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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 03/21/2017 - ITEMS RELATING TO SHORT TERM RENTAL LAND USE CODEAgenda Item 18 Item # 18 Page 1 AGENDA ITEM SUMMARY March 21, 2017 City Council STAFF Ginny Sawyer, Policy and Project Manager SUBJECT Items Relating to Short Term Rental Land Use Code and City Code Ordinances. EXECUTIVE SUMMARY A. Second Reading of Ordinance No. 044, 2017, Amending the City of Fort Collins Land Use Code Regarding Short Term Rentals. B. Second Reading of Ordinance No. 045, 2017, Amending Chapter 15 of the Code of the City of Fort Collins to Add Short Term Rental Licensing Regulations. These Ordinances, unanimously adopted on March 7, 2017, bring forward a licensing structure and the associated Land Use Code (LUC) changes to regulate short term rental (STR) activity in the City of Fort Collins. Included in the Ordinance on Second Reading are changes for clarity to the grandfathering provisions. The amendments required to Ordinance No. 045 (City Code) should Council choose to consider removing inspections and replacing with self-certification are attached as an exhibit to this AIS. STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on Second Reading, followed by a 2-year review to evaluate effectiveness and any needed changes. BACKGROUND / DISCUSSION Ordinance Changes Between First and Second Reading Proposed changes to the Ordinances adopted on First Reading are as follows: Land Use Code Proposed Short Term Rental Regulations (Ordinance No. 044, 2017) 1. Ordinance Section 6 regarding proposed Land Use Code Section 3.8.34(F)(3): Staff recommends deleting the proposed text that reads “, during all times the dwelling unit was rented as a short term primary or non-primary rental.” This deletion clarifies that in order to be considered a lawful use for purposes of being considered a nonconforming use, a short term rental only need to have been in operation pursuant to a valid sales and use and lodging tax licenses obtained prior to the effective date of the Ordinance. This change is consistent with legal requirements, the intent of the Ordinance, and the way in which City staff has communicated the requirement in response to public inquiries. 2. Ordinance Section 27 regarding proposed definitions of short term non-primary and short term primary rental: Council directed the inclusion of language exempting the rent back of a residence to its former owner subsequent to its sale from the definition of short term rental. The added language for the LUC Agenda Item 18 Item # 18 Page 2 regarding this exemption is identical to language already included in the definitions contained in the Code of the City of Fort Collins short term rental Ordinance. Code of the City of Fort Collins Proposed Short Term Rental Regulations (Ordinance No. 045, 2017) 1. Ordinance Section 4 regarding proposed Code of the City of Fort Collins Section 15-632(b)(7): Staff recommends deleting “, members of the public, and” and adding “or.” The text was inadvertently left in the last version of the proposed provisions when the intent was to delete it as was done in Section 15- 632(a)(7). Deletion will make the language consistent with the existing language in Section 15- 632(a)(7) and Section 15-636(6). 2. Ordinance Section 4 regarding proposed Code of the City of Fort Collins Section 15-634(a): Staff recommends deleting the proposed text that reads “, during all times the dwelling unit was rented as a short term primary or non-primary rental.” This deletion clarifies that in order to be considered a lawful use for purposes of being considered a nonconforming use, a short term rental only need to have obtained valid sales and use and lodging tax licenses prior to the effective date of the Ordinance. This change is consistent with legal requirements, the intent of the Ordinance, and the way in which City staff has communicated the requirement in response to public inquiries. This identical change is also recommended above for the City Code short term rental provisions. On March 7, 2017, the Mayor and Mayor Pro-Tem requested that staff look into the possibility of self- certification instead of City inspections. Suggested language regarding self-certification is provided as Attachment 2. ATTACHMENTS 1. First Reading Agenda Item Summary, March 7, 2017 (w/o attachments) (PDF) 2. Proposed Change to City Code Short Term Rental Provisions Regarding Self Certification (DOCX) 3. PowerPoint Presentation (PDF) Agenda Item 21 Item # 21 Page 1 AGENDA ITEM SUMMARY March 7, 2017 City Council STAFF Ginny Sawyer, Policy and Project Manager SUBJECT Items Relating to Short Term Rental Land Use Code and City Code Ordinances. EXECUTIVE SUMMARY A. First Reading of Ordinance No. 044, 2017, Amending the City of Fort Collins Land Use Code Regarding Short Term Rentals. B. First Reading of Ordinance No. 045, 2017, Amending Chapter 15 of the Code of the City of Fort Collins to Add Short Term Rental Licensing Regulations. The purpose of this item is to bring forward a licensing structure and the associated Land Use Code (LUC) changes to regulate short term rental (STR) activity in the City of Fort Collins. These Ordinances together provide regulations that address:  Allowable zones for both primary and non-primary STRs  Grandfathering of existing lawful STRs as nonconforming uses  Parking requirements for STRs  STR safety inspections  Limiting STR licenses to property owners STAFF RECOMMENDATION Staff recommends adoption of the Ordinances on First Reading, followed by a 2-year review to evaluate effectiveness and any needed changes. BACKGROUND / DISCUSSION Short term rentals refer to lodging offered for less than 30 days. The lodging can be a whole house, a private room or space in a house, or shared accommodations. There are numerous online platforms catering to STRs, the most popular being Vacation Rental By Owner (VRBO) and Airbnb. The short term rental phenomenon, like other online/innovative activities, has become widely utilized prior to the creation or adoption of standard regulations. Fort Collins first began discussing STRs over two years ago. In the time since, staff has engaged with residents and Council to seek means to protect and enhance neighborhood livability and the compatibility of STRs with other uses, protect renters of STRs, maintain the availability of residential housing, and ensure proper tax collection while still accommodating a popular and desired use in the community. Proposed Ordinance Highlights Land Use Code (LUC) Changes/additions to the LUC include definitions, zoning limitations, and parking minimums. ATTACHMENT 1 Agenda Item 21 Item # 21 Page 2 Definitions: Primary residence shall mean the dwelling unit in which a person resides for nine or more months of the calendar year. Under this definition, a person has only one primary residence at a time. Short term non-primary rental shall mean a dwelling unit that is not a primary residence and that is leased in its entirety to one party at a time for periods of less than 30 consecutive days. The term party as used in this definition shall mean one or more persons who as a single group rent a short term non- primary rental pursuant to a single reservation and payment. Short term primary rental shall mean a dwelling unit that is a primary residence of which a portion is leased to one party at a time for periods of less than 30 consecutive days. The term party as used in this definition shall mean one or more persons who as a single group rent a short term primary rental pursuant to a single reservation and payment. A carriage house that is not a primary residence is deemed to be a short term primary rental if it is located on a lot containing a primary residence. A dwelling unit of a two-family dwelling that is not a primary residence is deemed to be a short term primary rental if the connected dwelling unit is a primary residence and both dwelling units are located on the same lot. Early on in the outreach process it was clear that residents felt a distinct difference between an owner- occupied STR (primary) and a non-owner occupied (non-primary) STR. These have been defined separately. The definitions also state that a primary STR owner must be a resident at least 9-months of the year and allow for a carriage house or duplex to be considered a primary STR. Zoning Primary STRs are allowed in 20 zones, all of which currently allow bed and breakfast of less than six bedrooms and hotels and motels. (Attachments 1 and 2) Non-primary STRs are limited to13 zones that currently allow hotels, motels, bed and breakfasts of any size. (Attachment 1 and 3) Parking Parking minimums have been set at one off-street parking spot per every two bedrooms rented. Number of Bedrooms Rented Number of Off-Street Parking Spaces 1-2 1 3-4 2 5-6 3 The original proposed exemption for STRs in the Transit-Oriented Development Overlay Zone (TOD) has