Overview: Are STRs allowed in Donnelly, ID?

Yes—explicitly allowed. Short-term rentals (STRs) are a permitted use in all zones that allow residential use within the City of Donnelly, subject to a business license and the conditions/standards in City Ordinance No. 252 (2020). Operators must also obtain a county STR permit and comply with state tax laws.

Important: Donnelly sits within Valley County, which separately requires an STR Administrative Permit (see “Required Documents, Permits, Licenses, and Guidelines” below). Compliance requires both the city business license and the county permit, plus Idaho tax obligations.

Link to source ordinance: www.cityofdonnelly.org/wp-content/uploads/2020/12/Ordinances-248-252.pdf

Starting a Short-Term Rental in Donnelly

1. Confirm zoning and HOA/CC&Rs

• STRs are allowed in all zones that permit residential use within Donnelly. If your parcel hosts more than one STR unit (or more than one residential use), you must obtain a conditional use permit.

2. Align with county requirements

• Valley County requires an STR Administrative Permit for properties inside Donnelly’s limits (Donnelly is an enclave within Valley County). Obtain this permit before or alongside your city business license. Apply via the Valley County Planning & Zoning online portal.

3. Secure city business license

• Submit a city application with applicable fee (fee is set by city resolution) to the City Clerk (Donnelly City Hall). Your license must be renewed annually, with notice to adjacent property owners and an annual compliance report.

4. Meet core STR standards (per Ordinance 252)

• Utilities: STR must be served by approved central water and sewage; no porta-potties; contract for daily garbage removal with a local provider.
• Parking: Off-street; one space per bedroom minimum; no parking in road lanes; parking must be clearly defined and not in landscaped areas.
• Use limitations: Residential-only. No event-based uses (weddings, corporate retreats, seminars, team-building, etc.). If such uses are desired, seek a conditional use permit.
• Lighting and noise: Lighting must meet City Code 18.30.070; outdoor amplified sound beyond household speakers is prohibited; observe quiet hours 10 p.m.–7 a.m.
• Safety and fire: Approved fire pit (Fire Department approval), with a fire extinguisher/water hose accessible; properly installed smoke/CO/LP detectors; display emergency exit plan and emergency contacts on-site.
• Occupancy: Limited by safe egress and Central District Health (CDH) or sewer capacity. If septic, do not exceed CDH’s authorized maximum occupancy. If on sewer, the city standard is up to four (4) people per bedroom up to twelve (12) total without a CUP.
• Lot coverage and outbuildings: Comply with city lot coverage rules; outbuildings are allowed but may not be used for sleeping/habitation.

5. Comply with Idaho tax obligations

• Sales tax: Collect and remit Idaho sales tax (6%) on taxable rents. See Idaho Code Title 63, Chapter 36 (Sales Tax). Platforms may collect/ remit for you; if you self-manage, you are responsible for registration and reporting.
• Local option tax and bed taxes: Local option tax applies; Valley County may collect a lodging (bed) tax. Proof of compliance is required with your STR application (as a “reseller” or tax-registered entity). See: legislature.idaho.gov/statutesrules/idstat/Title63/T63CH36/SECT63-3622UU/
• Central District Health (CDH) and water/sewer approvals: Obtain CDH approval for maximum occupancy if on septic; if on municipal sewer, provide proof of service. This is required for your county STR permit.

Source portal and forms: www.co.valley.id.us/STRApplication

Required Documents, Permits, Licenses, and Guidelines

Valley County STR Administrative Permit (for all Donnelly properties):

• City of Donnelly Business License (with city fees and annual renewal/adjacent-owner notice).
• Site plan to scale showing:
  • Structures over 3 feet in height (subject to single-family setbacks).
  • Off-street parking (number of vehicles; include boats/ATVs).
  • Outdoor lighting (height/type; comply with lighting ordinance, maximum of 20-ft height, 3,000 lumens, fully shielded).
  • Fire pit location and photos (with setbacks compliance).
  • Lot coverage (all structures and impervious areas may not exceed 35% of the lot).
• Lighting photos; fire pit photos; proof of compliance with payment of sales tax through platform or FEIN for self-managed.
• Central District Health approval (septic maximum occupancy) or sewage facility proof.
• Posted emergency exit plan; posted emergency contact numbers.
• Garbage service agreement or pickup plan (contract with local provider).
• On-site posted address proof (photos).
• Annual reporting and renewal requirements; permit revoked if not submitted within 30 days of renewal date.
• Annual report due on the original permit issuance date each year, showing compliance and any changes.

Idaho state-level compliance:

• Sales tax (6%): Registration/collection/remittance under Idaho Code Title 63, Chapter 36. See: legislature.idaho.gov/statutesrules/idstat/Title63/T63CH36/SECT63-3622UU/
• Local taxes (local option tax, lodging/bed tax): May be collected/ remitted by the platform or by the operator. Confirm current county lodging tax requirements.

City Business License (Donnelly) per Ordinance 252:

• Annual business license fee (resolution adopted) and annual report due August 31 each year.
• Application includes operational plan, proof of taxes, and site plan.
• Failure to obtain/license or to comply results in license revocation and enforcement as an infraction.

