Since the beginning of May, the Cottonwood Heights City Council has been considering various ways to update the city’s Short-Term Rental Policy.  The impetus for updating the Short-Term Rental Policy comes from the popularity and economic boom of vacation rental properties (like Airbnb and VRBO). 

“We are averaging one call per day - asking if a home can be used as a short-term rental,” said Community and Economic Development Director Mike Johnson.

Based on information from the State of Utah’s Legislature research on vacation rentals, there are about 500 within the city of Cottonwood Heights. (The legislature is on a mission this year to find and document every single short-term and vacation rental in the state. Short-term rentals are estimated to produce $5.5 million in tax revenue per year, so the legislature wants to partner with the vacation rental platforms to get a better handle on legally licensing these rentals.) 

According to current city code, short-term rentals are primarily allowed within multi-family zones with a private road systems. Licensing those legal short-term rentals requires owners to pay fees and go through annual inspections.  Short-term rentals are not allowed in single-family residential zones. 

Cottonwood Heights has between 110 and 120 legal short-term rental licenses that are renewed every year. Ninety percent of those are located within three condo communities including the Canyon Racquet Club Condominiums (7430 Wasatch Blvd.) and Oaks at Wasatch (along Wasatch Grove Lane). 

“Those legal ones are not the ones we have issues with. The people who go through that process are on the ball and the units are usually complaint. They are respectful of the ordinance,” Johnson said. 

Vacation rentals that are not licensed are becoming more of a nuisance for residents and the city’s ordinance enforcement. Many residents voice their complaints to city staff members about the noise and/or parking issues elicited from illegal vacation rentals in their neighborhoods. 

“The fine is $80 to $100. It’s laughable because there are people making $5,000 per week. $100 is not a deterrent,” said Cottonwood Heights Police Chief Robby Russo.  

He suggested raising the fine and prosecution for those running illegal short-term rentals. It’s currently a Class C misdemeanor to run a short-term rental without a license. 

Per legislature from the State of Utah, listings on websites like Airbnb or Vrbo are not enough to prosecute. That means the Cottonwood Heights Police Department can’t use Airbnb solely as an enforcement tool. 

As such, Russo is in support of the city implementing a licensing process for legal short-term rentals in single-family areas since they could cross-check the property with the city’s licensing directory when receiving calls about residents operating an illegal vacation rental.

“Most of the issues are in single-family areas,” Johnson explained. “If we want to really see a change, we would need to tiptoe into the single family area, understanding that there are concerns with the housing market.”

The Cottonwood Heights City Council has been discussing requiring short-term rentals to be owner-occupied as well. Councilmember Ellen Birrell mentioned how many within her District (4) would like to license part of their homes for short-term rentals during ski season as a supplement to their income. 

“We do have an aging population who needs that extra resource,” said Councilmember Shawn Newell.

“I’m OK adding one individual car in one bedroom to supplement their income. I’m less interested in the eight people coming in for the weekend,” said Councilmember Matthew Holton. 

“Renting a room is allowed as a long-term rental but not in the short-term rental ordinances,” Johnson explained. 

“Canyon View (Elementary) is already cutting 25% of their first-grade classroom,” Councilmember Suzanne Hyland said, voicing her concern over vacation rentals in single-family areas, thereby limiting the amount of kids enrolled. 

Over the next few months, the city council plans to continue deliberating on how to update their short-term rental policy with increased fines and penalties, impacts to taxes, potential owner-occupancy language, parking needs in single-family neighborhoods, and requirements for licensing (including a cap on short-term rental licenses within the city boundaries). Keep an eye on the city’s website as a public hearing will be scheduled for the council to hear from city residents about this issue. 

resource. Mayor thinks it would be worthy of a public hearing. Traffic and street parking is what people have an issue with. Holtons not hearing much else about STRs for how people are complaining. λ