been removed, consistent with the recommendation by the Planning and Zoning Board. Municipal Code/Licensing The additions to the Municipal Code provide the structure for STR licensing. Highlights include:  All STRs required to have STR license  All are required to have a sales tax license and a lodging tax license and remit appropriate taxes  License must be posted at property and included in all advertising Agenda Item 21 Item # 21 Page 3  All STRs will be inspected to ensure minimum property maintenance standards are met (Attachment 4)  Licenses are $200  Annual renewal is $100  Fee waiver for units providing the following accessibility amenities: No entryway stairs or offer access to a portable ramp. o Interior first/main floor with no stairs. Level access to living, eating, bathroom, and sleeping area. o All doorways on main level must be at least 36 inches wide. o No-step shower or shower bench provided. Grab bars are provided. o Raised toilet seat. o Bed cane/grab bar available for at least one bed in the unit. o Minimal carpeting or rugs throughout unit  Licenses run from January 1 to December 31  Only a property owner may license an STR (no tenants)  Local contact information required The proposed licensing and zoning provisions also include grandfathering for those STRs that may no longer be in an allowed zone. STRs that were operating as STRs, had acquired sales and lodging tax licenses, and remitted all required taxes prior to the adoption of zoning limitations would be allowed to apply for a STR license. Materials provided for the five City Council short term rental work sessions held on June 9, 2015, October 27, 2015, February 23, 2016, July 12, 2016, and January 10, 2017, are available at www.fcgov.com/shorttermrentals/. CITY FINANCIAL IMPACTS The proposed fee structure is set based on consideration for an on-site inspection and 2-3 hours of staff time per application in the first year. In renewal years staff time is expected to drop to 1-2 hours per renewal. For the last two years, sales tax staff has worked to educate and contact residents regarding the need for sales and lodging tax remittance. STR sales and lodging tax remittance from 2014 to current: Sales Tax Lodging Tax Total 2014 $25,667 $19,909 $45,576 2015 $59,552 $45,773 $105,325 2016 $74,045 $56,388 $130,433 Total $159,265 $122,069 $281,334 For the first two years of a licensing program, staff recommends contracting out the address verification and “scrubbing” of web sites for local listings. This process is the most difficult and time-consuming and there are now businesses that have become very efficient in this process. The cost to do this would range from 13-20K annually. BOARD / COMMISSION RECOMMENDATION The Planning and Zoning Board considered the LUC changes at its December 15, 2016 meeting. The Board voted to recommend, with the exception of the TOD parking exemption from the minimum requirements. Staff met with the following boards for outreach purposes: Affordable Housing Board: October 2015, January 2016, November 2016 Human Relations Commission: May 2016 Commission on Disability: February 2016, October 2016 Agenda Item 21 Item # 21 Page 4 PUBLIC OUTREACH The ordinances under consideration were made available to the public on February 7, 2017 through fcgov.com and through direct email to known stakeholders. Prior to January 2017, staff met with individual stakeholder groups, the Visit Fort Collins Board, the Fort Collins Board of Realtors, and hosted three community open houses in 2016. Non-statistically valid online surveys were also conducted, including one targeted to neighbors of licensed STRs. The topic of STRs has been very polarized throughout the community. Since the first outreach STR hosts have wanted some level of regulation and neighbors have expressed a high level of concern about neighborhood quality. The focus of neighbor concerns includes the following:  A desire to classify STR operation as a commercial use not a residential use  General neighborhood impacts such as parking, noise, and lack of understanding of neighborhood norms  A loss of “neighborhood fabric” by not having permanent neighbors who are part of the community The proposed regulations provide a balance between protecting neighborhood quality and allowing this unique opportunity within our community. ATTACHMENTS 1. STR Zoning Matrix (PDF) 2. Zones Proposed to Allow Primary STRs (PDF) 3. Zones Proposed to Allow Non-Primary STRs (PDF) 4. STR Minimum Standards (PDF) 5. Powerpoint presentation (PDF) Proposed Change to Code of the City of Fort Collins Short Term Rental Provisions Regarding Self Certification Instead of City Inspection Sec. 15-632. - Licensing requirements. (a) The following are the minimum requirements that must be satisfied by the applicant for the issuance of a short term primary rental license. (1) The applicant must provide documentation satisfactory to the Financial Officer that the applicant is the owner of the dwelling unit and that the dwelling unit is his or her primary residence. (2) The applicant must have valid sales and use and lodging tax licenses issued pursuant to Chapter 25, Article IV, of the Code of the City of Fort Collins for the dwelling unit to be utilized as a short term primary rental. (3) The dwelling unit must comply with all applicable federal, state, and local laws including, but not limited to, the Code of the City of Fort Collins and Land Use Code, and in particular, Land Use Code § 3.2.2(K)(1)(k) which sets forth applicable parking requirements. (4) The applicant shall certify that the dwelling unit proposed to be licensed as a short term rental The dwelling unit must pass a safety inspection conducted by Community Development and Neighborhood Services. Such inspection shall examine the exterior and interior of the portions of the dwelling unit proposed to be rented to verify compliesance with specific sanitation, mechanical, electrical, structural, and fire safety requirements in Chapter 5 of the Code of the City of Fort Collins and listed in administrative regulations adopted pursuant to § 15-639. The Director may inspect the dwelling unit proposed to be licensed for purposes of verifying compliance with such requirements and refusal by the applicant to allow such inspection shall be grounds for denial of the issuance of a license.The Director may waive the inspection for any dwelling unit that passed a comparable inspection of the areas of the dwelling unit proposed to be rented within the last five years from the date of application for a license. Documentation of such comparable previous inspection satisfactory to the Director must be submitted at the time of application. (5) The applicant must provide proof of liability insurance sufficient to compensate renters for injuries that may be sustained in the dwelling unit proposed to be rented within the coverage limits established in administrative regulations adopted pursuant to § 15-639. (6) No applicant shall be issued a license if marijuana is cultivated or processed, or marijuana products are processed or otherwise produced, in the dwelling unit proposed to be rented. (7) The applicant must identify one or more persons who will be available to respond within four hours at all times during which the dwelling unit is rented to any issues raised by the renter or the City. Any such person must have access to the dwelling unit and be authorized to make decisions regarding the dwelling unit. (8) The dwelling unit must be located in a zone district that allows short term primary rentals as specified in the Land Use Code. Alternatively, the dwelling unit must satisfy the requirements contained in § 15-634 for short term primary rentals established in restricted zone districts prior to March 31, 2017. (9) The applicant must specify which portions of the dwelling unit will constitute the licensed premises available for use by renters. (b) The following are the minimum requirements that must be satisfied by the applicant for the issuance of a short term non-primary rental license. (1) The applicant must provide documentation satisfactory to the Financial Officer that the applicant is the owner of the dwelling unit. (2) The applicant must have valid sales and use and lodging tax licenses issued pursuant to Chapter 25, Article IV, of the Code of the City of Fort Collins for the dwelling unit to be utilized as a short term non-primary rental. (3) The dwelling unit must comply with all applicable federal, state, and local laws including, but not limited to, the Code of the City of Fort Collins and Land Use Code, and in particular, Land Use Code § 3.2.2(K)(1)(k) which sets forth applicable parking requirements. (4) The applicant shall certify that the dwelling unit proposed to be licensed as a short term rental The dwelling unit must pass a safety inspection conducted by Community Development and Neighborhood Services. Such inspection shall examine the exterior