Silverthorne Town Council appears poised to pass a cap on short-term rental licenses after a majority of council members approved on first reading a draft plan from town staff during a Dec. 14 meeting. 

The plan will still need a second review and final council vote before it is approved, which is expected to take place Jan. 11, 2023. If approved, Silverthorne’s council would become the third Summit County governing body to pass such a measure — joining the Towns of Breckenridge and Frisco as well as the county itself, which has a cap on unincorporated areas outside town limits. 

“A lot of the towns have put in these restrictions and that has forced a lot of short-term rentals to look at the town of Silverthorne,” said Councilmember Amy Manka before voting for the ordinance. “We have to take into account the lives of the people that live here … and that’s why the cap is important to me.”

Under Silverthorne’s proposal, the majority of the town would fall under a limit for how many housing units, through licenses, can be short-term rentals — between 10% and 50%. Staff divided the town into three main sections, referred to as Area 1, 2 and 3, to determine how each would be affected.

Area 1, the largest area, which encompasses much of the town’s main corridors and neighborhoods, would see a cap of 10%. Area 2, which includes much of the southern downtown area along the Blue River as well as Summit Sky Ranch to the north, would be capped at 50%. And Area 3, which encompasses what staff called much of the town’s workforce housing just south of the Willowbrook neighborhood, would have no cap.

Currently, the town has about 280 short-term rental licenses. According to Mark Leidal, assistant town manager and community development director, if the proposed caps were implemented it would allow for a total of 740 licenses, which he said showed “there is plenty of room to grow.” 

Leidal said 740 licenses would represent nearly 20% of all the town’s housing units. 

Conversations around the impacts of short-term rentals in Silverthorne began in June when the council first directed staff to draft an ordinance that would limit licenses. 

A town survey in September that garnered more than 1,400 responses found a majority of residents in favor of some form of license cap. When asked about a 10% cap, 43% said it was appropriate, 41% said it was too high and 14% said it was too low.

But a majority of residents were also opposed to a cap as high as 50%. Survey results showed 68% said it was too high, 25% said it was appropriate and 6% said it was too low. 

“I think what we’re trying to do with these caps is to say ‘we understand that we want short-term rentals, we just want them in specific locations,’” Ledial said. 

Though the ordinance garnered enough support to pass on the first reading, council members debated its effects and whether it was a necessary policy to act on now. 

Mayor Ann-Marie Sandquist said she wanted to see an exemption from caps for owner-occupied units, such as residents living in their home who may rent out a bedroom. Leidal said that when the ordinance is brought back to council for second reading it will include that clarification. 

Councilmember Erin Young said she believes a cap is proactive and added, “we don’t want basic complaints, trash complaints, traffic from short-term rentals to become a problem.”

Councilmember Kelly Baldwin said council did its “due diligence” when looking at short-term rentals through community outreach like town halls and the September survey and believes the ordinance “is representing what the majority said.”

Councilmember Mike Spry said he had concerns over whether the cap could react to economic trends in years to come and questioned how easy it would be to raise the caps if demand warranted it. 

“We need to make sure we understand the market and how things are going. Are the sales being affected by the fact that we’re proposing caps?” Spry said. “I’ve never seen government increase something once we approve it … so that makes me nervous.” 

Councilmember Tim Applegate said he felt the caps were too restrictive and feared it could lead to vacancy in current and future housing if those owners were unable to rent out units, especially in the downtown area.

“Why build these units if we’re going to give them 50%?” Applegate said. “It just doesn’t make sense to me.”

The final vote was 3-2, with council members Manka, Baldwin and Young voting yes and Spry and Applegate voting no.