Aurora City Council defers on new rules for Airbnb-style short-term rentals

When asked whether residents renting their homes through sites such as Airbnb were obtaining business licenses and paying lodger's tax, City Attorney Mike Hyman said many Aurora homeowners are likely not in compliance with the rules.

AURORA | Aurora City Council deferred on voting Monday, Aug. 8, for new requirements for residents operating short-term rentals, with some council members saying that rules to require listing a business license number in advertising would go too far.

“It’s time for government to quit putting restraints on the public,” said Ward II Aurora Councilwoman Renie Peterson, who opposes the measure. “Let us pay taxes in our homes and live in them freely. As long as we’re not causing harm to anyone else, let us have some freedom.”

Council members tentatively decided to revisit the issue at an Oct. 17 study session.

The city already collects lodger’s tax from individuals who rent out their homes for 30 days or less on sites such as Airbnb.com and requires those homeowners to obtain a business license. City council is also looking at requiring homeowners renting their home via Airbnb to occupy 75 percent or more of a home, effectively banning any whole-home rentals.

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Saurabh Chawla stands outside of his house on Friday July South Aurora. Chawla had been a host for Airbnb since January until he was asked to stop by the city because of a zoning violation. Photo by Gabriel Christus/Aurora Sentinel

Aurora officials say the measure would not apply to rentals longer than 30 days. Those rentals are only required to be reported on a landlord’s tax returns.

Aurora’s Finance Department estimates there are around 170 Airbnb-style businesses in Aurora at any given time, and that 25 percent advertise their entire home for rent. City staff also estimate top-performing renters make between $15,000 and $48,000 in sales annually.

Trevor Vaughn, manager of the city’s tax and licensing division, said other home-based businesses in the city must follow that requirement. He said Aurora could make between $6,000 and $30,000 per year if these businesses were required to pay the city’s 8-percent lodger’s tax.

He said cities across Colorado are regulating short-term rentals such as Airbnb as a way to maintain the character of neighborhoods, provide a framework for neighbors to complain about noise and address the lack of affordable housing.

Ward IV Councilman Charlie Richardson also questioned the need for the ordinance, stating that he had posed the issue of Airbnb rentals to local homeowners’ associations and had not heard of any problems.

Under Aurora’s current short-term rental rules, homeowners are required to obtain a $38 Aurora business license and collect an 8-percent lodger’s tax from each guest they host.

When asked whether residents renting their homes through sites such as Airbnb were obtaining business licenses and paying lodger’s tax,  City Attorney Mike Hyman said many Aurora homeowners are likely not in compliance with the rules.

“As we catch up with this new industry, the law may be in place but businesses aren’t aware of it,” he said.

At-Large Councilman Bob LeGare said city council needed to make a decision sooner rather than later.

“People renting houses are already in violation of code,” he said.  “We have to do something to pass this with modifications, or we have to pass an ordinance saying we’re doing away with our regulations that makes this not allowed.”

Ward I Councilwoman Sally Mounier was absent from the meeting.

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