and interior of the portions of the dwelling unit proposed to be rented to verify compliesance with specific sanitation, mechanical, electrical, structural, and fire safety requirements in Chapter 5 of the Code of the City of Fort Collins and listed in administrative regulations adopted pursuant to § 15-639. The Director may inspect the dwelling unit proposed to be licensed for purposes of verifying compliance with such requirements and refusal by the applicant to allow such inspection shall be grounds for denial of the issuance of a license.The Director may waive the inspection for any dwelling unit that passed a comparable inspection of the entire dwelling unit within the last five years from the date of application for a license. Documentation of such comparable previous inspection satisfactory to the Director must be submitted at the time of application. (5) The applicant must provide proof of liability insurance sufficient to compensate renters for injuries that may be sustained in the dwelling unit proposed to be rented within the liability coverage limits established in administrative regulations adopted pursuant to § 15-639. (6) No applicant shall be issued a license if marijuana is cultivated or processed, or marijuana products are processed or otherwise produced, in the dwelling unit proposed to be rented. (7) The applicant must identify one or more persons who will be available to respond within four hours at all times during which the dwelling unit is rented to any issues raised by the renter, members of the public, and the City. Any such person must have access to the dwelling unit and be authorized to make decisions regarding the dwelling unit. (8) The dwelling unit must be located in a zone district that allows short term non- primary rentals as specified in the Land Use Code. Alternatively, the dwelling unit must satisfy the requirements contained in § 15-634 for short term non-primary rentals established in restricted zone districts prior to March 31, 2017. Sec. 15-635. - Term of license and renewal. (a) Licenses issued pursuant to this Article shall be valid from the time of issuance through December 31 of the same calendar year. Licenses must be renewed annually and a renewed license shall be valid for an additional period from January 1 through December 31. (b) Renewal applications shall be reviewed by the Financial Officer in consultation with the Director, are subject to § 15-636, § 15-637, and must meet the standards set forth in § 15-632, except that no inspection of the licensed premises shall be required pursuant to § 15-632 unless the Director has reasonable grounds to believe a safety issue exists. (c) Any formally established violation of the provisions of this Article may be considered during the license renewal review and may result in non-renewal. In the Financial Officer’s discretion, after consultation with the Director, the Financial Officer may impose conditions upon a license at the time of renewal to address non-compliance with the terms of the license, the provisions of this Article, or any other applicable provision of federal, state, or local law. Failure to comply with such conditions may result in suspension, revocation, or non-renewal of the license pursuant to § 15-637. Sec. 15-636. - License regulations. Upon issuance of a license pursuant to this Article, the following requirements must be met in order for the license to remain valid. Failure to comply with any of the following regulations may result in revocation, suspension, or non-renewal of the issued license pursuant to § 15-637: (1) The license number shall be prominently displayed in all listing or advertising of the licensed premises for short term rental. (2) A copy of the license shall be prominently displayed in the licensed premises. (3) The licensee shall comply with all applicable Code of the City of Fort Collins and Land Use Code provisions including, but not limited to, the Code of the City of Fort Collins Chapter 5, Buildings and Building Regulations, and the Code of the City of Fort Collins Chapter 20, Nuisances, Chapter 25, Taxation, and Land Use Code 3.2.2(K)(1)(k). (4) The licensee shall maintain compliance with all sanitation, mechanical, electrical, structural, and fire safety requirements that were the subject of the inspection described in § 15-632. License holders not required to undergo an inspection pursuant to § 15-632 because the licensed premises was inspected prior to issuance of a license shall maintain compliance with the same sanitation, mechanical, electrical, structural, and fire safety requirements. (5) The licensee shall ensure that renters of a short term primary rental shall only be allowed access to the portions of the dwelling unit identified in the license. (6) The person(s) identified in § 15-632(a)(7) and § 15-632(b)(7) shall be available at all times during which the licensed premises is rented to respond within four hours, in person if necessary, to any issues raised by the renter or the City. The licensee shall provide each renter and the City with a current telephone number of the person(s) available to respond and each such person must have access to the licensed premises and be authorized to make decisions regarding the licensed premises. (7) The licensee shall maintain insurance as specified in § 15-632 at all times during which the license is valid. (8) The licensee shall prevent the cultivation or processing of marijuana and the processing or production of marijuana products in any dwelling unit utilized as a short term primary or non-primary rental. 1 City Council Regular Meeting March 21, 2017 Short Term Rentals (STRs) ATTACHMENT 3 Regulatory Framework Land Use Code - Parking - Legal Non-Conforming Use - Definitions Municipal Code - Licensing framework 2 Definitions Short term primary rental: A dwelling unit that is a primary residence where a portion is leased to one party at a time. Owners must reside in their primary STR at least 9 months out of the year. • A carriage house or one side of a duplex can be a short term primary rental if it is located on a lot containing a primary residence. Short term non-primary rental: A dwelling unit that is not a primary residence and that is leased in its entirety to one party at a time. Party: One or more people who rent as a single group. 3 Minimum Parking Requirements Minimum off-street parking: 4 Number of Bedrooms Rented Number of Off-Street Parking 1-2 1 3-4 2 5-6 3 5 Primary STR Zoning • Urban estate (UE) • Low Density Mixed-Use Neighborhood (LMN) • Medium Density Mixed-Use Neighborhood (MMN) • High Density Mixed-Use Neighborhood (HMN) • Neighborhood Conservation, Medium Density (NCM) • Neighborhood Conservation, Buffer (NCB) • Downtown - Old City Center (DOC) • Downtown - Canyon Avenue (DCA) • Downtown - Civic Center (DCC) • River Downtown Redevelopment (RDR) • Community Commercial (CC) • Community Commercial - North College (CCN) • Community Commercial - River (CCR) • General Commercial (CG) • General Commercial - I-25/SH 392 Corridor Activity Center (cac CG) • Service Commercial (CS) • Limited Commercial (CL) • Harmony Corridor (HC) • Employment (E) • Industrial (I) 6 Non-Primary STR • Downtown - Old City Center (DOC) • Downtown - Canyon Avenue (DCA) • Downtown - Civic Center (DCC) • River Downtown Redevelopment (RDR) • Community Commercial (CC) • Community Commercial - North College (CCN) • Community Commercial - River (CCR) • General Commercial (CG) • General Commercial - I-25/SH 392 Corridor Activity Center (cac CG) • Service Commercial (CS) • Limited Commercial (CL) • Harmony Corridor (HC) • Employment (E) Licensing STR License: • Licenses- $200 non-refundable and non-transferrable. • Annual renewal $100. • License is for the person not the property. • License is non-transferrable and revocable. • License posted at property and number required to be included on all advertising. 7 Licensing Requirements:  Sales and lodging tax licenses and remittance of all applicable taxes.  A one-time inspection. • Exterior, Interior, Sanitation, Mechanical, Electrical, Fire Safety • Can be waived if proof of recent inspection  Waiving of fee for more handicap accessible STRs  License must include name of local contact 8 Existing STRs STRs in a non-allowable zone that have obtained sales and lodging tax licenses and have collected all required taxes prior to licensing being required (3/21 or 3/31) may apply for a STR license by June 30, 2017. 