Hotel Occupancy Taxes

Growth of Short-Term Rentals in Jeff Davis County and How Your Airbnb Can Come into Compliance

Reagan Stone, Executive Director of the Fort Davis Chamber of Commerce

The county of Jeff Davis and village of Fort Davis are growing and so are the number of short-term rentals (STRs) in the region, many listed on popular rental websites such as Airbnb. Yet with this growth, some owners are not paying their required fair share to the local Hotel Occupancy Tax fund (local HOT). As of November 1, 2022, over half of the STRs in the county were not registered nor paying local HOT. This year will be a come to Jesus moment for the county, which plans to bring together resources to notify all owners of the rules already on the books and rules in the making which will help the county collect this important fund and help owners pay the pass-through, local HOT easier.

First, what is a short-term rental? According to the Texas Comptroller’s website, “Local hotel taxes apply to sleeping rooms costing $2 or more each day. Persons leasing their houses must collect hotel occupancy taxes from their customers in the same way a hotel or motel collects the tax from its guests.” This includes Hotels and Motels, but also Airbnb’s, VRBO’s, HomeAway’s, stationary travel trailers and even yurts or teepees, whether they are listed on a rental website or managed personally by a property owner.

How is local HOT collected by owners? Since this is a pass-through tax, this does not come out of owner’s pockets and instead is added onto the final bill, just like any other tax, and then is paid to the county by the owner. For example, the average daily room rate in the county is $153. The owner would calculate the local HOT tax of 7% into their daily rate. In the example, adding an additional $10.71 to the $153 bill. Therefore, this tax is collected by the STR owners from the tourist that enjoy our county.

Is this a big or small problem? Over the last 5 years, Airbnb’s and other short-term rentals have grown exponentially, yet the local HOT collections have remained stagnant. Local HOT is collected by the county for two big reasons – historic preservation and tourism. With more and more folks rightly choosing Fort Davis as a premier place to travel, the funds need to be in place to allow infrastructure needs to accommodate them including but not limited to county historic preservation grants, Visitor Center needs, community events, and tourism marketing-related expenses. As we grow, staffing and event logistics grow, competition in tourism grows, and all these expenses cost more and more each year.

How can we resolve the problem? The short answer is teamwork. The Fort Davis Chamber of Commerce and Visitor Center is a vital player in historic preservation as well as bringing and serving tourist, which are needed to bring economic growth. We are seeking STR owners’ advice on how to improve the process. Some ideas already passed along to county leadership include allowing a forgiveness period to come into compliance, mandating a fine for those who do not register or pay, and accepting online payments. Please remember lots of owners are already paying their share. We’d like to see those STR owners that aren’t registered do the right thing, as we hope to never leverage fines or require court mandated appearances like other regions in Texas have done. If you’d like to be part of the process of making this program work for everyone and to not be left in the dark or loose vital tourism dollars to neighboring Big Bend counties, please email Reagan Stone at In closing, neither membership nor current county registration is required to work with us, we look forward to working with all parties to do what’s right for our community’s future.