town of Vail's housing funds and the total income for a year is typically $60,000 which is
typically spent on consultants.
The housing funds are not available for the Authority to spend but of interest. The major
funding source is the Housing Sales tax plus the $2.5M transfer from the capital projects fund
annually to fund housing program. Workforce housing sales, earnings on investments and
other miscellaneous revenues are also reflected in this fund.
The Authority recommends usage of these funds to the Town Council who ultimately makes
the final decisions and sign off for use of funds. These funds are used in a variety of ways
including housing buy-downs, investing in properties for Town of Vail employee housing and
for seed money to do larger projects.
Shipe confirmed that historically, revenues track closely to the forecast of revenues based on the
sales tax revenues.
$4.2M of $15.5M budgeted dollars of the Housing Fund have been spent on a Pitkin
Creek Unit 3B purchase and West Middle Creek development.
As part of the packet, Shipe reviewed the use of the Capital Projects Fund for $2M of the $3.2M
which was spent on Town of Vail employee housing including Buffehr Creek 3B and Meadow
Creek L4.
4.3 Local Planning Capacity Grant Update
Presenter(s): Steve Lindstrom, VLHA Chairman, Jason Dietz, Housing Director, Martha
Anderson, Senior Housing Coordinator
Time: 15 Min.
A grant was secured for $ 208,000 through the Department of Local Affairs (DOLA) to be applied
through the Town of Vail. We can anticipate an executed contract to come in September or
October. They advised the Town not to contract for the usage until it is contracted and presented
with the terms and conditions, which will include quarterly reporting.
Deitz and Anderson reviewed the next steps, including the public procurement process and
procedures for contracts of $50,000 or more. $208,000 is the net that can be spent. The main
intention was to help with affordable housing capacity building, reducing the development
entitlement process. The largest portion of the funding will be for a housing liaison.
The housing team will keep the Authority updated as additional information comes through
from DOLA and Lindstrom will reach out to Mauriello Planning Group with an update.
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4.4 Rural Resort AMI Petition with Colorado Housing and Finance Authority
Presenter(s): Steve Lindstrom, VLHA Chairman and Martha Anderson, Senior Housing
Coordinator
Time: 15 Min.
Rural Resort Petition to Waive Income Limits Rev1.3.24 (1).pdf
Anderson reported regarding the Rural Resort AMI Petition in follow-up from her attendance
to the August 2nd Mountain Resort Stakeholder Outreach and Engagement event. With
DOLA present, Anderson learned that the Town of Vail AMI petition was declined. The Town
of Vail will need to re-submit with a more updated housing needs assessment report in order
to meet the requirements of the grant in order to increase the AMI levels within the Town of
Vail.
The Town of Vail needs to go back with additional information and housing needs
assessment would needed to have been more recent than the special needs assessment that
dates back to 2018.
$15,000 has been budgeted towards a housing needs assessment but additionally, Deitz is
working within a regional group in Eagle County.
Anderson and Dietz continued to describe the process and next steps around a future
housing needs assessment that will likely be drafted in September 2024 for review by the
variety of jurisdictions.
Conversation ensured around reasoning for seeking potential future AMI increases within the
Town of Vail.
5. Matters from the Chairman and Authority Members
5. 1 Matters from the Chairman and Authority Members
Presenter(s): Steve Lindstrom, VLHA Chairman
Time: 5 Min.
Lindstrom summarized the recent Town of Vail planning commission meeting. Upon review of the
first project that has come through with the revised Community Housing Zone District, there are a
few things that still need to go to planning commission (PEC), including additional review of the
environmental impact. West Middle Creek is nearly fully entitled.
Lindstrom believes that Timber Ridge financing was set to close on Friday, Aug. 9th and they will
pull back on sales during the key construction phase and purchase prices are planned to increase
soon and later supported by a modular sales showroom.
Anderson mentioned the Town of Vail Board Appreciation event from 6 - 8 p.m., Tuesday, Aug.
27 at the AMP.
The Authority looks to do an appreciation event at 4 p.m., Wednesday, Aug. 28 in thank you to
previous Authority member James Wilkins.
6. Adjournment
6.1 Adjournment 5:00 PM (Estimate)
Meeting adjourned at 3:55 p.m.
MOTION: Santucci SECOND: Denton PASSED: 3-0
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7. Future Agenda Items
7.1 VLHA Legal Structure, Powers and Responsibilities
Financial Policies and Best Practices
8. Next Meeting Date
8.1 Next Meeting Date August 27, 2024
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Procurement
Contracting and
PRESENTATION BY Carlie Smith, TOV Finance Director
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authority, county, municipality, city and
State Statute Requirements
vailgov.com
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Update
Annual
be void, and no moneys belonging to a local government shall be paid on such contract.
Semi
¤Any contract, verbal or written, made in violation of this section shall
county, district, or other political subdivision of the state of Coloradothe amounts appropriated.
2021
|
¤Applies to all local governments (¤Agencies can not expend or contract to expend any funds in excess of
Vail
of
¤Budgeting and contracting requirements are governed by state statue: 29-1¤Colo Rev Stat 29-1-110:
Town
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: Ensure fair and open competition and
Procurement Policies
vailgov.com
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Update
Annual
Semi
¤Bid process/procedures¤Contracting requirements¤Approval limits
2021
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¤VLHA has not adopted¤Requirement for some grant funding (recipient or subrecipient)¤Audit Preference if your Revenues/Expenditures > $750K¤Procurement Policy generally includes
Vail
of
Best Practice: Procurement PolicyPurpose of a Procurement Policy compliance with all laws and regulations to provide the best value to the taxpayers for the goods and services
Town
2:
Grant Administration
vailgov.com
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Update
Annual
to the outcome of what grant is funding
Semi
¤Ensuring proper resources for ongoing costs/match or costs related ¤Resources for administrative process
to be taken before applying or accepting grants to maximize the benefits
2021
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¤GFOA recommends developing a grant policy that requires certain steps
Vail
of
Grant Administration Grants generally come with specialized requirements: Can apply to general operations of the grant, specific compliance rules, monitoring of other parties that may
receive resources from the grants, and specialized reporting/audit requirements
Town
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VLHA Revenues
vailgov.com
|
Update
Annual
Semi
2021
Current VLHA Revenue Sources:
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¤MiddleCreekMgmt. Fee:$16.5Kannually¤Lionsridge(0.01% ownership interest): $800annually¤Ground Lease Revenue: $35K Expires 12/31/24¤Interest GeneralGovernment Revenue Sources:¤Taxes¤ChargesforService
s¤Fees¤Grantsandotherintergovernmentalsources
Vail
of
Town
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Thank you
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__________________________________________________________________________
Memorandum
TO: Town Council
FROM: Finance Department
DATE: May 17, 2022
SUBJECT: Ordinance No. 11, Series of 2022, an ordinance repealing and updating Ordinance No.
19, Series of 2018, providing for adjustments to regulations and fees for Short-Term
Rental properties within the Town of Vail.
I. SUMMARY
Based on feedback received during the short-term rental (STR) study presented at the January
17, February 15, March 15, and April 5, 2022, Vail Town Council meetings the attached
Ordinance No. 11, Series 2022 is presented for consideration. At the last meeting, Council
supported an increase in penalties for violations, requirements for increased insurance, fire
safety inspections and an increase in license fees to cover administration costs.
