Since the “shared economy” is here to stay, in that “genie-out-of-the-bottle” cliché, government regulators must ensure everyone is playing on a level field. It won’t be easy, but in the end well worth the effort to protect consumers and taxpayers and to keep the U.S. economy modern.
Airbnb is one of those new app-driven economies millennials have latched onto and baby boomers have learned to profit from, but which drives classic (as in old model) businesses crazy. There are other sites but few as listing-booking-transaction-handling friendly.
Complaints have been lodged by hoteliers, bed and breakfast owners, condo and co-op boards, especially in New York City, which has drawn the attention of the state attorney general.
None of the outcry has stopped the listings from lengthening from Amsterdam to Zanzibar. Why would Niagara Falls, one of the world’s top tourist destinations, be any different?
As News staff reporter Jillian Deutsch wrote, traditional bed-and-breakfast owners in the Falls find themselves with new kids on the block, like Kristen Grandinetti whose black-and-white long-haired cats and tenant all have agreed (even tacitly) to share the “family” home with travelers from around the world.
Last year, the company created a $1.9 million windfall for hosts in Western New York, according to an Airbnb press release. Still, it shouldn’t be hard to empathize with Merle Smouse and his wife, whose renovation of an old house into a new B&B cost $12,000 to register and bring up to code. That included securing a certificate of compliance, a state Health Department permit, a building permit, a Department of Environmental report, a site plan for the city and a slew of papers on zoning and inspections.
Smouse and his colleagues feel well-regulated while having to compete with hosts bearing a digital camera and Internet access. Niagara Falls’ chief of code enforcement has reacted by sending 30 cease-and-desist letters to Falls residents in May and almost 10 the prior year. All were Airbnb hosts. His letter informed recipients that they were operating an illegal “bed and breakfast/vacation rental.”
Airbnb has drawn the attention of New York Attorney General Eric T. Schneiderman, especially when it comes to operations in New York City. The site displays New York’s laws with links to local information. Hosts agree that they have read the rules prior to posting on Airbnb. New York City is anticipating the governor’s signature on new legislation against listing unregistered rentals on the site.
Even San Francisco, the company’s birthplace, is requiring the site publish only those listings with official registration numbers. On Monday, according to the New York Times, the company sued the city following a unanimous decision made earlier this month “by the San Francisco Board of Supervisors to fine Airbnb $1,000 a day for every unregistered host who used the service.” The company may face misdemeanor charges if it doesn’t comply.
This isn’t just about accommodations. Other app-driven businesses in other sectors are also buffeting the traditional economy. Most prominent among them are Uber and Lyft, which are drawing howls from the taxi industry.
But things have changed. The “shared economy” is here and it will be hard to “unshare.” That underscores the importance of designing a level playing field that acknowledges the unstoppable influences of e-commerce.