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TC Ord. No. 21-11 Ameding Chapter 3 by the Addition of a New Charpter 3.29 Implementing Voter Approval by the Town of Avon Electorate of the Community Housing STRA Avon COLORADO ORDINANCE NO.21-11 AMENDING CHAPTER 3 OF THE AVON MUNICIPAL CODE BY THE ADDITION OF A NEW CHAPTER 3.29 IMPLEMENTING VOTER APPROVAL BY THE TOWN OF AVON ELECTORATE OF THE COMMUNITY HOUSING SHORT-TERM RENTAL TAX. WHEREAS, on November 2, 2021, the electorate of the Town of Avon, Colorado approved and adopted the imposition of a two percent (2.0%) excise tax on the amount charged to any person leasing a short-term rental unit, defined as leasing any property in the Town of Avon assessed as residential by the Eagle County Assessor for a period of less than thirty days (the "Community Housing Short -Term Rental Tax"); and WHEREAS, detailed provisions to be codified in the Avon Municipal Code are now needed to provide the administrative process as to the collection of the Community Housing Short -Term Rental Tax; and WHEREAS, it is the desire of the Town Council of Avon to provide and adopt a new Chapter 29 entitled "Community Housing Short -Term Rental Tax" within Title 3 of the Avon Municipal Code. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO the following: Section 1. Recitals Incorporated. The above and foregoing recitals are incorporated herein by reference and adopted as findings and determinations of the Town Council. Section 2. Addition of Chapter 3.29 Short Term Rental Tax of the Avon Municipal Code. Chapter 3.29, "Community Housing Short -Term Rental Tax" is added to Title 3, "Revenue and Finance," of the Avon Municipal Code to read as set forth in Exhibit A to this Ordinance, which exhibit is attached hereto and incorporated in full as an exhibit to this Ordinance. Section 3. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term "provision" means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term "application" means and ORD 21-11 Community Housing Short Term Rental Tax Page 1 of 10 includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 4. Effective Date. This Ordinance shall take effect January 1, 2022, subject to voter approval of Town of Avon Ballot Issue 2C, which ballot issue will be considered at the November 2, 2021 coordinated election. Section 5. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town of Avon, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 6. No Existing Violation Affected. Nothing in this Ordinance shall be construed to release, extinguish, alter, modify, or change in whole or in part any penalty, liability or right or affect any audit, suit, or proceeding pending in any court, or any rights acquired, or liability incurred, or any cause or causes of action acquired or existing which may have been incurred or obtained under any ordinance or provision hereby repealed or amended by this Ordinance. Any such ordinance or provision thereof so amended, repealed, or superseded by this Ordinance shall be treated and held as remaining in force for the purpose of sustaining any and all proper actions, suits, proceedings and prosecutions, for the enforcement of such penalty, liability, or right, and for the purpose of sustaining any judgment, decree or order which can or may be rendered, entered, or made in such actions, suits or proceedings, or prosecutions imposing, inflicting, or declaring such penalty or liability or enforcing such right, and shall be treated and held as remaining in force for the purpose of sustaining any and all proceedings, actions, hearings, and appeals pending before any court or administrative tribunal. Section 7. Codification of Amendments. The codifier of the Town's Municipal Code, Colorado Code Publishing, is hereby authorized to make such numerical and formatting changes as may be necessary to incorporate the provisions of this Ordinance within the Avon Municipal Code. The Town Clerk is authorized to correct, or approve the correction by the codifier, of any typographical error in the enacted regulations, provided that such correction shall not substantively change any provision of the regulations adopted in this Ordinance. Such corrections may include spelling, reference, citation, enumeration, and grammatical errors. Section 8. Publication. The Town Clerk is ordered to publish this Ordinance in accordance with Chapter 1.16 of the Avon Municipal Code. [SIGNATURE PAGE FOLLOWS] ORD 21-11 Community Housing Short Term Rental Tax Page 2 of 10 INTRODUCED AND ADOPTED ON FIRST READING AND REFERRED TO PUBLIC HEARING on September 14, 2021 and setting such public hearing for September 28, 2021 at