The main question remaining for Council is to consider a Ðper-bedroom feeÑ intended to
deter property owners from converting their units to short-term rentals and at the same
time raise revenues for the purpose of lessening the influence of STRS on locals
housing. All funds raised by a per-bedroom fee would be allocated to the townÓs Housing Fund
and used for housing programs, initiatives, and developments.
A per-bedroom fee is not intended to solve the townÓs housing problems, however will offer
funding support to compliment the townÓs current efforts. The Town of Vail continues to address
community housing needs in a variety of ways, with funding by the townÓs Capital Projects Fund.
2017 $4.3M Chamonix infrastructure subsidy
2019 $4.0M for the purchase of deed restrictions at the Solar Vail project
2019 $ 0.6M for purchase of deed restrictions at 6 West in Edwards
2017Î2021 $4.3M in the purchase of individual units
2018Î2021 $7.3M in InDEED deed restrictions from 2018 to 2021.
5-year total: $20.5M
Over the past five years, the town has invested $20.5M in housing programs and developments,
not including the construction of 72 new units at The Residences at Main Vail. This significant
commitment to housing for locals was supported by voters in November, 2021 with the approval
of a new 0.5% sales tax that will generate approximately $4.5M per year. The town is pursuing
numerous opportunities to create more housing, such as a redevelopment of Timber Ridge,
potential development on CDOT property, and a State Land Board parcel in Eagle-Vail, among
others.
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II. BACKGROUND
Purpose of the 2021/2022 STR Study:
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On July 6 2021, staff presented background history and data on the townÓs short-term rental
regulations and activity. During that presentation, Town Council expressed concern that the
town is experiencing a severe shortage of housing for the local workforce and directed staff to
bring back an emergency ordinance to suspend new STR registrations. On July 20, 2021 an
emergency ordinance was presented to Town Council but after hearing concerns from citizens
and local businesses the ordinance was not passed.
At the direction of Town Council, staff contracted with RRC Associates and Economic &
Planning Systems Inc. (EPS) in September of 2021 to conduct a study in order to better
understand the townÓs short-term rental (STR) inventory and its impacts on the community.
Conclusions of the Short-Term Rental Study
Throughout the short-term rental study, a considerable amount of data and analysis was
presented on short-term rental activity in the Town of Vail. To summarize, the study reviewed
current regulations, real estate market impacts, peer community approaches to regulation, and
the granular location densities and inventory composition of the registered STR properties
throughout town.
Below is a summary of key findings from the study:
31% of residential parcels were registered as STRs (a total of 2,454 units)
18% of units in Zone 2 were registered as an STR in 2021 with new registrations in
Zone 2 occurring at a higher rate since January 2020 than in prior years
138 of the 410 properties sold (one-third) during 2021 were registered as an STR before
the sale, after the sale or both
Vacant homes and those used for seasonal, recreational, or occasional uses represent
69% of the townÓs housing stock according to census data; this did not change
significantly between 2010 and 2019
Saturation of STRs in business license Zone 2 is significantly lower than the overall rate
of 32%. When adjusted for STRs located in developments with 24/7 onsite management,
the saturation rate is at or below 20% in these areas
Data suggests that though the full-time resident population in Vail has increased, the
population of locals aged 18-34 has declined
The number of owner-occupied housing units increased from 2010 to 2019, while the
number of long-term rentals decreased resulting in a net loss of 162 local occupied
rental housing units
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III. DISCUSSION
The study has presented the challenges that come with managing STR activity while trying to
address local housing availability. In the attached ordinance, several updates to the existing
STR regulations are presented based on the feedback of the council. These are discussed in-
depth here.
Transition to STR Licenses
To increase requirements for obtaining the right to short-term rent a residential property in the
Town of Vail, it is also recommended that the Town transition from a STR registration to a STR
license requirement.
A license is a legal document that gives official permission to engage in the act of short-term
property rental. Existing requirements do not include being granted official permission, merely to
register the STR property with the Town. Changing the requirement will allow for;
Enhanced enforcement of STR regulations
Enhanced enforcement of STR penalties
Greater staff oversight of STR activity in the Town
Ability to require additional proposed STR Fire Safety Inspections and Insurance
requirements
Increased Penalties and Fines
During the STR study presentation, Council has expressed concern over STR properties
impacting neighborhood character and community standards. It was questioned whether our
current STR enforcement structure is adequate to mitigate these problems. Currently, the townÓs
STR violation structure has four levels, with the fourth being a revocation of the STR registration
for two years. Staff recommends changing this policy by reducing the maximum number of
violations from four to three, increasing the fine amounts for each level, and increasing the
revocation period from two to three years.
Additionally, staff suggests imposing a significant fine of $2,670, the maximum allowed penalty
under code, for any STR found operating without a valid registration. The purpose of this would
be to dissuade non-compliance from unregistered units.
Below is a summary of the recommended violation and fine structure:
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Health and Life Safety Standards
Staff recommends revisiting the current health and life safety standards required by the STR
ordinance. Currently, the town requires a self-compliance affidavit to be completed by the
homeowner or property manager attesting that their property or properties adhere to the items
listed on the affidavit including fire and building safety standards, community impacts like
parking and noise ordinance, and occupancy limits. Based on recommendations from Vail Fire
Department, staff has included the following requirements in the ordinance to improve safety
compliance and create some alignment with commercial hotels and lodges:
Fire Department Inspections
Town staff recommends requiring a periodic inspection of all short-term rental units not located
in buildings with on-site, 24/7 management. Staff recommends requiring proof of inspection
every three years as a condition of renewal of the STR license and verification of the fire and
life-safety affidavit in intervening years. In order to stagger inspections of existing STR
st
licensees, staff recommends an effective date of January 1, 2026 for this requirement. This
program would require additional staff time and administration costs which could be covered by
increased STR license fees. Staff estimates approximately half of all current STR licenses
would require an inspection Staff recommends requiring the following items in the proposed fire
safety inspection:
1. Fire extinguishers
2. Adequacy of egress (exits)
3. Egress plan is posted
4. Carbon monoxide detectors
5. Smoke alarms
6. Occupant load
7. Improvised electrical conditions and use of extension cords
8. Use of portable heating appliances
9. Outdoor heating appliances
10. Physical address including unit # is provided in a conspicuous manner
This policy is recommended to increase the health and life safety standards of these properties
and mitigate the risk of property damage.
