More Than 100 Property Owners Sue Summit County To Overturn Short-Term Rental Ordinances

A group of more than 100 property owners in Summit County sued the Board of County Commissioners earlier this month seeking to overturn the county’s regulations on short-term rental properties that are scheduled to go into effect in September.

The group that sued the county commissioners is known as Summit County Resort Homes Inc., and claims to represent 101 homeowners in the county. The lawsuit was filed in the U.S. District Court of Colorado and comes at a time when many jurisdictions in the state have put restrictions on short-term rental properties, which are defined as rentals that are available for 29 days or less per month. 

“Summit County Commissioners have ignored the voices of hundreds of responsible homeowners who provide a valuable service to visitors to Summit County who contribute greatly to our local economy,” Todd Ruelle, the lead plaintiff in the lawsuit, said in a press release. “The County’s regulations will hurt many, many homeowners who rely upon short-term rentals to help pay their mortgages and taxes.”

The Summit County Board of County Commissioners did not immediately respond to Bisnow's request for comment on the lawsuit, which is awaiting a hearing.

Over the past couple of years, many local leaders in Colorado have taken steps to restrict the number of short-term rental properties within their jurisdiction. Others have levied lodging taxes and other fees on the properties in an attempt to provide more housing for local residents. 

These maneuvers were meant to help stop home prices from spiking in Colorado’s mountain communities, but they have had little effect. For instance, Durango was one of the first cities in the country to restrict short-term rental properties, which the city did back in 2014. The city requires short-term rental owners to acquire a limited use permit before they can advertise the property on websites like Vrbo and Airbnb. It also establishes standards for parking, occupancy and noise, according to the city’s website.

However, home prices in popular resort communities across Summit County such as Frisco and Breckenridge have surged since March 2020 when the pandemic began. Redfin data shows that home prices in Breckenridge have increased by 55% up to a median price of more than $1.1M, as of June 2023, while home prices in Frisco have surged by 63% to more than $1M as well.

Housing prices like these are well out of reach for the many retail and hospitality workers who keep shops, restaurants and ski slopes in resort towns running.

Summit County’s regulations nearly mirror Durango’s, as do the rules that other places like Dillon, Frisco and Breckenridge have passed. For example, Summit County requires short-term rental owners to acquire a license before they can begin renting their property and restricts where the properties can be located within the county boundaries, according to the county’s website. 

However, Ruelle and the other plaintiffs argue that the regulations are “arbitrary and unreasonable” and may also violate Colorado state law. 

Those claims are similar to arguments levied by other property owner groups seeking to overturn the short-term rental regulations in Breckenridge. The ordinance essentially split the city into four zones and placed short-term rental caps in three of the zones. The nonprofit group Colorado Property Owners for Property Rights said in a press release that the city’s process for obtaining a license is “extremely difficult, and in many instances impossible.”