Grand Lake increases annual fees for nightly rental properties
Do nightly rental properties constitute a business? Do single-night rental properties represent an unfair form of competition to official lodging businesses?
These were just a couple of the questions discussed at the last Grand Lake Board of Trustees meeting, held in late August, when the Board approved an increase in the fees charged to Nightly Rental property owners. The license fee for nightly rental property operators was increased from $400 annually to $600 annually.
The last time the nightly rental property fee was increased was January 2009. The Board also voted to allocate the fees assessed on nightly rental properties to the Grand Lake Affordable Housing Fund. There is also an additional $150 application fee that accompanies the license fee, which was preexisting.
Over the past several years nightly rental accommodations have become a growing segment of the vacation lodging industry. Nightly rental accommodations are typically privately owned residences that are rented out for a single night, or some other short-term duration. According to Mayor Judy Burke, Grand Lake does not officially consider such establishments to be businesses.
Some Grand Lake business owners who compete for the same clientele as the nightly rentals consider the unique legal and regulatory position the nightly rental properties enjoy as an unfair advantage. Tom Goodfellow of Grand Escape Cottages in Grand Lake spoke bluntly to the Board about his issues with nightly rental properties in general.
“This is for you to be aware of unintended consequences,” Goodfellow said. “As a lodging establishment I am competing against those folks. The impact has been not so much in the summer, but in the shoulder and winter seasons. My business is down.”
Goodfellow explained, because nightly rentals are not officially businesses they are not required to meet many of the same legal and regulatory requirements his business must meet, which he felt created unfair competition. The Board informed Goodfellow the nightly rental property issue is being discussed throughout the state as vacation-rental-by-owner properties increase in numbers and the Internet makes them easy to find.
“When we did this nightly rental license thing I don’t think we realized it was going to be as popular as it is,” said Trustee Kathy Lewis.
Trustee Lance Sabo expressed his belief that increasing the nightly rental license fee did work to level the playing field between the rental properties and the lodging businesses.
“This is going be a problem,” Goodfellow said. “And I think the lodging community is going to say you threw us under the bus.”
According to officials from the Town of Grand Lake there are a total of 83 approved nightly rental properties in the Town. There are 18 official lodging businesses.
In other Grand Lake news Tom Goodfellow also addressed the Board as a representative of the Grand Lake Constitution Week Committee requesting approval of a special event permit for the upcoming Constitution Week event. Constitution Week is scheduled for Sept. 14 through 19. The permit, which was approved, is for the use of Town property to show a documentary called, “Honoring a Commitment”. The documentary will be shown during Constitution Week, on Saturday Sept. 19 from 2 p.m. to 4 p.m. at the Community House.
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Grand County’s real estate transactions Jan. 17-23 were worth more than $8.4 million combined.