Larimer struggles with short-term rentals

ESTES PARK — Some talk of compromise was in the air. Some wasn’t.

Larimer County planners held an unusually formatted public meeting at the Estes Park Community Center on Jan. 25, hoping to address the fears of owners of short-term rental properties in the unincorporated Estes Valley while still supporting the concerns from those properties’ neighbors about noise, trash and traffic that prompted the county last fall to propose tighter regulations on the industry.

Some STR owners were encouraged by some of the changes the county made in the second draft of the regulations, issued Jan. 13, but other issues including the requirement that there be a 500-foot buffer between vacation rental properties in the original draft left them unsatisfied.

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By the end of the meeting, Lesli Ellis, Larimer County’s community development director, and members of her staff had gotten an earful — but noted that the face-to-face open house seemed to have made the debate quite a bit calmer.

“We heard that the second draft is better than the first draft,” she said, “but there’s still some things that people would like to work on — things like enforcement and the 500-foot setback. But at the same time, there are people here at this meeting who are neighbors concerned about pending applications and the impacts on their properties.”

Instead of speakers standing at the front of the room and taking questions from the audience, the county set up four stations on the perimeter, with two staffers at each station, and round tables in the center where attendees could meet and share perspectives. One station focused on lodging types and definitions, another was designed to cover where STRs would be allowed in the Estes Valley, a third covered standards and a fourth was meant to field questions about the amended process and enforcement.

The success of the perimeter stations seemed mixed, with some constructive discussions but other attendees departing after waiting in line.

The planning staffers at the stations “are very nice. They are cordial. They are very dedicated to what they have already written,” said Suzanne Blackhurst, administrator for the Estes Valley Short-Term Rental Alliance, which has stridently opposed the new regulations. “But they are not terribly receptive to the idea that it is important for people to talk with the commissioners rather than have their messages filtered through the staff.”

Blackhurst had served as interim CEO at Visit Estes Park, the tourism marketing district that last year pushed for the ballot issue that raised the Estes Valley’s current lodging tax from 2% to 5.5%, allocating the additional 3.5% — revenue estimated to be around $5.25 million — to fund housing for the area’s seasonal workforce and providing child care for them, both identified as pressing needs for businesses in and near the mountain village at the gateway to Rocky Mountain National Park. That extra percentage is added to the nightly rate Estes Park-area visitors pay to stay at hotels, motels, guest houses — and short-term rentals. EVSTRA contends that the proposed rules would not only squeeze STRs out, putting many owners out of business, but also would seriously erode the revenue from the lodging-tax increase that was approved by more than 60% of Estes Valley voters in November.

County officials, however, say some tightened regulation is needed to address neighbors’ complaints about noise, trash, traffic, parking and short-term rentals operating illegally.

“It’s a tough situation,” said Dru Webb, a member of the Estes Valley Planning Advisory Committee, a panel of Estes Valley residents, property owners and business owners appointed by Larimer County commissioners. “It’s a balance between business and money, and normal people who want to live in quiet neighborhoods with no noise next to them. I understand both sides.”

“There needs to be a balance,” agreed Mary Murphy, an agent with First Colorado Realty. “They’re concerned about workforce housing, but they’re also concerned about personal property rights.”

Murphy noted that challenges for STRs exist within the Estes Park town limits, not just in the unincorporated areas the county seeks to regulate.

“The town has not done a good job from the very beginning of regulating short-term rentals,” she said. “It just keeps being problematic. We had an intergovernmental agreement between the county and town, but that fell apart a few years ago and that just made everything harder.”

Dick and Liz Mulkern own three short-term rental properties and a bed-and-breakfast in Estes Park. “We had one in unincorporated (Estes Valley), but we saw this coming, and we sold it and bought in the city,” Dick Mulkern said. “Now we’re in the town of Estes. We decided we didn’t want to risk it. The city is more focused on this kind of thing; for the county, it’s a side business, such a small priority for them.”

Added Liz Mulkern, “I just want to be an advocate for everyone in Estes Park. I want to support the short-term industry in Estes Park. It’s a good business. We’ve been doing this for 20 years. We’ve never had a bad renter. We enjoy the people who come.”

But the county’s tightened rules “could start to not make it as available,” she said. “If we have fewer of those opportunities, it would be sad. Many of our guests are three generations; they come from all over the country. I don’t think a hotel could do what a home can do. They can’t enjoy Grandma’s cooking.”

She’d like a little more recognition as well, something she acknowledged that no regulation can do.

“I guess we’d like to feel more appreciated and feel we’re a part of the tourism industry as well,” she said. “Most of the STR owners are people like me. We’re knocking ourselves out all summer, middle of May to October, every night, our properties are booked. We get really tired, and then we’re the bad guy.  We want to feel like we’re part of everything else in Estes Park, and we don’t get that.”

Although they attended the open house, some, such as a woman who owns two short-term rentals, didn’t want their names published. “This is a small town, and I could have enemies,” she said.

Because her properties are within the town limits, the county’s proposal “doesn’t affect me, but I care about other people and their property rights,” she said. “I’m just here because we need to be paying attention to what people are doing and what restrictions they’re putting on property owners.

