DENVER (KDVR) — Opponents came from across the state Tuesday to urge Colorado legislators not to support a bill designed to change how short-term rentals are taxed.
Opponents of the measure said they came to the Capitol to get ahead of the proposal, but lawmakers backing the bill said it’s a work in progress, and the final bill may not impact owners the way they think it will.
“Well, we came down here because we’re obviously in opposition of this bill. That is no surprise,” Al Furlone said. He’s the manager of Winter Park Lodging Company and Steamboat Lodging Company, and he’s also a founding member of the Colorado Lodging and Resort Alliance.
“But we’ve been hearing that there are major amendments coming to this bill. We’re hoping to learn more about that,” he said.
Furlone and hundreds of other property managers and owners across Colorado have voiced opposition against a bill designed to make sure corporate property owners are not paying residential rates.
“We are really trying to understand the conversion issue that is happening, where commercial properties are being converted into residential for a tax loophole,” said state Sen. Chris Hansen, prime sponsor of the measure. “We are seeing that happen across the state. So that’s what really started the interest in the legislature in short-term rentals.”
Who would see effects of short-term rental tax change?
Furlone and other managers say there are far more vacation homeowners who would be impacted by the measure if passed.
“We have conducted a survey that was thousands of vacation rental homeowners in Colorado, and essentially what it showed is that 89% of them own one property,” Furlone said. “But really, the narrative that seems to be coming out is that it’s these large corporations that are taking over and managing hundreds and thousands of properties. So we want an opportunity to try to state the case that this bill is going after individual homeowners.”
Hansen said amendments are coming to the proposal to ensure the bill will impact who lawmakers intend it to.
“What you are going to see in first committee is a really careful narrowing and focusing of the legislative approach,” Hansen said. “Right now, the IRS defines commercial property activity as if it’s rented more than 180 days a year. And so I think we will be looking close at the IRS’ definition and how the tax treatment is already being handled at the federal level and see if we can become more congruent with that in Colorado.”
Hansen said the proposal is a part of the larger conversation surrounding property taxes and services that benefit from them in Colorado.
“I think you have folks who are really well-intentioned and really trying to think about the impact of their own finances,” Hansen said. “That totally makes sense — I would be doing the same thing if I owned a second home, a third home or a ninth home up in the mountains. That’s great — I am happy for those people. But there is also a very important state responsibility to sustainably fund local services.”
While opponents came out to speak on the bill Tuesday, the committee hearing where changes to the bill are expected does not happen until next Tuesday.
Source: Rocky Mountain News
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