As Steamboat Springs moves toward implementing a vacancy tax this November, the community is divided over a fundamental question: should full-time residents really decide the tax burden that primarily affects non-resident property owners?
This has reignited old debates about “taxation without representation.”
The vacancy tax proposal outlines a flat fee of $3,100 for properties that are unoccupied for more than 183 days a year. Estimates from city staff suggest that between 1,200 and 3,200 homes might qualify as “vacant,” with an average figure of 2,250 used for financial projections.
If passed, this tax could raise between $3.9 million and $10 million annually for the city’s General Fund, potentially increasing available funding and mitigating the growth of sales tax.
The logic here is straightforward. Vacant homes still demand urban services—like public safety and road upkeep—yet they don’t contribute to local sales tax revenue as occupied properties do. Given Steamboat’s reliance on sales tax, city officials argue it’s unfair for vacant properties not to contribute adequately to the services they utilize.
The strongest criticism centers around the voting demographic. Only full-time residents—those eligible to vote in Steamboat—will decide this measure, despite the fact that the tax primarily targets non-resident owners who may live out-of-state or visit only occasionally.
A recent survey conducted by WR Communications showed a solid backing for the vacancy tax among Steamboat voters. About 60.5% voiced support during the survey, and after receiving additional details, that figure rose to 63%.
The messaging around the tax emphasized fairness, aiming to ensure that vacant property owners contribute to the local tax base, a stance that resonates with roughly half of those surveyed. Yet, while some participants expressed doubts about how the tax would be enforced and the possibility of legal challenges, others suggested a complete reevaluation of the city’s tax structure, including the introduction of a general property tax.
Alan Frohbieter, a resident of Shadow Run Condominiums, has voiced his thoughts on the vacancy tax at prior meetings. He referenced comments made by Urban Attorney Dan Foot, who emphasized the importance of clarity and fairness in tax implementation.
Frohbieter expressed skepticism, saying, “I don’t see fairness in it. $31 doesn’t seem fair and could cause resentment among second homeowners.”
Doug McDougal, who splits time between Minnesota and Steamboat, shared his concerns in a letter to the council. He and his wife contribute significantly to the local economy during their seasons in town, patronizing local businesses and paying property taxes that support year-round services. He voiced frustration about feeling overly monitored by the government, stating, “We signed up for the Peaceful Mountain Old Man’s Life in Steamboat, not the ‘Big Brother’ government.”
McDougal further highlighted that he and his peers often spend considerably more than the average resident due to their leisure activities and the influx of friends and family, suggesting that rather than creating new taxes, the city could raise funds through increasing existing property taxes, which he views as fairer.
Concerns about fairness were echoed by Councillor Michael Buccino, who likened the proposal to “taxation without representation.” He proposed that a citywide property tax shared by all property owners, regardless of residency, would be a more equitable approach. He raised doubts about the accuracy of vacant property estimates and the complexities associated with enforcing the new tax.
Buccino and Councillor Bryan Swintek discussed the wording of the proposed tax during a council session, emphasizing the potential repercussions for local short-term rentals. “If the tax is too high, it could deter visitors,” he warned, emphasizing the need for balance.
Swintek countered with the argument that this vacancy tax is the most viable method for raising funds, underlining the urgency of the city’s financial situation.
Steamboat isn’t the only place contemplating a vacancy tax. Boulder city leaders have opted to postpone discussions until at least 2026, recognizing that while a vacancy tax may appeal to voters, it comes with potential legal complexities and challenges in enforcement.
In various mountain towns across Colorado, local governments are eyeing vacancy taxes as a solution to housing shortages and to diversify revenue streams, particularly as property values rise and many homes sit empty for substantial parts of the year.
Statutory towns and cities in Colorado, unlike home-rule municipalities such as Steamboat and Boulder, are encouraged to consider vacancy taxes for voter approval, although details about regulations around how long a home must be vacant are still being ironed out.
Some communities, like South Lake Tahoe, are also exploring similar taxes aimed at encouraging long-term rentals and supporting local infrastructure funding.
However, as the debate unfolds, Steamboat has yet to emphasize how this tax could potentially enhance housing opportunities for locals. Dan Foot, the city attorney, acknowledged discussions about affordable housing connections but noted a deliberate choice not to pursue that route at this time.
Some initiatives in places like Crested Butte have seen vacancy tax proposals fail at the ballot. Proponents argue these taxes can help fund essential services, while opponents express concerns about adverse effects on tourism and property rights.
As the council moves forward with refining the ballot language, the outcome will set important precedents not just for Steamboat but also for other Colorado resort towns grappling with similar issues.
If approved, Steamboat would be the first city in Colorado to adopt such a housing vacancy tax, joining a growing number of North American communities testing this strategy.