Require Proof of Adequate Insurance for Short-Term Rental Activity
As identified by the Rocky Mountain Insurance Information Institute and Insurance Information
Institute, standard homeownerÓs insurance policies are generally inadequate on their own to
cover claims due to STR activity. This may negatively impact neighboring homes and units
which experience claims due to the activity. Some insurers will cover these claims when the
STR activity is very limited, generally one rental per year. Staff recommends requiring proof of
one of the following with a minimum $1.0 million coverage for all STRs:
o Endorsement to a home ownerÓs policy for coverage of STR activities
o Proof of other gap insurance policy for STR activities, excluding automatic
insurance provided by online STR rental platforms like Airbnb, VRBO,
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etcÈ These policies are far less comprehensive than standard homeownerÓs or
commercial insurance
Tiered License Fees
The Town of VailÓs current license fees are lower than peer communities and are well below the
townÓs administrative costs for STR enforcement. At the last council meeting, Town Council
expressed support for the following base fees for STR licenses to cover administrative costs
A. Base Fees to Cover Administrative Costs
Base Fees (to cover Admin costs)
Annual Estimated Revenue
All STR Registrations$150 Per Registration$375,000
This base fee will cover costs to the Town including, but not limited to:
Software dedicated to enforcement of STR regulations and licensing
Staff time across the finance, fire, and code enforcement departments
Legal costs of enforcement
Monitoring of STR activity in Town
B. Per Bedroom Fees to Fund Local Housing Initiatives
Town Council also expressed support at the last meeting toward adopting a per-bedroom fee to
fund housing initiatives in the Town. As covered previously by the fee nexus study, guests
staying in STRs spend money in the local economy. This spending is primarily in the retail, food
and beverage, and recreation industries which supports jobs that do not pay enough for
employees to afford market-rate housing in the town. The basis of this fee is therefore the gap
between what employees can afford and the cost to purchase an attached home in Vail. The
calculation also accounts for the possibility that a home used as an STR could be occupied by a
local resident, and the fee is further based on the difference between the impact of guest
spending in the local economy versus the baseline impact of local resident spending. The charts
below show a few options for per bedroom fees, based on the maximum fee of $5,912. The
full nexus study is included as Attachment A.
Staff has received feedback from the Vail business community indicating that high per-
bedroom fees may pose a significant cost to property management and Ðcondo-telÑ
businesses. There has also been feedback that the town should treat Ðpurpose-builtÑ
residential condo properties differently than other residential STRs. Unfortunately,
based on the fee study as well as legal limitations, per-bedroom fees should be applied
equally to all types of STR properties. However, the town can make an exception for
primary, owner-occupied, and rentals less than 30-days per year that may be charged a
reduced fee. Fees should also be charged equally across all areas of the town to avoid
potential claims of unfair treatment and Equal Protection violations.
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The below chart outlines proposed per-bedroom fees for various mitigation rates. Currently, the
townÓs mitigation rate for commercial linkage is 30% and the townÓs goal is to house at least
30% of employees locally in Vail. Based on those objectives, staff is proposing that Council
choose from the following three fee options:
Per-bedroom fee for
primary residence, owner-Revenue
Mitigation Per-bedroom
occupied and rentals of generated
Rate license fee
less than 30-days per for housing
year.
30% $1,800 $465 $9,478,000
20% $1,200 $310 $6,334,000
10% $600 $155 $3,190,000
The revenue generated by the per bedroom fee would be allocated to the townÓs Housing Fund
for investment in housing initiatives, developments, and programs. While the fees above raise
significant dollars, they are one piece of the funding puzzle for housing. If approved, these fees
will join other sources of revenue being allocated by the town.
IV. ACTION REQUESTED OF COUNCIL
Please provide feedback and direction to staff regarding the first reading of Ordinance No. 11,
Series 2022.
The following items are included in the attached ordinance based on Town Council support April
th
5:
1. Increasing fines and penalties for violations of the STR code to $1,500 (first
violation) and $2,650 (second violation / unlicensed unit)
2. Late fees for license renewals of $250
3. $150 flat license fee to cover administrative costs
4. An update to health and safety standard requirements for STRs including Fire
Department inspections and proof of adequate insurance
5. Per bedroom fees have been included in the ordinance wording, with the
dollar amount left blank until tonightÓs discussion. Does Council support a
per-bedroom fee amount?
3:
M EMORANDUM
To:Kathleen Halloran, Finance Director, Town of Vail
From: Andrew Knudtsen and Rachel Shindman, Economic &
Planning Systems
Subject: Short Term Rental Fee Analysis; EPS #213137
Date: May 12, 2022
This technical memorandum summarizes the study supporting a
fee program to be applied to short term accommodation unit (short
term rental or “STR”) licensees in the Town of Vail. Economic &
Planning Systems (EPS) was retained by the Town of Vail to
determine a reasonable fee for this program. The analysis
demonstrates a reasonable relationship between guest spending
from STRs in the town and the demand for housing. The study
uses economic impact techniques to quantify the relationships
between guest spending when staying in STRs and the number of
jobs and employee-households supported in the local economy by
that spending.
Guests staying in STRs spend money in the local economy. This
spending is primarily in the retail, food and beverage, and recreation
industries, and in turn creates local jobs. These jobs generate
demand for households, which then seek housing units. Many of the
jobs created are at wage levels that do not pay enough for
employees to afford market rate housing in the town. The basis of
this fee is therefore the gap between what employees can afford and
the cost to purchase a home in the Town of Vail.
The calculation also accounts for the possibility that a home used as
an STR could be occupied by a local resident, and the fee is further
based on the difference between the impact of guest spending in the
local economy and the baseline impact of local resident spending.
Rationale
This regulatory fee is needed to support the local labor force and
Town housing programs that sustain the tourism economy in Vail.
Without an adequate supply of housing and housing support
programs, the Town risks losing some of its labor supply that is
essential to the businesses in which STR guests spend money
during their stay. This is important, as tourism is a primary
element of the Town’s economic base.
213137- STR Fee Technical Memo 5-12-22
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If businesses do not have an adequate labor force and if workers do not have adequate
housing, the guest experience and the Town’s economy are likely to degrade.
STR owners or hosts will pay an annual licensing fee under this program. The fee payers
receive benefits through investment by the Town in housing for the workforce needed to
sustain the visitor economy. STR owners and operators are likely to benefit from the
supply of labor and from investments the Town will make using the fee revenue on
housing for the local workforce. Having more housing options for the local workforce is
also likely to benefit the fee payers in better customer service through increased
employee retention and reduced employee turnover.
Methodology
This analysis uses a jobs-housing economic impact model to quantify the jobs and
households supported by guest spending in STRs. The analysis begins by quantifying the
jobs supported by spending. Next, several analytical steps are taken to translate the
supported jobs to employees and employee-households (where a household is a group of
people, related or unrelated, living in one occupied dwelling unit).
The IMPLAN model (Impact Analysis for Planning) was used to estimate the relationships
between spending and jobs supported. IMPLAN was developed by the Bureau of Land
Management, U.S. Forest Service, and the University of Minnesota and is widely used by
state and federal agencies, academic researchers, and local economic development
organizations to evaluate the economic impacts of proposed policies, new industries, and
land use changes.
The conversion of jobs (from IMPLAN) to employee households uses analytical techniques
commonly used in housing economics and affordable housing studies as discussed further
in the body of this memorandum.
Data Sources
Analysis inputs come from the following sources:
Accommodation inventory: Town of Vail (number of units, number of bedrooms,
average number of bedrooms per unit)
STR occupancy rates: Inntopia
Guest spending: Vail Lodging Guest Survey, 2017-2019 (RRC Associates)
Home prices: Multiple Listing Service (MLS)
Wages by Occupation: Bureau of Labor Statistics (BLS)
Median household income: U.S. Census (ACS 5-year estimates, Town of Vail)
Jobs per employee: 2016 Vail Employer Survey Results (RRC Associates)
Employees per household: U.S. Census (ACS 5-year estimates, Town of Vail)
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Guest Spending Analysis
Guest spending – Guest spending was modeled on the average expenditure across
all accommodation types, with data inputs from the Vail Lodging Guest Survey
averaged over the 2017 to 2019 time period (RRC Associates). The survey data
provides per unit expenditures by type; based on this data, expenditures average
$898 per unit per day, including $428 on food and beverage, $300 on retail/shopping,
and $170 on entertainment and recreation.