the Council Chambers of the Avon Municipal Building, located at One Hundred Mikaela Way, Avon, Colorado. � OF 02 BY: ATTEST: V v E A •: Sarah Smith Hymes, M y r Brenda Torres, Town Cl ADOPTED ON SECOND AND FINAL READING on p� ATTEST:pF.4�04, Sarah Smith Hymes, A a or Brenda Torres, Town Cle SEAL APPROVED AS TO FORM: n Attorney K41 VW wv ORD 21-11 Community Housing Short Term Rental Tax Page 3 of 10 CHAPTER 3 Community Housing Short -Term Rental Tax 3.29.010 - Purpose. With an effective date of January 1, 2022, this Chapter has been enacted to implement the vote of the Town Electorate made on November 2, 2021, to adopt and impose a two percent (2.0%) excise tax on the amount charged to any person leasing a Short -Term Rental unit in the Town of Avon, but not including hotel units, accommodations, or short-term rental units classified as commercial property by the Eagle County Assessor. The purpose of the Community Housing Short -Term Rental Tax is to fund Community Housing and Community Housing programs, and the revenue shall be collected and deposited in the Town's separate fund known as the Community Housing Fund, which shall be used exclusively to fund and finance the development and preservation of Community Housing, including the acquisition of land therefor. All provisions contained within this Chapter shall be liberally interpreted and construed in furtherance of said purpose. 3.29.020 - Definitions. The following words and phrases as used in this Chapter shall have the following meaning: Community Housing Short -Term Rental Tax means the Town of Avon excise tax approved by the Town Electorate on November 2, 2021, imposing a two percent (2.0%) excise tax on the amount charged to any person leasing a Short -Term Rental unit in the Town of Avon, but not including hotel units, accommodations, or short-term rental units classified as commercial property by the Eagle County Assessor. Consumer means any person who pays to use a Short -Term Rental unit within the Town. Director means the Director of Finance for the Town. Price paid is the total amount promised or paid in cash or other consideration in exchange for use of a Short -Term Rental Unit, including but not limited to vendor mark-up, cleaning fees, service fees, or any other charge, excluding taxes, which must be paid by the Consumer for use of the rental unit. Short -Term Rental Unit, for the purposes of this Chapter only, means any room or rooms, apartment, condominium, boardinghouse, hotel room, guesthouse, lodge, campground site, recreational vehicle space, bed and breakfast, residence or similar accommodation generally used for sleeping and made available for a fee or other consideration to guests on an overnight basis for a period fewer than thirty (30) days, excluding any unit classified as commercial property by the Eagle County Assessor. ORD 21-11 Community Housing Short Term Rental Tax Page 4 of 10 Vendor means a person providing a Short -Term Rental unit to a Consumer for a price paid, including marketplace facilitators as defined in Section 3.08.010. Sec. 3.29.030 - Excise tax imposed. (a) There is hereby imposed and levied in the Town, and shall be collected and paid, a two percent (2.0%) excise tax, called the Community Housing Short -Term Rental Tax, on the price paid for use of any Short -Term Rental unit. This tax shall be levied irrespective of the location from which the reservation for the rental use is made. (b) The vendor shall separately state the Community Housing Short -Term Rental Tax amount on an invoice, sales receipt, or any similar document provided to the consumer reflecting the price paid for use of the Short -Term Rental unit. (c) It is unlawful for any consumer not to pay, and for any vendor not to collect, the Community Housing Short -Term Rental Tax. A marketplace seller as defined in Section 3.08.010 is not liable for this collection of tax; rather, any marketplace facilitator facilitating the provision of short-term rental under this Chapter is so liable. (d) This tax shall be imposed on any rental use taxable under this Chapter for which both a bona fide reservation and any part payment, including a deposit, is made after 12:00 midnight, Mountain Standard Time, December 31, 2021, pursuant to the effective date of the enabling ordinance. Sec. 3.29.040 — License. (a) Every person who has the duty to collect the tax imposed in this Chapter must first obtain, without charge, a license to collect the tax. (b) The Town Council, upon reasonable prior and written notice to the licensee and after a hearing, may revoke or suspend the license of any person found by the Town Council to have violated any