Short-term rentals in Cottonwood, explained properly.

The registration application must be signed by the applicant and must contain, as a minimum: the physical address of the property; the name, address and telephone number of the owner (for an entity, its legal name and statutory agent); the name, address and telephone number of the owner's designee, if any; the name, address and 24-hour telephone number of the emergency point of contact; and evidence that the rental is registered with the Yavapai County Assessor's Office under A.R.S. 33-1902. The chapter says this information is made publicly available (5.08.030(B)). The City manager or designee develops the application, attestation and database (5.08.030(F)). The City form itself was not available to read.

The owner must give written notice to the city manager or designee of any change in the information submitted with the registration application, not less than ten days before the change takes effect. Every item required in the application is treated as material, and a violation of this subsection is a civil offense (5.08.030(D)). Emergency contact changes have their own ten-day notice (5.08.040(C)).

When a police officer asks, the owner, designee or emergency point of contact named on the application must be on the premises, or available by phone or text, within sixty minutes (5.08.040(A)). The owner, designee or contact must answer all other complaints about the rental in person, by phone, by email or by text within twenty-four hours of the request (5.08.040(B)). Any change to the emergency contact information needs prior written notice to the City not less than ten days before the change (5.08.040(C)). A violation is a civil offense, and an owner who fails to give the required notice faces a civil penalty of up to $1,000 for every thirty days; before the first penalty the City gives thirty days' notice of violation by email or mail, with a right of appeal under 5.08.110 (5.08.040(D), (E)).

Before offering a vacation rental for rent for the first time, the owner or designee must give written notice, in the form the City requires, to each single-family residential property adjacent to the rental, directly across from it, and diagonally across the street. The notice states the permit number issued by the City, the physical address of the rental, and the name, physical address, email address and 24-hour telephone number of the emergency point of contact (5.08.060(A)). Any change to that information needs further notice not later than five days before the change (5.08.060(B)). Before the first rental the owner or designee must also give the City an attestation that the neighbor notification was done (5.08.060(C)). A violation is a civil offense (5.08.060(D)).

The owner or the owner's designee is responsible for displaying the permit number issued by the City on each advertisement for the vacation rental. A violation is a civil offense, and each advertisement in violation counts as a separate violation (5.08.070). An advertisement is any method of soliciting the use of property for vacation rental purposes (5.08.020).

The owner must display the name, phone number and email address of the owner, the designee and the emergency point of contact in a conspicuous place within fifteen feet of the primary entrance of the vacation rental. A violation is a civil offense, and each day the information is not displayed is a separate violation (5.08.080).

A vacation rental must comply with all applicable federal, state and local laws, including laws on public health and safety, sanitation, solid waste, hazardous waste, tax privilege licensing, property tax registration, traffic control, pollution control, noise, property maintenance and nuisance abatement, and no one may operate a vacation rental in violation of the chapter or other law (5.08.050(A), (B)). Anyone who causes, allows, facilitates, aids or abets a violation of the chapter commits a civil offense, and a designee's failure to comply does not relieve the owner of liability (5.08.050(E), (F)).

Renting or offering to rent a vacation rental without registering is prohibited (5.08.030(A)). A vacation rental that fails to register within thirty days of the registration application being made available by the City must immediately cease operations, and an online listing that refers to the property is prima facie evidence that a vacation rental is operating in the City (5.08.030(E)). The chapter repeats the thirty-day rule and adds that the City may impose a civil penalty of up to $1,000 per month if the owner or designee fails to apply within thirty days of receiving written notice of the failure to comply (5.08.100(C)). The date the City made the application available was not found in the text read.

For a verified violation of the chapter, or a failure to do an act the chapter requires, at the same rental property within the same twelve-month period, the City may impose a civil penalty of up to $500 or up to one night's advertised rent, whichever is greater, for the first violation; up to $1,000 or two nights' advertised rent, whichever is greater, for the second; and up to $3,500 or three nights' advertised rent, whichever is greater, for a third and any later violation. Violations arising from the same response to an incident count as one violation. These remedies are cumulative with the other penalties in the City code (5.08.100(A), (B)). Separate civil penalties for late notice of contact changes are described under the emergency contact rule.

The City may start an administrative process to suspend a vacation rental for up to twelve months after three verified violations of the chapter within twelve months, not counting a violation based on aesthetics, solid waste or vehicle parking that is not also a serious threat to public health and safety. A single verified violation can also lead to suspension if it involves a felony at or near the rental by the owner or designee; a serious physical injury or wrongful death from the knowing, intentional or reckless conduct of the owner or designee; the owner or designee knowingly or intentionally housing a sex offender, allowing adult-oriented business, sexual or prostitution offenses, or operating a sober living home; or knowingly allowing a special event that needs a permit or license, or a retail, restaurant, banquet or similar use (5.08.090(A)). Separately, a felony act at a rental that results in death or actual or attempted serious physical injury is grounds for judicial relief suspending use of the property as a vacation rental for up to twelve months, which the city attorney can pursue in municipal or other competent court (5.08.120).

Anyone aggrieved by a decision to deny or refuse to issue a vacation rental permit, to suspend a permit, or to impose a penalty under the chapter may appeal by filing a written notice of appeal with the City no later than thirty days from the date of the decision letter, on a City-approved form or with enough information for the City to respond. An appeal does not stay a permit suspension, and the appeal section does not apply to judicial actions under 5.08.120 or to penalties imposed by a court (5.08.110).

Applies to: Subject to change if state law is amended

A.R.S. § 9-500.39(A) bars Arizona cities and towns from prohibiting short-term rentals, and subsection (B) lists the only ways they may regulate them (health and safety rules, zoning and nuisance rules applied like other residential property, emergency contact, a local permit, neighbor notice, permit number in ads, insurance, and owner residency on some properties with an accessory dwelling unit). Permit caps and minimum-distance or spacing limits are not on that list, and the statute applies to cities of every size.

Short-term rental income (stays under 30 days) is subject to Arizona transaction privilege tax (TPT), so hosts need a TPT license from the Arizona Department of Revenue (a seasonal license can be chosen on AZTaxes.gov) and must include the TPT license number in any advertising for the rental. A city business license, where a city requires one, is separate from the TPT license.

Arizona's state transaction privilege tax rate on the transient lodging classification (A.R.S. § 42-5070) is 5.5%, set by A.R.S. § 42-5010(A)(2). County and city taxes are added on top and vary by location.

Hosts must file a TPT return for every period even if the property was not rented, filing a $0 return rather than skipping the filing.

Separately from tax licensing, every Arizona county requires residential rental properties to be registered with the County Assessor, and penalties can apply to rentals that are not registered. A.R.S. § 9-500.39(J) keeps this duty in place for short-term rental owners.