A motion by a member of the Palisade Planning Commission in favor of adding a new section to regulate short term vacation rental properties in the Land Development Code did not receive a second at the commission hearing on Nov. 3.  The motion was made by Commissioner Kenneth Ruth.

After no second was made, the other commission members said they were not ready to vote on the proposal after hearing questions raised at the public hearing about the proposed ordinance.  The questions were raised passionately by seven speakers at the hearing.

The proposed regulations, however, will still go to the town board of trustees on Nov. 11, but without a recommendation from the planning commission.

The trustees could send it back to the planning commission, Ron Quarles, Palisade community development director, said to the commissioners.  In fact, “That’s probably what we would recommend,” Quarles said.

Quarles later explained that instead of sending the proposed ordinance back to the commission, the trustees could, instead, approve it, or deny it.

The members of the public who spoke at the meeting passionately were advocates for the operation of short term rentals, but most wanted less formal business regulations than proposed, as well as less expensive administrative costs, and some spoke about ensuring fairness for the different types of short term rental businesses.  Other media also covered the meeting.

Marijuana land use conflict?

In other discussion, Commissioner Lafe Wood said he is researching a question of concern to him following the planning commission’s recommendation in October in favor of amending the land development code to allow application for off-site cultivation for medical marijuana.  The town board approved the amendment later in October.

Wood said his concern is that if the off-site grow operation eventually receives town approval, the operation could potentially be shut down by federal law enforcement as a result of its location.  The site is on Mesa County Land Trust conservation easement land which in part has received federal funds.

Colorado Alternative Health Care, a medical marijuana dispensary in Palisade, is expected to submit plans to grow medical marijuana on a one-acre site leased from the Cox Farm, 3824 Highline Canal Rd.  The 10 acre farm was recently annexed to Palisade.

Wood said he is aware of similar situations nationally where, in those cases, recreational marijuana grow locations on conservation lands were found to be in conflict with the federal schedule I controlled substances act.

Vacation rentals

“The short term vacation rental market has continued to expand in all parts of the country, Palisade not excluded,” Development Director Quarles said in a memo to the planning commission explaining the proposal to add a short term residential vacation rentals section to the Palisade Land Development Code.  The staff recommended approval of the application to amend the code for the rentals as a permitted use in the Residential Zoning Districts.

“The basis for the ordinance is recognition that although this type of land use has some benefits to the Town of Palisade, safeguards will need to be in place to protect the residential neighborhoods,” the memo states.

“The intent of the ordinance is to ensure that if this land use evolves in Palisade, it will have minimal impacts to the neighborhoods,” Quarles wrote, and “to ensure that the regulations are reasonable enough to encourage the use in those instances where it is the desire of the homeowner.”

Quarles said in the memo that the benefits of the short term vacation rental industry include “encouraging additional visitors to the Town; allowing some homeowners alternative ways to subsidizing housing costs; and providing some additional revenues for the Town through additional lodging tax collections (Lodging Occupation Tax.)”

Quarles in his memo said the definition of short term vacation rental “means a single family dwelling unit rented on a regular or seasonal basis for monetary consideration for a period of time less than thirty consecutive days, not including a bed and breakfast, residency unit, boarding or rooming house, or hotel.”

The memo notes, “This definition does not include offering the use of one’s property where no fee is charged or collected, or for house sitting…while the owner or primary occupant is temporarily away.”

Quarles listed the standards proposed in the ordinance.  They would require that an applicant submit a major site plan for approval, that no sign about the rental be permitted on the property, and no changes should be made that would diminish or detract from the residential appearance in the neighborhood.

In addition, standards would state that, “The maximum number of occupants shall not exceed two persons per bedroom plus two additional renters overall.”  Also, “Parking shall be provided to accommodate one space per the dwelling unit plus one space for each occupied bedroom.”

Standards would require that all vehicles “shall be parked in designated parking areas,” and, “No parking shall occur on lawns or sidewalks.”  Finally, “The short term vacation rental shall be subject to the same safety and health inspections, licenses, registrations, fees and taxes to which other licensed businesses or places of accommodation are subject.”

Speaking to the commission

Arden Blatter, who rents a property on Main Street as a short term rental, said, “We want regulations that are reasonable.”  Blatter also referred to Susan Metzger, another short term rental property homeowner, who would speak later.

Blatter said the proposed requirement for a sign on the property to notify others about a rental property application makes her uncomfortable and she said the proposed $250 fee is excessive and duplicitous.  She noted there is already a $50 a year business license fee.

Blatter said she likes the proposed standard that no changes should be made that would detract from the residential appearance in the neighborhood, and she has no problem with the maximum number of occupants and parking standards.

Blatter asked, however, “Why do we need a major site plan?  This is not the creation of a new subdivision.”

Blatter and Metzger handed out an information booklet about vacation rentals in Palisade, which included photos of good looking and poor looking rental properties.  “Short term rental owners MUST maintain high standards,” the booklet says.  “Complicated regulations and high fees will sadly force owners to return to long-term rentals.”  The booklet shows some unkempt properties and comments, “No matter how hard owners try, long-term rentals often end up eyesores, often with dead landscaping.”

At the meeting, Blatter, who lives at another location, said her rental property has been rented for 47 nights so far in 2014.  If the proposed ordinance had been in effect, she estimated that she would have paid $144 in the occupation/lodging tax and $124 in sales tax.

