Aspen City Council approved a slew of updates to the city’s short-term rental program on Tuesday but held off on changing permit-transfer rules tied to estate planning, giving staff and council members more time to review potential exemptions.
Council members have discussed the updates to the STR program for months that are meant to streamline some administrative processes that hadn’t been updated since the regulations were first approved in 2022. The new regulations eliminate annual homeowners association affidavits for existing permits, allow tax filing exemptions for permitted properties that are rendered untenable due to an “act of nature” emergency or have active building permits, and allow for the transfer of permits in the event of death or divorce.
They also created a new “STR-Temporary” permit type that will honor bookings made for an STR that take place after the sale of a property.
But after discussing potential updates to the program’s non-transferability clause in the case of estate planning during several work sessions, council members decided to continue the discussion to understand the implications of proposed transferability exemptions.
“I think this new element would be extremely complex and I have a lot of questions that would take this meeting into a different territory,” said Mayor Rachel Richards during the Tuesday meeting.
The current program does not allow the transfer of STR permits in any circumstance. According to a memo about the program updates sent to city council ahead of the meeting, “the sole mechanisms driving the attrition of STR permits are the prohibition of permit transfers and the annual permit renewal requirement.”
“Without permit attrition, the waitlists in capped zone districts would only lengthen, and prospective customers may not be able to obtain STR permits in [residential/multifamily] or other zone districts with waitlists,” the memo continued.
But city staff offered two potential exemptions to the non-transferability clause. One option would allow the permit holder to move the property into a trust without risking losing the permit. It would not allow a transfer of the permit until the event of the permit holder’s death.
A second option would allow the permit holder to transfer the permit to a family member with 10% ownership interest in the property. As proposed to city council, the permit could only be transferred to a spouse or lineal descendant (child, grandchild or great grandchild).
The first option would require an approved exemption from the real estate transfer tax.
Richards said that while she might support changes to the transferability regulations, the proposed changes were not fully vetted and wanted more information to determine the consequences of such a change. She and other council members also questioned whether other family members, like siblings or cousins, or even non-family members, should be included in the permit transfer exemptions.
“I think the other items in this ordinance have been very well-vetted and are ready to move forward,” she said. “I think that we could remove this item to go to a future work session code change when we fully grasp it, because I’m not willing to vote for something I don’t fully understand the full implications of.”
City council will hold a future work session to discuss the details of transferability exemptions. But council members approved the other proposed regulation changes Tuesday night so the new regulations would be in place during the 2026 permit renewal period. The renewal period started on Monday.
