Ross Herzog

Town manager Ross Herzog last November in Rebekah Hall. Weekly Telluride Town Council meetings are conducted via  Zoom platform each Tuesday until further notice. (Planet file photo)

Business owners in the Town of Telluride will have a bit of a breather when it comes to paying sales tax collected by the town. At Tuesday’s Telluride Town Council meeting, council approved an emergency ordinance that will permit businesses to defer paying sales tax for the months of March and April until Sept. 30.

Deferred taxes include, in addition to sales tax, the excise tax and the short-term rental tax. Businesses must still file paperwork for those tax amounts on their respective due dates of April 20 and May 20, or be ineligible for the deferrals.

The measure, which passed 6-1, also included a section that described penalties for those violating San Miguel County public health orders that prohibit the short-term rental of property. Some on council reluctantly cast aye votes because of expressed issues with the short-term rental portion of the ordinance and the penalties imposed for violating public health orders. Council member Tom Watkinson cast the sole dissenting vote.

According to the draft version of the ordinance as prepared by town attorney Kevin Geiger at council’s direction, “under this Emergency Ordinance any Short Term Accommodation is defined as a rental of property less than one hundred eighty (180) days.” Council ultimately reduced that definition to 90 days.

Penalties for violating the public health order include permanent revocation of a property owner’s short-term rental license. As originally drafted, that revocation would be affixed to the property, even if it were sold.

Council member Lars Carlson felt that penalty was onerous.

“I don’t think we should burden the property if it’s sold,” he said.

Council agreed to remove that language.

The aim of the ordinance — which can be more restrictive than the county public health order — is to prevent visitors from “riding out the pandemic,” Geiger said.

Members of Telluride’s lodging sector sent a letter expressing some concerns with the draft version of the ordinance, specifically when it came to renting to those temporarily working in the area, or to locals.

“While not a large part of our business models, all of us rent to residents of San Miguel County from time to time, and many of those reservations are less than six months,” the letter read, in part. “Reasons for these rentals vary but can include spans between leases, waiting for a property to close, the need to be in a particular location for work, etc. We expect that residents and workers in San Miguel County are exempted from this rule, and there will be no punishment levied against any owner or a property manager for doing that.” Larry Mallard, Ray Farnsworth, Christina Casas, Kevin Jones, Keith Hampton, Lee Zeller, Jenny Carlson and Frank Ruggeri, who each represent various lodging businesses, signed the letter.

Another lodger reported that she was currently renting two condos to two different people with front-line jobs that were distancing themselves from family members to keep them safe and healthy.

Geiger explained that if, on a case-by-case basis, those renting short-term properties could demonstrate legitimacy, there would be no penalties.

Greg Craig, a citizen representative to the San Miguel County Public Health and Emergency Preparedness Response Task Force, formed in the early 2000s, called the concern over short-term rentals “unfounded” in his written comments to council.

“There are already stiff sanctions including jail time and fines in the San Miguel County Public Health Order therefore the Town of Telluride has no need to create additional totally out of proportion brutal sanctions,” he wrote. “This would be grandstanding to look tough.”

In addition to business sales tax deferrals, council agreed to create a line item in the budget that would create a fund to assist those struggling to make rent or other crucial expenses, but for those who do not live in town-owned properties. Local citizens, Eliot and Mary Brown, approached Mayor DeLanie Young last week, telling her they’d like to contribute their federal stimulus checks to a town-operated fund specifically for helping those in need. In his memo to council, town manager Ross Herog asked members to consider “program intent, who qualifies to apply, what is required to demonstrate need, and is funding first-come, first-served basis as we may run out of funds before everyone may be approved.”

Council unanimously gave staff direction to create an ordinance amending the budget to reflect the new line item, which would be seeded by $25,000 originally intended for town employee training and travel. Council members requested that an application process be devised and that any awarded funds go directly to landlords or other utility providers. The fund would be set up to accept donations. Donations are tax-deductible.

Town Council will be meeting weekly, on Tuesdays, until further notice. For more council coverage, see the Thursday edition of The Watch.