Short-term rentals in Lakewood, explained properly.

Sec. 5.55.100 says no license issued under the chapter is transferable to another person or subsequent owner of the property. If the owner sells the licensed premises, the owner must immediately report the change to the City Clerk, and must notify the Clerk within 15 days after any change to the information submitted with the application.

Licenses are annual (Sec. 5.55.020). Under Sec. 5.55.030(C) renewal applications go to the City Clerk on the prescribed forms no later than 45 days before expiry, though the Clerk may waive the time requirement for good cause. A renewal needs all required fees and the additional materials the Clerk requires, and the Clerk will not grant a renewal unless the licensee has paid all applicable fees and taxes. A license not renewed in time expires at the end of its term, and the premises may not be used as a short-term rental after expiry until a new license is issued.

Sec. 5.55.040 says the City imposes fees, adopted by City Council resolution, to cover the costs of training, inspection, mediation and processing, including fees for a new license and for renewal. Payment in full of the license and application fees is part of a complete application (Sec. 5.55.030). The fee resolution or schedule, with its effective date, has not been read.

Under Sec. 5.55.030 the City Clerk accepts no incomplete application. A complete application includes the names and phone numbers of all owners; the address and the area used for the rental; proof of STR liability insurance of not less than $500,000; an inspection report signed and dated by an Inspector within 30 days before the application; a notarized affidavit (including that no private rules or covenants prohibit short-term rental use and that abutting neighbors were given notice); for properties under private rules or covenants, a copy of them as evidence that STRs are not prohibited; a verified ownership affidavit from each owner; a floor plan showing the number of rooms; a City sales and use tax license (Chapter 3.01) and a City hotel/motel accommodations tax license (Chapter 3.03); any further information the Clerk reasonably needs; and payment of fees.

Sec. 5.55.050(B) requires the owner to have the property inspected by an Inspector (an ASHI, InterNACHI or other certified master inspector or inspection company) before any license is approved for an initial term, with a report on a City form. Subsequent inspections are required only after a safety complaint is lodged with the Licensing Authority, and a renewal in good standing without safety complaints does not need a new inspection. The report must be dated within 30 days before the application.

Sec. 5.55.110 requires the applicant to give the occupant of each abutting property in the City a written notice, on a City-approved form, of the license application, including the opportunity for mediation of concerns. Abutting properties include all properties touching the parcel, including abutting corners and properties directly across any street, alley or easement. Notices go by certified mail within ten days after the application is submitted, and the applicant keeps proof of delivery for the Authority. Licensees agree to participate in good faith in mediation with an abutting property owner who alleges harm from the rental (Sec. 5.55.120).

Sec. 5.55.090(E) permits only one short-term rental contract at any time in any short-term rental. Whatever the number of lodging rooms available, owners may not enter into multiple rental contracts that would let separate parties use a licensed short-term rental at the same time.

Sec. 5.55.090(F) requires the license number in all advertising of the licensed premises and the license displayed prominently inside, clearly visible to renters and available to Code Enforcement staff at reasonable hours. Address numbers at the premises must be at least four inches high and well lit (Sec. 5.55.090(C)), and sleeping areas must carry a posted notice with phone numbers for emergency services and for reporting safety concerns (Sec. 5.55.030). Any STR Facilitator used by the licensee must be licensed with the City under Chapters 3.01 and 3.03 (Sec. 5.55.090(D)). Listing on a hosting platform or marketplace facilitator site without the Lakewood license number is a ground for denying an application (Sec. 5.55.060) and for show-cause proceedings to suspend or revoke (Sec. 5.55.070).

Sec. 5.55.050(C) requires a minimum of one operable fire extinguisher per floor (more if the inspection finds it necessary); operable smoke detectors in each sleeping room, outside each separate sleeping area near the bedrooms, and as section R314.3 of the 2021 International Residential Code requires; and operable carbon monoxide detectors outside each separate sleeping area near the bedrooms and as section R315.3 of the 2021 International Residential Code requires. A short-term rental with living or sleeping areas in a basement needs egress windows or other exit systems. Each short-term rental must comply with all applicable building, fire, housing and health codes.

Sec. 5.55.030(B)(3) requires proof of insurance that covers the proposed licensed premises for use as a short-term rental, adequately covers short-term rental liability, and is in no event less than $500,000.

Sec. 5.55.120 makes causing, permitting, aiding, abetting or concealing a violation unlawful, subject to the general penalty provisions of the Lakewood Municipal Code, and lets the City Attorney seek civil remedies such as nuisance abatement and injunctions. Each day of violation is a separate violation. Knowingly making a false statement in an application is unlawful and carries the penalties in Municipal Code Sec. 1.16.020. Under Sec. 5.55.080(C) the Authority may place a license on probation for at least the rest of its term, impose a civil fine under an adopted fine schedule, or revoke the license. The general penalty section and the fine schedule were not read.

Under Sec. 5.55.060 the City Clerk must deny an application that fails the chapter's requirements, contains a knowingly false statement, comes from an owner whose license was revoked or suspended within five years, covers premises cited for a public nuisance in the previous 12 months or the site of a substantiated noise complaint, or is listed on a platform without the license number. Sec. 5.55.070 lets the Authority issue an order to show cause why a license should not be suspended or revoked for grounds that include two nuisance citations or a conviction, two excessive-noise citations or a noise conviction, outstanding West Metro Fire orders, two or more calls for service in any 12-month period or a significant criminal act, delinquent City taxes under Chapter 3.01 or 3.03, and a failure to meet the chapter or zoning requirements. The Authority may order summary suspension on probable cause of a deliberate and willful violation or conduct that imposes an undue risk. A denial or summary suspension can be appealed to the Authority (Sec. 5.55.080).

Colorado charges its 2.9% state sales tax on the entire amount charged for rooms and accommodations. A stay may also owe local sales taxes that the Colorado Department of Revenue collects for counties and special districts, and any sales tax of a home-rule city that collects its own tax (see below).

State sales tax does not apply to a room or accommodations rented to a person who is a permanent resident of it and has a written agreement to occupy it for at least 30 consecutive days. Shorter stays are taxed.

The Colorado Department of Revenue says anyone who offers rooms or accommodations for rent must get a Colorado sales tax license and collect sales tax on taxable rentals. A seller who makes sales only through a marketplace may be exempt from licensing, collection and filing if the marketplace collects all state and state-administered local sales taxes for them. The license costs $16 (prorated) plus a $50 deposit, a separate license is needed for each business location, and licenses expire on December 31 of odd-numbered years.

For rooms rented through a marketplace (including online platforms), the marketplace facilitator must collect and remit the state sales tax and the local sales taxes the state collects, plus any county lodging tax and local marketing district tax. City taxes in home-rule cities are separate (see below).

The Colorado Department of Revenue does not administer any lodging tax imposed by a city or town, and it does not collect sales tax for home-rule cities that collect their own. Those taxes are licensed, filed and paid with the city.