Skift Take

If Airbnb will ever succeed in easing New York's stringent short-term rental regulations, a precursor would be the type of hosting-information-sharing pact that it reached with the city. It doesn't guarantee lighter regulation, but many things could be on the table in the new normal of a post-coronavirus New York City.

Ending a years-long skirmish over complying with short-term rental regulations, Airbnb and New York City reached a settlement that requires Airbnb to provide the city with host information, including names, physical addresses, phone numbers and emails. If hosts don’t consent to the data transfer, they would be barred from listing their properties on the platform.

That Airbnb consented to such a settlement in one of its biggest global markets may have implications for other cities.

With some exceptions, such as for private and shared-room listings and properties that were listed for fewer than four nights in the previous quarter, New York hosts are subject to paying state sales and use tax, New York City hotel occupancy taxes, and city and state nightly room fees.

“This information will only be provided for hosts who have consented — but hosts who do not consent will not be able to list their home as a short-term rental,” Airbnb stated.

The settlement of Airbnb’s lawsuit against the city, which was filed in the Southern District of federal court in New York in 2018, gives Airbnb protections in case businesses such as Expedia’s Vrbo or manage to reach a better deal.

However, the settlement requires the city to consider an amended ordinance within the next 120 days on these issues that would apply to all other short-term rental platforms, as well.

The settlement, which was reached Friday, is subject to the New York City Council passing an ordinance approving the terms, and would not go into effect until 180 days after such action. It is likely therefore that the new rules and host-information transfers wouldn’t begin until 2021.

The deal is not retroactive so Airbnb would not need to provide the city with host and listing information prior to implementation.

The settlement and release of claims, which is embedded below, do not appear to ease New York’s tight restrictions on short-term rentals. The New York State Multiple Dwelling Law restricts certain short-term rentals for stays of fewer than 30 days unless the host is present. That effectively bars super hosts and corporations with multiple dwellings unless they have hotel licenses.

Airbnb co-founder Nate Blecharczyk informed hosts in an online message and email about the company’s reasoning behind the deal. Airbnb will conduct a webinar June 29 to answer hosts’ questions.

“First, compared to the City’s original ordinance, the exceptions and confidentiality provisions that will be included in the amended ordinance and the City’s related commitments will help safeguard the personal information of many hosts citywide, who would not otherwise have received those protections,” Blecharczyk said.

For example, host information won’t be subject to the Freedom of Information Law, which requires public records disclosures, the parties said.

The Airbnb co-founder said he hopes that the settlement and host-information transfers would reassure the city and state “that short-term rentals can be effectively regulated without blunt prohibitions.”

“Now more than ever, regular New Yorkers should have the ability to occasionally share their home, activity that we believe should not be confused with illegal hotels,” Blecharczyk said. “By sharing all relevant data, we hope to make this very clear to all those concerned.”

The problem, though, is that short-term rentals have become a flashpoint because many do indeed serve as quasi-hotels, disrupting communities, and contributing to shortages of affordable housing.

Airbnb has been increasingly making deals with cities, such as Boston, for example, to provide such host information to local authorities in a bid to make peace with regulators.

Update: Vijay Dandapani, CEO of the Hotel Association of New York City, told Skift Monday he thinks “Airbnb got off very lightly and this [the settlement] do nearly enough to stop illegal activity.”

Among Dandapani’s objections, he said compliance verification is up to the Office of Special Enforcement, which is “already buried under reams of data from subpoenas high they have not even gotten to.”

Other weaknesses in the settlement include a “measly”quarterly penalty of $1,500 for not reporting information, and enabling Airbnb to bring further legal action against future laws, he said. Dandapani added that the settlement lacks cross-referencing mechanisms by owner and address.]

In other Airbnb news:

  • Reuters reported that Airbnb struck a partnership with Sao Paulo, Brazil to revive tourism there once the coronavirus pandemic subsides.
  • As Skift reported Friday, women employees at Airbnb in China sent a letter to management about a high-ranking executive in China who’s allegedly been talking about his scorecard of China and San Francisco female employees’ physical appearances.
  • Airbnb co-founder and CEO said Thursday that his board, which includes “four white men, three white women, one black man and one Asian man, according to CNN, should be more diversified, and that Airbnb “could have done so much more” on diversity issues.

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Correction: The story erroneously reported that the Airbnb-New York City settlement on information-sharing about hosts would lead to increased city tax collection efforts. But the settlement is geared toward cracking down on illegal short-term rentals and not tax collection, which is primarily the responsibility of New York State.
Note: This story has been updated to include comments by the Hotel Association of New York.

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Tags: airbnb, alternative accommodations, hosts, nyc, regulations, settlements, short-term rentals, taxes

Photo credit: Airbnb reached a settlement with New York City on June 12, 2020 to begin providing host information to the city after it adopts an amended ordinance. K.H.Reichert [ ... ] / Flickr

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