9 Grandfathering Second Reading  Adding consistent language on “rent -back” situations  Prepared to address self-certifying safety inspections  Need to clarify grandfathering date • Ordinance adoption-March 21 • Ordinance effective date-March 31  Striking language in Sec. 15-634 referencing: “…during all times the dwelling unit was rented…” 10 11 City Council Regular Meeting March 21, 2017 Short Term Rentals (STRs) -1- ORDINANCE NO. 044, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING THE CITY OF FORT COLLINS LAND USE CODE REGARDING SHORT TERM RENTALS WHEREAS, on December 2, 1997, by its adoption of Ordinance No. 190, 1997, the City Council enacted the Fort Collins Land Use Code (the "Land Use Code"); and WHEREAS, at the time of the adoption of the Land Use Code, it was the understanding of staff and the City Council that the Land Use Code would most likely be subject to future amendments, not only for the purpose of clarification and correction of errors, but also for the purpose of ensuring that the Land Use Code remains a dynamic document capable of responding to issues identified by staff, other land use professionals and citizens of the City; and WHEREAS, the renting of dwelling units for periods of less than thirty days (“Short Term Rental” or “Short Term Rentals”) is an ongoing activity in the City that has been permitted to date as an allowable residential use pursuant to the Land Use Code conditioned upon the person conducting the rental obtaining appropriate City sales and use and lodging tax licenses; and WHEREAS, in response to community concerns regarding Short Term Rentals, Council at its June 9, 2015, work session directed City staff to investigate and conduct public outreach regarding Short Term Rentals; and WHEREAS, Council conducted four subsequent work session on October 27, 2015, February 23, 2016, July 26, 2016, and January 10, 2016, during which Council evaluated and provided feedback on City staff research into Short Term Rentals within the City and in other jurisdictions, proposals for Short Term Rental regulations, and the results of public outreach; and WHEREAS, City staff has conducted extensive public outreach since 2015 regarding proposed regulation of Short Term Rentals including community open houses, online surveys, and outreach to the Visit Fort Collins Board and the Fort Collins Board of Realtors; and WHEREAS, City staff conducted outreach with the Fort Collins Affordable Housing Board regarding Short Term Rentals in October 2015, January 2016, and November 2016; and WHEREAS, City staff conducted outreach with the Fort Collins Human Relations Commission regarding Short Term Rentals in May 2016; and WHEREAS, City staff conducted outreach with the Fort Collins Commission on Disability regarding Short Term Rentals in February and October 2016; and WHEREAS, the Fort Collins Planning and Zoning Board at its December 15, 2016, regular meeting considered the proposed Land Use Code changes regarding Short Term Rentals and recommended adoption of the changes with the exception of the proposed parking requirement exception for Short Term Rentals located within the Transit Overlay District; and -2- WHEREAS, public outreach showed both support and concern for Short Term Rentals; and WHEREAS, the City wishes to protect neighborhoods while accommodating an existing and desired activity; and WHEREAS, by utilizing existing zoning code provisions and applying additional requirements on Short Term Rental activities, neighbors, renters, and traditional lodging establishments can all be protected from unregulated activity; and WHEREAS, limiting Short Term Rental activity by zone, inspecting properties, requiring minimum parking, and tax remittance will address concerns and provide a framework for Short Term Rental activity without jeopardizing neighborhood quality; and WHEREAS, in addition to input from the public presented to Council by City staff, Council has received extensive direct public input, in the form of correspondence and public comment at Council meetings, both in opposition to, and in support of, the adoption of Short Term Rental regulations; and WHEREAS, the changes to the Land Use Code set forth in this Ordinance are the result of the extensive research, public outreach, and discussion described above, and the public hearing process associated with adoption of this Ordinance; and WHEREAS, pursuant to Colorado Revised Statute §31-23-301, the City has been specifically granted the power to regulate the use of buildings for trade, industry, residence, or other purposes for the purposes of promoting health, safety, morals, or the general welfare of the community; and WHEREAS, Council is concurrently considering Short Term Rental licensing regulations for adoption into the Code of the City of Fort Collins and the requirement for licensing is incorporated into the Land Use Code amendments set forth in this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That based upon the information the City Council has received relevant to its consideration of the Land Use Code amendments set forth herein from work sessions, discussions with City staff, written and oral comments submitted by members of the public, and information and discussion during the public hearing process associated with adoption of this Ordinance, the Council makes the following additional determinations and findings: A. Short Term Rentals provide financial benefits to owners of such rentals and benefits to renters in the form of amenities and location. -3- B. Short Term Rentals could impact the neighborhoods in which they are located with respect to parking, noise, and neighborhood livability regarding persons from outside a neighborhood transiently visiting. C. Owners who occupy Short Term Rentals as their principal residences can provide greater oversight and accountability during periods rentals are occurring as opposed to Short Term Rentals not occupied by their owners as principal residences. D. Additional oversight of Short Term Rentals will help to ensure the health and safety of renters, and management of impacts to the surrounding neighborhood. Section 3. That the Land Use Code changes adopted herein are necessary to address the impacts of Short Term Rentals while at the same time recognizing the benefits of Short Term Rentals and reasonably allowing Short Term Rentals to continue operating with certain restrictions. The Land Use Code changes adopted herein are in the best interests of the citizens of Fort Collins and are adopted for the purposes of promoting the health, safety, morals, and general welfare of the community. Section 4. That Section 3.2.2(K)(1) of the Land Use Code is hereby amended by the addition of a new subsection (k) which reads in its entirety as follows: (k) Short term non-primary rentals and short term primary rentals: The minimum number of off-street parking spaces required are as follows: Number of Bedrooms Rented Number of Off-Street Parking Spaces 1-2 1 3-4 2 5-6 3 The number of additional off-street parking spaces required for more than six bedrooms rented shall be calculated in the same manner used in the above chart (e.g. 7-8 bedrooms rented requires 4 off-street parking spaces). Short term rentals licensed pursuant to the Code of the City of Fort Collins § 15-634 and for which the license application was submitted prior to June 30, 2017, are exempt from compliance with these parking requirements so long as such license remains continuously valid. Subsequent licenses issued pursuant to § 15-634 shall comply with these parking requirements. Section 5. That Section 3.8.3(10) of the Land Use Code is hereby amended to read as follows: 3.8.3 - Home Occupations A home occupation shall be allowed as a permitted accessory use, provided that all of the following conditions are met: -4- . . . (10) A home occupation shall not be interpreted to include the following: (j) short term primary rentals and short term non-primary rentals. . . . Section 6. That Division 3.8 of the Land Use Code is hereby amended by the addition of a new subsection 3.8.34 which reads in its entirety as follows: 3.8.34 - Short Term Rentals (A) Applicability. These standards apply to short term primary rentals and short term non-primary rentals. (B) Purpose. The purposes of these standards are to mitigate the impacts of short term rentals on the neighborhoods in which they are located, to maintain and enhance neighborhood livability, to ensure the health and safety of renters of short term rentals, and to ensure the compatibility of short term rentals with the allowed uses in the applicable zone districts. (C) Location. Subject to subsection (F) below, the allowable locations of short term primary and non-primary rentals are determined by the zone districts and their respective list of permitted uses as described in Article Four. (D) Off-street Parking. Refer to § 3.2.2(K)(1)(k) for minimum off-street parking space requirements. (E) Licensing. The licensing of short term rentals is governed by the Code of the City of Fort Collins Chapter 15, Article XVIII. No dwelling unit shall be used as a short term primary rental or short term non-primary rental unless a license is first obtained pursuant to Chapter 15, Article XVIII. (F) Nonconforming Use. A dwelling unit utilized as a short term primary or non- primary rental that is located in a zone district where such use is prohibited, and such short term