Several weeks ago, I wrote a letter about my intention to file a referendum on the City of Salida Ordinance 2022-24, which increased taxes on all Short Term Rentals. Much has changed since then.
I simultaneously sent that letter to the Mountain Mail and Council. I requested help from the Salida Clerk’s Office in guiding me through the referendum filing process but received no response. After a week, I asked again for help. I was informed the City of Salida had refused my right to a referendum, claiming the Ordinance in question was “administrative” not “legislative”. [In my opinion] It was obvious their delay in responding to me until during the year-end holidays was intentional, designed to leave me no time to seek legal counsel to determine the legality of their actions.
In addition, Council had filed emergency status, meaning the ordinance would take effect Jan 1, 2023, instead of the customary 30-day delay to allow for a referendum. This rarely used emergency status usually applies to fire and flood responses. You know, dire emergencies. Despite council inaction for years, they are now declaring affordable housing an emergency.
Regardless, Council scheming and slow responses allowed me no time to seek a legal opinion. And any legal proceeding I filed would take years. Legal costs mean I would lose even if I won. Meanwhile, the City Attorney, who made the decision to apply the doubly bogus “emergency administrative” strategy, would be rewarded by getting paid with our tax money to defend her own questionable actions. The system is truly rigged against the ordinary citizen.
What’s a lady to do? In seeking a solution, I became aware of the initiative process. A referendum repeals an ordinance. Using an initiative, I could instead repeal and replace ordinance 2022-24. I could write my own ordinance which defined a reasonable, rational level of taxes on STRs. I would still need to get petition signatures to place my initiative on the ballot of a special election.
After I informed the city of my intention to file an initiative and asked for help to guide me through the process, I again received no response. I approached the City of Salida Clerk and received what I can only call the cold shoulder. Apparently, city services are reserved for those who engage in city-approved activities. Those attempting to revise council action do not receive favorable, or even neutral treatment.
Council will tell you this issue was already decided by 2A and 2B on the Nov 8 ballot. My response is they placed these issues on the ballot at the last possible moment and left almost no time for opponents to educate the public.
Over the next weeks we will define the terms in the [potential proposed] new ordinance, then be asking for Salida voters to sign a petition to place this issue on the ballot. My sincere request is that people keep an open mind and examine the issues before deciding where they stand.
Kalen Steeves
Salida
Editor’s Note: All references to delays in the city’s response to Steeves as being unresponsive are the letter-writer’s opinion. No proof has been offered to Ark Valley Voice to support those conclusions or her claims of “double bogus” timing or the claim that “the system is truly rigged against the ordinary citizen.” The city’s placement of ballot questions on the ballot met all official timetables. At the time she sent it to the city, and to the Mountain Mail, Steeves did not share the letter she references with Ark Valley Voice.
The real problem with our housing shortage is the fact that affordable housing keeps getting bulldozed to build million dollar homes and condos. So why are the STR owners falling victim to this? The city needs a scape goat, and the “newest” business model that can be taxed heavily are just that. Time and time again I’ve heard “just pass along that cost to the tourist”. The problem with that is then the cost is through the roof in a business that is already seeing declining numbers in the past year.
The ballot initiative was rushed and the public was not properly educated. The city knew this was going to be a close vote and their tactics were unjust and manipulative. They publicly recited information that was hearsay and opinion. The public doesn’t know any different and believe their elected officials to present them with facts.
These taxes are the highest in the country. They are extremely out of line and need to be reeled in. It is borderline embarrassing to call this town home lately.
James Flatten
Salida, CO
James we’re glad you’ve commented and that you followed our policy of using your own name.But AVV needs to point out the following:
You make claims for which you offer no claim substantiation. What is your source for saying the following: “that affordable housing keeps getting bulldozed to build million dollar homes and condos,” “The city knew this was going to be a close vote and their tactics were unjust and manipulative”… “These taxes are the highest in the country.” Without substantiation, these cannot be considered true, but only opinions, and should not be repeated as fact.
In her letter, Ms. Steeves brings to light the inequities and process by which Salida instituted the new STR taxes. These measures were approved by the voters of Salida by a very thin margin (~1%). There are several issues that I find problematic in the legislative process. First, the City put forth forecasts of the revenue that would be obtained from the taxes but does not support this analysis with the basis for their calculations. Secondly, the legislation, does not define how the money collected will be spent. Finally, the City admits that the money collected will not solve the problem which it claims was the reason for increasing taxes.
The narrative used by the city to introduce the legislation were decidedly one sided. For example, see the arguments presented in the August 16, 2022 City Council Action Form presented by Drew Nelson ( https://mccmeetingspublic.blob.core.usgovcloudapi.net/salidaco-meet-a38a2ca9672f4d0184ef9b75e63b0411/ITEM-Attachment-001-0e3accfc0a4a41eb958117dfac61a988.pdf ) where many perceived negatives associated with STRS are claimed but clearly not supported by common sense. He claims that a house that is an STR results in more traffic, more water and wastewater usage than if it was occupied full time. Clearly, a dwelling that is occupied full time will have occupants who have automobiles that are used on the city streets and will park them at work or at home. A 100% occupied home uses water and wastewater full time. STR’s in the residential district are limited to 180 nights of rental. 100% versus 50% occupancy. You decide which uses more of anything. There were no STR owners included in the discussion as this narrative was drafted. Clearly, some people in the City government are biased and are not fairly representing the constituency.
