Starting this week, Santa Fe vacationers who find lodging through the website Airbnb must pay a local bed tax, adding a source of potential revenue that has for years eluded city coffers.
Santa Fe officials estimate the new regulations, along with gross receipt taxes and inspection fees, will bring in about $650,000 of additional revenue annually, according to spokesman Matt Ross. The city brought in about $9.25 million from lodgers taxes in the last fiscal year.
Homeowners who list rooms on the online marketplace will be required to apply for permits by Aug. 9, according to Randy Randall, the city’s tourism chief. People who host in residential areas will need one of 1,000 residential permits, while those in commercial zones will need to apply for a business license. Those who continue to rent out their property without a permit will be subject to fines.
Officials hope the new regulations will help legitimize a rogue market that has long frustrated local hoteliers who say they’re being punished for following the rules.
Although some Airbnb hosts have gone through the permitting process under the city’s short-term rental ordinance, it’s understood that many of the 478 Santa Feans who use the site for income have operated illegally. VRBO, a similar site with 671 Santa Fe listings, does not have a lodger’s tax agreement with the city.
For now, the new requirements do not apply to Santa Fe County residents who list homes outside city limits. But the county Lodger’s Tax Advisory Board has requested to study the city ordinance and implementation process, according to county spokeswoman Kristine Mihelcic.
Jane, a host who did not want to give her full name, tells the city’s announcement prompted her to reconsider renting out a room in her home. As a disabled person who relies on social security, she says the service has helped her with her mortgage payments, but the thought of obtaining a permit could put all that to an end.
Santa Fe should differentiate between owners of multiple homes and people who rent out a room or two in their primary home, Jane says. “We’re really goodwill ambassadors for the city.”
Not everyone is upset by the tax. Bernadette Vadurro lists her casita on Airbnb and obtained a business license before the city announced its agreement with the website. Vadurro, who spoke with SFR last year about her side business, says this week that the new regulations will actually streamline the rental process. Rather than mailing in a check to the city every month, Airbnb will automatically collect the tax from her account.
Other hosts who spoke with SFR, who have yet to undergo city inspections, say they welcome the changes.
“I don't mind paying nor having guests pay taxes that we will all benefit from,” says Rachel Bounds, an artist who lists her single-story home near Museum Hill.
“I don't know how the inspection will go,” she adds. “I have been told to make sure I have a fire extinguisher.”