PORTLAND, Ore. (PORTLAND TRIBUNE) — For the second time in two years, a city bureau is vowing to get tougher on the short-term rental industry for failing to comply with the city ordinance allowing people to rent out spare rooms in their homes to tourists.
The Bureau of Development Services announced Tuesday it’s seeking authority to levy much-bigger fines for local hosts — most of them listed on Airbnb — who fail to get permits. The bureau also wants to toughen enforcement for hosts who rent out more rooms than allowed, or rent out rooms without heeding the requirement for the host to be present.
“I think that it’s long overdue,” said Steve Unger, who owns Lion and the Rose Victorian Guest House in Irvington and operates The airbnb Analyst blog, at http://the-airbnb-analyst.com.
Getting a permit requires a cursory home inspection and a modest fee. However, only 656 of the estimated 3,000 Portland short-term rental hosts have sought permits, according to the Bureau of Development Services. That’s a compliance rate of about 22 percent.
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BDS operates on a “complaint-driven” enforcement basis, which means it doesn’t enforce city codes unless someone complains. But the city is getting an increasing number of complaints, ranging from hosts failing to get permits to a short-term rental becoming a “party house,” said Mike Liefeld, enforcement program manager for the BDS.
“From September 2014 to September 2016, we had 324 complaints just for this issue,” Liefeld said. “That’s a very high number.”
Liefeld has concluded that short-term rental hosts are gaming the system, fully aware of the city’s requirements but failing to get permits until a complaint is filed.
The new enforcement terms are meant to send a new message, he said.
Currently, BDS gives hosts working through Airbnb or other short-term rental companies 30 days to comply when a complaint comes in. If uncorrected after a month, the bureau can levy a fine of $707, and issue a similar fine the following month if the hosts still aren’t complying. On the third month, the monthly fine can double to $1,414.
Some local hosts are playing “cat and mouse” with the bureau, Liefeld said. When BDS investigates a complaint of, for example, someone renting out multiple rooms when they are only permitted to rent one, the host starts to comply. But after the heat is off, they revert to their former business practices, Liefeld said.
The current enforcement system was designed to be “educational” in part, he said, based on the reasoning that many folks just needed to learn about city rules.
“That’s just not very effective,” he said. “We’re trying to switch it up here.”
Now, more than two years after the city legalized short-term rentals, it’s clear that hosts know about the city’s requirements, he said.
The new proposal, which will be debated at an upcoming public hearing, would enable BDS to dispense with a 30-day compliance period and immediately issue a citation of $1,000. If the host remains noncompliant, the agency could issue a second fine of up to $3,000, Liefeld said. If the host is still noncompliant, the fine can go up to $5,000. Additional fines could be levied daily.
Portlanders can give testimony on the proposed new enforcement rules from noon to 2 p.m. Friday, Dec. 16, at 1900 S.W. Fourth Ave., Room 4a. Written comments also may be sent to Mike Liefeld at email@example.com.
After that point, the bureau can decide to amend its rule, adopt it as presented or drop the idea. No City Council approval is needed.
In March of 2015, the city Revenue Division vowed to crack down on short-term rental companies that weren’t complying with the city ordinance.
The ordinance requires listing companies to assure their hosts obtain permits before letting them advertise on their websites. Airbnb and other companies aren’t complying.
The Revenue Division filed suit against several of them last year to assure their compliance, and to assure they collect lodging taxes on behalf of the city. However, many of those actions are still tied up in court, Liefeld said.
In response to a request for comments Wednesday, Airbnb spokeswoman Laura Rillos sent a written statement. “We will continue to encourage all of our hosts to comply with local laws,” Rillos wrote. “We remain committed to helping Portland hosts register with the city; and will continue to proactively remove unwanted commercial listings from our platform.”
In a letter sent Tuesday to the mayor and city commissioners, Airbnb claimed it is “constantly working with hosts to ensure they are in compliance with the city’s regulations.” The letter states that Airbnb has called more than 2,000 of its most active hosts to urge they register with the city.
Several cities around the world also are attempting to rein in Airbnb and other short-term rental companies.
Airbnb is apparently softening its stance in San Francisco, home of its corporate headquarters. According to a Nov. 14 article in the San Francisco Chronicle, Airbnb said it is now willing to provide its local hosts’ names, addresses and guest stays, in a system it would craft with the city. The company has resisted providing such information when requested by Portland city officials.
But Airbnb’s action in San Francisco followed comments from a federal judge saying they’d likely rule against the company in a lawsuit over San Francisco’s law, the Chronicle reported.