Specific Regulations: City, County, and State

City of Donnelly (Ordinance No. 252):

• Zoning/allowed uses: Permitted use in all residential zones; one STR per parcel with business license. Multiple STRs or residential units require conditional use permit.
• Utilities: Must meet CDH water/sewer standards; porta-potties not allowed; daily garbage removal by local provider.
• Parking: Off-street; at least one space per bedroom; no parking in traffic lanes.
• Use limitations: Residential-only; no weddings/retreats/events; CUP needed for nonresidential event uses.
• Lighting/noise: Lighting per 18.30.070; no outdoor amplified sound beyond household speakers; quiet hours 10 p.m.–7 a.m.
• Safety/fire: Approved fire pit; fire extinguisher/water hose accessible; detectors required.
• Occupancy: Capped by egress/CDH limits; on sewer, up to 4 people per bedroom up to 12 total without CUP.
• Lot coverage: Per Chapter 18 of city code; outbuildings allowed but no sleeping.
• Posting: Rules and emergency contacts; exit plan posted on-site.
• Enforcement: Violation or lack of license is grounds for revocation; infractions apply.

Source: www.cityofdonnelly.org/wp-content/uploads/2020/12/Ordinances-248-252.pdf

Valley County (Administrative STR Permit):

• Application via Planning & Zoning; county-wide standards for site plans, lighting, fire pits, lot coverage (≤35%), parking, utilities, posted address, garbage, safety devices, and exit plans.
• Maximum occupancy: County permit caps occupancy at 12 unless a conditional use permit is obtained (no per-bedroom ratio in the county application language).
• Good neighbor guidance: Quiet hours 10 p.m.–7 a.m.; obey local ordinances on ATVs/UTVs/snowmobiles; minimize recreational vehicle trips through neighborhoods.
• Enforcement: Violations result in infraction citations by the Sheriff; after 3 infractions, enforcement escalates per Valley County Code 9-2-5 through 9-2-8; revocation possible for noncompliance; costs of enforcement may be applied.
• Annual reporting and renewal required within 30 days of due date.

Source portal and examples: www.co.valley.id.us/STRApplication (includes example site plan and emergency exit plan). Enforcement text reference: codelibrary.amlegal.com/codes/valleycountyid/latest/valleycounty_id/0-0-0-1823

Idaho State:

• Sales tax (6%) on short-term rentals: See Idaho Code Title 63, Chapter 36. Sales tax registration may be “reseller” status if a marketplace collects and remits on your behalf; otherwise register and remit yourself. See: legislature.idaho.gov/statutesrules/idstat/Title63/T63CH36/SECT63-3622UU/
• Local option taxes and lodging/bed taxes: Apply based on jurisdiction; platforms may remit; if self-managed, you must register and remit.
• Legal recognition of electronic signatures for applications: Idaho Code § 28-50-107.

Secondary overview (Idaho-wide, including tax obligations): www.steadily.com/blog/airbnb-short-term-rental-laws-and-regulations-in-idaho

Contact Information (Local Authority in Charge of STRs)

City of Donnelly (Business License and Ordinance):

• Address: Donnelly City Hall, Donnelly, Idaho
• Phone: Available via city hall/website; contact in person or by phone for the City Clerk (as listed in city records). No email provided in the ordinance documents.

Valley County Planning & Zoning (County STR Permit):

• Physical: 219 North Main Street, PO Box 1350, Cascade, ID 83611
• Phone: (208) 382-7115
• Fax: (208) 382-7119
• Email: cherrick@valleycountyid.gov (Director, Cynda Herrick, AICP, CFM)
• Email: lhunter@valleycountyid.gov (Planner II, Lori Hunter)
• Email: hsmith@valleycountyid.gov (Permit Technician, Hannah Smith)
• Email: tcostello@valleycountyid.gov (Code Compliance, Tod Costello)
• Web portal for application and documents: www.co.valley.id.us/STRApplication

Central District Health (CDH):

• Contact CDH for septic/accessory use authorizations and occupancy approvals. Phone/email details vary; consult CDH’s official website/contact channels.

Links to Source Pages

• City of Donnelly Ordinance No. 252 (Short-Term Rental Ordinance): www.cityofdonnelly.org/wp-content/uploads/2020/12/Ordinances-248-252.pdf
• Valley County STR Application and portal: www.co.valley.id.us/STRApplication
• Idaho Code Title 63, Chapter 36 (Sales Tax): legislature.idaho.gov/statutesrules/idstat/Title63/T63CH36/SECT63-3622UU/
• Idaho Code § 28-50-107 (Electronic Signatures): legislature.idaho.gov/statutesrules/idstat/title28/t28ch50/sect28-50-107/
• Valley County Code Enforcement (9-2-5 through 9-2-8): codelibrary.amlegal.com/codes/valleycountyid/latest/valleycounty_id/0-0-0-1823
• Secondary overview (Idaho-wide STR laws and taxes): www.steadily.com/blog/airbnb-short-term-rental-laws-and-regulations-in-idaho

Notes for investors:

• Both the city and county have overlapping STR rules for Donnelly properties. Plan to meet the stricter/most specific standard where differences exist (e.g., parking and occupancy constraints).
• Keep your annual city license and county permit current, and maintain ongoing sales tax and lodging tax compliance to avoid infractions and possible revocation.