Taos council approves short-term rental fee


The Taos Town Council voted Tuesday (April 10) to move forward on two motions seeking to fight the housing crisis in Taos head on.

One motion was regarding a plan to increase the number of affordable live-work spaces in town and another addressed a fee on short-term rentals. The council passed both motions unanimously with minor changes.

"The need for housing is higher in Taos than some of the other communities we work with," said Heidi Zimmer, senior vice president of property development for Artspace. "The demand was there in 2008, and it's there now."

Town officials say the affordable housing situation for those who work and live full time in Taos is challenged by the growing short-term rental market. Of the hundreds of short-term rentals listed within the town boundaries, less than 10 have registered with the town; those that aren't registered are not paying the gross receipts tax as required by the town.

One way to address the problem is to increase the number of affordable housing units.

Artspace is a nonprofit currently working with the town to establish a live-work space for artists and locals in Taos to assist with housing for those who come here for the arts. According to Zimmer, negotiations with the town began in 2008 and were solidified in 2009 when the town and Artspace agreed to partner on a housing project for Taos artists.

The town council voted Tuesday to approve a letter of agreement with the nonprofit so that the company can search for land. Artspace is in step three of its six-step plan to construct a 70-unit complex for retail and living space for artists in Taos.

The agreement voted on Tuesday by the council states the town will pay the organization $350,000 for steps one through four of the project, which includes preliminary planning, design and community awareness.

"It's an exciting project for the community," Zimmer said. "Artspace is 100 percent committed to the town of Taos. The history and heritage of art and culture in Taos is unlike most communities we work in."

The council approved the agreement on the conditions that town manager Rick Bellis would be able to renegotiate the contract and that the agreement will not be executed until a space for the project has been located and approved by the council. Once built, artists would apply to live in the housing project.

Zimmer said there is a preference for artists, but other people can apply to live in the units. Qualifications will be somewhat based on income. Zimmer said she hopes to begin construction on the project in 2019.

During a phone interview with The Taos News, Zimmer indicated a need for living space in Taos is partially due to the growing short-term rental market in the area.

The town council has also acknowledged the need for regulations and passed an ordinance requiring owners of short-term rentals to register as a business within the town. On Tuesday, the council approved a motion to require short-term rental property owners to pay $400 in an annual fee to the town to operate.

"With the knowledge that these short-term rentals are often properties that take regular rentals away for people living in the community, and for the workforce here, out of circulation," said Bellis during the meeting, "that money will be applied to creating workforce housing."

Of the fees, $300 will go towards regular annual fees, including business registration, fire and building inspection, short-term rental monitoring, codes compliance and short-term registration fees. In addition, at the request of Bellis, short-term rentals must also pay an additional $100 into the town's affordable housing fund for the creation of future workforce housing in Taos. Property owners advertising only a room in the primary residence as a short-term rental will be exempt from the additional $100 fee.

Councilor Nathaniel Evans reminded the public that short-term rental owners have had over two years to comply with town registration laws and yet the vast majority of them have still yet to sign up and pay gross receipt taxes.

Taos joins a growing list of cities across the U.S. that have passed similar regulations on the short-term rental market and have acknowledged them as businesses.

Failure to register as a business, according to town codes, could result in a $500 fine or 90-day jail stint per day of violation. In addition, fines associated with a failure to comply with fire or building codes could cost a business owner anywhere from $25 to $500 depending on the severity of the violation.

"We all know, anecdotally, about how many units have been taken off (the market) and about how hard of a struggle it is to find affordable housing here, especially if you are young and working in the service industry in this community," said Councilor Darien Fernandez.

Short-term rental owners who have already obtained a registration through the town will be exempt from the fines until they re-register in January for their annual renewal.