What the city didn’t consider in their calculations is that by driving STR owners out of business with large tax increases they increased the probability that sales of STR homes will be to people who want to come to Salida occasionally and can afford to leave them vacant most of the year. Tourist based business owners will lose business and the “gold mine” of STR taxes will not be realized.
The City was able to get these initiatives passed without specifying where the money will be used. The following comes right from the ballot “OMMENCING ON JANUARY 1, 2023, SHALL THE CITY OF SALIDA’S TAXES BE INCREASED BY $525,000.00 ANNUALLY (FIRST FULL FISCAL YEAR INCREASE) AND BY WHATEVER ADDITIONAL AMOUNTS ARE RAISED ANNUALLY THEREAFTER BY INCREASING THE OCCUPATIONAL LODGING TAX ON THE BUSINESS OF LEASING OR RENTING SHORT-TERM RENTAL UNITS FROM $4.82 TO $15.00 PER NIGHT, PER BEDROOM, AND SHALL ALL THE PROCEEDS OF SUCH TAX, TOGETHER WITH INVESTMENT EARNINGS THEREON, BE USED PRIMARILY TO PROMOTE AFFORDABLE HOUSING WITHIN THE CITY, AND SHALL THE CITY BE AUTHORIZED TO COLLECT AND SPEND SUCH REVENUES AS A VOTER-APPROVED REVENUE CHANGE, NOTWITHSTANDING ANY REVENUE OR EXPENDITURE LIMITATION CONTAINED IN ARTICLE X, SECTION 20 OF THE COLORADO CONSTITUTION?”
Where is the money going? Primarily, but not exclusively, to promote affordable housing in the City. What does promote mean? If the money collected were used to buy homes it wouldn’t go very far would it? Will it be used to acquire land on which to build low-income housing? That isn’t clear either. The only plans I have heard in subsequent City Council meetings is that the money will be used to support bureaucracy surrounding the “affordable housing” problem. The citizens of Salida should demand an accounting for what was collected and where it was spent.
STRs and their owners contribute to the economic wellbeing of the community and to the culture of the city by generally being well kept and pleasing to the eye. Most of the STRs in town are not affordable housing by the City’s definition. Further, the City has capped the number of STR licenses. So STR’s are not responsible for an affordable housing shortage. The cost of building in Salida may well be the problem. The primary new buildings going up in the residential district are condos that sell for $750,000 or more. Builders will only build what allows them to make money. Salida should look at incentivizing builders to build affordable housing rather than penalizing STR owners. Lowering the risk for builders and future owners of affordable housing is an important step to solving this problem.
I would like to see the City engage productively with STR owners to help solve the problem rather than unfairly penalizing them and doing so in the fashion demonstrated in last year’s ballot initiative which was one sided, rushed and lacking a complete solution.
Greg Fetzer
Salida, CO
Per Ms. Steve’s letter, as well as in my own experience, it seems that short term rentals (STRs) have been politicized recently, and are being at least partially blamed for a lack of available housing inventory as well as a lack of affordable housing, which I believe is at best, a gross over-simplification of a long standing and complex set of issues. A cap on short term rental licenses (at 310), representing 6% of housing inventory is pretty conservative, and should adequately prevent STRs from “taking over” our amazing town. 6% is not a large enough number to have significant influence on ANY market aspect. That said, I think it is fair to expect occupancy fees from them. However, setting the fees at triple the rate of hotels and motels, and charging them even when rooms are not occupied (unlike hotels/motels) demonstrates the City’s negative bias against STRs, as the author above proclaims.
STRs bring new and hopefully, repeat visitors to Salida and its businesses, just like hotels and motels do. But, they are the preferred mode of stay for many families, who need more space and a kitchen – and are often a more economical choice for them as well. Having a variety of accommodations helps make Salida a more desirable destination – and like it or not, a primary driver of the economic engine of this town is tourism.
My understanding is that the funds that the new license and occupancy fees will bring are earmarked for addressing both housing inventory and affordable housing. Great – I believe affordable housing is a right, and our local workforce should be able to work AND live here. But the revenue generated by these fees will be woefully insufficient to address the needs of more than a handful of residents, and at the cost of unreasonably driving up the price of STR stays and/or driving hosts out of business. What other funds are being generated to help provide a realistic pot of money to address this problem, how quickly, and with what consequences? For context, Vail resorts wants to invest $17 MILLION for seasonal workforce housing, which will only provide “160 beds.”
I would love to see some projections that demonstrate a realistic plan to add affordable housing for everyone who needs it, which SHOULD have been, but was not any part of the campaigns to promote these initiatives. STRs ain’t gonna do it alone, but we need STRs to help keep Salida among the top Colorado destinations. Let’s work together, people!
I believe three things need to change in order to begin to effectively address the duel challenges of supply and affordability: greater density in town, incentives and/or credits for builders, and a living wage for our workforce. A first year teacher in Chaffee County makes less than $40,000 a year. That means that they can afford, at maximum, a house, townhome or condo that costs $150k. Where have we seen that price lately?? The only way that teacher can afford to buy a home is if there are sufficient incentives for builders to build them and sell them affordably. And hospitality workers in town average less than that, and on a seasonal basis to boot.
I am all for keeping our county “country” and for smart building that makes our City more efficient, affordable, and desirable for the long term. Housing is INFRASTRUCTURE, just as roads and services are. It’s time the City and County took that responsibility seriously, instead of politicizing and punishing one tiny aspect of local housing that actually brings in tourist dollars reliably and steadily.