Pando

In San Francisco, Airbnb faces new regulations and a ballot measure aiming to curb house-sharing

By Dan Raile , written on July 17, 2015

From The Sharing Economy Desk

In San Francisco, the path to a political solution to the negative impacts of Airbnb has been long, winding and covered in astroturf.

On Tuesday that road reached its end at the Board of Supervisors. And, not for the first time, the final installment of this thrilling piece of political theater featured a surprise ending.

The proceedings of the Board were overshadowed by news from earlier in the day that a ballot initiative aimed at regulating Airbnb had been approved by the Department of Elections and will appear on the ballot this fall. Still, after months of wrangling, the Board was able to pass its own legislative package, and this new regulatory regime will remain the law of the land should the ballot measure fail.

“The problem with a ballot initiative is that if we want to change the law, we would have to go back to the voters again. We’ll have to revisit this time and again, and that’s why I believe the ballot is absolutely the wrong approach,” said Supervisor Mark Farrell at Tuesday’s hearing.

The ballot measure is notably more severe than the regulation proposed by Farrell and Mayor Ed Lee, which passed into law this week.

First, a brief explainer of the events leading up to this less-than-monumental decision: this spring, shortly after a regulatory passage passed last year took effect, the Planning Department, charged with enforcing that law, complained that the law was unenforceable. Its primary gripes were three-fold.

  • Registration – while the previous law created a process for registering Airbnb rentals with Planning, there was nothing to compel the platforms hosts to do so. Unsurprisingly, the vast majority of hosts chose not to.

  • Data-sharing – in order to effectively determine whether Airbnb and its hosts were complying with the law, the City requires data as to the location of Airbnb units and the duration of stays. Airbnb flatly refuses to provide such information to Planning, or even the city tax collector.

  • Short-term rental cap – the original law featured a ‘split cap:’ hosts who lived in their rented unit enjoyed a higher limit on the number of days out of the year they could rent their unit than those who lived elsewhere. Due to the data-sharing and registration difficulties noted above, the Planning Dept. had little ability to determine whether or not someone was living in a particular unit.

Shortly after the Planning Dept. aired these grievances, two competing packages of amendments were drafted and submitted for the Board’s approval, one by the Mayor and another led by Supervisor David Campos. Only Campos’ proposal mandated that Airbnb offer only registered units on its platform and report the relevant information regularly to the City. Both of the proposed ordinances featured ‘hard caps’ on the number of days per year a unit could be rented.

The Planning Dept. subsequently backed off its demands. Airbnb assembled its hosts to testify on its behalf at City Hall and gave them neat stickers. Months and meetings passed, until Tuesday when a vote was finally granted to the legislation.

The Mayor’s package passed, 6-5. But before it did, it was amended to remove the hard cap and revert to the original ‘split cap’ formula. The new law will also require that hosts, not the platforms, report their information to the city. So, after all those meetings and months, next to nothing was accomplished, except to excuse Silicon Valley’s second most valuable private company from having to report to the city about its operations. That responsibility was shifted to the platform’s users, who, the company stresses throughout its lobbying and marketing, are struggling to make ends meet.

These eleventh-hour changes, proposed by mayor-appointed supervisor Julie Christensen, caught some members of the Board off-guard.

“Her amendments were a complete surprise to me,” said Supervisor Jane Kim on Wednesday, by phone.

The first time the amendments packages were considered by the Board, no vote was taken. At that juncture, back in June, a new law could have forestalled the ballot measure. The issue was tabled for a month, and insiders told Pando this had happened because the Mayor’s package didn’t have the votes it needed. This was largely due to the principles of Supervisor Scott Wiener, self-described friend of Airbnb, who repeatedly claimed he could not support either package and preferred the law in its current form.

At that June meeting, Christensen said she was hopeful that a month’s delay would provide an opportunity for compromise.

“Tabling this legislation just a little longer is not disrespect, or dragging feet. It’s just to iron out the lumps and get it right.”

Alas, no lumps were ironed, and the two bills returned to the Board this week unchanged. A few weeks back, Supervisor Jane Kim told me she hadn’t heard of anyone actually trying to reconcile any differences of opinion. Supervisor Norman Yee said as much during the hearing.

“I was hoping that when we continued this we would come to some compromises, but we didn’t,” Yee said.

Christensen got her amendments through, and Wiener voted in favor of the Mayor’s package. (Editor’s Note: any resemblance between that sentence and a dick joke is completely unintentional.)

At the very same time as Wiener was abandoning his earlier hardline position in the Board chambers, he was making some San-Francisco-voter-friendly news on the airwaves. Fox News’ Bill O’Reilly aired a clip of Wiener refusing to be interviewed by a Fox News reporter, saying repeatedly “Fox news isn’t real news.”

As Wiener takes a victory lap in the press for his staunch Democratic principles, don’t forget that his staunch democratic principles may not be real principles, either.

Bill O’Reilly concluded that Wiener was a “pinhead” and that San Franciscans have gotten the government they deserve. If only O’Reilly had done a little more reporting, he might have found something to like in Wiener’s inclination for corporate appeasement.