The D.C. Council on Tuesday gave final approval to a bill that restricts and regulates short-term rentals through home-sharing services like Airbnb and VRBO, bringing to a close a contentious debate that stretched over 18 months and touched on issues of property rights and affordable housing.
The bill — which passed unanimously, and now heads to Mayor Muriel Bowser — allows homeowners to rent out a bedroom, basement or carriage house for short periods of time without any restrictions if they are present, but imposes a 90-day annual cap when they aren’t. It also prohibits the use of second or third homes for home-sharing purposes. If signed by Bowser, the bill will not take effect until Oct. 1, 2019.
Workers in the city’s hospitality industry and some affordable housing advocates cheered the bill, saying it would help curtail residents and business that take housing units off the market and use them instead for short-term rentals. Those have gotten increasingly popular in recent years; there are currently some 9,000 rentals in D.C. on services like Airbnb, VRBO, FlipKey, and HomeAway.
“Protecting affordable housing options in D.C. is vital to our efforts in ending homelessness and helping low-income families find a stable, affordable home,” said Kelly Sweeney McShane, the president of the Community of Hope, which provides services to homeless residents.
But some homeowners and the home-sharing services themselves lambasted the bill as unnecessarily restrictive, especially in imposing the 90-day cap and prohibiting second homes from being used for short-term rentals.
“The D.C. Council’s reckless vote today is the latest example of the misleading tactics used to pass fiscally irresponsible home sharing policy,” said Crystal Davis, an Airbnb spokeswoman, after the vote. “This Council managed to accomplish the seemingly impossible today, simultaneously depriving D.C. residents of $64 million in supplemental income annually and then sending D.C. taxpayers a bill for $104 million.”
That’s a reference to the estimated cost of the bill: $104 million. That total tallies the revenue coming in from home-sharing services that currently collect the hotel tax for every stay that’s booked on their platform. With this new bill, that income would be lost. The city’s current Zoning Code prohibits home-sharing in many residential neighborhoods, though it widely happens anyhow. By passing the bill, D.C. CFO Jeffrey DeWitt estimated that between 80 and 90 percent of current short-term rentals would be declared illegal and taken off the home-sharing platforms.
That total projected loss is expected to decrease, though. The Zoning Commission met last month and indicated that it was willing to make changes to the Zoning Code to allow short-term rentals.
During Tuesday’s debate, there were various attempts to loosen the restrictions on home-sharing, including two unsuccessful amendments introduced by Council member Brandon Todd (D-Ward 4) that would extend the cap from 90 to 120 days and allow residents with second homes to use those for short-term rentals.
Todd pointed out that Montgomery County has a 120-day cap, while Arlington’s is 185 days, and said that his constituents were concerned that the Council bill would impact them.
“I’ve heard from more people in my ward for the first time [on this matter] than on any other issue this year,” he said.
But both the amendments were opposed by Council Chairman Phil Mendelson — who helped write the bill — and were eventually voted down.
“This actually makes the affordable housing crisis in our city worse,” he said of Todd’s amendments. “It encourages people to use an investor unit for short-term rentals rather than long-term leases. That’s what our housing crisis is.”
An amendment introduced by Charles Allen (D-Ward 6) was adopted by the Council; it allows residents who are required to travel for work or to tend to a sick relative to apply for a hardship exemption to the 90-day cap.
“Many D.C. residents have jobs that require extensive travel outside the city,” he said.
The debate may have ended in the Council, but it could well continue outside of it. Airbnb said last month that if the bill passed in its current iteration, it would consider putting the issue to D.C. voters through a ballot measure. And just this week the company sued Boston over regulations that are similar to those passed by the D.C. Council.
“While our host community of 6,500 D.C. families hoped for a better solution, we remain committed to ensuring home sharing is protected in our nation’s capital,” said Crystal Davis.
A spokesman for HomeAway said the company would be “exploring all of our options in light of today’s vote.”
But Council member Kenyan McDuffie (D-Ward 5), who wrote an original version of the bill that included a much stricter annual cap, said the bill that passed represented a balancing act.
“We’re not stopping people from doing this. We’re saying if you use your primary residence, you can do short-term rentals,” he said. “But we have to strike a balance. If you have 10 rooms, you can rent them out. If you have a basement, you can rent it out. But when you start talking about second homes, you may as well talk about the third homes, the fifth homes.”
This story originally appeared on WAMU.
Martin Austermuhle