Overview: Short-Term Rental Legality in Westcliffe, CO

Short-term rentals are explicitly allowed in Westcliffe, CO. The Town of Westcliffe has established a comprehensive licensing program for vacation rentals, offering two distinct categories: STR-1 (owner-occupied dwellings) and STR-2 (non-owner occupied properties). Westcliffe operates independently from county restrictions—properties located within town limits can obtain STR licenses regardless of any county-level moratorium affecting unincorporated areas.

Starting a Short-Term Rental Business in Westcliffe, CO

Step 1: Determine License Category

• STR-1: Owner-occupied dwelling unit or dwelling unit on a two-dwelling unit property
• STR-2: Non-owner occupied property rented or offered for rent
• Note: STR-1 has no density limits or restrictions; STR-2 is subject to "DENSITY-STR 2 Refer Exhibit A" (specific density requirements not detailed in provided documents)

Step 2: Pre-Application Preparation

Before submitting your STR license application, ensure the following:

1. Property Compliance Verification: Confirm your property meets all health, life safety, and municipal code standards
2. Insurance Evaluation: Secure appropriate liability insurance coverage for short-term rental operations
3. Tax Registration: Obtain Colorado sales tax license and lodgers' tax account registration
4. Fire Safety Arrangements: Schedule inspection with Wet Mountain Fire Department
5. Legal Documentation: Prepare deed or lease documentation proving lawful possession

Required Documents, Permits, Licenses, and Guidelines

Primary Licensing Requirements

Short-Term Rental License Application

Mandatory Documents:

• Proof of lawful possession (deed or lease)
• If not the property owner: notarized written authorization from owner
• Current insurance coverage proof
• Colorado Department of Revenue sales tax license registration
• Lodgers' tax account registration with Colorado Department of Revenue
• Completed self-compliance affidavit
• Affidavit confirming compliance with all license requirements and no conflicting private covenants
• Fire inspection certification from Wet Mountain Fire Department

Associated Business Licensing

• Colorado State Sales Tax License (required for all STR operations)
• Westcliffe Business License ($40/year, due January 1st, $25 late fee after February 15th)

Safety and Compliance Standards

Health & Life Safety Requirements

• Structural Integrity: All building components must be sound and properly maintained
• Occupancy Limits: Maximum 2 persons per bedroom plus 2 additional occupants (must be clearly advertised)
• Detection Systems:
  • Smoke detectors outside each sleeping area, in sleeping rooms, and on each living area level
  • Carbon monoxide detectors within 20 feet of sleeping areas
• Fire Safety:
  • Fire extinguishers within 30 feet of kitchen, on each living level, and in garage
  • Emergency exit maps/floor plans required
• Utilities: Operable toilet, sink, and bathtub/shower with privacy enclosures

Property Identification and Addressing

• Street address visible from street (minimum 4-inch height, ½-inch width numbers on contrasting background)
• License number, local agent, and property owner contact information posted conspicuously inside property

Community Impact Requirements

Parking and Traffic Management

• Adequate on-site parking for renter use
• On-street parking permitted where allowed by town (first-come, first-served basis, not exclusively reserved)
• No interference with public parking availability

Guest Communication and Community Relations

• Inform renters of noise ordinances (no excessive or unreasonable noise at any time)
• Communicate trash/recycling regulations and scheduled pickup times
• Provide sufficient trash and recycling receptacles complying with town code
• Comply with night lighting ordinances to minimize exterior light usage after dark
• If pets allowed: inform guests of leash laws, pet waste disposal requirements, and noise considerations

Advertising Requirements

• Mandatory inclusion: License number must appear immediately following property description in all advertising

Specific Regulations

Town of Westcliffe Regulations (Municipal Code Title 10, Chapter 1, Section 16)

• Bi-annual license renewal required
• Compliance with all residential dwelling ordinances
• Owner responsibility for license maintenance and renewal
• Subject to Zoning Enforcement Officer evaluation and approval

Custer County Regulations

Important: As of March 27, 2025, Custer County adopted a moratorium on new STR permits in unincorporated areas through December 31, 2025. This moratorium:

• Does NOT affect properties within Westcliffe town limits
• Exempts properties with existing valid permits (they may continue operating and renew)
• Allows county planning staff time to align local rules with forthcoming state regulations

State of Colorado Requirements

• Colorado sales tax license registration mandatory
• Lodgers' tax account establishment required
• State On-site Wastewater Treatment Systems (OWTS) regulations apply to properties using septic systems

Contact Information

Town of Westcliffe (Primary Authority for Town Properties)

Address:
P.O. Box 406
1000 Main Street
Westcliffe, CO 81252

Phone: 719-783-2282 (Extensions 10 or 11 for forms)

Email: Contact through phone for application forms and guidance

Hours: Monday through Friday, 8:00 AM to 5:00 PM

Website: townofwestcliffe.colorado.gov/applications-forms

Custer County Planning & Zoning (For Unincorporated Areas and Reference)

Address:
205 S 6th Street
Westcliffe, CO

Phone: 719-783-2669

Fax: 719-783-9907

Email: PZ@custercounty-co.gov

Hours: Monday through Thursday, 8:00 AM to 5:00 PM

Website: custercounty-co.gov/pz

Wet Mountain Fire Department (Fire Inspections)

Website: wetmountainfire.com/services/

Note: Direct contact information not provided in source documents; inspection required through their services

Source Links

• Town of Westcliffe STR License Application
• Town of Westcliffe Applications & Forms Page
• Custer County Planning & Zoning
• Custer County Moratorium Article (Citizen Portal AI)
• Wet Mountain Tribune STR Discussion

Investment Recommendation: Westcliffe presents a viable STR market with clear licensing pathways for town-located properties. The county moratorium affects only unincorporated areas, creating opportunity for town-limited investments. Prospective operators should prioritize early application processing due to bi-annual renewal cycles and ensure full compliance with safety standards to maintain license status.