Recently, New York City’s tough AirBnB law was struck down by the Federal court. This is a major win for host listing services and may foreshadow things to come in D.C. When D.C. adopted one of the most stringent laws in the country to regulate transient, so-called ‘AirBnB’ rentals, the practical reality of actually implementing it took a back seat in the public debate. The recent struggles of New York City with its Air BnB restrictions raises a serious question about D.C.’s ability to actually enforce its ambitious measure. The NYC law required sites like VRBO, Homeaway, and AirBnB to cooperate with local authorities by providing host data. The operators refused and two of them (AirBnB and Homeaway) filed a federal lawsuit. In January, the Court declared the law unconstitutional.
The DC AirBnB law is likely to meet similar enforcement challenges
The DC law set to take effect in October 2019 restricts transient rentals to an owner’s principal residence. That means no “second homes” or corporate owned units can be listed for rent. It further limits the number of nights that the unit can be rented when the owner is not present to 90 per year. But, there is no limit on the number of nights an owner can rent while present. Further, there is an exception to the 90 night limitation for owners that have to relocate for work. The law aims to strike a balance between the rights of property owners and the public need to preserve housing stock. Opponents of the regulation argue that homeowners should be allowed to earn supplemental income while housing advocates claim that AirBnB rentals deplete affordable housing resources. Regardless of your perspective, the law raises some clear enforcement problems that require practical regulatory solutions. Such as how the District will identify unregistered hosts? How the government will determine if the host is present to enforce the 90 day restriction? Will it be self-reported? Unlike NY, the D.C. law does not impose reporting obligations on the home sharing sites. But, if the regulations implementing the law go in that direction there will undoubtedly be legal challenges. Without cooperation from the sites, DC has to monitor about 6000 hosts with more than half-a-million rentals annually, using the existing regulatory machinery. That is a tall order for the notoriously inept DCRA. The impact of the AirBnB law on affordable housing, tax revenues, and the hotel industry,remains to be seen. But, there is no question that enforcement is going to be complex and potentially financially onerous.