If approved, as Mendelson said he expects, the bill would represent a victory for critics of short-term rentals including the hotel industry, hotel workers union and neighborhood associations. They have said that the rapid growth of short-term rentals was reducing the availability of affordable housing and disrupting neighborhoods.
But it would also put a dent in the pocketbooks of thousands of D.C. property owners who have embraced the sharing economy and have been profiting from the District’s popularity as a destination for tourists and business visitors.
Airbnb faulted the bill for “overly strict limits” on rentals, burdensome licensing and reporting requirements, and fines of up to $6,000 for a third violation.
“Taking a hacksaw to the short-term rental industry, at the behest of the hotel industry, is not a way to encourage people to visit D.C.,” said Christopher Nulty, head of public affairs for the Americas at Airbnb.
Mendelson spoke after The Washington Post obtained a copy of the draft legislation. He said that some provisions might change by Tuesday — when the council will hold an initial vote — but that key parts would remain the same, including the ban on renting second homes and the 90-day cap.
The future of short-term rentals has become a high-profile point of contention in the broader debate in the District over gentrification. Detractors say owners are driving up housing costs by converting long-term-rental units to better-paying ones advertised for short stays by Airbnb, HomeAway, VRBO and other companies.
The bill “will not only return thousands of homes to the city’s long-term housing supply but also protect thousands more from being bought up by outside commercial investors,” said Lauren Windsor of the It’s Time D.C. coalition, which includes labor leaders and community groups.
The industry and many hosts counter that people need to rent out rooms in their primary residences, or second and third homes that they own, to earn enough money to remain in the District.
The practice has mushroomed in the nine years since Airbnb began operations in the District. Airbnb had 6,500 active hosts in the city as of July 1 and 432,800 guest arrivals last year.
The new bill is somewhat less restrictive than the original bill proposed last year by council member Kenyan R. McDuffie (D-Ward 5). The proposed 90-day cap on short-term rentals of a primary residence, when the host is away, compares with a 15-day cap in McDuffie’s version.
Mendelson said the bill was designed “to reduce the commercialization” of short-term rentals and establish rules for the young industry. Large numbers of hosts are technically in violation of zoning laws now, a condition that would be fixed with creation of a license specifically for short-term rentals.
“This field is completely unregulated, and we’re seeing some deleterious effects, whether it’s party houses, or folks complaining that people are coming night and day to the unit next door, or we’re losing apartment buildings to these short-term rentals,” Mendelson said.