“I don’t think they should put any ordinance in place that they don’t already regulate homeowners on,” she said. “This person can have 10 cars outside their house and they’re just a homeowner, but a short-term rental person is in trouble because they have five cars and they’re only supposed to have four. You get a $1,000 fine, but your neighbor, who owes their home, can have junk cars, parties, noise, fires, you name it.

“What I found in town is that they can’t enforce the ordinances they have — noise ordinances, light ordinances, fire ordinances. They can’t because they don’t have enough people. But the county would be worse.”

That enforcement issue sparked a lively midroom dialogue between Ellis and EVSTRA chairman Greg Rosener, who manages short-term rental properties including 48 in residential-zoned areas of the unincorporated Estes Valley.

“If you have to call the sheriff, they won’t be there for awhile,” said Rosener, adding that “my proposal is that the county bring in a contract security firm and give them authority to enter the property to sort this out. If that costs $100,000 a year, maybe the guests could pay another $5” a night to pay for it.

Ellis responded that enforcement is happening already, but that Rosener’s idea “is something that is really outside of the regulations, more of an operational thing.”

Critics have said the requirement for 500-foot separation would have an especially severe impact in Windcliff, an area southwest of town limits near the YMCA of the Rockies that was specifically developed for short-term rentals. Rich Chiappe, owner of Windcliff Vacation Homes, contended that the county’s new rules would hurt the STR business there and supersede those of Windcliff’s homeowners’ association.

“Between 70% and 80% of our vacation rentals are from word of mouth. They know our rules, they know who to call if there’s a problem,” he said. “We’re that strict about who we let rent our properties. That keeps our neighbors from going, ‘I’m getting tired of these renters.’ You’re over 25? You’re not going to smoke? You’re not going to party? Shut the lights off at night. That’s our rules. That’s why it works.

“Everybody who’s bought there in the past 53 years knew one thing: If I want to, I can rent my house out,” Chiappe said. “There’s the office, that’s the manager. It’s been a short-term rental community. Our HOA said we need rules. So the HOA voted on a set of rules. We allow STRs, and they have to operate inside these rules. I manage my rentals to those rules.

“Now, the county’s coming over and saying, well, you can’t have a new one within 500 feet of another one. Everyone in Windcliff thinks they can get one because that’s been in our bundle of rights since Day One. For 53 years, we’ve had the right to peace and quiet and short-term rentals. And the county’s saying ‘No, no, no. We’ll determine whether you get a short-term rental license. Is there one within 500 feet? No. And you need to have signage on the door or we’re not giving you a license. Well, signs aren’t allowed by our HOA.”

One compromise county staffers offered Chiappe was to rezone the neighborhood from residential to accommodations. He bristled at the idea.

“Accommodations is a zone for hotels, motels, lodges and cabins,” he said. “We don’t have that. We have private residences that short-term rent. That’s not a good compromise.

“This is not going to fly for 160 different disparate homeowners,” he said. “What we want to be is what we’ve always been — a private residential area that allows short-term rentals. So what we’re asking from them is some form of exemption — and it can be a qualified exemption — or a variance. In other words, if your HOA has recorded covenants that permit STRs and regulate STRs in your community, that takes precedence.”

Ellis said she was open to other ideas as well.

“For something like Windcliff, they’re a little different in that they’re a neighborhood that has historically had this kind of use,” she said. “So we’ve been looking at different options for their situation. Maybe they would conceivably want to rezone part of their property. Windcliff is not super in favor of accommodation, but maybe some other customized zoning district for that situation. But that would be something that would have to happen after this project. Rich would have to organize the folks in his neighborhood directly on that, come up with a proposal, and it would go through the whole public-hearing process and the commissioners would decide in the end.”

But that wouldn’t settle the 500-foot setback problem, Chiappe said.

“We still need a license from them. But if we’re within 500 feet and we don’t meet these criteria, all these regulations will take that right out of the fist of every homeowner,” he said. “Fifty-five of the 160 properties have a license. Picture a checkerboard. There ain’t 500 feet between any of them.

“There are 10 houses under construction or heavy remodel right now. Six of those were built by their owners only because they knew when it’s done, at least we could get some rental income from it and offset our expenses,” Chiappe said. “We’re talking about three million-dollar investments. Under construction. Still don’t have a house. And in order to rent, when they’re done and they’re coming into my program, they’re going to have to have a license. And they’re going to go before this group, and these regulations are going to say no, you’re in a residential zone, you’re within 500 feet — all the things they list there are pretty much saying no. And all those people are like, “Wait a second. I bought this property knowing I could rent it. I knew there was a process to get a license, but I knew I could get it eventually. Now, as this stands as a draft, we can’t get a license.’”

Working out the bugs in the proposed regulations continued Jan. 30 when the project team meets with county commissioners at their work session, and public comments were due by that date as well.

The project team hoped to have the final drafts completed by Feb. 3 and is to work with the county commissioners and planning commission on Feb. 8.

The project team will hold a public hearing March 15, and the planning commission will provide a recommendation to the county commissioners, who will hold their own public hearing on March 27 —the final one before an expected decision on the final draft in April.

In the meantime, county officials continue to digest what they heard at the community meeting.

“I think we had a pretty mixed group, and that was good,” Ellis said. “We’re trying to balance all the issues and all the perspectives and try to get it right.”