It feels like every time someone comes up with a way for the average Joe to make money from a good idea and to provide a needed service for the general public at a reasonable price, someone–either the existing business that wants a monopoly on the service or the government–does something to throw a wrench in the works.
This was the case with Airbnb. In San Francisco, a ballot initiative called Proposition F was the culprit. Here is the beginning of a short description of the initiative found at ballotpedia.org:
Proposition F was sometimes referred to as the Airbnb Initiative.
This measure, which proved the most contentious measure on the San Francisco ballot, would have imposed restrictions on private, short-term housing rentals. It would have restricted all such private rentals to 75 nights per year and imposed provisions designed to ensure such private rentals were paying hotel taxes and following city code. It would also have required guest and revenue reports from rental hosts and “hosting platforms” every three months. Moreover, Proposition F was designed to prohibit the use of “in-law” units for short-term rentals and enact regulations concerning privacy, peace and quiet. Proposition F would have allowed enforcement of its provisions by the city, as well as authorizing private action lawsuits by “interested parties”—defined as anyone living within 100 feet—against those suspected of violating the law.
So you see, the City of San Francisco and housing industry special interest groups joined forces to form a lobbying group called Share Better SF to nip this noncompliant money-making group in the bud. Because if the Airbnb homeowners weren’t going to play by the hotel rules and they weren’t going to have to pay exorbitant taxes to the City, then they weren’t going to be allowed to be in the game.
But the good news came on November 3, when the citizens of San Francisco voted for the freedom to run Airbnb differently. The people voted to allow people seeking lodging more options when they travel.
One of the big problems with Proposition F is that it fostered, nay encouraged, citizens to rat on each other.
It gave anybody living within 100 feet of an alleged short-term rental standing to sue both the people providing the short-term rentals and the websites that hosted them if they had violated the ordinance. Housing nonprofits in the city would also have standing to sue. This thing was a guaranteed lawsuit generator.
Airbnb focused on the fear of NIMBY neighbor feuds in its ad campaigns, warning it would lead people to spy on each other and sue. It also engaged in a bus shelter ad campaign that was considered “controversial” and which they eventually apologized for that suggested ways the city should spend the $12 million in hotel taxes Airbnb was paying the city, like keeping the libraries open later. Apparently it is considered poor form to remind the government that the money they forcibly take from you is supposed to be used to provide services.
So in addition to shutting down competition in the marketplace and inhibiting income growth among the short-term renters, taxpayer dollars would have been wasted on frivolous law suits as people were encouraged to sue one another.
Well done, citizens of San Francisco. You took a stand for freedom of commerce and for allowing the marketplace to experience the benefit of good competition! Perhaps you will feel the blessing of more people visiting your beautiful city and bringing more travel and tourist dollars to your economy. And, when this happens, maybe, just maybe, the City and Share Better SF will eat some crow and admit they were wrong. Not holding my breath, though!