rental was a lawful use as defined in (3) below prior to March 31, 2017, is considered a nonconforming use. Such nonconforming use shall correspond to the type of short term rental conducted, either primary or non- primary, prior to the above date. (1) In addition to complying with the nonconforming use regulations in Land Use Code Division 1.5, the owner of the dwelling unit must obtain a license pursuant to the Code of the City of Fort Collins § 15-634 and continuously maintain such license to maintain nonconforming use status. Failure to apply for such license by June 30, 2017, shall be considered abandonment of the nonconforming use. Should such license be revoked, -5- not be renewed, or lapse for any period of time, the nonconforming short term rental use shall be considered abandoned or otherwise terminated. (2) Should ownership of a dwelling unit licensed pursuant to § 15-634 be transferred, and such license was continuously valid until the transfer of ownership, the new owner must comply with the following in order to continue the nonconforming use: (1) apply for a license pursuant to § 15- 634 within thirty days of the transfer of ownership; (2) comply with the parking requirements contained in § 3.2.2(K)(1)(k) of this Code; and (3) continuously maintain any license issued pursuant to § 15-634. Should any license issued to the new owner be revoked, not be renewed, or lapse for any period of time, the nonconforming short term rental use shall be considered abandoned or otherwise terminated. (3) To be considered a lawful use, a dwelling unit must have, prior to March 31, 2017, been actually utilized as a short term primary or non-primary rental pursuant to valid sales and use and lodging tax licenses issued for such dwelling unit in accordance with Chapter 25, Art. IV, of the Code of the City of Fort Collins, during all times the dwelling unit was rented as a short term primary or non-primary rental. Section 7. That Section 4.2(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 2 which reads in its entirety as follows: (e) Residential Uses: . . . 2. Short term primary rentals. Section 8. That Section 4.5(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 2 which reads in its entirety as follows: (e) Residential Uses: . . . 2. Short term primary rentals. Section 9. That Section 4.6(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary rentals. -6- Section 10. That Section 4.8(B)(1)(a) of the Land Use Code is hereby amended by the addition of a new subparagraph 4 which reads in its entirety as follows: (a) Residential Uses: . . . 4. Short term primary rentals. Section 11. That Section 4.9(B)(1)(a) of the Land Use Code is hereby amended by the addition of a new subparagraph 7 which reads in its entirety as follows: (a) Residential Uses: . . . 7. Short term primary rentals. Section 12. That Section 4.10(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary rentals. Section 13. That the table contained in Section 4.16(B)(2)A of the Land Use Code is hereby amended to read as follows: Land Use Old City Center Canyon Avenue Civic Center A. RESIDENTIAL . . . . . . . . . . . . Short term primary and non-primary rentals BDR BDR BDR -7- . . . . . . . . . . . . Section 14. That Section 4.17(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary and non-primary rentals. Section 15. That Section 4.18(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary and non-primary rentals. Section 16. That Section 4.19(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary and non-primary rentals. Section 17. That Section 4.20(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary and non-primary rentals. Section 18. That the table contained in Section 4.21(B)(2) of the Land Use Code is hereby amended to read as follows: -8- Land Use I-25/SH 392 (CAC) General Commercial District (C-G) A. RESIDENTIAL . . . . . . . . . Short term primary and non-primary rentals BDR BDR . . . . . . . . . Section 19. That Section 4.22(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 2 which reads in its entirety as follows: (e) Residential Uses: . . . 2. Short term primary and non-primary rentals. Section 20. That the table contained in Section 4.24(B)(2) of the Land Use Code is hereby amended to read as follows: Land Use Riverside Area All Other Areas A. RESIDENTIAL . . . . . . . . . Short term primary and non-primary rentals BDR BDR -9- . . . . . . . . . Section 21. That Section 4.26(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 2 which reads in its entirety as follows: (e) Residential Uses: . . . 2. Short term primary and non-primary rentals. Section 22. That Section 4.27(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 3 which reads in its entirety as follows: (e) Residential Uses: . . . 3. Short term primary and non-primary rentals. Section 23. That Section 4.28(B)(1)(e) of the Land Use Code is hereby amended by the addition of a new subparagraph 2 which reads in its entirety as follows: (e) Residential Uses: . . . 2. Short term primary rentals. Section 24. That the definition “Bed and breakfast” contained in Section 5.1.2 of the Land Use Code is hereby amended to read as follows: Bed and breakfast shall mean an establishment operated in a private residence or portion thereof, that provides temporary accommodations for a fee to overnight guests, a morning meal limited to guests only, and that is occupied by the operator of such establishment. A bed and breakfast may provide accommodations to individuals or multiple separate parties concurrently on both a reservation and walk-in basis. The term party as used in this definition shall mean one or more persons who stay at a bed and breakfast as a single group pursuant to a single reservation and payment. Section 25. That the definition “Dwelling” contained in Section 5.1.2 of the Land Use Code is hereby amended to read as follows: -10- Dwelling shall mean a building used exclusively for residential occupancy and for permitted accessory uses, including single family dwellings, two-family dwellings, and multi-family dwellings, and short term primary and non-primary rentals. The term dwelling shall not include hotels, motels, homeless shelters, seasonal overflow shelters, tents or other structures designed or used primarily for temporary occupancy with the exception of short term primary and non-primary rentals. Any dwelling shall be deemed to be a principle building. Section 26. That the definition of “Hotel/motel/lodging establishment” contained in Section 5.1.2 of the Land Use Code is hereby amended to read as follows: Hotel/motel/lodging establishment shall mean a building intended and used for occupancy as a temporary abode for individuals who are lodged with or without meals, in which there are five (5) or more guest rooms. The terms hotel/motel/lodging establishment shall not include homeless shelters, seasonal overflow shelters, and short term primary and non-primary rentals. Section 27. That Section 5.1.2 of the Land Use Code is hereby amended by the addition of three new definitions which read in their entirety as follows: Primary residence shall mean the dwelling unit in which a person resides for nine or more months of the calendar year. Under this definition, a person has only one primary residence at a time. Short term non-primary rental shall mean a dwelling unit that is not a primary residence and that is leased in its entirety to one party at a time for periods of less than 30 consecutive days. The term party as used in this definition shall mean one or more persons who as a single group rent a short term non-primary rental pursuant to a single reservation and payment. The term short term non-primary rental shall not include the rental of a dwelling unit to the former owner immediately following the transfer of ownership of such dwelling unit and prior to the former owner vacating the dwelling unit. Short term non-primary rental is a distinct use from short term primary rental under the Land Use Code. Short term primary rental shall mean a dwelling unit that is a primary residence of which a portion is leased to one party at a time for periods of less than 30 consecutive days. The term party as used in this definition shall mean one or more persons who as a single group rent a short term primary rental pursuant to a single reservation and payment. A carriage house that is not a primary residence is deemed to be a short term primary rental if it is located on a lot containing a primary residence. A dwelling unit of a two-family dwelling that is not a primary residence is deemed to be a short term primary rental if the connected dwelling unit is a primary residence and both dwelling units are located on the same lot. The term short term primary rental shall not include the rental of a dwelling unit to the former owner immediately following the transfer of ownership of such dwelling unit and prior to the former owner vacating the dwelling unit. Short