Jobs supportedby industry –The spending associated with guests is applied to the
IMPLAN model as an “industry output” event for the three affected industries (NAICS
72 – Accommodation and Food Services, NAICS 44-45 – Retail Trade, and NAICS 71
– Arts, Entertainment, and Recreation). IMPLAN applies industry expenditure flows
through its input-output model and estimates the spending and jobs supported in the
20 major industries in the North American Industry Classification System (NAICS).
Jobs to employees (multiple job holder adjustment) – An adjustment is made
to acknowledge that many employees have more than one job, such as two part time
jobs or a full time and a part time job. So as not to overestimate the number of
employees supported, the number of jobs is reduced using a factor of 1.20 jobs per
employee. This factor is specific to the Town of Vail, as reported in the 2016 Vail
Employer Survey Results report (RRC Associates).
Employees by industry to occupations and wages – A NAICS industry contains a
wide range of job types and wage ranges. For example, a worker in the retail NAICS
sector could be an accountant (for the retailer) or retail showroom employee. The
range of wages and occupations supported is better represented by the 21 Standard
Occupational Classifications defined by the Bureau of Labor Statistics (BLS). The
National Industry by Occupation Matrix published by the BLS provides the estimated
distribution of occupations and wages for each NAICS category. The results from the
IMPLAN analysis are applied to the Industry by Occupation Matrix to estimate the
number of jobs by wage level supported.
Household formation – A final adjustment is made to account for the fact that
many households have more than one earner. This adjustment has the effect of
raising the collective income of the employees within a household, thus increasing the
amount the employee-household can pay for housing and reducing the gap between
their ability to pay and the cost of housing. In the Town of Vail, there are an average
of 1.85 earners per household (US Census ACS 5-Year estimates). In this analysis,
the first earner earns the wage derived from the economic impact analysis and
allocation to occupations. The “second” 0.85 earner is assumed to earn 0.85
multiplied by average wage in the industry of the primary earner.
Tabulation of households by income range – The last step involves counting the
number of households supported by income range, expressed as a percentage of Area
Median Income (AMI). Given the breadth of need addressed by housing programs and
policies in the Town of Vail, all households earning up to 200 percent of AMI are
included for this analysis. The AMI definitions are based on the Colorado Housing and
Finance Authority (CHFA) 2020 income limits for Eagle County.
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Local Resident Household Analysis
The last component of the analysis involves isolating the difference between guest
spending and local resident household spending. To do this, the same steps outlined
above are undertaken for a resident household earning the local median income of
$89,987 (as reported in the U.S. Census ACS 2019 data for Vail) to document the jobs
supported from household spending in the economy.
This household income is input to the IMPLAN model, which applies an expenditure profile
(including savings) specific to the household income range. The model then estimates the
spending and jobs supported in the 20 major NAICS industries. The same steps to
determine need by AMI range are completed, and this housing need is then subtracted
from that of guest spending, resulting in the needs associated with guest spending above
those of a local resident household.
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Analysis
Guest Spending
Guest spending was modeled on the average per-unit expenditure across all
accommodation types, with data inputs from the Vail Lodging Guest Survey averaged over
the 2017 to 2019 time period (RRC Associates). Within the IMPLAN model 1,000
accommodation units were modeled in order to establish an appropriate scale of analysis.
Per unit and per bedroom adjustments are made later in the model to calibrate the fee.
As shown in Table 1, with an average daily spending rate of $898 per unit per day,
1,000 units results in total annual spending of $327.9 million. Note that at this point in
the analysis 100 percent occupancy (365 days of spending) is used. The average annual
occupancy rate adjustment is applied later in the analysis.
Table 1. Guest Spending
Guest Spending -
Description Factors All
Program
Units1,000
Guest Spending (per unit per day)
Food & beverage$428
Retail/shopping$300
Entertainment/recreational activities$170
Total$898
Annual Guest Spending (per unit per year)
Food & beverage 365 days (100% occ.)$156,233
Retail/shopping 365 days (100% occ.)$109,539
Entertainment/recreational activities 365 days (100% occ.)$62,144
Total$327,916
Total Guest Spending
Food & beverage 1,000 units$156,233,398
Retail/shopping 1,000 units$109,538,597
Entertainment/recreational activities 1,000 units$62,143,716
Total$327,915,711
Source: RRC Associates; Economic & Planning Systems
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Jobs, Employees, and Households
As shown in Table 2, the spending associated with 1,000 accommodation units supports
3,208.15 jobs. The industries with the most jobs are those with direct spending impacts –
specifically accommodation and food services; arts, entertainment and recreation; and
retail.
Following total jobs, the next step is to translate jobs to employees. In today’s economy
it is common for people to hold more than one job. To step down from jobs to employees,
jobs are divided by a factor of 1.20 jobs per employee. As shown in Table 2, the
3,208.15 jobs supported by 1,000 accommodation units results in 2,673.46 employees
after the adjustment for multiple job holders.
Table 2. Jobs and Employees by Industry Supported from Guest Spending
Guest Spending
Jobs by Industry Employees by
Description(IMPLAN Results)Category
Jobs to Employee Conversion Factor 1.20
Industrial Sectors
11 Ag, Forestry, Fish & Hunting3.873.22
21 Mining0.500.42
22 Utilities2.622.18
23 Construction13.9211.60
31-33 Manufacturing1.511.26
42 Wholesale Trade15.5212.93
44-45 Retail trade453.41377.84
48-49 Transportation & Warehousing32.9027.42
51 Information11.719.76
52 Finance & insurance43.3236.10
53 Real estate & rental117.3097.75
54 Professional- scientific & tech svcs85.7271.44
55 Management of companies20.9217.44
56 Administrative & waste services101.2084.33
61 Educational svcs14.1111.76
62 Health & social services58.4148.67
71 Arts- entertainment & recreation536.29446.91
72 Accomodation & food services1,637.301,364.41
81 Other services50.8842.40
91-99 Government & non NAICs6.745.62
Total3,208.152,673.46
Source: IMPLAN; Economic & Planning Systems
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Employee to Household Conversion
To translate employees to households and their related income levels, the analysis steps
are as follows:
Employees by Occupation –The jobs by NAICS classification are converted to more
specific occupation categories to obtain a more detailed distribution of wage levels for
the new jobs, since using the average wage for an industry masks the upper and
lower wage levels. The BLS National Industry by Occupation Matrix provides the
estimated distribution of occupations for each NAICS category. The wages for each
occupation in Eagle County are estimated by indexing the national wages by
occupation and industry to the average wage in that industry for Eagle County.
Employees to Households – The next adjustment for estimating housing demand is
to account for multiple earners per household. On average, there are 1.85 earners per
household in the Town of Vail. This adjustment reduces the 2,673.46 employees
supported from guest spending in 1,000 accommodation units to 1,445.11 employee-
households.
Wages and Household Income – The next step in the employee and household
analysis is to estimate household incomes accounting for the wages from the primary
and secondary earners in the household. The primary earner – the jobs estimate from
the IMPLAN analysis – is assigned the average wage for their industry and occupation.
The second 0.85 earner (totaling 1.85 earners per household) is assumed to make
the average wage for the industry in which the primary earner is employed.
Households and Target Income Ranges
The last step in the guest
spending analysis is to tabulate
the employee-households at
Table 3. Households by AMI Supported by Guest Spending
income levels of 200 percent of
AMI or less. For guest spending
Guest Spending - All
in 1,000 accommodation units,
there are 1,426.3 employee
Total Households Generated per 1,000 Units1,445.1
households supported below 200
percent of AMI, as shown in
Households by Income Range
Table 3. Of the 1,445.1 total
30% of Median0.0
50% of Median0.0
employee-households
80% of Median282.0
supported, 98.7 percent are at
100% of Median950.4
incomes of 200 percent of AMI
120% of Median50.8
or less. The balance of 1.3
150% of Median90.6
200% of Median52.5
percent are compensated
Total - Target Income Ranges1,426.3
sufficiently to afford market rate
housing. These are the
Percent of Households Generated98.7%
employee households needed to
Source: Economic & Planning Systems
support the spending in the
economy from 1,000 STR units.
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Employee-Household Housing Gap
To determine affordability needs, the gap for households earning up to 200 percent AMI
(by AMI category) is calculated based on the cost to purchase a home in the town,
estimated using the median cost for attached homes (e.g., condos). Housing costs were
based on sales during the four-year period from 2018 through 2021. This calculation
assumes an income for a 2.5-person household as a proxy for an average household size
and uses CHFA income levels for Eagle County as those are the income definitions used in
most housing qualification processes.
As shown in Table 4, affordable prices at these AMI levels range from $55,700 at 30
percent AMI to $726,800 at 200 percent AMI. With a median home cost of $1,250,000, the
gap per unit ranges from $1,194,300 at 30 percent AMI to $523,200 at 200 percent AMI.
Table 4. Affordable Price and Gap by Income Range
AMI
DescriptionFactor30%60%80%100%120%150%200%
HH Income and Housing Expense
HH Income (2.5-person household)2.5 pp/hh$25,500$51,000$68,000$85,000$102,000$127,500$170,000
Affordable Monthly Housing Cost30%$638$1,275$1,700$2,125$2,550$3,188$4,250
Supportable Monthly Payment
Less: Insurance$2,500/year-$208-$208-$208-$208-$208-$208-$208
Less: Property Taxes7.15% ass't rate50.751 mills-$20-$60-$80-$100-$120-$160-$210
Less: Miscellaneous (e.g. HOA Dues)$1,500/year-$125-$125-$125-$125-$125-$125-$125
Net Supportable Mortgage Payment (Monthly)$284$882$1,287$1,692$2,097$2,694$3,707
Valuation Assumptions
Loan Amount$52,900$164,200$239,700$315,100$390,600$501,900$690,500
Mortgage Interest Rate5.0% int.5.0% int.5.0% int.5.0% int.5.0% int.5.0% int.5.0% int.
Loan Term30-year term30-year term30-year term30-year term30-year term30-year term30-year term
Downpayment as % of Purchase Price5.0% down pmt5.0% down pmt5.0% down pmt5.0% down pmt5.0% down pmt5.0% down pmt5.0% down pmt
Maximum Supportable Purchase Price$55,700$172,800$252,300$331,700$411,200$528,300$726,800
Cost per Unit$1,250,000$1,250,000$1,250,000$1,250,000$1,250,000$1,250,000$1,250,000
Gap per Unit$1,194,300$1,077,200$997,700$918,300$838,800$721,700$523,200
Source: Economic & Planning Systems
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Local Resident Spending
To isolate the effect of guest spending on housing need, a similar methodology was
followed to determine the relationship between a local resident household and housing
need. This was then subtracted from the guest impact.
Local resident spending was modeled based on the median household income in Vail of
$80,987, as reported in the U.S. Census 2019 American Community Survey. As with
guest spending, 1,000 households were modeled and per household adjustment is made
to calculate the final fee. As shown in Table 5, a household income of $80,987 results in
a disposable income of $58,774 after accounting for payroll tax. Based on these figures,
the total disposable income for 1,000 households is $58.77 million.
Table 5. Local Resident Household Income
Factors
DescriptionLocal Spending
Program
Units1,000
HH Income (Vail median)ACS 2019 5-Yr Estimate$80,987
Minus Payroll Tax
Federal$12,697
FICA$5,021
Medicare$1,174
State$3,321
Total Deductions$22,213
Net Pay / Adjusted Household Income$58,774
Total Annual Household Income 100%$80,987,000
Total Annual Payroll Rax 27%-$22,213,000
Disposable Income 73%$58,774,000
Source: US Census; Economic & Planning Systems
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This income was input to IMPLAN, which then calculates the jobs supported by this
household spending. As shown in Table 6, 1,000 households earning the median income
support 312.72 jobs. Applying the multiple jobholder factor of 1.20 jobs per employee,
this spending results in 260.60 employees.
Table 6. Jobs and Employees by Industry Supported from Local Spending
Local Spending
Jobs by Industry Employees by
Description(IMPLAN Results)Category
Jobs to Employee Conversion Factor 1.20
Industrial Sectors
11 Ag, Forestry, Fish & Hunting1.010.84
21 Mining0.100.09
22 Utilities0.630.52
23 Construction3.943.28
31-33 Manufacturing0.470.39
42 Wholesale Trade5.604.67
44-45 Retail trade47.7739.81
48-49 Transportation & Warehousing9.537.94
51 Information3.723.10
52 Finance & insurance18.8315.69
53 Real estate & rental46.4738.73
54 Professional- scientific & tech svcs15.2012.67
55 Management of companies1.661.38
56 Administrative & waste services21.5417.95
61 Educational svcs7.005.83
62 Health & social services50.1741.81
71 Arts- entertainment & recreation11.749.79
72 Accomodation & food services40.1933.49
81 Other services25.3021.08
1.55
91-99 Government & non NAICs1.86
Total312.72260.60
Source: IMPLAN; Economic & Planning Systems
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These employees were then categorized by occupation and wage and converted into
employee households following the same methodology for guest spending. As shown in
Table 7, local resident household spending supports a total of 140.90 employee-
households, 93.0 percent (131.0 households) of which fall at or below 200 percent of
AMI. Affordability needs of these households are determined using the same methodology
outlined for guest spending.
Table 7. Households by AMI Supported by Local Spending
Local Spending
Total Households Generated per 1,000 Units140.9
Households by Income Range
30% of Median0.0
50% of Median0.0
80% of Median18.0
100% of Median60.1
120% of Median13.8
150% of Median28.6
200% of Median10.5
Total - Target Income Ranges131.0
Percent of Households Generated93.0%
Source: Economic & Planning Systems
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Fee Calculation
This section outlines the calculation of the accommodation unit license fee. There are four
key components to the fee calculation:
Households Supported – The number of households at or below 200 percent of AMI
supported by guest spending form the basis of the fee, as these represent employees
needed in the community who cannot otherwise afford housing.
Occupancy Rate – The impacts of guest spending were determined assuming 100
percent occupancy (i.e., 365 days per year) for modeling purposes and needs to be
adjusted for annual occupancy rates. An occupancy rate of 40.0 percent is applied to
the housing demand, based on the occupancy data for properties in Zone 1 and Zone 2
from 2016 through 2019 as well as 2021 (2020 was excluded, as COVID impacts
made the data non-representative of local conditions).
