AirBnB ordinance officially introduced

Last week Council member Tim Burgess held a high-level briefing on the ordinance he intended to introduce (after a year of iterations) to regulate short-term rentals on platforms such as AirBnB.  Today he officially introduced the legislation, and I read it cover-to-cover so you don’t have to.

There aren’t a lot of surprises in the legislation; it’s true to what Burgess announced last week. The legislative package, co-sponsored by Council member Rob Johnson, is actually three ordinances. The first introduces the regulatory structure for short-term rental operators and platforms. The second adjusts land-use rules for short-term rentals as well as adjusting the rules for B&Bs so they are on par.  And the third introduces a tax on short-term rentals.

The text of the ordinances does provide more details on exactly how things will work, and especially on what people will have to pay. Here are the details:

• All short-term rental operators must obtain a short-term operator’s license. That costs $75 annually. A B&B operator’s license will also cost $75 per dwelling unit.
• Short-term rental platform operators are required to get a “platform license. The charge for that will be a certain dollar amount per night booked through the platform, paid quarterly. The current version of the ordinance doesn’t specify what the amount will be — it list $0 as a placeholder. So that will get sorted out in committee.
• Violation of the rules for rental operators will result in a citation with a $500 penalty for the first offense, and $1000 for subsequent offenses. Each day an operator is in violation is considered a separate offense.
• Violation of the rules for platform operators will result in a citation with a  $500 fine each day up to ten days, and $1000 per day from the eleventh day onward.
• Citations may be appealed to the city’s Hearing Examiner, which is the final authority.
• Anyone who violates the regulations and has at least two prior citations in the past three years may be subject to criminal penalties (a misdemeanor).
• The ordinance proposes a tax of $10 per night booked on being in the business of a short-term rental operator, to be paid at the same time they pay their business tax (either quarterly or annually). This is an estimate of the lodging taxes levied on hotel rooms in the city.
• The ordinance specifies that the city intends to maintain a level playing field for hotel operators and short-term rental operators and will monitor tax rates to keep them on par.

There are a few special cases, exceptions and exemptions carved out in the ordinances as well:

• An operator who offered or provided a short-term rental in the Downtown Urban Center, Uptown Urban Center, or the South Lake Union Urban Center, as established in the Seattle Comprehensive Plan (2016), prior to September 30, 2017, may obtain a short-term rental operator license allowing them to continue to operate those units and to offer or provide up to two additional dwelling units for short-term rental use.
• An operator who offered or provided a short-term rental in any dwelling units within a multifamily building constructed after 2012 that contains no more than five dwelling units established by permit under Title 23 and is located in the First Hill/Capitol Hill Urban Center, as established in the Seattle Comprehensive Plan, prior to September 30, 2017, may obtain a short-term rental operator license allowing them to continue to operate  hose units and to offer or provide up to two additional dwelling units for short-term rental use.
• A dwelling unit, or portion thereof, that is operated by an organization or government entity that is registered as a charitable organization with the Secretary of State, State of Washington, and/or is classified by the Internal Revenue Service as a public charity or private foundation, and provides temporary housing to individuals who are being treated for trauma, injury, or disease, and/or their family members, is not a short-term rental. (and is thus exempt from the regulations)

The city has not yet released estimates of how much revenue this legislation is expected to bring in, or what the funds will be used for — assuming they exceed the administrative costs to implement and enforce the regulations.

The Affordable Housing, Neighborhoods and Finance Committee will take up this legislation on Friday.