Overview: Are Short-Term Rentals Allowed in Midland, TX?

Yes, short-term rentals are explicitly allowed in Midland, Texas. The city has established a regulatory framework that permits STR operations while ensuring compliance with hotel occupancy tax collection. Midland's approach is straightforward—operators must collect and remit a 7% hotel occupancy tax on all gross rental proceeds, with the revenue supporting community projects and quality of life programs.

The city defines a short-term rental as "the rental of all or part of a residential property to a person who is not a permanent resident," where a permanent resident is someone who has the right to use or possess a room for at least 30 consecutive days. This regulatory framework went into effect on February 1, 2022, and is administered by the city's Finance Department.

How to Start a Short-Term Rental Business in Midland

Starting an STR business in Midland follows a clear, streamlined process:

Step 1: Property Preparation and Compliance

• Ensure your property meets all zoning requirements and housing codes
• Verify compliance with any applicable HOA or condominium association rules
• Obtain appropriate insurance coverage for short-term rental operations
• Install required safety equipment (smoke detectors, carbon monoxide detectors, fire extinguisher)

Step 2: Registration and Tax Setup

• Register through Granicus' Host Compliance portal before accepting guests
• Set up your account for online tax payment processing
• First-time users must complete registration before making payments through the portal

Step 3: Tax Collection and Remittance

• Collect 7% hotel occupancy tax from guests on the gross rental price
• Remit collected taxes quarterly to the City of Midland
• Use the Host Compliance portal for payment processing

Step 4: Ongoing Operations

• Maintain accurate records of all rental transactions
• Display any required permit numbers on advertisements
• Comply with noise ordinances and nuisance regulations
• Respond promptly to guest inquiries and issues

Required Documents, Permits, Licenses, and Guidelines

Primary Requirements

1. Hotel/Motel Room Occupancy Tax Form - Required for tax remittance
2. Host Compliance Portal Registration - Mandatory for all STR operators
3. Business Registration - Set up through the city's online portal

Tax Collection Requirements

• Tax Rate: 7% of gross rental proceeds
• Filing Frequency: Quarterly
• Due Dates: Based on quarterly tax calendar
• Method: Online payment through Host Compliance portal

Definition Criteria

• Short-term rental: Residential property rented for 30 consecutive days or less
• Permanent resident: Someone with rental rights for 30+ consecutive days
• Hotel occupancy tax applies when 80% of gross rental receipts come from transactions of 30 days or less

Safety and Insurance Requirements

• Maintain appropriate liability insurance
• Install smoke detectors in sleeping areas and on each floor
• Provide carbon monoxide detectors where required
• Keep fire extinguishers on-site and accessible
• Ensure property meets all local housing and safety codes

Specific Regulations: City, County, and State Level

City of Midland Regulations

Tax Obligations

• Hotel Occupancy Tax Rate: 7% of gross rental proceeds
• Collection Requirement: Must collect tax from guests at point of sale
• Remittance: Quarterly payments to City of Midland Finance Department
• Penalty for Non-Compliance: Up to $500 fine per violation

Definition and Scope

• STR defined as rental of residential property to non-permanent residents
• Includes all extensions and renewals to the same person or affiliated persons
• Applies to entire residential properties or portions thereof
• Excludes oilfield portable units as defined by state law

Administrative Framework

• Finance Department administers the STR program
• Granicus' Host Compliance manages registration and tax collection
• Online portal for account setup and payments
• First-time users must register before using payment system

County Level Regulations

Note: No specific Midland County regulations were identified in the provided sources. STR operators should verify county-level requirements independently.

State of Texas Regulations

Hotel Occupancy Tax Framework

• Texas Government Code Section 156.001 defines "hotel" to include short-term rentals
• State law provides foundation for local hotel occupancy tax collection
• Oilfield portable units excluded from hotel definition (Texas Government Code Section 152.001)

Municipal Authority

• Cities authorized to collect hotel occupancy tax on STRs
• Local ordinances must align with state definitions
• Maximum penalty provisions align with general penalty guidelines

Contact Information for Local Authority

City of Midland Finance Department

Primary Contact

• Address: 300 N Loraine, Midland, TX 79701
• Phone: (432) 685-7100
• Website: www.midlandtexas.gov

Short-Term Rental Program Support

• Host Compliance Portal: Available through city website
• Registration Support: Available via phone during business hours
• Tax Questions: Finance Department handles all occupancy tax inquiries

Additional Resources

• City Directory: Available at midlandtexas.gov/directory.aspx
• Report Issues: Report an Issue portal for compliance concerns
• Emergency Services: Available through city emergency management

Links to Source Pages

Primary Regulatory Sources

• City STR Information: https://www.midlandtexas.gov/1029/Short-Term-Rental
• City Ordinance No. 10190: https://www.midlandtexas.gov/DocumentCenter/View/6563/10190---Ordinances---City-Council---Regular---6_8_2021

Required Forms and Resources

• Hotel/Motel Room Occupancy Tax Form: https://www.midlandtexas.gov/DocumentCenter/View/2437/HotelMotel-Room-Occupancy-Tax-Form
• Host Compliance Portal: https://secure.hostcompliance.com/midland-tx/permit-registration/welcome

Additional Regulatory Resources

• US Mayors STR Best Practices: https://www.usmayors.org/wp-content/uploads/2023/06/23_05_23_USCM_airbnb_v4b.pdf
• Midland Market Overview: https://www.redawning.com/pm/market-overview/midland-texas

City Services and Resources

• City Contact Directory: https://www.midlandtexas.gov/directory
• Issue Reporting: https://www.midlandtexas.gov/1193/Report-an-Issue---SeeClickFix
• Emergency Management: https://www.co.midland.tx.us/232/Emergency-Management

Key Takeaways for STR Investors

1. Midland welcomes STR investments with a business-friendly regulatory environment
2. Simple tax structure - just 7% quarterly hotel occupancy tax collection and remittance
3. Streamlined compliance through online portal system
4. No complex permitting - focus on tax compliance and basic safety requirements
5. Strong market fundamentals driven by oil industry and growing tourism sector

The regulatory framework is designed to be accessible while ensuring community benefit through tax revenue collection. Success depends on consistent compliance with tax obligations and maintaining positive community relationships through responsible hosting practices.