San Francisco and Airbnb, Take Two

by on April 23, 2015

Short-term rentals are more lucrative than permanent housing

The San Francisco Planning Commission votes on April 23 on new regulations for the city’s short-term rental industry. Some of the measures were part of trailing legislation when the Board of Supervisors passed its law last fall; others are Mayor Lee and the Planning Department’s response to concerns that said law is unenforceable and unworkable.

Passions are high on both sides.

Having won a huge victory last fall, short-term rental hosts like Airbnb see no reason to revisit the issue. But the politics have changed. David Chiu’s Assembly campaign is no longer driving the debate. Instead, a proposed November ballot measure by ShareBetter San Francisco has led Mayor Lee to offer changes to the law that address some of the enforceability and housing impacts.

Short-term rentals is a complicated issue. The details of regulations make a big difference. So while polls show broad support for short-term rentals, San Franciscans do not support illegal tourist rentals, which many see Airbnb and other companies as promoting.

The Big Picture: Enforcement

I consider myself an expert on preventing illegal tourist rentals. Starting in 1990 the Tenderloin Housing Clinic (which I head) often had to use clandestine strategies to stop illegal SRO conversions. In one case I even obtained the tax records of an SRO owner which showed he was falsely concealing tourist income from the IRS. He left the country and sold the hotel to avoid criminal prosecution.

I have long criticized Planning’s failure to aggressively enforce residential zoning laws. This is hardly an agency known for over-zealous crackdowns against illegal rentals.

So when Planning says it does not believe hosts like Airbnb should be able to advertise rentals for units that have not been certified by the city, people need to pay heed. Planning staff is convinced that stopping the advertising of non-certified units will greatly reduce illegal rentals.

The Planning Commission should defer to its staff on this critical issue (Update: The Commission voted 4-3 against the staff recommendation. The issue now goes to the Supervisors).

I understand that Airbnb, Craig’s List and other sites that advertise short-term rentals do not want to monitor whether units are certified. Such sites are not required to screen ads for landlords advertising rentals that violate discrimination, habitability, or other housing laws, so why should they have to monitor certifications for short-term rentals?

The answer is that this obligation comes in exchange for San Francisco’s effective rezoning of the entire city to allow otherwise illegal tourist rentals. That benefit comes with responsibilities, and requiring advertisers to certify is among them.

Section 230 of the federal Communications Decency Act states, “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.”In other words, federal law would seem to prevent San Francisco from holding Airbnb or another host liable for advertising rentals that turn out to be illegal. But the city can require hosts to limit ads to units certified by the city, as this requires no independent investigation and is not content based.

Nonprofit Standing

The nonprofit standing provision backed by Mayor Lee and Supervisor Kim last October is also before Planning. It is expected to pass, and could make a huge difference in enforcement.

The nonprofit standing provision was a game-changer for stopping SRO conversions. Hotel owners were liable for attorneys’ fees even if the lessee or manager committed the violations without the owner’s knowledge.

But as noted above, federal law likely prohibits San Francisco from imposing liability on Airbnb, Craig’s List and other hosts for advertising units that are illegally rented. So from whom can nonprofits obtain the legal fees won by enforcing the short-term rental law?

If the building owner is not liable, it becomes much more difficult to collect from a tenant. I know that some high-living realtors are involved in illegal rentals, so collection would not be a problem. But if the person doing the illegal rentals owns no real estate, collection will be difficult.

The city needs to monitor how the nonprofit enforcement plays out. It may be that city funding for enforcement is necessary.

Ballot Measure Inevitable?

In an April 14, 2015 email responding to the new short-term rental proposal announced by Mayor Lee and Supervisor Mark Farrell, ShareBetter San Francisco spokesperson Dale Carlson criticized the plan. Carlson ended the message by stating, “Fortunately, in November, the voters of San Francisco will have the opportunity to establish meaningful, enforceable rules for short-term tourist rentals.”

This says to me that a ballot measure is inevitable. If so, short-term rental proponents will be looking to pass a revised law that does just enough to reduce the ballot measure’s chances of victory. That likely explains why the Lee-Farrell proposal drops the allowable short-term rental use period from 360 to 120 days, but does not go down to the 90 days that ShareBetter San Francisco prefers.

The Planning Commission hearing  is just the beginning of a very long fight. And with the core issue of Airbnb’s back taxes largely resolved, this is a detail driven debate that many San Franciscans are likely to tune out despite the dramatic implications for the city’s rental housing stock.

Randy Shaw is Editor of Beyond Chron

Randy Shaw

Randy Shaw is the Editor of Beyond Chron and the Director of San Francisco’s Tenderloin Housing Clinic, which publishes Beyond Chron. Shaw's latest book is Generation Priced Out: Who Gets to Live in the New Urban America. He is the author of four prior books on activism, including The Activist's Handbook: Winning Social Change in the 21st Century, and Beyond the Fields: Cesar Chavez, the UFW and the Struggle for Justice in the 21st Century. He is also the author of The Tenderloin: Sex, Crime and Resistance in the Heart of San Francisco

More Posts

Tags: , , , , ,

Filed under: San Francisco News