The City and County of Denver proposed a new citywide licensing and enforcement system in 2016 that allows short-term rentals (STRs) in Denver’s residential neighborhoods to ensure the city’s rules and regulations are staying current with the emerging “shared economy.” STRs are often facilitated by peer-to-peer websites such as VRBO.com and AirBnB.com, and are defined as the rental of a shared room, a single room, multiple rooms or an entire property for less than 30 days.
Denver’s STR ordinance, which passed in July 2016 and took full effect in January 2017, allows for STRs to operate provided hosts have a business license and pay the city’s 10.75 percent Lodger’s Tax. It’s estimated there are up to 3,000 STRs in the City and County of Denver.
Denver takes a two-pronged approach to STR enforcement, taking action on unlicensed STRs based on complaints and through proactive tracking and monitoring. Complaints about STRs including unlicensed STRs, can be filed through 3-1-1, Pocketgov or STR@denvergov.org.
Shortly after the ordinance went into effect our Peak Academy process improvement team and the STR staff at Excise and Licenses partnered to develop processes to efficiently and effectively track STR operators throughout the city. The Peak team guided and facilitated sessions to map out the compliance process. We created current and future state processes and with the help of the Peak data team created a tracking system putting us on a path to mail our first set of Notice of Violations (NOVs). We mailed 1,057 NOV letters to unlicensed operators in early 2017 to make sure the businesses operating STRs in Denver are complying with the new rules. Those operators were given 14 days to comply before fines are issued.
Two months into enforcement, the City and County of Denver has issued over 1,000 Short-Term Rental licenses, or more than one-third of STR properties in the city. This is more than comparable cities like Austin, Nashville, Portland and San Francisco which have been licensing STRs for several years and have seen frustratingly low compliance rates.
Although Denver has only been licensing STRs for eight months – and enforcing for only two months – the city has already surpassed other municipalities in terms of compliance rate and number of licenses issued.