Denver STRAC Update March 27th, 2018 Excise and Licenses

Current STR License & Enforcement Numbers Licenses/Compliance: Total STR Licenses in Denver: 2,065 Total number of unique STR properties in Denver: 3933 Current compliance rate of ~52% 107 licenses have been renewed while 77 have expired Dominic

STR Compliance/Trends

Treasury Update Lodger’s Taxes: Total number of STR Lodger’s Tax Accounts: 2,535 Total Lodger’s Tax revenue collected from STR operators for 2017 : $3,489,682.52 This includes 222 monthly filers and 917 quarterly filers An additional 1,396 Lodger’s Tax Licensees are registered to file annually This amount does not include OPT or license fees Using Lodger’s Tax Account numbers, Denver is at 64% compliance rate Dominic

Short Term Rental Taxation Information Airbnb has officially announced that they will start collecting Denver Lodger’s tax on April 1, 2018. Hosts will no longer need to collect the tax on sales made through Airbnb. Sales made through another platform that does not collect Denver Lodger’s Tax remain taxable, and the host is still responsible to collect and remit the tax on those sales. Bob

STR Enforcement Update New Enforcement Tools (Host Compliance) Adjustments to the Strategic Enforcement Plan Licenses is unique given the lack of defined premises. Mass Enforcement will overwhelm City Agencies. New Enforcement Program Coordinator Primary residency investigations subject to enhanced scrutiny. Lawful operation, based on investigation.

Short Term Rental Strategic Enforcement Plan Strategy 1: Community Engagement Engagement Tactic 1: Provide ‘town hall’ forums to heighten public awareness and seek input. Engagement Tactic 2: Provide a critical stakeholder (industry & host) forum for education licensing requirements and enforcement. Engagement Tactic 3: Solicit community and stakeholder feedback; make adjustments as needed Engagement Tactic 4: Establish and launch media campaign to notify and inform the public of the requirements. Strategy 2: Ease of Compliance Compliance Tactic 1: Collaborate with internal CCD partners to establish core requirements. Compliance Tactic 2: Leverage existing enterprise applications to minimize implementation risks. Compliance Tactic 3: Deliver compliance tools in a medium familiar to core constituency. Compliance Tactic 4: Develop resources to aid the community in complying with regulations. Strategy 3: Compliance Monitoring & Enforcement M & E Tactic 1: Determine method to identify and track scofflaw STRs. M & E Tactic 2: Identify resources and mechanism to implement monitoring. M & E Tactic 3: Coordinate with PEAK team to ensure process efficiency. M & E Tactic 4: Utilize existing tools to facilitate compliance (Reminders, NOVs, Admin Citations). Strategy 4: Complaint Investigation Monitoring & Enforcement I & E Tactic 1: Determine method to identify and track operator complaints. I & E Tactic 2: Identify method for tracking licensed operators violating established requirements. I & E Tactic 3: Utilize existing tools to facilitate compliance (Reminders, NOVs, Postings, Admin Citations) I & E Tactic 4: Coordinate with CAO, provide evidence for CAO determination to show cause for revocation.

STR Enforcement Numbers Notice of Violations (NOVs), Postings, and Admin Citations (ACs): Total NOVs issued: 2,024 (advertising without a license) Total ACs issued: 42 - 8 @ $500, 34 @ $150 for a total of $9,100 in fines issued (continuing to advertise without a license) Total number of properties posted: 44 Host Compliance: Host compliance will begin tracking administrative enforcement actions in mid-February. EXL has approximately 25 open STR investigations based on complaints, etc. Based on the results of the investigations, they could be referred to the City Attorney’s Office for consideration of a Show Cause. Dominic/Brian

STR Enforcement Numbers Complaints: 232 complaints on 109 licensed premises 53 licenses have just one complaint Show Cause Hearings: 6 orders to Show Cause have been filed 4 have surrendered licenses 2 have settled after neighbor mediation 3 investigations have been completed that resulted in no Order to Show Cause (unable to prove charges) 1 Order to Show Cause is pending approval by Director Dominic/Brian

Short-term Rentals in the Denver Zoning Code What is the History of Short-term Rentals in the Denver Zoning Code? Where Does Zoning Permit Short-term Rentals? All zone districts where residential is permitted (most districts other than Industrial) What About Short-term Rentals in Former Chapter 59 Zone Districts? Permitted by Zoning Administrator interpretation Industrial Zone Districts Abe Former Chapter 59 Zone Districts

Short-term Rentals in the Denver Zoning Code What Limitations Does the Denver Zoning Code Place on Short-term Rentals? Short-term Rentals Shall: Be clearly incidental and customary to and commonly associated with the operation of the primary residential household living use Be operated by the person or persons maintaining the dwelling unit use as their primary residence Not include rentals where the length of stay per guest visit is 30 or more days Not be located in mobile homes, recreational vehicles, or travel trailers Not display or create any external evidence of the Short-term Rental, except one wall or window sign Not have any employees or regular assistants not residing in the primary or accessory dwelling unit Not include simultaneous rental to more than one party under separate contracts Not be subject to a maximum number of guests per night Abe

Insurance Requirements Property Liability Insurance: The Permanent Resident maintains liability insurance appropriate to cover the Short-Term Residential Rental Use in the aggregate of not less than $500,000 or conducts each Short-Term Residential Rental transaction through a Hosting Platform that provides equal or greater coverage. Hosting Platform Options: Airbnb: Provides up to $1,000,000 of coverage. VRBO: Provides up to $1,000,000 of coverage. Home Away: Provides up to $1,000,000 of coverage. Dominic/Jordan

Going forward Additional enforcement tools: Short term: Mid-term: Complaint notification Denver Police Department-communication and strategy Mid-term: Audit implementation item of adding additional document requirements on application (End of Summer) Long term: Add additional ordinance language (or rules?) that define the primary residence (e.g. Boulder) E.g., Occupancy limits, advertising regulations, nuisance abatement, etc. Dominic/Jordan Next Meeting: May 22, 2018, 4pm

Questions? www.Denvergov.org/STR