The People's Republic of Boulder, Colorado has tasked a committee with determining whether or not Homeowners should pay tax for short-term rentals on their homes as reported by the Daily Camera. Sheila Horton (Boulder Area Rental Housing Assoc) states:
We are seeing an increasing number of property owners doing short-term rentals who are not under motel or hotel licensing," Horton said. "They're not paying the tax. They fall into this kind of no man's land.
Here is the problem as Horton sees it:
The people who are doing these vacation rentals are competing with these hotels and motels.
These are private individuals that decide to rent out their home during the peak tourist season while they vacation elsewhere. They are not in the commercial rental business. Horton's organization represents commercial rental companies. There is currently no law requiring these private homeowners to pay a city rental tax.
In 1992, Colorado passed a Taxpayer Bill of Rights (TABOR). This law simply requires a vote of the people to increase taxes beyond its stated limits. Unfortunately for the taxpayers, our government still cannot grasp the concept that our money is ours, and if they want some of it, they need to ask, not take. Governor Bill Ritter is learning this concept now in court.
Horton finally states what I expected to hear:
We're talking about significant funds that the city is losing.
What funds exactly are they losing? It's the funds to which they think they are entitled, but then there's that nasty TABOR law in their way. So what to do...what to do.
Government officials, frustrated with this law and their inability to get more revenue are turning to other methods, such as re-interpreting existing law.
Bob Eichem, Boulder's finance director says,
It isn't something that we've collected tax on. We're doing the research on it.
At least Eichem understands the law:
You can't tax a whole new thing if it isn't in your code, you have to go to a vote of the people.
City Manager Frank Bruno, however, will wait for a report from the finance department before making a decision on whether existing law applies to these homeowners.
I think what disgusts me more than anything about this issue is that an organization representing private businesses has initiated this process because they don't like competition. Now they've involved the government, who is always too eager to look for new sources of revenue. They're kidding themselves if they thing the government won't someday come after them in the same way.
They'll likely rue the day they awakened the Leviathan.
"We're talking about significant funds that the city is losing."
Revenue is not lost, it is earned. What are they doing to earn the revenue? Probably not enough.
Fighting for conservatism one day at a time.