Lawsuit alleges Summit County sanitation district overcharged short-term renters

A class action lawsuit has been initiated against the Upper Blue Sanitation District by a Summit County homeowner, alleging that short-term renters of single-family homes have been unfairly charged excessive and arbitrary fees by the district. Todd Ruelle, who short-term rents a single-family home within the sanitation district, filed the lawsuit in Summit County court on April 18. The lawsuit asserts that the district’s fees violate a Colorado law that prohibits unreasonable charges for wastewater services and aims to obtain monetary restitution for the impacted homeowners.

According to court documents, the lawsuit wants short-term rentals to be treated equitably based on their actual wastewater discharge without receiving preferential treatment or bearing an unfair burden of the system’s expenses. Attorney Alex Dorotik, representing Ruelle, emphasized the importance of short-term rentals being charged fairly for their contributions to the wastewater system.

While the Upper Blue Sanitation District has refrained from commenting on the litigation, the lawsuit alleges that single-family homeowners engaged in short-term rentals within the district have been collectively subjected to millions of dollars in unjust fees. It points out that the fees are calculated not on the basis of the actual wastewater discharge but as per an estimate of the number of occupants in each dwelling served by the district. However, as per the complaint, the district began applying a different formula to short-term rentals in 2019, leading to significantly higher fees based on the maximum allowed number of occupants for each property.

The complaint challenges the logic behind these increased fees, arguing that they are not justifiable based on the claim that short-term rentals are occupied at maximum capacity throughout the year. It describes such an assumption as absurd and emphasizes that the fees are not aligned with the actual costs of delivering the service as mandated by law.

A technical memorandum released by the Upper Blue Sanitation District last year defended the fee structure, highlighting that the district’s facilities are designed to accommodate peak daily flow and loadings, especially with the surge in overnight short-term housing in Blue River, Breckenridge, and Summit County. This approach aims to account for the impact of short-term rental properties on peak daily loading more accurately, as indicated in the memorandum.

Furthermore, the complaint asserts that even during the peak flow rates in 2024, the district’s operational capacities were not stretched to their limits. The highest one-day flow recorded in the system in 2024 was 2.86 million gallons, significantly below the district’s capacity of 6.68 million gallons per day.

The lawsuit seeks resolution on behalf of all single-family homeowners renting their properties on a short-term basis, advocating for a collective legal approach to prevent inconsistent judicial rulings and to alleviate the strain on the court system that individualized litigations may cause. The overarching goal is to rectify what the complaint characterizes as millions of dollars in illegitimate charges imposed on short-term renters in the area.