A few weeks ago John Lavalle of the Woodstock planning board went before the Woodstock town board to talk about how everyone had to get thinking about new parking to deal with growth in town. He mentioned a number of projects underway and zeroed in on how much activity was being generated by a spurt of growth in the number of short term rentals available through Airbnb, VRBO and other websites, services that match those looking for lodging with the proprietors of such, as well as the frequency of their use. A call to the planning board chairman a few days later yielded a general reluctance to talk about what he was seeing, it being “still very early.” There were expansions being discussed, he allowed. And that short term rental issue.
“There are Airbnbs all over town now,” he said. “You get 700 new people in town over a weekend. Much of it is happening on neighborhood streets where no one ever thought there’d be parking problems.”
A follow up call to longstanding Planning Board secretary Therese Fernandez uncovered a host of issues under discussion, from a full saturation of virtual in-lieu-of parking situations and need for new spaces that’s starting to be negotiated between private parties on the western side of the hamlet on Tinker Street. As well as concerns about where the line between motels, short-term rentals and multiple unit dwellings lies for legal definitions and regulations.
Meanwhile, the Airbnb phenomenon also caught the attention of Ulster County Comptroller Elliott Auerbach in recent weeks, who put out a press release saying that this element of the “sharing economy” needs to share more…and pay its taxes. That came just as neighboring Delaware County decided to delay its implementation of a new lodging tax so it could include Airbnb and other short term rentals, drawing much comment and opposition in the process. And in San Francisco, where Airbnb is headquartered, voters rejected a proposition on Election Day, 55 to 45 percent, that would have started regulating short-term rentals, limiting the frequency of such transactions to no more than 75 days a year.
Airbnb and VRBO, for those not yet in the know, lets people rent out rooms, suites, floors and whole houses for short terms, running from a night to months. Airbnb now operates in 190 countries, and it has provoked a similar response to that of Auerbach’s in a great many of them, as seen by the San Francisco fight that saw millions spent in advertising by each side.
In his recent call to arms, the County Comptroller pointed out that in Ulster County, a two percent Hotel and Motel Room Occupancy Tax is part of the charge paid by every visitor overnighting in traditional hostelries. Except those staying in the new “underground” short term sites.
So Auerbach says that since these entities are not collecting nor remitting these taxes to the county, he is investigating how to capture the missing revenue. Or more specifically, having his assistant, Evan Gallo, look into what laws and taxes other municipalities and counties around the state and region have employed to deal with the phenomenon.
“Legislation will be necessary in order to capture these new types of businesses under our somewhat antiquated tax structure,” the comptroller said, noting how he’s hoping to lift his sights from the “hosts” of Ulster County to the big boys, too. “These billion dollar corporate entities need to take on the responsibility of adequately gathering and submitting local taxes that already apply to our established hotel industry.”
The official Airbnb site advises hosts to comply with local tax rules, but Airbnb does nothing to make sure they do; that task is left to local law enforcement.
‘Disrupters’
In Woodstock, Fernandez said that as important as the tax matters are, there’s also a need to figure out how to deal with a host of planning issues regarding the new phenomenon, almost to the level of a full zoning ordinance revision.
“We have a law that still addresses issues involving satellite dishes,” she remarked, noting that such a large issue might be best handled on a multiple municipality or even regional basis.
Dennis Doyle of the Ulster County Planning Department said that when he’s gotten inquiries from local towns and villages about short term rentals, he’s referred people to the American Planning Association, which has “an extensive data base” including various regulations on the phenomenon in such places as Cape Cod, the Jersey Shore and Saratoga.
“Or I tell them to Google ‘disrupters,’ a reference to a growing literature regarding all manner of such new internet-based businesses, including Uber, Lift and other shared services that slide under most current regulatory environments,” he added. “Think back to what the talk was like in the early days of telecommunications, not all that long ago,” Doyle said. “To figure out the regulatory response you have to take the time to really look at all the pros and cons. It’s similar to that of other area we’re hearing about, what with more and more nontraditional venues for parties and events, like barns, small b&bs and even stables, getting neighborhoods in an uproar over the meaning of agri-tourism.”
Auerbach expressed similar thoughts, albeit in a slightly different context. “The law in practice needs to catch up to what is going on around us in reality,” he said. “Business models constantly evolve but economic innovation often occurs before government has a chance to act. We need policies in place, especially with regard to occupancy tax, that level the playing field between online short-term room renters who are likely not paying their portion and conventional hotels that currently follow the rules.”
The comptroller added that he, too, had heard about planning concerns in addition to revenue possibilities, along with questions about short-term rentals and insurance.
“I’ve had some good talks with the lodging coalition,” he said. “We’re talking about shortcomings and challenges created by new technology.”
Auerbach added that he was planning a roundtable discussion with lodging bureau professionals, realtors, and owners of both traditional B and Bs and Airbnbs for later this month.
Similarly, Doyle said he’s been part of informal discussions in the county executive’s office regarding the same matters, and hearing requests for a larger conference on such matters from town and village officials.
Meanwhile, this week Dr. Gerald Benjamin of the former Center for Research, Regional Engagement and Outreach at SUNY New Paltz, recently renamed The Benjamin Center for Public Policy Initiatives in his honor, said that his office will start work towards putting on just such a conference in the coming months.
“It’s definitely a regional issue that needs addressing,” he said. “We are honored to help with this. See www.newpaltz.edu/benjamincenter for further information.
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