Salida STR Tax Relief: Council & Commission Debate

Salida’s City Council and Planning Commission recently met to talk about short-term rental (STR) taxes. It’s a tricky situation, balancing tourism with making sure locals can afford to live here. They’re looking at ways to offer some tax relief while still trying to fix the housing crunch.

The Growing Challenge of Short-Term Rentals

Short-term rentals are really changing Salida. Since 2025, more and more homes are being used for STRs instead of long-term rentals for residents and workers. This has made housing harder to find and more expensive. Back in 2021, about thirty percent of homes in commercial and industrial areas were STRs, especially downtown. People worry these areas will become just for tourists, making it even tougher for locals.

Understanding Salida’s STR Rules

Salida has rules for STRs. You need a license if you rent a place for less than 30 days. There’s an Occupational Lodging Tax (OLT) for these rentals, which is different from hotel taxes. It’s $15 per bedroom, per night for STRs in homes. Hotels pay $4.82 per room, per night.

Key STR Regulations

STR License: Required for rentals under 30 days.
Annual Fee: $1,000 for new licenses, plus a $200 review fee.
Owner Residency: In residential zones, owners must live in Chaffee County and own the property.
Rental Limits: STRs in residential zones are limited to 185 days a year.
One License Per Property: Owners can only have one STR license per property.
License Display: STR license and emergency info must be visible in the rental.
Penalties: Not following rules can mean fines up to $2,650 per day.

The Purpose of the Lodging Tax

The OLT has two main goals. Money from hotels and motels helps fund parks and recreation, keeping those services affordable. Revenue from STRs is set aside for affordable housing projects, directly tackling the housing shortage. The Lodging Tax Fund, started in 2016, collects money from both types of rentals for improvements to parks, recreation, and arts facilities, like the Salida Hot Springs Aquatic Center and the SteamPlant Event Center.

Economic Impacts and Community Feelings

STRs affect more than just housing; they impact Salida’s economy too. Studies in other cities show that more STRs can lead to higher rents and home prices. This growth in STRs since 2011 might be a big reason for rising rents here. STRs have also been linked to gentrification and pushing out lower-income residents.

Some property owners feel the current rules and taxes are too much and want relief. Others, including many residents and community leaders, believe these measures are necessary to deal with the housing crisis and ensure a sustainable future for Salida. The Salida Tourism Alliance is also part of these discussions.

Looking at Tax Relief Options

The request for STR tax relief has led to a close look at current policies. Some ideas are floating around to help STR owners while still meeting the city’s goals for housing affordability.

Proposed Tax Changes

Annual Fee Cuts: One idea is to lower the annual STR license fee from $1,000 to $540, especially for those not living in Chaffee County.
Nightly Fee Reduction: Another suggestion is to lower the per-bedroom nightly tax from $15 to $5.
Incentives to Convert: There’s talk at the state level about allowing cities to offer tax breaks to STR owners who switch their properties to long-term rentals or workforce housing.

Making Decisions with Data

The city uses data and what people say to guide its STR regulations. A survey in August 2021 got almost 750 responses to help shape policies. The city also checks OLT and STR tax collections to see how revenues are doing and how they affect community programs and housing. For example, STR tax collections in early 2025 were a bit lower than the year before, but OLT collections went up.

How the Council and Commission Work Together

The Salida City Council and Planning Commission work hand-in-hand on land use and development, including STRs. The Planning Commission studies and suggests zoning changes, and the City Council makes the final decisions on ordinances and policies. These joint meetings help them talk and solve problems together.

Key Roles in Policy

Planning Commission: Reviews and suggests changes to land use and zoning, which affects where and how STRs can operate.
City Council: Holds public meetings, passes ordinances, and makes final decisions on STR rules and tax policies.
Joint Work Sessions: These meetings allow for direct talks and teamwork between the two groups.

What’s Next for Salida?

The ongoing talks about short-term rentals and tax relief show a commitment to changing policies as Salida’s needs evolve. The city is focused on collecting data, getting public input, and working together to create a balanced and sustainable community. Future discussions will likely focus on improving regulations, finding new ways to make housing affordable, and keeping Salida a great place for everyone. Community involvement is key, with chances for public comments and participation in upcoming meetings.

The city’s dedication to addressing the housing crisis is clear in its policies and the ongoing conversations between the City Council and Planning Commission. The aim is to create a system that supports economic growth while protecting the quality of life for all Salida residents. You can learn more about local housing initiatives at HUD User.

For more on the economic impacts of short-term rentals, check out this Brookings Institution report. Understanding zoning laws is also important, and you can find resources on the American Planning Association website.

To see how other cities are handling STRs, you might find this article from NPR helpful. And for general information on local government, the National League of Cities is a good resource.

Here’s a video discussing the housing market:

And another on community planning: