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SF legislators approve tougher rules for Airbnb

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(Natasha Dangond/Special to S.F. Examiner file photo)

Short-term rental websites will have to play by a much tougher set of rules in San Francisco under legislation approved by the Board of Supervisors on Tuesday.

The legislation, introduced by Supervisor David Campos with the support of Supervisor Aaron Peskin, was approved in a 10-0 vote. It requires short-term rental websites like Airbnb to only post rental listings by residents registered with The City, or face daily fines of up to $1,000.

Supervisor Mark Farrell recused himself from the vote, citing business interests he has with the short-term rental industry.

The approval by 10 supervisors ensures Mayor Ed Lee cannot veto the legislation.
Leading up to the vote, it was unclear how several supervisors would vote on the contentious issue amid a tense election year.

Board President London Breed, for instance, is up for re-election, vying against the more progressive tenants rights advocate Dean Preston, while Supervisor Scott Wiener, considered a more moderate politician, is facing off against the progressive Supervisor Jane Kim for the state Senate District 11 seat.

Adding to the political drama was that Airbnb had contributed more than $200,000 to more moderate candidates and ballot measures ahead of Tuesday’s election, after Campos’ proposal became known earlier this year. That move drew some criticism that the company was attempting to buy influence.

Campos emphasized the legislation is needed to enforce the current law.

The legislation adds “corporate responsibility” to the enforcement of the law to protect San Francisco’s housing stock, Campos said. Short-term rentals have been widely blamed for exacerbating The City’s housing crisis.

Last week, Breed announced she was supporting the law during a board committee hearing, adding a key seventh vote to the progressive majority.

“We’ve got to have a stronger system in place that goes after people who have entire units off the market for this purpose. That is definitely a huge problem in The City,” Breed said last week.

That left, Katy Tang, Scott Wiener and Malia Cohen as yet to take a position heading into the board meeting Tuesday.

In supporting the law, Wiener said during the meeting that “we need improved enforcement.”

The legislation was opposed by Airbnb and other internet advocacy groups like CALinnovates and Internet Association, which raised legal issues about the proposal, arguing it violates the federal law protecting internet freedom, Section 230 of the Communications Decency Act in 1996.

But the City Attorney’s Office has argued the law doesn’t regulate internet content, but instead business activities.

In the 18 months since short-term rentals were legalized in San Francisco, 1,324 hosts have registered with The City, as was already required. That’s far shy of the thousands who are engaged in short-term rentals.

Mayor Ed Lee didn’t directly take a position on the law following the vote, but said he wants to improve the registration process for hosts.

“The mayor continues to be concerned about how this new law will stand up to a legal challenge, however, he supports streamlining the process to make it easier for hosts to register and comply with the law,” said mayoral spokesperson Christine Falvey.

To ensure the law is followed, the legislation requires The City’s Office of Short-Term Rentals to provide quarterly reports on its implementation. The new law also requires short-term rental websites to post registration numbers on listings or email the number and name of the host to the Office of Short-Term Rentals.

The tougher rules will take effect within approximately 30 days.

Following the vote, Airbnb released a statement further questioning the legality of the new rules.

“An estimated 1,200 San Franciscans avoided foreclosure or eviction by hosting on Airbnb, and this legally-questionable proposal puts their housing at risk without offering any real solutions to fix the complex process,” the statement reads.

“The board acknowledged that the registration system is broken and, in order to help people to be able to stay in their homes, The City needs to fix it. We hope the board will act to fix this broken registration system, and we are considering all options to stand up for our community and keep fighting for real reform.”
Those options could include a lawsuit or a ballot measure.

It wouldn’t be the first time there was a ballot fight over Airbnb. Last year, voters defeated Proposition F that would have strengthened short-term rental regulations after Airbnb spent more than $9 million to defeat the measure.

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  • 2of3jays

    I support Regulation of businesses whether it be taxis like Uber or rental facilitating middle men like Airbnb. Well done, Supervisors, now let’s get going on Uber.