“That’s $268 dollars.  Is that worth it?” she asked, adding, “It’s a financial burden that I cannot easily afford.”

Commissioner Ruth asked what she would propose instead of a major site plan.  Blatter said other towns charge $25 a year.

Question of Fairness

Julie Commons, who owns and operates the Dreamcatcher Bed and Breakfast, 3694 F Road, outside the town limits, described the rigorous county requirements to open and operate her business.  “I just want this to be fair. I had to jump through so many hoops,” she said, comparing the county requirements to the proposed Palisade ordinance standards.

Commissioner Ruth asked Commons about the proposed vacation rental business fees and taxes.  Commons said, “I feel they should pay the same as B&Bs.”  She said if the Palisade ordinance passes, she would take her sign down and stop paying tax. Ruth said, “We’re trying to make this simpler,” commenting, “We want your input and your feelings, and other people’s.”

Development Director Quarles noted that Palisade requires a conditional use process for B&B applications.

Metzger, who rents short-term residential property in Palisade, said, “I’d like to see more people coming to Palisade.”  Metzger, who is a member of the Blue Pig Gallery in Palisade, said artists want to stay in a house, where they can set up their art work.  Some want extra space and some have pets.  “They want to experience living in a town.”

Renting provides some income to upgrade and enhance the property, Metzger pointed out.  “That’s good for the whole neighborhood.”

Metzger said her preference for the short term rental requirements would be a $25 registration fee and payment of the occupation lodging taxes.

Metzger noted that the Short Term Living Advocacy Council offers best practices guidelines for towns.  She noted that San Francisco banned short term rentals, to address a housing shortage, but it lost in court; Palm Springs rolled back a $500 fee to $25, and Vail dropped regulations for homes rented to six or fewer people.

Occupation lodging tax

Felix Iovanni, who owns a B&B near Palisade, but who voluntarily pays the Palisade occupation lodging tax, said the occupation tax should apply to short term rentals.

Iovanni said he is a member of the Palisade Tourism Advisory Board (TAB), although he was speaking for himself.  He pointed out that the occupation lodging tax revenue is used to fund the TAB and its tourism programs.  Therefore, he said, any rental, including short term rentals, will benefit from promotional work by TAB.

Brian Moffett, local resident, asked about the proposed ordinance.  Development Director Quarles said short term vacation rental regulations are not in the current Land Development Code.  If the town received a code compliant complaint now about a property operated as short term rental, “I’m not sure how we would address that.”

Moffett expressed concern about rental properties.  “As a homeowner, I don’t like rental units,” he said.  “We need to clean up the rental units we have around town.”

Commission Chair Betsy McLaughlin said, “That’s how this came about.  What we’re trying to do is put regulations around it.”  Moffett said, “It’s a lot more clear to me. Thank you.”

Gary Hauschulz spoke to the commission.  “Short term rentals are self-regulated on the Internet,” Hauschulz said, through on-line reviews and critques.  In comparison, he suggested that long-term rental housing can fall into disrepair.

Julie Carter, who said she has experience working in the lodging and hospitality business, said, “All sales taxes and lodging taxes are very important.”  Carter also said short term rentals are perfect for families.

Short term rental owner Metzger concluded, “I’d just like to see a less formal version,” of the ordinance.  Chair McLaughlin said the town’s approach to businesses should not provide exceptions.

Commissioner Wood offered a comparison to define what a business is.  For instance, he said, selling a couple of cars in a year is informal, while selling 15 cars a year becomes a business.  Wood compared it to short term renting only during festivals.  McLaughlin commented that short term rentals are advertised on the Internet, so they should follow business rules.

After the motion to recommend approval of the ordinance failed to receive a second, Wood said he wasn’t ready to vote after hearing the public testimony.  McLaughlin agreed, and said, “A couple of things have come up I would like to discuss as well.”  Wood said to people in the audience, “Thank you all for your comments.”

Building design standards

In other business, Development Director Quarles asked for guidance on the commission’s preferred approach to revisions in the building design standards section of the Land Development Code.  In response, the commission expressed a consensus that the section is worth reviewing. The section specifies design standards for single family and multi-family construction.

Quarles pointed out that the section, for instance, does not include standards for historic zoning districts.  Although, he said, “I’m not sure that we want that.”

Trustee Robynn Sundermeier, who is the liaison from the board of trustees, then asked, “What is the theme of our town?”  She preferred to keep the section.  Commissioner Ruth agreed and pointed out that a builder could apply for a variance if desired.  “I don’t see anything that is really restrictive here.”  Ruth has experience as a home builder.

Chair McLaughlin said, “We shouldn’t change these (exiting standards) until we review the comprehensive plan.”

Flood plain regulations

Development Director Quarles briefed the commission on the first completed draft of a section in the Palisade Land Development Code, which the commission is reviewing for revisions.  The completed section is on flood plain regulations. “Although no changes are recommended to the specific regulations, the chapter has been re-designed to reflect a new organization,” Quarles said in a memo to the commission.  Quarles asked commissioners to read the section for the next meeting.

The two hour meeting was held at the Palisade Civic Center. Commissioner Roger Rawlings did not attend. Commission meetings are held on the first Monday of the month, at 6 p.m. and are open to the public.  Agendas are posted on the town website.