Summer brings first glance at new STR and residential development ordinances | News


The month of June will be a busy one for the city of Aspen, and not just because summer tourism will be kicking off. Aspen City Council will hear first and second readings of two ordinances that will regulate short-term rentals and residential development as the city moves toward the expiration of the moratoriums. 

On May 24, council heard the first reading of Ordinance 9, which will regulate STRs, and unanimously approved it. The STR moratorium is set to expire on Sept. 30, and the moratorium on residential development is set to expire on Aug. 8. The city expects to have both ordinances adopted several weeks ahead of those dates — by the end of June. That’s because there’s still lots of organizational and preparatory work that needs to get done before STR and development activity starts up again.

“We have a lot of work to do on the short-term rental side,” said Community Development Director Phillip Supino. “We are hiring a person to manage the short-term rental program, whereas previously we’ve used a combination of community development and finance department staff to manage permitting and tax components. And that was frankly kind of a chewing-gum-and-baling-wire approach to staffing it in the first place, and the significantly more extensive regulations that would be put in place by Ordinance 9 necessitates somebody to manage the program.”

Between now and Sept. 30, the city needs to hire and onboard this new staff member, and that person will need to build a new short-term rental program that will include permit application forms, informational flyers, web pages and a permit waitlist algorithm. The city also plans to inspect units for life-safety compliance, issue more involved permits than what are currently available, and conduct permit compliance and tax compliance auditing. 

When the moratorium lifts on Sept. 30, Ordinance 9 will extend all current STR permits through the end of 2022, and open up the application process for new permits on Oct. 1. At that time, applications for all three new types of permits will be available — classic STRs, owner-occupied STRs and lodging-exempt STRs. 

And that’s only half of it. The city is also working on a new system on the residential building side.

“In addition to building the short-term rental program, we have to continue community engagement,” Supino said. “Architects and planners and property owners and whomever else need to understand how to follow the new residential building rules. They need to understand the consequences of some of those. Finance has to potentially put a tax question on the ballot, and they have to build out a different means of collecting and putting in different funds, the new and different fees that we may be collecting through these ordinances. So we’ve created a lot of work for ourselves.” 

In addition to the ordinances regulating STRs and residential building, the city may consider a third ordinance this summer which covers a fee-in-lieu. Fee-in-lieu is a calculation based on what it costs to build an affordable housing unit, Principal Long-Range Planner Ben Anderson explained via email. 

“This sets the basis for the value of any affordable housing mitigation that a project is responsible for,” Anderson said. “Code gives direction that this should be updated annually using a construction cost index. We will be proposing an 8.5% increase to the FIL based on this index.”

Supino and Anderson said that the purpose for splitting up the projects into three ordinances is to provide more clarity and allow council the flexibility to pull specific topics for further discussion as they please. 

“Being able to break it out into different ordinances allows the public to digest different topics differently, separately, and it also gives council the space to decide the degree to which each piece of the ordinances responds to their expectations or not,” Supino said. “And of course we can make changes between first and second reading, and we anticipate having to do that to some degree or another.”

That’s what happened on May 24 when the council heard Ordinance 9 for the first time. While council members were unanimous in their decision to move it forward, there were smaller details within the ordinance that they had questions about or disagreed on — such as occupancy limits and night rental limits. 

The first draft of Ordinance 9 capped occupancy for all STRs at two people per bedroom plus one — meaning three people to a one-bedroom unit, five to a two-bedroom and so on. Council directed staff to change it to two people per studio and two people per bedroom plus two for anything larger. 

Staff expects the council to have similar requests for the residential building ordinance, which the council will hear for the first time on June 14. On June 7, the Planning and Zoning Commission will have a chance to see Ordinance 9 and provide feedback. Both ordinances will be brought back to city council for second reading on June 28, at which point the public will be allowed to provide comments. 

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