  • DVR

    Booo – why does SF hate Airbnb? Don’t they realize all 7,000 listings only represent 1.4% of all housing stock. This will hardly make any difference on available housing.

  • faze

    AirBnB and all the other “sharing” companies are parasites. Nothing but “race to the bottom” SOBs. Screw them; screw their CEOs; screw their senior staffs, and screw their investors! They blatantly violate community and legal norms as if they are “special children”. Just who do they think they are? They break laws; they violate certification regulations, and then act upset when municipalities demand that they submit to normal regulations? The entire lot of them make me sick. I say not only regulate these parasites, but start holding their senior executives and investors accountable up to and including suing them in civil court.

  • davidkennerly

    Because they’re statists who want to regulate every aspect of our lives and are egotistical enough to believe they are capable of doing so better than we are ourselves. I’ve got an empty two-bedroom apartment, part of my duplex of which I occupy the other half, that I refuse to rent in this city precisely because I won’t be regulated by a city government viscerally hostile to property owners and free markets. Neither as a rental or as an AirBnB. It’s in a great neighborhood and has a fantastic view. Empty. And it’ll stay empty as long as the busybodies occupy City Hall.

  • biggityB

    Why do you dislike them so much? I’m guessing it’s more than just the fact that (according to you) they break laws and violate certification regulations. If they didn’t do these things would you be ok with them?

  • faze

    You nailed it in your second sentence. The absolute hubris shown by these heavily investor-financed companies is breathtaking. On the other side of that coin are spineless municipal officials who roll over and play dead, so they can be part of the gravy train. It’s sickening.

    I have nothing against financial success, profit, or wealth accumulation – but when rules that everyone else has to follow are broken for no other apparent reason than there is “big investor (i.e. “connected”) money behind certain efforts, it’smore than disappointing.

    When one considers the infrastructure that these parasites feed off of,and how they play markets to win at all cost (including human costs), they deserve to be called out and – in many cases, *personally* punished.

    Aside from that, look at the social disruption caused by these companies – ironically, called “sharing” companies.

    Re: AirBnB – at *least* 10,000 housing units have been taken off the market in SF. How does that help middle class workers – teachers, social workers, nurses, etc. etc. who have to commute because they can’t afford to live here?

    Uber/Lyft: How many cab driver families have been put out to pasture? A double irony being that these two car sharing parasites are actively looking into self-driving cars, openly undermining their current workforce – a workforce that they go to court to deny benefits to.

    The only “sharing” I see is the sharing of profit at the top, while social disruption results in the middle and bottom. I have a problem with that because it does not portend well for the future of social stability or mobility in America.

  • monsoon23

    Next: Uber–a taxi dispatch company–should pay the same; fees, taxes and employee benefits equal to that paid by taxi companies.

  • Jane Hardberry

    they avoided foreclosure and eviction by exploiting

  • jhayes362

    What community spirit you have.

  • StarFire

    Uber has helped these middle-class people pay for their expensive mortgage and rent, especially in San Francisco where the mean price for a 1 bedroom apartment is up to $3,000 a month. I agree they do need to be regulated, have Airbnb hosts register and pay the hotel tax, and the corporate Airbnb company pay the taxes as well.

  • StarFire

    I would say it’s a love/hate thing with Airbnb. One the negative side, iIt decreases the housing available for purchase and apartments for rent. On the other side of the coin, lots of people are becoming Airbnb host to help them pay their rent or mortgage. San Francisco isn’t a cheap place to live thanks to the tech boom!

  • StarFire

    I think it is only fair that Airbnb hosts register and pay the hotel tax. They are a business. You would have to pay tax for your own business correct? Businesses need to be regulated.

  • StarFire

    I agree. They are a business let them pay the taxes and be registered. We have to register for everything. And let then help us pay taxes to support our cities.