Affordability Gap – The affordability gap per household and AMI range described
earlier ranges from $523,200 at 200 percent of AMI to $1,194,300 at 30 percent of
AMI. The number of households in each AMI category (after accounting for the
occupancy rate) are multiplied by the gap per household to calculate the total
affordability gap. This gap is calculated for both guest spending and local spending.
Based on this calculation, the gap per accommodation unit is $515,216 and the gap
per local household/housing unit is $110,819.
Adjustment for Local Households – To isolate the impact of guest spending above
the impact of a local household, the gap associated with local household spending
($110,819) is subtracted from the gap associated with guest spending ($515,216).
This results in a net gap per accommodation unit of $404,397.
This fee is then adjusted to reflect a per-bedroom figure (rather than per unit). EPS’s
analysis of the Town’s STR data indicates that STRs have an average of 2.28 bedrooms
per unit. This is then annualized over 30 years (divided by 30), which is a typical financing
period for a long-term housing investment. Based on this analysis, the maximum fee per
bedroom is $5,912, as shown in Table 8. This maximum fee amount is the annualized
cost of providing housing to the local workforce supported by guest spending.
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Table 8. Fee Calculation
Local SpendingGuest Spending - All
Households Generated (per 1,000 units)A
30% of Median0.00.0
50% of Median0.00.0
80% of Median18.0282.0
100% of Median60.1950.4
120% of Median13.850.8
150% of Median28.690.6
200% of Median10.552.5
Total per 100 Units131.01,426.3
Per 1.0 Units0.131.43
STR Occupancy RateB 40.0%
Net Households Generated (per 1,000 units)C
30% of Median A x B 0.00.0
50% of Median0.00.0
80% of Median18.0112.7
100% of Median60.1379.7
120% of Median13.820.3
150% of Median28.636.2
200% of Median10.521.0
Total per 1,000 Units131.0569.8
Per 1.0 Units0.130.57
Gap per Household by AMI RangeD
30% of Median$1,194,300$1,194,300
50% of Median$1,077,200$1,077,200
80% of Median$997,700$997,700
100% of Median$918,300$918,300
120% of Median$838,800$838,800
150% of Median$721,700$721,700
200% of Median$523,200$523,200
Total GapE
30% of Median C x D$0$0
50% of Median$0$0
80% of Median$17,918,868$112,400,795
100% of Median$55,196,836$348,678,886
120% of Median$11,568,172$17,037,798
150% of Median$20,634,526$26,123,638
200% of Median$5,500,933$10,975,135
Total$110,819,335$515,216,252
Gap (Fee) per UnitF
E / 1000-$110,819-$515,216
Net STR Gap per Unit (minus local spend)-$404,397
Avg. Number of Bedrooms2.28
Net STR Gap (Fee) per Bedroom-$177,367
Annualized Fee per Bedroom 30 years$5,912
Source: Economic & Planning Systems
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Final Fee
The fee outlined above represents the maximum reasonable fee to be charged under this
program. Communities will generally apply a mitigation rate to this fee to determine the
final fee to be charged.
As shown in Table 9, a mitigation rate of 15 percent would result in an annual per
bedroom fee of $890, a 50 percent mitigation rate would result in a $2,960 annual fee,
while a 65 percent mitigation rate would result in a fee of $3,840 per bedroom annually.
Table 9. Mitigation Rates
Fee Per Bedroom
Description
Maximum Annual Fee$5,912
Mitigation Rate
15%$890
20%$1,180
25%$1,480
30%$1,770
35%$2,070
40%$2,360
45%$2,660
50%$2,960
55%$3,250
60%$3,550
65%$3,840
Source: Economic & Planning Systems
Over time, as development opportunities within communities have become limited, as
market pressures have increased, and as commute-sheds have grown, local officials have
increased mitigation rates, reflecting a greater pressure on the need for local affordable
housing. Mitigation rates in peer communities for similar programs (STR fees, residential
linkage fees, and commercial linkage fees) range from 15 percent to 65 percent, with
many programs falling in the middle of that range.
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Owner-Occupied Short Term Rentals
In the Town of Vail, owner-occupied properties are limited to 30 days or less of short
term rentals per year. A unit rented for a maximum of 30 days per year represents a
maximum occupancy rate of 8.2 percent, and thus justifies a separate fee calculation.
Additionally, since these units are occupied by local residents the impact of guest
spending occurs in addition to the impact of local spending. Thus, the impact of local
household spending is not netted out of the guest spending impact attributed to the STR.
As shown in Table 11, this results in a maximum annual fee per bedroom of $1,550.
As with the standard fee, a mitigation rate would be applied to determine the final fee to
be charged. Examples of the per-bedroom fee at a range of mitigation rate levels are
shown in Table 10. For example, a 15 percent rate would result in an annual per
bedroom fee of $230, a 50 percent mitigation rate would result in a $780 annual fee,
while a 65 percent mitigation rate would result in a fee of $1,010 per bedroom annually.
Table 10. Mitigation Rates – Owner Occupied Units
Fee Per Bedroom
Description
Maximum Annual Fee$1,550
Mitigation Rate
15%$230
20%$310
25%$390
30%$470
35%$540
40%$620
45%$700
50%$780
55%$850
60%$930
65%$1,010
Source: Economic & Planning Systems
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Table 11. Fee Calculation – Owner Occupied Units
Guest Spending -
Owner-Occupied
Households Generated (per 1,000 units)A
30% of Median0.0
50% of Median0.0
80% of Median282.0
100% of Median950.4
120% of Median50.8
150% of Median90.6
200% of Median52.5
Total per 100 Units1,426.3
Per 1.0 Units1.43
STR Occupancy RateB 8.2%
Net Households Generated (per 1,000 units)C
30% of Median A x B 0.0
50% of Median0.0
80% of Median23.2
100% of Median78.1
120% of Median4.2
150% of Median7.4
200% of Median4.3
Total per 1,000 Units117.2
Per 1.0 Units0.12
Gap per Household by AMI RangeD
30% of Median$1,194,300
50% of Median$1,077,200
80% of Median$997,700
100% of Median$918,300
120% of Median$838,800
150% of Median$721,700
200% of Median$523,200
Total GapE
30% of Median C x D$0
50% of Median$0
80% of Median$23,123,770
100% of Median$71,732,325
120% of Median$3,505,119
150% of Median$5,374,313
200% of Median$2,257,871
Total$105,993,397
Gap (Fee) per UnitF
E / 1000-$105,993
Avg. Number of Bedrooms2.28
Net STR Gap (Fee) per Bedroom-$46,488
Annualized Fee per Bedroom 30 years$1,550
56
Source: Economic & Planning Systems
ORDINANCE NO. 11
SERIES 2022
AN ORDINANCE REPEALING AND REENACTING CHAPTER 4-14 OF
THE VAIL TOWN CODE, REGARDING SHORT-TERM RENTALS, AND
ESTABLISHING A LICENSING PROGRAM AND ANNUAL FEE FOR
SHORT-TERM RENTALS
WHEREAS,guests staying in short-term rentals ("STRs")in the Townspend
money in the local economy, primarily in the retail, food and beverage and recreation
industries, and in turn create local jobs;
WHEREAS, these jobs generate demand for housing, but many of the jobs created
are at wage levels that do not pay enough for employees to afford market rate housing in
the Town;
WHEREAS, without an adequate supply of housing and housing support
programs, the Town risks losing some of its labor supply that is essential to the
businesses in which STR guests spend money during their stay;
WHEREAS, to pay for the required housing supply and support programs,and to
cover the costs of administering the Town's STR licensing program, annualfees for STRs
are necessary;
WHEREAS, the Town contracted with Economic and Planning Systems, Inc. to
conduct a study to determine the appropriate fees for STRs, and the Town Council is
relying on that study to set the annual fees for STRs;
WHEREAS,without regulation by the Town, nuisances created by STRs, such as
noise, parking issues and over-occupancy, would negatively impact neighborhoods in the
Town; and
WHEREAS, the Town wishes to ensure the safety of guests staying in STRs by
ensuring that they meet minimal life-safety requirement.
NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE
TOWN OF VAIL, COLORADO, THAT:
Section 1. Chapter 4-14 of the Vail Town Code is hereby repealed in its entirety
and reenacted as follows:
CHAPTER 14
SHORT-TERM RENTALS
4-14-1: PURPOSE AND APPLICABILITY:
A. The purpose of this Chapter is to establish a comprehensive
licensingprogramto safeguard the public health, safety, and welfare by
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regulating and controlling the use, occupancy, location, and maintenance
of short-term rentals in the Town.
B.This Chapter shall apply to short-term rentalsonly, as defined herein.
This Chapter shall not supersede or affect any private conditions,
covenants, or restrictions applicable to short-term rentals.
4-14-2: DEFINITIONS:
For purposes of this Chapter, the following terms shall have the following
meanings:
LEASE:Anyagreement, whether verbal or written,by which an owner gives
to a tenant, for valuable consideration, possession and use of property or a
portion thereof for a definite term, at the end of which term the owner has
an absolute right to retake control and use of the property.
PRINCIPAL PLACE OF RESIDENCE: The home or place in which one's
habitation is fixed and to which one has a present intention of returning after
a departure or absence therefrom. In determining what is a principal place
of residence, the Town shall consider the criteria set forth in C.R.S. § 31-
10-201(3), as amended.
PROPERTY MANAGEMENT FIRM: An entity comprised of one or more
professional property managers with all required licenses in good standing,
or a group of one or more employees of a lodge or fractional fee club (as
those terms are defined in Section 12-2-2 of this Code) who are trained in
property management and provide such services to owners of STRs within
the lodge or fractional fee club, which entity or group is designated by the
STR owner to act as the STR owner's agent regarding the STR.
PROFESSIONALLY MANAGED STR:An STR that is managed, operated
or controlled by a property management firm.
SHORT-TERM RENTAL (STR): A residential dwelling unit, or any room
therein, available for lease for a term of less than thirty (30) consecutive
days, but excluding bed and breakfasts and accommodation units.
4-14-3: LICENSE REQUIRED:
A. General. A current, valid license is required for each STR in the
Town. Each STR license is non-transferable.
B. Application. For new licenses and renewals, the STR owner or
property management firm shall file an application with the Finance Director
or designee, on forms supplied by the Town, accompanied by the following:
1. The applicable license fee established by Section 4-14-4;
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2.An administrative fee of $150, which administrative fee shall
be used by the Town to offset the costs of processing the application;
3.An affidavit, signed by the owner or the property management
firm, under penalty of perjury, certifying that the STR isin habitable
condition and complies with the health and safety standards set forth in this
Chapter; and
4. If the STR is located within a duplex, a copy of a written notice
sent by the owner or property manager to the last known address of the
record owner of the adjoining residential dwelling unit, by first-class mail at
least seven (7) days prior to submission of the application.
B. Local Representative. Each application shall include the
appointment of a natural person who shall remain within a sixty (60) minute
distance of the STR and is available twenty four (24) hours per day, seven
(7) days per week, to serve as the local representative for the STR. At least
five (5) days prior to any change in such appointment, the STR owner or
property management firm shall notify the Town of such change, including
new contact information. For an STR located in a building with onsite
management services available at all times, if the STR owner uses such
services, no local representative appointment shall be required.
C. Expiration; Renewal. Each STR license shall expire on February 28
of each calendar year, or when title of the STR transfers to a new owner,
whichever occurs first; each change in ownership of a STR shall require a
new license.
D. Timing. An initial license application shall be filed at least thirty (30)
days prior to any advertising of an STR. A renewal application shall be filed
by January 31 of the year in which the license expires.
E. Revocation. In addition to any other penalties allowed by this
Chapter, the Town may revoke any STR license if the Town finds and
determines that any violation of this Chapter exists at the STR; provided
that the Town provides the licensee with at least fourteen (14) days' prior
written notice and an opportunity to be heard prior to revocation. The notice
shall include a description of the violation and the date and time when the
STR owner may appear and be heard, and the notice shall be either
personally served on the STR owner or mailed by first-class United States
Mail to the last-known address of the STR owner or property management
firm.
4-14-4: LICENSE FEES:
A. The purpose of the STR license fee is to offset the impacts of STR
use and occupancy on the Town's workforce, and particularly workforce
housing, as demonstrated by the current study performed by the Town
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regarding such issues, and also to cover the Town's costs in administering
the STR licensing program established by this Chapter.
B.The STR license fee shall be imposed per bedroom offered for lease,
and the maximum number of bedrooms offered at any time during a
calendar year shall be used to establish the amount of the fee. By way of
example, if an STR includes one (1) bedroom for lease for eleven (11)
months in a calendar year, but three (3) bedrooms for lease for one (1)
month of a calendar year, the STR shall be subject to the STR fee for three
(3) bedrooms.
C. The STR license fee is assessed per calendar year. If an STR
license is revoked, no refund shall be provided. If an application is filed mid-
year, the license fee shall be reduced accordingly.
D. The license fees for STRs are as follows:
1. An STR located on property that is the property owner's
principal place of residence: $_______ per bedroom.
2. An STR that is rented for less than thirty (30) total days per
year, regardless of whether the property is the property owner's principal
place of residence: $______ per bedroom.
3. All other STRs: $ ______ per bedroom.
4-14-5: INSURANCE:
Every STR shall be continuously insured, with minimum limits of
$1,000,000. The insurance may be in any of the following forms: property
liability insurance; commercial liability insurance; or an endorsement to a
homeowner’s policy for coverage of STR activities. Insurance provided by
online STR platforms does not qualify as valid insurance under this
subsection.
4-14-6: HEALTH AND SAFETY STANDARDS; INSPECTIONS:
A. Standards: Each STR shall comply with all of the following
standards, at a minimum, at all times while the STR is occupied:
1. Buildings, structures or rooms shall not be used for purposes
other than those for which they were designed or intended.
2. Roofs, floors, walls, foundations, ceilings, stairs, handrails,
guardrails, doors, porches, all other structural components and all
appurtenances thereto shall be capable of resisting any and all forces and
loads to which they may be normally subjected and shall be kept in sound
condition and in good repair.
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3.An operable toilet, sink, and either a bathtub or shower shall
be located within the same building, and every room containing a toilet or
bathtub/shower shall be completely enclosed by walls, doors, or windows
that will afford sufficient privacy.