provision of this Chapter. Sec. 3.29.045 - Tax credit. Notwithstanding any other provisions of this Chapter, there shall be granted to each person owing the tax imposed in this Chapter for use of property located within The Village (at Avon) a temporary tax credit against collection of the tax equal to the amount of any public accommodations fee paid by or on behalf of such person. The amount of the credit shall not exceed the amount of the tax. No such credit shall be granted subsequent to termination of the collection of the public accommodations fee pursuant to the annexation and development agreement for The Village (at Avon). Neither the ability of the Town to grant the temporary tax credit nor the termination of the credit shall constitute a tax increase, the imposition of a new tax, or a tax policy change. ORD 21-11 Community Housing Short Term Rental Tax Page 5 of 10 Sec. 3.29.050 - Collection and remittance of tax; interest and penalty. (a) All vendors subject to this Chapter shall timely collect and be liable for an amount equal to two percent (2.0%) of the price paid for the Short -Term Rental unit and shall, before the twentieth day of each month, make a return to the Town for the preceding calendar month and remit said collected tax amounts to the Town. (b) All returns and remittances shall be made in such a manner and upon such forms as the Director may prescribe. The Director may extend the time for making a return and paying the taxes under such reasonable rules, regulations, or conditions as he or she may determine necessary from time to time. (c) Interest shall accrue, and be owed to the Town, on all delinquent or deficient payments of the Community Housing Short -Term Rental Tax from the date the tax is first due to the date it is fully paid at the simple rate of one and one-half percent (1.5%) per month. Interest shall be calculated for each month, or portion of a month, that a tax delinquency or deficiency remains unpaid. (d) A penalty of ten percent (10%) of a delinquent or deficient tax amount shall also be assessed from the date the tax is first due unless the delinquency or deficiency is due to fraud or an intent to evade the tax, in which case the penalty shall be fifty percent (50%) of the tax owed. Interest shall accrue on unpaid penalty amounts. No interest shall be allowed or paid on any overpayment of tax. Sec. 3.29.060 - Exemption from Community Housing Short -Term Rental Tax. (a) The following shall be exempt from the tax imposed under this Chapter: (1) Rentals made to the United States government and all departments and institutions thereof, the State of Colorado and the departments, institutions, and political subdivision thereof, and the Town of Avon; but only in the exercise of their governmental functions and only when rentals and purchases are supported by official government purchase orders or other official documentation and paid for by draft or warrant drawn on the government's account directly to the vendor. (2) Rentals made to charitable organizations duly established and recognized under state or federal law, but only to the extent any such rental or sale is transacted in the conduct of the organization's regular charitable functions and activities and is paid for directly by the organization without reimbursement therefor. (3) Rentals which the Town is prohibited from taxing under the Constitution or laws of the United States or the State of Colorado. (b) The burden of proving that any rental is exempt from the tax imposed under this Chapter shall be on the person asserting such exemption under such reasonable ORD 21-11 Community Housing Short Term Rental Tax Page 6 of 10 requirements of proof as the Director may prescribe. Sec. 3.29.070 - Review of return; notices. (a) The Director shall examine a return as soon as practicable after it is filed, and if it appears that the correct amount of tax to be remitted is other than that shown in the return, the Director shall recompute the amount of tax owed. (b) If the amount paid exceeds that which is owed, the Director shall send a notice of overpayment to the taxpayer, who may submit a refund claim or file an amended return within thirty (30) days of the notice. No refund shall be paid if a claim or amended return is not made within 30 days. (c) If the amount paid is less than the amount due, the Director shall send a notice of deficiency and demand for payment, including interest and penalty, to the taxpayer. The additional payment shall be due within fifteen (15) days of the notice. The taxpayer may appeal a notice of deficiency and demand for payment to the Town Manager as set out at Section 