Federal Judge Dismisses Lawsuit Against Short-Term Rental Ordinance

Last month, fed­er­al Judge Gor­don Gal­lagher dis­missed a law­suit against Sum­mit Coun­ty, Col­orado, which claimed short-term rental reg­u­la­tions passed by the local gov­ern­ment were exces­sive and vio­lat­ed their rights. Accord­ing to an arti­cle in Sum­mit Dai­ly, the ordi­nance in ques­tion, which went into effect last fall, placed caps on the num­ber of short-term rental licens­es that could oper­ate in each neigh­bor­hood (rang­ing from 5 to 18 per­cent) and lim­it­ed the num­ber of annu­al book­ings to 35 per home­own­er. It also con­tains exemp­tions for prop­er­ties in areas deemed “resort over­lay zones” and for full-time coun­ty res­i­dents who work more than 30 hours per week in the coun­ty or who have retired and have a his­to­ry of work­ing in the coun­ty for at least 10 to 15 years.

The judge was sym­pa­thet­ic to the sig­nif­i­cant reper­cus­sions of the ordi­nance for the prop­er­ty own­ers, but ulti­mate­ly ruled that the coun­ty pro­vid­ed suf­fi­cient ratio­nal basis for the ordi­nance and said the home­own­er plain­tiffs failed to estab­lish the the right to rent one’s prop­er­ty is a fun­da­men­tal right and that the had con­ced­ed they do not have a fun­da­men­tal right to a short-term rental license.

At the time the ordi­nance was passed, coun­ty com­mis­sion­ers said “the rules were designed to mit­i­gate an esca­lat­ing afford­able hous­ing cri­sis by pro­tect­ing exist­ing hous­ing stock for long-term ten­ants,” writes Robert Tann for Sum­mit Dai­ly. Short-term rentals reg­u­la­tions aren’t the only strat­e­gy local offi­cials there have used to that end. Ear­li­er this year, the Nation­al Asso­ci­a­tion of Coun­ties report­ed on a unique part­ner­ship between Sum­mit Coun­ty, the U.S. For­est Ser­vice, and the town of Dil­lion to build a 162-unit hous­ing facil­i­ty with a cer­tain num­ber of beds and units reserved for For­est Ser­vice Employ­ees, who have been strug­gling to find afford­able hous­ing in the area.

Moun­tain resort com­mu­ni­ties across the coun­try are grap­pling with their own afford­abil­i­ty crises, as home prices sky­rock­et and large num­bers of hous­ing units are being con­vert­ed to short-term rentals and list­ed on sites like Airbnb and Vrbo. Tann reports that sim­i­lar short-term rental mea­sures have also been “tak­en by town coun­cils in Breck­en­ridge, Frisco and Sil­ver­thorne, each of which placed caps on short-term rentals with­in their respec­tive town bound­aries.”