Study verifies deficiencies in tracking nightly rentals in Summit County
April 6, 2018
The Summit County Council heard the final results of a study on Wednesday that was commissioned to help elected leaders in Summit County and Park City better understand the broader short-term rental market impacts on a resort community.
Summit County, Park City and the Park City Chamber/Bureau contracted with Brumby McLeod, an associate professor in the School of Business at the College of Charleston, South Carolina, to assess the housing mix in the county and Park City as it relates to short-term and nightly rentals.
Phase 1 of the study, which mainly consisted of data gathering, was recently completed. The findings were presented to the County Council on Wednesday and a similar presentation was given to the Park City Council on Thursday.
"I think the more cohesive we can be on this issue the better," said County Council Chair Kim Carson. "It will be easier for the properties to be compliant if we have similar requirements for everyone."
McLeod assessed the various jurisdictions and unincorporated areas to examine the requirements currently in place for operating short-term rentals. The first phase of the study provided a snapshot of the current housing mix to better inform policy and zoning to help regulate the market. The data suggests a compliance issue in the community, which most say is not surprising.
The data showed there are currently 25,466 residential dwellings in the incorporated and non-incorporated areas of the county, with 10 percent of those residences, or 2,535, holding nightly rental licenses. Most of the licenses — 2,526 — are for residences in Park City and the Snyderville Basin. The licensing information was obtained from building, assessor, and nightly rental license data from the county and Park City Hall.
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One issue that emerged from the data is the lack of clarity when it comes to who is operating the nightly rentals. Of 4,254 internet listings for nightly rentals McLeod examined, 1,976 were owner managed, 1,293 were professionally managed and 994 were unspecified.
"This part was surprising," McLeod said. "When getting a license for a nightly rental, they are not being asked who is operating the property. That is a piece we would want to correct. We want to know who is responsible for listing it and checking people in.
"We have big companies here and we should be able to see who are running those processes," McLeod said. "We believe we can tweak and fix those things to close those loops so it doesn't happen again."
Another inconsistency that was identified was the requirements for operating a nightly rental. Some nightly rental operators are not complying with them, creating an uneven playing field for companies that are, McLeod said.
"If I'm Newpark Hotel and I see that I've licensed all of my units and I see that others are not doing that that's a concern," McLeod said. "We owe it to nightly rental operators to be consistent."
The study highlighted three areas that require more attention: nightly rental businesses processes; understanding of existing lodging inventory; and technology to monitor, measure and manage the ever-changing listings of nightly rentals in the market, according to a county staff report.
"The things that were highlighted for me were the issue with business licensing and clarifying that process to make sure we get who the actual operators of the unit are," Carson said.
Carson said the lack of operator information can lead to health and safety issues because the county is unable to verify whether the units that are being rented are safe.
To address the shortcomings discovered in Phase 1, there is a proposed consulting component to Phase 2, according to a staff report. It states a "formal proposal of services and costs shall be prepared and presented in the very near future."
Phase 2 will likely include recommendations for ordinances and zoning policies to help regulate the market, allowing the county and Park City to track the units that are being used for short-term rentals and receive taxes from the transactions.
"I think the more cohesive we can be on this, the better," Carson said referring to the city and the county. "It will be so much easier for the properties to be compliant if we have similar requirements in place."
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