3.29.120. (d) All notices required under this Chapter shall be in writing and, if sent by conventional or electronic mail to the last known address of the intended recipient, shall be sufficient upon that mailing. A designated notice period begins with the date listed on the notice. Sec. 3.29.080. Refunds; taxes paid under protest or by mistake. (a) A taxpayer claiming an exemption disputed by a vendor may pay the tax under protest. Applications for a refund of such a protested tax must be made within sixty (60) days after the sale or event for which an exemption is claimed. (b) A taxpayer claiming refund for tax paid by mistake must make that claim within three (3) years from the date of sale. (c) All claims for refund shall be upon forms prescribed by the Director. The Director shall promptly review refund claims and issue a denial in writing or provide the funds requested. The taxpayer may appeal a Director's final decision to the Town Manager as set out at Section 3.29.120. (d) A vendor may claim a refund on behalf of a consumer if- (i) The consumer could file a claim for a refund on his or her own behalf; and (ii) The vendor establishes to the Director's satisfaction that the vendor has paid or will pay the amount claimed to the consumer. (e) No vendor shall be compelled to file a refund claim pursuant to this Chapter. ORD 21-11 Community Housing Short Term Rental Tax Page 7 of 10 Sec. 3.29.090 - Records and audits; investigations. (a) It shall be the obligation and duty of every taxpayer required to collect and remit the Community Housing Short -Term Rental Tax imposed under this Chapter to keep accurate and suitable records of all transactions subject to the tax, along with such other books, accounts and records as may be necessary to determine the amount of any tax liability. All records and books, inclusive of invoices or other rental or purchase receipts, shall be preserved for a period of three (3) years, and all such records, books and accounts shall be open for examination at any time by the Director. (b) For the purpose of ascertaining the correctness of a return, or for the purpose of determining the amount of tax due from any taxpayer, the Director may hold investigations and hearings concerning any matters covered by this Section, and may examine any relevant books, papers, records, or memoranda of any such person, requiring the attendance of such taxpayer, or any officer or employee of such taxpayer, or of any person having knowledge of such sales, and taking such testimony and proof as may be necessary to properly ascertain any tax liability. The Director shall have power to administer oaths to any person in the course of such investigations or hearings. Production of documents and attendance of witnesses shall be requested by the Director on his or her own motion or on motion of any parry; any request for production or attendance shall inform persons that compliance is voluntary but that, if the request is not complied with, the Director may apply to the Municipal Judge for issuance of a subpoena. Sec. 3.29.110 - Tax lien. (a) The taxes imposed by Section 3.29.030 shall be a first and prior lien upon the property of any person required to collect and remit taxes under this Chapter, which lien shall take precedence over all other liens, encumbrances, or claims of whatever nature and shall immediately attach to such property without the necessity of filing any notice of lien thereof. (b) If any taxes, penalty, or interest imposed by this Chapter are not timely paid after notice of deficiency is made, the Director may take action to collect such taxes, penalty, or interest, including the filing of liens. Sec. 3.29.120 - Appeals to Town Manager. (a) Any taxpayer aggrieved by a tax decision made by the Director may appeal that decision to the Town Manager. All appeals shall be made in writing, shall set forth in plain language the basis for the appeal and the relief sought, and must be delivered to the Town Manager within twenty (20) days from the date of the decision appealed from, with a copy to the Director. The Town Manager shall notify the taxpayer in writing of the time and place fixed for a hearing on the appeal at least ten (10) days in advance thereof. (b) The hearing before the Town Manager shall be informal and no transcript, rules of evidence, or filing of briefs shall be required; but the taxpayer may elect to submit a brief, in which case the Director may submit a brief. The Town Manager shall hold such hearing ORD 21-11 Community Housing Short Term Rental Tax Page 8 of 10 and issue a decision within ninety (90) days after receipt of the taxpayer's written notice of