This week, Basalt Town Council convened for a brief meeting to discuss new housing regulation fees to direct more funding towards affordable housing initiatives, including potential new fees for operating short-term rental units.

During the meeting, the Town Council unanimously voted to appoint resident Bentley King to the Basalt Affordable Community Housing (BACH) Commission. King, employed at the Basalt branch of Alpine Bank, has experience with deed-restricted housing both as an owner and a lender, and looks forward to providing her skills to BACH’s mission.

“I’m just really passionate about providing some opportunities to create and maintain an array of opportunities for people to own and live in this area of the Valley,” King said. “Homeownership is a big dream of many people, and it’s difficult in this area.”

With King’s appointment, all seven seats on BACH’s commission are now filled.

In terms of housing guidelines, council held the first reading for Ordinance No. 2, which updates the Town’s affordable housing cash-in-lieu fee.

At the council’s discretion, developers can pay cash in lieu of providing affordable housing. The Town code prioritizes construction of actual deed-restricted units rather than paying cash, as it is more difficult to use that cash to construct new deed-restricted units elsewhere than to require the developer to construct units on their own.

However, the amounts for cash-in-lieu have not been updated since 2015, and are currently based on the 2009 Basalt Community Housing Strategy Support Study. Economic and Planning Systems, the same firm which worked on Basalt’s 2024 Housing Needs Assessment, has been contracted to update the cash-in-lieu fee amounts in Part 3, Section 3(B) of Basalt’s Community Housing Guidelines.

The document updates the fee for housing categories 1-3, as well as prices for the newly created categories 0, 4 and 5. The fees are given as a dollar amount per square foot of community housing required. For Category 1, the fee has roughly tripled from $197.31 to $591.00 per square foot, and for Category 3 it has over quadrupled from $106.12 to $485.00 per square foot. According to the planning document, these new fee amounts are based on the gap between the median home price in Basalt and the maximum affordable purchase price. These fees were unanimously approved for a second reading.

Council also held the first reading for amendments to the town code which would establish a regulatory fee for short-term rentals (STRs).

STRs, usually available through rental services like Airbnb and VRBO, are defined as residential properties available for rent for a period of fewer than 30 days. Currently, the Town of Basalt charges a sales tax, business tax and lodging tax for the operation of STRs, which are existing taxes also applied to other businesses and not unique to STRs. The Town of Basalt also charges an annual licensing requirement of $460.

Due to the impacts of STRs on the availability of housing, the Town of Basalt is considering implementing additional fees to create a source of revenue for affordable housing initiatives.

Economic and Planning Systems also performed a study on the effects of STRS on affordable housing demand. It includes a range of possible fees calculated based on how much guests at STRs contribute to the local economy, the number of jobs supported by that spending and the cost of housing in Basalt.

BACH recommended an annual fee of $2,532 per bedroom, which is 50% of the maximum that can be charged according to the Economic and Planning Systems’ report. However, BACH also recommended that the code establish exemptions from the fee for local owners. While the Town would not consider exemptions requested after the issuance of an STR license, the exemption will be considered for unit owners who do not rent for more than 60 total days annually, demonstrate that the unit is the owner’s primary residence and demonstrate that the unit owner is an essential employee.

Council considered implementing a halved fee in June. Town staff also intend to run an outreach campaign to inform STR owners of the new regulations. The ordinance was approved for a second reading and a public hearing was set for Feb. 11.