term -11- primary rental is a distinct use from short term non-primary rental under the Land Use Code. Introduced, considered favorably on first reading, and ordered published this 7th day of March, A.D. 2017, and to be presented for final passage on the 21st day of March, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk Passed and adopted on final reading on the 21st day of March, A.D. 2017. __________________________________ Mayor ATTEST: _______________________________ City Clerk -1- ORDINANCE NO. 045, 2017 OF THE COUNCIL OF THE CITY OF FORT COLLINS AMENDING CHAPTER 15 OF THE CODE OF THE CITY OF FORT COLLINS TO ADD SHORT TERM RENTAL LICENSING REGULATIONS WHEREAS, the renting of dwelling units for periods of less than thirty days (“Short Term Rental” or “Short Term Rentals”) is an ongoing activity in the City requiring owners of Short Term Rentals to obtain City sales and use and lodging tax licenses; and WHEREAS, in response to community concerns regarding Short Term Rentals, Council at its June 9, 2015, work session directed City staff to investigate and conduct public outreach regarding Short Term Rentals; and WHEREAS, City Council conducted four subsequent work session on October 27, 2015, February 23, 2016, July 26, 2016, and January 10, 2016, during which Council evaluated and provided feedback on City staff research into Short Term Rentals within the City and in other jurisdictions, proposals for Short Term Rental regulations, and the results of public outreach; and WHEREAS, City staff has conducted extensive public outreach since 2015 regarding proposed regulation of Short Term Rentals including community open houses, online surveys, and outreach to the Visit Fort Collins Board and the Fort Collins Board of Realtors; and WHEREAS, City staff conducted outreach with the Fort Collins Affordable Housing Board regarding Short Term Rentals in October 2015, January 2016, and November 2016; and WHEREAS, City staff conducted outreach with the Fort Collins Human Relations Commission regarding Short Term Rentals in May 2016; and WHEREAS, City staff conducted outreach with the Fort Collins Commission on Disability regarding Short Term Rentals in February and October 2016; and WHEREAS, public outreach showed both support and concern for Short Term Rentals; and WHEREAS, the City wishes to protect neighborhoods while accommodating an existing and desired activity; and WHEREAS, by utilizing existing zoning code provisions and applying additional requirements on Short Term Rental activities, neighbors, renters, and traditional lodging establishments can all be protected from unregulated activity; and WHEREAS, limiting Short Term Rental activity by zone, inspecting properties, requiring minimum parking, and tax remittance will address concerns and provide a framework for Short Term Rental activity without jeopardizing neighborhood quality; and -2- WHEREAS, in addition to input from the public presented to City Council by City staff, Council has received extensive direct public input, in the form of correspondence and public comment at Council meetings, both in opposition to, and in support of, the adoption of Short Term Rental regulations; and WHEREAS, the changes set forth in this Ordinance to Chapter 15 of the City Code to require licensing of Short Term Rentals are the result of the extensive research, public outreach, and discussion described above, and the public hearing process associated with adoption of this Ordinance; and WHEREAS, City Council is concurrently considering amendments to the City of Fort Collins Land Use Code regarding land use regulation of Short Term Rentals and such regulations incorporate the requirement for licensing as set forth in this Ordinance. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That based upon the information the City Council has received relevant to its consideration of the City Code amendments set forth herein from work sessions, discussions with City staff, written and oral comments submitted by members of the public, and information and discussion during the public hearing process associated with adoption of this Ordinance, the Council makes the following additional determinations and findings: A. Short Term Rentals provide financial benefits to owners of such rentals and benefits to renters in the form of amenities and location. B. Additional oversight of Short Term Rentals through licensing will help to ensure the health and safety of renters. C. Licensing promotes a fair operating environment for traditional providers of lodging and transient accommodation by providing an additional measure to ensure sales and use and lodging taxes are remitted pursuant to City Code Chapter 25. D. Licensing facilitates ongoing data collection to further evaluate the impacts and benefits of Short Term Rentals. E. Short Term Rentals could impact the neighborhoods in which they are located with respect to parking, noise, and neighborhood livability regarding persons from outside a neighborhood transiently visiting. F. Owners who occupy Short Term Rentals as their principal residences can provide greater oversight and accountability during periods rentals are occurring as opposed to Short Term Rentals not occupied by their owners as principal residences. -3- Section 3. That the City Code changes adopted herein are necessary to address the impacts of Short Term Rentals while at the same time recognizing the benefits of Short Term Rentals and reasonably allowing Short Term Rentals to continue operating with certain restrictions. The City Code changes adopted herein are in the best interests of the citizens of Fort Collins and are adopted for the purposes of promoting the health, safety, morals, and general welfare of the community. Section 4. That Chapter 15 of the Code of the City of Fort Collins is hereby amended by the addition of a new Article XVIII which reads in its entirety as follows: ARTICLE XVIII. SHORT TERM RENTAL LICENSING Sec. 15-628. - Purpose. The local licensing system implemented pursuant to this Article ensures the health and safety of renters of short term rentals, mitigates the impacts of short term rentals on the neighborhoods in which they are located, and maintains and enhances neighborhood livability. The system of licensing promotes a fair operating environment for all persons in the business of providing lodging or transient accommodation. The system of licensing also allows for ongoing data collection to further evaluate the impact of short term rentals on the neighborhoods in which they are located and on affordable housing. Sec. 15-629. - Definitions. The following definitions shall apply to this Article: Director shall mean the Director of Community Development and Neighborhood Services. Dwelling unit shall mean one (1) or more rooms and a single kitchen and at least one (1) bathroom, designed, occupied or intended for occupancy as separate quarters for the exclusive use of a single family for living, cooking and sanitary purposes, located in a single-family, two-family or multi-family dwelling or mixed-use building as such terms are defined in the Land Use Code. Financial Officer shall mean the Financial Officer of the City of Fort Collins referenced in Article V, Part III, § 21, of the City of Fort Collins Charter. Licensed premises shall mean a dwelling unit, or portion thereof, that has a valid license issued pursuant to this Article allowing short term primary or non-primary rental of such dwelling unit. Party shall mean one or more persons who as a single group rent a short term primary or non- primary rental pursuant to a single reservation and payment. -4- Primary residence shall mean the dwelling unit in which a person resides for nine or more months of the calendar year. Under this definition, a person has only one primary residence at a time. Short term non-primary rental shall mean a dwelling unit that is not a primary residence and that is leased in its entirety to one party at a time for periods of less than 30 consecutive days. The term short term non-primary rental shall not include the rental of a dwelling unit to the former owner immediately following the transfer of ownership of such dwelling unit and prior to the former owner vacating the dwelling unit. Short term primary rental shall mean a dwelling unit that is a primary residence of which a portion is leased to one party at a time for periods of less than 30 consecutive days. A carriage house, as defined in the Land Use Code, that is not a primary residence is deemed to be a short term primary rental and may be licensed as a short term primary rental if it is located on a lot containing a primary residence. A dwelling unit of a two-family dwelling, as defined in the Land Use Code, that is not a primary residence is deemed to be a short term primary rental and may be licensed as a short term primary rental if the connected dwelling unit is a primary residence and both dwelling units are located on the same lot. The term short term primary rental shall not include the rental of a dwelling unit to the former owner immediately following the transfer of ownership of such dwelling unit and prior to the former owner vacating the dwelling unit. Sec. 15-630. - License required. No dwelling unit may be utilized as a short term primary rental or short term non-primary rental within the City unless a license to rent such dwelling unit has been first issued as provided in this Article. Sec. 15-631. - Application for license. (a) A license to utilize a particular dwelling unit as a short term primary rental or short term non-primary rental may be granted in the discretion of the Financial Officer if he or she determines that the applicant and the premises proposed to be licensed meet the requirements of this Article. (b) The Financial Officer may require additional information and documentation as may be necessary to determine whether an application meets the requirements of this Article. (c) The applicant shall self-certify that the information on the application is accurate and truthful under penalty of perjury under the laws of the State of Colorado. (d) At the time of an initial or renewal application for a license, each applicant shall pay a fee set by the City Manager pursuant to his or her authority to establish administrative fees as set forth in Chapter 7.5 of this Code. The application fee may be refunded at the discretion of the Financial Officer if the applicant demonstrates that the dwelling unit proposed to be licensed has certain modifications that make it more accessible and accommodating to people with -5- disabilities. The modifications required for a refund shall be established in administrative regulations adopted pursuant to § 15-639. Sec. 15-632. - Licensing requirements. (a) The following are the minimum requirements that must be satisfied by the applicant for the issuance of a short term primary rental license. (1) The applicant must provide documentation satisfactory to the Financial Officer that the applicant is the owner of the dwelling unit and that the dwelling unit is his or her primary residence. (2) The applicant must have valid sales and use and lodging tax licenses issued pursuant to Chapter 25, Article IV, of the Code of the City of Fort Collins for the dwelling unit to be utilized as a short term primary rental. (3) The dwelling unit must comply with all applicable federal, state, and local laws including, but not limited to, the Code of the City of Fort Collins and Land Use Code, and in particular, Land Use Code § 3.2.2(K)(1)(k) which sets forth applicable parking requirements. (4) The dwelling unit must pass a safety inspection conducted by Community Development and Neighborhood Services. Such inspection shall examine the exterior and interior of the portions of the dwelling unit proposed to be rented to verify compliance with specific sanitation, mechanical, electrical, structural, and fire safety requirements in Chapter 5 of the Code of the City of Fort Collins and listed in administrative regulations adopted pursuant to § 15-639. The Director may waive the inspection for any dwelling unit that passed a comparable inspection of the areas of the dwelling unit proposed to be rented within the last five years from the date of application for a license. Documentation of such comparable previous inspection satisfactory to the Director must be submitted at the time of application. (5) The applicant must provide proof of liability insurance sufficient to compensate renters for injuries that may be sustained in the dwelling unit proposed to be rented within the coverage limits established in administrative regulations adopted pursuant to § 15-639. (6) No applicant shall be issued a license if marijuana is cultivated or processed, or marijuana products are processed or otherwise produced, in the dwelling unit proposed to be rented. (7) The applicant must identify one or more persons who will be available to respond within four hours at all times during which the dwelling unit is rented to any issues raised by the renter or the City. Any such person must have access to the dwelling unit and be authorized to make decisions regarding the dwelling unit. -6- (8) The dwelling unit must be located in a zone district that allows short term primary rentals as specified in the Land Use Code. Alternatively, the dwelling unit must satisfy the requirements contained in § 15-634 for short term primary rentals established in restricted zone districts prior to March 31, 2017. (9) The applicant must specify which portions of the dwelling unit will constitute the licensed premises available for use by renters. (b) The following are the minimum requirements that must be satisfied by the applicant for the issuance of a short term non-primary rental license. (1) The applicant must provide documentation satisfactory to the Financial Officer that the applicant is the owner of the dwelling unit. (2) The applicant must have valid sales and use and lodging tax licenses issued pursuant to Chapter 25, Article IV, of the Code of the City of Fort Collins for the dwelling unit to be utilized as a short term non-primary rental. (3) The dwelling unit must comply with all applicable federal, state, and local laws including, but not limited to, the Code of the City of Fort Collins and Land Use Code, and in particular, Land Use Code § 3.2.2(K)(1)(k) which sets forth applicable parking requirements. (4) The dwelling unit must pass a safety inspection conducted by Community Development and Neighborhood Services. Such inspection shall examine the exterior and interior of the portions of the dwelling unit proposed to be rented to verify compliance with specific sanitation, mechanical, electrical, structural, and fire safety requirements in Chapter 5 of the Code of the City of Fort Collins and listed in administrative regulations adopted pursuant to § 15-639. The Director may waive the inspection for any dwelling unit that passed a comparable inspection of the entire dwelling unit within the last five years from the date of application for a license. Documentation of such comparable previous inspection satisfactory to the Director must be submitted at the time of application. (5) The applicant must provide proof of liability insurance sufficient to compensate renters for injuries that may be sustained in the dwelling unit proposed to be rented within the liability coverage limits established in administrative regulations adopted pursuant to § 15-639. (6) No applicant shall be issued a license if marijuana is cultivated or processed, or marijuana products are processed or otherwise produced, in the dwelling unit proposed to be rented. (7) The applicant must identify one or more persons who will be available to respond within four hours at all times during which the dwelling unit is rented to any issues raised -7- by the renter, members of the public, and or the City. Any such person must have access to the dwelling unit and be authorized to make decisions regarding the dwelling unit. (8) The dwelling unit must be located in a zone district that allows short term non- primary rentals as specified in the Land Use Code. Alternatively, the dwelling unit must satisfy the requirements contained in § 15-634 for short term non-primary rentals established in restricted zone districts prior to March 31, 2017. Sec. 15-633. - Issuance of licenses. Upon compliance with the requirements of this Article, the Financial Officer shall issue a license to the applicant authorizing the short term rental of the licensed premises. The license issued shall allow only the short term primary rental or the short term non-primary rental of the licensed premises. Licenses issued for short term primary rentals shall specify the areas of the dwelling unit that may be rented. Each license shall be applicable to a single dwelling unit and no license issued shall be transferable. A license shall terminate upon transfer of ownership of the licensed premises. Sec. 15-634. - Licensing of short term primary and non-primary rentals existing prior to Land Use Code restrictions. (a) A dwelling unit used as a short term primary or non-primary rental that is located in a zone district in which the Land Use Code prohibits such use is eligible for a license pursuant to this Article provided that prior to March 31, 2017, such dwelling unit was actually utilized as a short term primary or non-primary rental pursuant to valid sales and use and lodging tax licenses issued for such dwelling unit in accordance with Chapter 25, Art. IV, of the Code of the City of Fort Collins, during all times the dwelling unit was rented as a short term primary or non- primary rental. (b) In addition to satisfying (a) above, the applicant must satisfy the requirements set forth in § 15-632 in order to be eligible for a license. License applications submitted pursuant to this