appeal; however, the Town Manager may extend such period if the delay in holding the hearing or issuing the decision was occasioned by the taxpayer. In such event, the Town Manager shall hold the hearing and issue the decision within one hundred eighty (180) days of the taxpayer's written notice of appeal. (c) The Town Manager may, for good and just cause, abate penalty or interest on an assessment if the taxpayer submits a written request for abatement not less than two (2) business days before payment of the penalty or interest is due. All abatement decisions must be in writing and placed in the taxpayer's records on file with the Town. (d) A taxpayer dissatisfied with the Town Manager's decision may seek appeal in the District Court in and for the County of Eagle as may be permitted by law. Sec. 3.29.130 - Administration of tax collections; authority of Director of Finance. Administration of provisions of this Chapter is vested in the Director of Finance, who may, with the approval of the Town Manager, prescribe forms and reasonable rules and regulations in conformity with this Chapter for the making of returns, for the ascertainment, assessment and collection of the taxes imposed hereunder, and for the proper administration and enforcement hereof, a copy of which forms, rules, and regulations shall be made available to the public. Sec. 3.29.140 - Tax information confidential. (a) Except in accordance with judicial order, or as otherwise herein provided, the Town shall not divulge any information gained from any return filed or as a result of any investigation or hearing held pursuant to the provisions of this Section. (b) Nothing contained in this subsection shall be construed to prohibit: (1) The delivery to a person, or to his or her duly authorized representative, of a copy of any return filed in connection with his or her tax; (2) The publication of statistics so classified as to prevent the identification of particular reports or returns and the items thereof, (3) The inspection by the Town Attorney, or any other legal representative of the Town, of the return or other information relating to any taxpayer who may become involved in litigation with the Town in which the said information may become material; (4) Disclosure of information to an auditor or any other outside agent hired by the Town for the purpose of auditing or establishing tax liabilities. (c) Reports and returns shall be preserved for three years, and thereafter until the Director, with the approval of the Town Manager, shall order them destroyed. Sec. 3.29.150 — Limitation of actions. ORD 21-11 Community Housing Short Term Rental Tax Page 9 of 10 No taxes imposed by this Chapter, nor interest or penalties, shall be assessed, nor shall any notice of lien be filed, distraint warrant issued, or suit for collection instituted, nor any other action to collect the same be commenced more than three (3) years after the date on which the tax was or is payable; nor shall any lien continue after such period, except for taxes assessed before the expiration of such period, notice of lien with respect to which has been filed prior to the expiration of such period, in which case such lien shall continue only for one (1) year after the filing of notice thereof. Before the expiration of such period of limitation, the taxpayer and the Town may agree in writing to an extension thereof, and the period so agreed on may be extended by subsequent agreements in writing. In the case of a false or fraudulent return made with intent to evade a tax, or where no return was filed for the same purpose, the tax, together with interest and penalties thereon, may be assessed, and proceedings for the collection of such taxes may be begun, at any time. Sec. 3.29.160 - Revenue dedication; Community Housing Fund. Money deposited into the Community Housing Fund as a result of this Community Housing Short -Term Rental Tax, shall, subject to duly adopted appropriation made by the Town Council from year-to-year, be expended exclusively to fund community housing, including without limitation the acquisition of land for housing, construction of housing, extension of public infrastructure to serve community housing development, purchase of deed restrictions, down payment assistance programs, partnerships with public and private entities to develop community housing and related costs for administration, design, legal, and consulting. Sec. 3.29.170 - Violation —penalty. Any person violating any of the provisions of this Chapter shall be subject to the penalties contained in Chapter 1.08 of this Code. ORD 21-11 Community Housing Short Term Rental Tax Page 10 of 10