PRESIDIO — At Monday night’s meeting, Presidio City Council presented a draft of a proposed ordinance that will require all short-term rentals, including those listed through online platforms like AirBnB and VRBO, to register with the city and pay hotel occupancy (HOT) tax. The draft distributed on Monday night had already been reviewed by the city’s legal representation — members of council will have plenty of time to review before it’s presented in public for a final vote.
This ordinance has been in the works since May, when Arian Velázquez-Ornelas, who serves as both a council member and board director of the Convention and Visitor Bureau, brought the issue to the attention of both organizations.“The first ordinance was put in place in 1999,” she explained. “It originally included what we considered ‘vacation homes’ as part of it, but we wanted to make sure we’re protected when it comes to that.”
Velázquez-Ornelas has been observing the rise of tourism in towns like Marfa and Terlingua for years. Both towns have had issues with getting short-term rental owners to register themselves on the HOT tax rolls, which has resulted in the city or county needing to take legal action. “Whatever’s happening around us usually ends up happening in Presidio,” she said.
The potential updates include a brand-new short-term rental ordinance and amendments to the existing HOT tax ordinance for the City of Presidio. Both are intended to help the city collect tax money it’s owed through the law, and use the money to promote the city’s burgeoning tourism industry. Local HOT tax is collected throughout the state of Texas, though the fine print of individual municipal ordinances vary from place to place.
The new short-term rental ordinance is intended to target AirBnB and VRBO listings, but it applies to any rental listing intended for occupancy under 30 days. Through the new law, all short-term rental owners would be required to seek a permit from the city. The cost for the annual permit would be $100, which includes a safety inspection from the city and a registration number for enrollment in HOT tax collection.
The ordinance also includes an important safety stipulation: short-term rental owners managing their listings remotely must designate a “local responsible party” that can be available in case of an emergency. Any time there are people occupying a short-term rental, the “local responsible party” must be reachable by phone or in person at all times, and able to get to the property within a “reasonable time” of the distress call. Failure to comply with any part of the ordinance could carry a fine up to $2,000.
The city is also hoping to amend its HOT tax ordinance to include the new short-term rental ordinance. The HOT tax ordinance specifies that the local HOT tax rate is 7% — the tax may not be levied against long-term renters or state or federal employees on official business. There’s a 1% penalty fee for noncompliance, and both the city administrator and the city attorney may bring suit against property owners found to be delinquent on their taxes.
The HOT tax ordinance also includes a detailed section on what Presidio’s remitted taxes can be used for. First on the list is “convention center facilities” and “tourism information centers” — while plans for a major convention center in the city have been put on ice, the Convention and Visitor Bureau has been actively discussing a new-and-improved information kiosk over by the pool as well as a more formal visitor center downtown.
“Pending eligibility” — approval and legal review — the funds could also potentially be used for arts facilities and sporting events. The ordinance also allows for the taxes to be used for “transportation systems” — municipal buses and shuttles might seem a long way off, but it gives the city room to grow. The funds also increase the budget for the Convention and Visitor Bureau, which puts on cultural events tourists and locals alike can enjoy, like 4th of July fireworks shows and the annual Christmas Posada parade.
Velázquez-Ornelas was receptive to criticism that the new rules could deter people from starting their own short-term rental businesses, but felt that giving the city’s tourism economy some structure would be positive in the long run. “Presidio has been growing exponentially in the past five years — you can just see it,” she said. “We want to focus on economic growth. People are going to start looking at this area, and then they’re going to be looking for places to rent.”
The regulations are intended to monetize a potential business and tourism boom while preserving what makes Presidio special. “A lot of the magazines and articles that are written about Presidio are about its isolation, its friendly and welcoming people,” she explained. “We want to be able to grow our tourism while having people say, ‘It wasn’t commercialized, it wasn’t tailored to tourism. It had this small hometown feel.’ It’s a hard line to balance, but we can work together.”