Section on or before June 30, 2017, do not need to comply with the parking requirements in Land Use Code § 3.2.2(K)(1). (c) In order to be eligible for a license pursuant to this Section, subject to (e) below, the applicant must submit an application for a license pursuant to this Article on or before June 30, 2017. No application submitted after June 30, 2017, shall be eligible for a license pursuant to this Section unless submitted pursuant to (e) below. (d) Any license issued pursuant to this Section shall expire at such time that the ownership of the licensed premises changes. Should a license issued under this Section be revoked, not be renewed, or lapse for any period of time, the owner shall no longer be eligible for a license for such dwelling unit pursuant to this Section. (e) Should ownership of a dwelling unit licensed pursuant to § 15-634 be transferred, and such license was continuously valid until the transfer of ownership, the new owner is eligible for -8- a license identical in scope to the previously issued license provided: (1) the new owner applies for a license within thirty days of the transfer of ownership; (2) the dwelling unit complies with the parking requirements in Land Use Code Section 3.2.2(K)(1)(k); and (3) any license issued pursuant to § 15-634 is continuously maintained. Should a license issued to the new owner under this Section be revoked, not be renewed, or lapse for any period of time, the new owner shall no longer be eligible for a license for such dwelling unit pursuant to this Section. Sec. 15-635. - Term of license and renewal. (a) Licenses issued pursuant to this Article shall be valid from the time of issuance through December 31 of the same calendar year. Licenses must be renewed annually and a renewed license shall be valid for an additional period from January 1 through December 31. (b) Renewal applications shall be reviewed by the Financial Officer in consultation with the Director, are subject to § 15-636, § 15-637, and must meet the standards set forth in § 15-632, except that no inspection of the licensed premises shall be required pursuant to § 15-632 unless the Director has reasonable grounds to believe a safety issue exists. (c) Any formally established violation of the provisions of this Article may be considered during the license renewal review and may result in non-renewal. In the Financial Officer’s discretion, after consultation with the Director, the Financial Officer may impose conditions upon a license at the time of renewal to address non-compliance with the terms of the license, the provisions of this Article, or any other applicable provision of federal, state, or local law. Failure to comply with such conditions may result in suspension, revocation, or non-renewal of the license pursuant to § 15-637. Sec. 15-636. - License regulations. Upon issuance of a license pursuant to this Article, the following requirements must be met in order for the license to remain valid. Failure to comply with any of the following regulations may result in revocation, suspension, or non-renewal of the issued license pursuant to § 15-637: (1) The license number shall be prominently displayed in all listing or advertising of the licensed premises for short term rental. (2) A copy of the license shall be prominently displayed in the licensed premises. (3) The licensee shall comply with all applicable Code of the City of Fort Collins and Land Use Code provisions including, but not limited to, the Code of the City of Fort Collins Chapter 5, Buildings and Building Regulations, and the Code of the City of Fort Collins Chapter 20, Nuisances, Chapter 25, Taxation, and Land Use Code 3.2.2(K)(1)(k). (4) The licensee shall maintain compliance with all sanitation, mechanical, electrical, structural, and fire safety requirements that were the subject of the inspection described in § 15-632. License holders not required to undergo an inspection pursuant to § 15-632 because the licensed premises was inspected prior to issuance of a license shall maintain -9- compliance with the same sanitation, mechanical, electrical, structural, and fire safety requirements. (5) The licensee shall ensure that renters of a short term primary rental shall only be allowed access to the portions of the dwelling unit identified in the license. (6) The person(s) identified in § 15-632(a)(7) and § 15-632(b)(7) shall be available at all times during which the licensed premises is rented to respond within four hours, in person if necessary, to any issues raised by the renter or the City. The licensee shall provide each renter and the City with a current telephone number of the person(s) available to respond and each such person must have access to the licensed premises and be authorized to make decisions regarding the licensed premises. (7) The licensee shall maintain insurance as specified in § 15-632 at all times during which the license is valid. (8) The licensee shall prevent the cultivation or processing of marijuana and the processing or production of marijuana products in any dwelling unit utilized as a short term primary or non-primary rental. Sec. 15-637. - Suspension, revocation, nonrenewal of license. (a) The Director may suspend, revoke, or not renew any license issued pursuant to this Article if the Director determines that any of the following have occurred: (1) Fraud, material misrepresentation or false statement in the initial application for the license or any renewal application; (2) Failure to obtain a sales and use tax license and lodging tax license or failure to remit taxes pursuant to Chapter 25, Art. IV, of the Code of the City of Fort Collins; (3) Failure to comply with the terms of the license, the provisions of this Article, or any other applicable provision of federal, state, or local law including, but not limited to, the Code of the City of Fort Collins and Land Use Code. (4) Failure to comply with conditions imposed on any license pursuant to § 15- 635(c) and § 15-637(b). (b) In the Financial Officer’s discretion, after consultation with the Director, the Financial Officer may impose conditions upon a suspended license to address non-compliance with the terms of the license, the provisions of this Article, or any other applicable provision of federal, state, or local law. Upon satisfaction of such conditions, the license shall be reinstated. Failure to comply with such conditions shall result in continued suspension or revocation. (c) Upon revocation of a license, the dwelling unit described in the license is ineligible to receive another license pursuant to this Article for one year from the date of revocation. -10- (d) All licensed premises shall be subject to inspection by the Director for the purpose of investigating and determining compliance with the requirements for any license issued under this Article. Where any part of the licensed premises consists of a locked area, such area shall be made available for inspection as provided hereunder, without delay, upon request. Sec. 15-638. - Violations and penalties. In addition to the suspension, revocation or refusal to renew any license issued hereunder, any licensee who violates any provision of this Article may be punished by a fine or imprisonment or both, in accordance with the Code of the City of Fort Collins § 1-15. Additionally, the City may take any other legal action available to address violations of the provisions of this Article. Sec. 15-639. - Administration. The Financial Officer and Director shall administer the provisions of this Article and are authorized to jointly promulgate rules and regulations for its administration and implementation. Sec. 15-640. - Appeal. An applicant or licensee may appeal any decision whether to grant, renew, suspend, or revoke his or her application or license to the City Manager in accordance with Chapter 2, Article VI of the Code of the City of Fort Collins. The City Manager's decision shall be final. Sec. 15-641. - Severability. If any section, sentence, clause, phrase, word or other provision of this Article is for any reason held to be unconstitutional or otherwise invalid, such holding shall not affect the validity of the remaining sections, sentences, clauses, phrases, words or other provisions of this Article or the validity of this Article as an entirety, it being the legislative intent that this Article shall stand, notwithstanding the invalidity of any section, sentence, clause, phrase, word or other provision. Sec. 15-643 - 15-660 - Reserved Introduced, considered favorably on first reading, and ordered published this 7th day of March, A.D. 2017, and to be presented for final passage on the 21st day of March, A.D. 2017. __________________________________ Mayor ATTEST: _____________________________ City Clerk -11- Passed and adopted on final reading on this 21st day of March, A.D. 2017. __________________________________ Mayor ATTEST: _____________________________ City Clerk