Overview

Short-term rentals ARE ALLOWED in Chester, VT under a comprehensive ordinance adopted by the Select Board on December 7, 2022. The town requires registration, fees, and compliance with health and safety standards. This regulatory framework provides a clear pathway for legitimate STR operations while maintaining community standards.

Starting a Short-Term Rental Business in Chester, VT

Business Model Options

Chester categorizes short-term rentals into two distinct types:

Hosted Rentals: Properties where the operator's primary residence includes the rental unit or is on the same premises. These rentals offer lower regulatory costs and simpler compliance requirements.

Unhosted Rentals: Properties where the owner does not live on-site or within the immediate premises. These rentals face higher registration fees and increased regulatory scrutiny.

Registration Process

• Registration Period: Annual registrations run from April 1 through March 31
• First Registration: Available starting April 2023
• Grace Period: The town indicated reasonable treatment for properties operating between ordinance effective date and April 2023 registration period
• Ongoing Compliance: Annual renewal required with updated documentation

Required Documents, Permits, Licenses, and Guidelines

Town Registration Requirements

Application Information:

• Host's full legal name, mailing address, email, and phone number
• Date of birth
• Driver's license state and number
• Military service status
• Property address and description
• Number of bedrooms and intended occupancy

Financial Requirements:

• Hosted Rental Registration Fee: $150 annually
• Unhosted Rental Registration Fee: $300 annually
• Proof of liability insurance

State-Level Requirements

Meals and Rooms Tax:

• Vermont requires STR operators to include their Vermont Meals and Room Tax account number in all advertisements
• Collect and remit 9% Vermont Meals and Rooms Tax if renting 15+ days per year
• May be subject to 1% local option tax depending on property location

Posting Requirements (Vermont State Law):

• Contact information for person/business responsible for property maintenance
• Contact information for Vermont Department of Health
• Contact information for Vermont Department of Public Safety, Division of Fire Safety

Occupancy-Specific Requirements

Properties Hosting 8 or Fewer Guests:

• Self-certification of guest capacity
• Compliance with health and safety standards outlined in town health and safety document

Properties Hosting More Than 8 Guests:

• Documentation of sewer or septic capacity
• Inspection by State of Vermont Division of Fire Safety
• Certificate of occupancy from state fire marshal
• Final occupancy determination made by state fire marshal

Specific Regulations for Short-Term Rentals

Chester Town Regulations

Occupancy Limits:

• Standard capacity: Two guests per bedroom plus two additional guests
• Final determination for properties over 8 guests through state fire marshal inspection
• Occupancy limits apply to sleeping accommodations, not temporary visitors

Property Classifications:

• Excluded: Hotels, motels, inns, and bed and breakfast establishments (these are regulated separately by the state)
• Included: All dwelling units rented for less than 30 consecutive days and more than 14 days per calendar year

Owner Requirements:

• Out-of-state owners must maintain a representative in either Windsor or Windham counties for legal document service
• Compliance with posted capacity limits in all advertising and listings
• Adherence to health and safety standards

State-Level Vermont Regulations

Taxation:

• 9% Vermont Meals and Rooms Tax on gross rental income
• Additional 9% gross receipts tax on STR income (as of 2023)
• Local option tax may apply in certain municipalities

Advertising Requirements:

• Vermont Meals and Room Tax account number must appear in all advertisements
• Contact information for responsible party must be clearly displayed

Enforcement Mechanisms

Monitoring:

• Town has contracted with Granicus, a compliance vendor that monitors online STR postings
• Compliance company identifies properties advertising capacity exceeding registration limits
• Regular monitoring of platform listings for ordinance compliance

Violation Enforcement:

• Municipal tickets can be issued for ordinance violations
• Vermont Judicial Bureau has jurisdiction over civil violations including municipal ordinance infractions
• State Fire Marshal has authority over occupancy and safety violations

Contact Information for Local Authority

Chester Town Government

Primary Contacts:

• Zoning Administrator: Preston Bristow (contact through town office)
• Town Manager: Julie Hance
• Select Board Chair: Arne Jonynas

Town Office:

• Address: Chester Town Hall (specific address not provided in source)
• Phone: Contact through town offices
• Email: Contact through town offices

Meeting Schedule:

• Regular Select Board meetings typically held monthly
• Meeting schedules and agendas available through town office and public notice systems

State-Level Contacts

Vermont Department of Taxes:

• Short-Term Rental Information: tax.vermont.gov/business/industry/short-term-rentals

Vermont Department of Public Safety, Division of Fire Safety:

• Inspection and Certificate of Occupancy: For properties exceeding 8 guests

Source Links

1. Chester STR Ordinance (Adopted December 7, 2022): www.chestertelegraph.org/wp-content/uploads/2022/12/STR-Ordinance-Passed-by-CSB-12-7-22.pdf

2. Chester STR Health and Safety Guidelines: www.chestertelegraph.org/wp-content/uploads/2022/07/Short-Term-Rental-healthand-safety.pdf

3. Chester STR Registry Application: www.chestertelegraph.org/wp-content/uploads/2022/11/Chester-STR-registry-application-11-16-22.pdf

4. Vermont Department of Taxes - Short-Term Rentals: tax.vermont.gov/business/industry/short-term-rentals

5. Vermont Department of Environmental Conservation - Tourist Lodging Regulations: dec.vermont.gov/sites/dec/files/permit-handbook/sheet51.pdf

6. Hostfully Vermont STR Regulations Overview: www.hostfully.com/regulations/vermont/

Investment Considerations

Market Context

• Current average nightly rental rate in Chester: $300
• Growing STR market with increasing regulatory oversight
• Balance between investment opportunity and community impact concerns

Compliance Costs

• Annual registration fees: $150 (hosted) to $300 (unhosted)
• Additional costs for properties over 8 guests (state inspection fees)
• Ongoing tax obligations (9% state tax plus potential local taxes)
• Insurance requirements and potential compliance vendor costs

Strategic Planning

• Consider hosted versus unhosted model based on fee structure and management requirements
• Plan for annual registration renewal and regulatory compliance
• Factor in state taxation requirements and local option tax possibilities
• Maintain detailed records for tax compliance and regulatory reporting

This regulatory framework provides a structured environment for STR investment in Chester while ensuring health, safety, and community standards are maintained. Investors should carefully review all requirements and maintain ongoing compliance to avoid penalties and ensure sustainable operations.