4.There shall be a sufficient number of trash receptacles to
accommodate all trash generated by the occupants, and all receptacles
shall comply with Title 5, Chapter 9 of this Code.
5.Occupancy of an STR shall comply with Title 12, Chapter 2 of
this Code.
6.The use of portable outdoor fireplaces is prohibited.
7.Electrical panels shall be clearly labeled.
8.All pets shall be subject to Title 6, Chapter 4 of this Code.
9.All items listed in subsection B.2. hereof shall comply with the
current Vail Fire Code.
10. Parking for each STR shall comply with all applicable
provisions of this Code. All vehicles shall be parked in designated parking
areas, and parking is prohibited in any landscaped area.
11. A sign shall be conspicuously inside each STR with the STR
license number, the local representative's current contact information, and
the physicaladdress of the STR, including unit number if applicable.
B. Inspections:
1. When required:
a. Each STR, other than those located in buildings with on-site
management services available at all times, shall obtain a fire and
life safety inspection as a condition of license issuance and every
three (3) years thereafter. Requests for inspections shall be made
to Vail Fire and Emergency Services at leastsixty(60) days prior to
the date of the initial license application and at least sixty (60) days
prior to the end of each subsequent three (3) year period.
b. Notwithstanding the foregoing, each STR that was validly
registered with the Town on the date of the ordinance codified in this
Section, and is not located in a building with on-site management
services available at all times, is eligible for an STR license without
an initial inspection, provided that the STR is inspected prior to
January 1, 2026 andevery three (3) years thereafter. Requests for
initial inspections shall be made to Vail Fire and Emergency Services
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on or before July 1, 2025,and requests for later inspections shall be
made at least sixty (60) days prior to the end of each subsequent
three (3) year period.
2. Items Inspected: The following will be inspected by Vail Fire
and Emergency Services for compliance with the current Vail Fire Code:
a. Fire extinguishers;
b. Adequacy of egress;
c. Posted egress plan;
d. Carbon monoxide detectors;
e. Smoke alarms;
f.Occupant load;
g. Improvised electrical conditions and use of extension cords;
h.Use of portable heating appliances and outdoor heating
appliances; and
i. Conspicuous posting of the physical address of the STR.
3. Re-inspection: If an inspection reveals that an STR is not in
compliance with this Chapter, a re-inspection shall be required. Re-
inspections must be scheduled in advance and may take up to sixty (60)
days to complete.
4-14-7: ADVERTISING:
Advertising for an STR shall include the STR license number immediately
following the description of the STR.
4-14-8: TAXES:
A. All applicable Town Sales and Lodging Taxes for STRs shall be
timely collected and remitted.
B. A property management firm may submit one tax payment for
multiple STRs, so long as there is sufficient supporting information to
identify each individual STR and the taxes collected on such STR.
4-14-9: INITIAL COMPLAINTS:
Initial complaints concerning a short-term rental property shall be directed
to the local representative. The local representative shall resolve the issue
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that was the subject of the complaint within sixty (60) minutes, or within thirty
(30) minutes if the problem occurs between 11:00p.m.and 7:00a.m.,
including visiting the site if necessary.
4-14-10: VIOLATIONAND PENALTY:
A. Violation:It is unlawful to violate any provision of this Chapter. Each
day of violation shall be deemed a separate offense.
B. Liability: Each STR owner shall be liable for any and all violations
occurring at the STR. A property management firm shall be jointly and
severally liable for any and all violations occurring at any of its professionally
managed STRs in the Town.
C. Civil Enforcement:
1. If the Town chooses civil enforcement, a citation may be
served by posting on the front door of the STR, or by personal service on
the STR owner or professional management firm, or by mailing first class
U.S. Mail to the last known address of the STR owner or property
management firm.
2. Civil violations shall be subject to the following fines and
penalties, per STR:
First violation in any twelve (12)month period: $1,500
Second violation in any twelve (12) month period: $2,650
3. All penalties shall be paid within fourteen (14) days of the date
of the citation. If the civil violation is paid, there shall be no opportunity to
challenge or otherwise appeal the violation. If the STR owner disputes the
violation, the STR shall file a written protest with the Town within fourteen
(14) days of the date of the citation.
4. If the STR protests the citation, the Town shall cancel the
citation and proceed to criminal enforcement.
5. If the penalty is not timely paid and no protest is timely filed,
the Town may summarily suspend the STR license until the penalty is fully
paid. Written notice of such suspension shall be provided to the last-known
address of the STR owner, or to the local representative or property
management firm.
D. Criminal Enforcement: If the Town chooses criminal enforcement or
a protest is filed and the civil citation is canceled, a summons and complaint
may be served as provided in the Colorado Municipal Court Rules of Civil
Procedure. The penalties shall be as set forth in Section 1-4-1 of this Code.
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E. Suspension: Regardless of the type of enforcement, the third
violation in any twelve (12) month periodfor a single STR, regardless of
ownershipof the STR, shall result in a three (3) yearsuspension,
commending on the date of the last violation, during which no license shall
be granted for such STR.
F. Other Remedies: In addition to the penalties described above, the
Town shall have any and all remedies provided by law and in equity for a
violation of this Chapter, including without limitation: damages; specific
performance; and injunctive relief, including without limitation an injunction
requiring eviction of any occupants of the STR and an injunction to prohibit
the occupancy of any property in violation of this Chapter.
Section 4. If any part, section, subsection, sentence, clause or phrase of this
ordinance is for any reason held to be invalid, such decision shall not effect the validity of
the remaining portions of this ordinance; and the Council hereby declares it would have
passed this ordinance, and each part, section, subsection, sentence, clause or phrase
thereof, regardless of the fact that any one or more parts, sections, subsections,
sentences, clauses or phrases be declared invalid.
Section 5. The Town Council hereby finds, determines and declares that this
ordinance is necessary and proper for the health, safety and welfare of the Town and the
inhabitants thereof.
Section 6. The amendment of any provision of the Vail Town Code as provided
in this ordinance shall not affect any right which has accrued, any duty imposed, any
violation that occurred prior to the effective date hereof, any prosecution commenced, nor
any other action or proceeding as commenced under or by virtue of the provision
amended. The amendment of any provisionhereby shall not revive any provision or any
ordinance previously repealed or superseded unless expressly stated herein.
Section 7. All bylaws, orders, resolutions and ordinances, or parts thereof,
inconsistent herewith are repealed to the extent only of such inconsistency. This repealer
shall not be construed to revise any bylaw, order, resolution or ordinance, or part thereof,
theretofore repealed.
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INTRODUCED, READ ON FIRST READING, APPROVED, AND ORDERED
th
PUBLISHED ONCE IN FULL ON FIRST READING this 17day of May, 2022and a
th
public hearing for second reading of this Ordinance set for the 7day of June, 2022, in
the Council Chambers of the Vail Municipal Building, Vail, Colorado.
_____________________________
Kim Langmaid, Mayor
ATTEST:
____________________________
Tammy Nagel, Town Clerk
READ AND APPROVED ON SECOND READING AND ORDERED PUBLISHED
th
this 17 day of May, 2022.
_____________________________
Kim Langmaid, Mayor
ATTEST:
____________________________
Tammy Nagel, Town Clerk
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