Air bnb licenses

Condos in Aspen often find their way onto Airbnb or another short-term rental platform. The “million dollar question” is to what extent the growing popularity of the platforms has caused housing stock that previously served longterm residents to convert to short-term rentals.

City of Aspen officials may follow other towns’ lead in pursuing a low-tech solution to a high-tech problem.

Achieving widespread compliance with short-term-rental regulations in the era of Airbnb may be as simple as requiring a few numbers be posted in every advertisement.

That has been the town of Breckenridge’s experience, since it passed a law last summer requiring that all short-term rental listings include the host property’s town license number.

Breckenridge, like Aspen, has long allowed residential properties to be used for short-term tourist accommodations, so long as lodging and sales taxes are paid. In Aspen, such homes and condos historically have made up 40 percent or more of the total tourist bed base. But tracking compliance is difficult without additional tools, as it often requires a forensic investigation to determine the address and ownership information connected to a rental ad.

Breckenridge changed that paradigm with the law that makes checking compliance much easier. The Summit County ski town works with a third party compliance auditor that, using the town ID number, cross checks listings with town records.

Town spokesperson Haley Littleton said that, since the law has been passed, compliance rates are exceeding 90 percent.

She added that sometimes the short-term rental platforms want to block the numbers as their software thinks it’s a phone number, but progress has been made on that front.

The compliance rate is Aspen is difficult to know now. While there are more than 400 local listings on Airbnb, the town has less than 200 business tax licenses on file for tourist accommodations, which include traditional lodges. The planning and zoning office counts only 61 active short-term rental permits, which are required to be renewed annually.

Complicating the analysis is that each license and permit could represent dozens of units. Many if not most short-term rentals are associated with a property management company that only needs one license for all its units. City officials in the future may require more information on how many units are associated with each permit.

In a work session last month, finance director Don Taylor and city attorney Jim True said they are considering multiple options to get a better handle on the local short-term rental marketplace and increase compliance with local tax and registration regulations.

The officials said they were not in favor of working out a direct collection and remittance agreement with Airbnb, which dozens of towns have signed up for, unless the online rental platform was willing to renegotiate its “standard” agreement. That agreement does not give the city a way to audit individual owners or collect back taxes, they said. Airbnb also would also only consider the revenue paid to the host, minus the platform’s commission, as taxable, whereas the city believes the entire cost of the unit paid by the guest should be taxable.

The officials said they were hoping that Airbnb would work out an arrangement with Aspen similar to a recent agreement with San Francisco, which requires Airbnb and its competitor HomeAway to confirm that the properties it lists in that city are registered and compliant. The agreement came after Airbnb sued the city to block a law San Francisco passed that levies fines on the companies for any illegal rentals booked on their platforms.

Following a court ruling in the city’s favor, Airbnb and HomeAway agreed to work with the city to check hosts’ registration numbers before allowing bookings, while making monthly reports to San Francisco’s Office of Short Term Rentals on who is active on the platform.

Unlike Aspen and Breckenridge, San Francisco puts limits on the volume and intensity of short-term rentals allowed in the city. While a resident is allowed to host guests in a spare room as much as they would like, whole-unit rentals are capped at 90 days per year in San Francisco, which is in the midst of a housing crisis. Additionally, a host can only rent a unit that is their primary residence, which prevents an entity from purchasing multiple residential properties and converting them into short-term rentals.

“San Francisco’s pioneering rules on short-term rentals are designed to strike a balance, allowing residents to supplement their income by occasionally renting out a spare room or their home while at the same time protecting the existing housing supply from being cannibalized by the lucrative travel market,” says a press release from the San Francisco City Attorney’s Office.

The city of Denver has a similar rule requiring that short-term rentals are only allowed in a unit that serves as a person’s primary residence. Denver also requires all online ads to list the unit’s registration number, which makes it easier to check compliance with local rules.

In Breckenridge, compliance rates in the 90s mean that city officials can better track the marketplace.

“Our whole goal in licensing … is to understand how short-term rentals are being used” and what implications they have on the larger community, said Littleton, the spokesperson for the town that, like Aspen, counts residential short-term rentals as a longstanding and important part of the local resort economy.

“The million-dollar question,” she said, is whether, or to what extent, the growing popularity of short-term rental platforms has caused housing stock that previously served longterm residents to convert to short-term rentals.

“We are trying to get a hold of that — all mountain towns are,” she said.