STR enforcement

This slide taken from a presentation about the Town of Telluride’s short-term rental enforcement efforts lists some of the challenges of such audits. (Courtesy image)

Changes in public health orders over the last year of the COVID-19 pandemic have affected certain industries differently. Small businesses and food establishments have had to adjust to altered restrictions, including the county’s most recent move to “Level Orange Extreme” this week. Lodging has also been subject to fluctuating capacity limits.

No matter the orders, the question of enforcement has come up again and again, particularly when it comes to self-managed short-term rentals — a segment of the lodging industry that is more difficult to oversee given the various platforms people may use to rent out their properties.

During Monday’s virtual intergovernmental meeting hosted by Mountain Village, Town of Telluride Prosecuting Attorney Lois Major led a discussion regarding the town’s short-term rental enforcement efforts.

Currently, lodging capacity in Telluride is 50 percent, per this week’s new public health orders, which is the latest change in a long list of varying occupancy limits since March. 

Major explained that some people are simply confused about what’s allowed and what isn’t, especially since orders have been so fluid. 

“It has been difficult for the self-managed, at least, to track some of that. The biggest thing that helps us get information out was this lodging verification form that the county instituted,” she said. 

Of the town’s 753 short-term rental units, 264 are self-managed. 

“We did have a pretty good amount of people registered, which is huge because that is one way the lodging oversight committee can both push out information as well as answer questions for people,” Major said. “Now we have 70 percent of all self-managed licensed units registered. We feel that’s a victory because those are the people that really don’t understand what’s going on. The lodging community as a whole is more part of the conversation so they are getting the information better, so we feel like that was a big step toward getting compliance.”

As of Monday, 15 over-rental violations were prosecuted in municipal, while another 30 were settled out of court. Similarly, three cases were pending and five suspected violations were awaiting prosecution, and 80 registration violations were not yet addressed. The town has conducted 175 audits so far, which have resulted in $168,892 in total fines. Major explained that fines have ranged from $200 to nearly $20,000 in one case due to over-renting. 

“It’s expensive. Some people have paid some very significant fines and were unhappy, but I think word is getting out that they’re serious,” she said. 

Under the town’s municipal code an offender is suspect to fines up to $1,000 per day for each violation, or worse.

“Town Council can look at someone who has misused their business license and they can either admonish them, they can suspend it or they can permanently revoke their right to short-term rent. That is a really harsh consequence, but it’s out there when and if we find people who are so egregiously violating this that the council wants to do that. It hasn’t come before the council yet,” Major said. “No one yet has pleaded guilty to a violation that would automatically trigger a town council review. As we get deeper into this, that may be forthcoming shortly.”

During the onset of such restrictions, Major said, the town was receiving a high volume of tips from concerned residents, but recently more audits have been conducted and resulting in violations. 

“So how are we figuring out whose cheating? Originally, we had a lot of both anonymous and named complaints. People were kind of panicked, especially at the start. We responded to a lot of calls from the public about violations. Then as those sort of settled down and moving more, I guess people weren’t on as high alert, we did a lot of audits,” she said. 

The violations are across the board, Major added, so it doesn’t matter if renters are charging $99 per night or $5,000. Most people, though, are amendable to working with the town to avoid a lawsuit.   

“We’re not targeting any group and we’re not ignoring any group. It’s a lot. It is hard on these people, and I do appreciate the county, going forward, making these restrictions more clear because it’s easier for people to follow that and it’s also easier for us to enforce,” she said. 

Town attorney Kevin Geiger reiterated Major’s points and addressed the misconception that the town isn’t enforcing public health orders.    

“There have been some media reports and some discussions in the community about a concern of a lack of enforcement of some of the public health orders and the restrictions in the pubic health orders. While the Town of Telluride doesn’t have as much authority as the county under the statutory scheme for quarantines, pandemics, things like that, where we do have authority is in some limited areas, one that we’re focusing on right now is the short-term rentals and those restrictions that have fluctuated,” he said. “ … We have had restrictions in place since basically the end of March last year. This enforcement action we’re only probably half to three-quarters of the way through it and those numbers are really telling in terms of how many, unfortunately, actors we have been picking up that have not respected some of those restrictions. Some of them may have been a misunderstanding. Some of them were violations where I think they just chose to ignore the public health restrictions out there for short-term rentals, but nevertheless, our efforts have been robust, and we will continue to do that so long as these public health orders are in place and they restrict short-term occupancy in the Town of Telluride.”