  • StarFire

    They took advantage by using Airbnb to avoid foreclosure and eviction because they can’t pay their rent. If you live in San Francisco you would understand.

  • davidkennerly

    I’m more than willing to pay the hotel tax. That’s not the issue.

  • davidkennerly

    I have enormous community spirit. What I don’t have is unlimited tolerance for petty bureaucrats who treat their constituents with contempt and who look for every opportunity to crush entrepreneurism.

  • faze

    And why is rent so expensive – doesn’t taking 10’s of thousands of units OFF the market decrease supply, thereby increasing rental prices? These “sharing” companies are raping this city;it’s labor force, and its socioeconomic diversity – while their Founders, senior executives and investors walk away with huge fortunes.

    And the point is that they have to be THREATENED to pay their fees and to monitor their businesses. They’re little more than “sharing mafia”,

  • sebra leaves

    Thanks to all the supervisors for supporting this important legislation. Why should taxpayers spend money to regulate a wealthy corporation that has to register and set up “controls” for each unit anyway. All the host need to do is add a single registration number to the posts. They know exactly how many days the places are rented each year, so they should set a cut-off in their system to comply with the law.
    Agree with the monsoon23 comments that Uber and Lyft are next in line to be regulated. These corporations call themselves disruptive for a reason. The so-called “sharing companies” are looking for ways to make money be disrupting societies. Since when is disrupting society a good idea?

  • WhatWouldYodaDo

    It is not fair that some companies must succumb to regulation and others not. The answer is not to regulate them all equally, rather it is to de-regulate them all equally. Let the free market operate. Why should someone be restricted from renting out their own home to a willing occupant? Why should someone be restricted from driving around a willing stranger for money? These technology companies help remove the risks and dangers involved in these transactions. Now it is time to remove another source of friction; government regulation! I’m ok with consumption taxes and taxing people for buying luxury goods and services, but only if we remove the immoral and counter-productive income and property taxes. Stop taxing productivity, stop taxing property values which are primarily determined by the Fed’s interest rate manipulation scheme. Lets be honest about what is taking place.

  • faze

    There is no such thing as a “free market”. What “free market” operates without subsidies? Subsidies for infrastructure necessary for the “free market” to operate (roads, internet, electric infrastructure, mortgage deductions; etc. etc).

    There is nothing wrong with someone renting a room, but to take that room off the *rental* market, and enable a company that is living off all the infrastructure provided to homeowners, and make a profit from that? Sorry, no sale!

  • Deke

    This argument that people should be able to do whatever they want with their properties is kinda ridiculous. Housing is zoned residential, if you decide to turn your house into a hotel then it should be zoned accordingly. If I buy a house on a nice quiet street and some dude decides to turn his house into a hotel, then that’s bullshit. It affects *my* property value and why should they be allowed to affect me? I don’t give a crap if someone rents a room out here and there, but the second you turn it into a serious business, then BE a business and follow the rules.

    But if you argue that someone should be able to do whatever they want with their own property I would ask you if you’d be happy if I bought the apartment next to yours and turned it into a nightclub? Or what if I wanted to slaughter pigs… or raise cattle?

    Local governments have to balance residential vs commercial and yeah they might not always get it right but at the end of the day just become some tech company figured out some way around regulations it doesn’t mean it’s right.

  • Deke

    How about you sell me that half of that duplex and I’ll turn it into an unregulated 24 hour nightclub? We’ll see how quickly you become a “statist” and start begging the government to help you shut me down.

  • davidkennerly

    No, I actually really like my neighbors. It’s the socialist Board of Supervisors that I detest who insist that I cannot provide occasional out-of-town guests with a reasonably-priced and comfortable alternative to the hotels on offer by corporate cronies.

  • sfmission

    David Campos wants to fight AirBNB instead of cleaning up 16th and Mission.
    In his district there was 3 murders in one week last week. Over the last 10 years there have been 100 murders or serious assaults in the area. Keep up the good work David!