Editor’s note: This story was updated to clarify how many homeowners are suing the Summit Board of County commissioners in another lawsuit.

A Summit County homeowner has filed a class action lawsuit against the Upper Blue Sanitation District claiming that the district is charging those who short-term rent their single-family homes excessive and arbitrary fees.

Todd Ruelle, who short-term rents a single-family home within the sanitation district, filed the civil lawsuit in Summit County court on April 18, according to court documents. The lawsuit claims that the district violates a Colorado law requiring wastewater services not to charge unreasonable fees and seeks monetary restitution for the homeowners affected, court documents state.

“We’d like to see short-term rentals treated fairly for what they actually discharge,” Alex Dorotik, an attorney representing Ruelle in the case, said. “They shouldn’t get a break, but they also shouldn’t be carrying more than their fair share of the costs of the system.”

The Upper Blue Sanitation District declined to comment on the litigation.

The lawsuit asks a judge to treat all single-family homeowners who short-term rent in the sanitation district as a class, claiming that individualized litigation could lead to contradictory judgements and overburden the court system. In total, single-family homeowners who short-term rent “have been made to pay millions of dollars illegally” to the sanitation district, according to the complaint Dorotik filed in the case.

The complaint states that the Upper Blue Sanitation District sets fees for services based not on actual wastewater discharge, but on an estimate of how many persons occupy each dwelling it serves. For example, a three-bedroom, two-bathroom, single-family home is estimated to be occupied by 3.5 people, the document states.

But in 2019, the district began treating short-term rentals differently than other single-family homes, instead using a formula based on the maximum allowed occupants, according to the complaint. For a three-bedroom, two-bathroom home that is short-term rented, the maximum allowed occupants is 10 people, resulting in fees 287% higher than the same single-family home if it were not short-term rented, the document states. It claims the fees are “based on the idea that (short-term rentals) are occupied with the maximum possible number of people 365 days out of the year.”

“There is simply no evidence that (short-term rentals) are occupied with the maximum capacity 365 days out of the year and such an assertion is preposterous,” the complaint states. “And, the fees currently charged are not in any way reasonably related to the expenses of providing the service, as required by law.”

But a short-term rental technical memorandum published by the Upper Blue Sanitation District last year states that the district designs, constructs, operates and maintains its facilities for “peak daily flow and loadings” as opposed to an “average weekly, monthly or annual loading.”

Short-term rentals in Blue River, Breckenridge and Summit County “allow for an increased overnight short-term housing population compared to the original property allocation,” the memorandum states. Therefore, the formula the district uses to convert single-family residences for short term rentals “tended to better reflect the peak daily loading impact of the short-term rental single-family residences,” according to the memorandum.

The complaint filed in the lawsuit further claims that even when the Upper Blue Sanitation District’s one-day flow rates were at their highest in 2024, they were nowhere near the district’s capacity of 6.68 million gallons per day.

The highest one-day flow in the system in 2024 was 2.86 million gallons, or 43% of total capacity, but Colorado statutes and regulations only require a district to undertake planning for expanding collection and treatment capability upon reaching 80% capacity, according to the complaint.

Given the building constraints in Summit County, “it’s hard to conceive of a need to ever expand the system unless the entire housing and density scheme of Breckenridge were to change completely,” Dorotik said.

Ruelle is also president of Summit County Resort Homes, Inc., which represents over 100 homeowners suing the Summit Board of County Commissioners in the Summit County courts. That lawsuit claims the county’s short-term rental regulations violate the state Constitution and state law.