The legislation which could require Airbnb to remove up to 75 percent of their estimated 9,500 listings in San Francisco, or face penalties that could theoretically total over $5 million a day, has been approved by San Francisco’s Board of Supervisors 10-0 with Supervisor Farrell recused from the vote.

The Short-Term Residential Rentals and Hosting Platforms amendment requires that all Hosting Platforms, such as Airbnb, Homeaway/VRBO and FlipKey, verify that every unit offered for rent in San Francisco has been registered with the City prior to its listing, mandates that Platforms respond to demands from the City for information regarding the compliance of any listing within one business day, and extends the potential civil, administrative, and criminal penalties that exist for individuals that violate the City’s short-term rental laws to Platforms which could face penalties of up to $1,000 per day for every instance in which they either (1) fail to inform a host of the City’s registration law, (2) fail to collect or pay taxes on a stay, (3) allow an unregistered unit to be listed, or (4) fail to respond to the City’s demand for information to verify a units compliance with the law.

The legislation will not apply to sites such as Craigslist which do not act as intermediaries, a key distinction to provide cover with respect to the threat of a legal challenge based on Section 230 of the Communications Decency Act (CDA).

Assuming the legislation survives a second vote next week, it will then be sent to the Mayor to sign or ignore. The amended law will become effective 30 days after the Mayor returns the signed ordinance or if ten days pass without any Mayoral action.

And any penalties collected will be deposited in the City’s Housing Trust Fund for use by the City’s Small Sites Program.

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Comments from “Plugged-In” Readers

  1. Posted by Sara Short

    The city needs to be sued for unfair targeting of productive people while allowing bums and criminals a free rein of terror over the city. It’s pure ECONOMIC PROFILING !

    • Posted by Sabbie

      Yeah it’s really productive to take housing stock away from an extremely tight local market and make a killing renting it out to people who make your neighbor’s lives miserable, all the while skirting various regulations and evading taxes.

      • Posted by Elitist Pig

        Exactly, we can’t have property owners using their own property however they like. They need to be forced into using it how WE want it to be used.

        • Posted by SFResident

          Zoning laws exist for a reason.

          • Posted by BobN

            It’s not a zoning law if it covers all areas of the city, regardless of, uh, zoning…

          • Posted by 111111

            Exactly, they exist to drive an agenda, such as NIMBYism.

        • Posted by Sabbie

          Not only has the Supreme Court upheld zoning laws as being a constitutional limitation on property rights in multiple instances, but most people agree that they make for a better quality of life. If you want to live in a libertarian paradise I would suggest Somalia or perhaps Honduras, the kind of places where if you have big dreams for your property, the sky is the limit!

        • Posted by Hunter

          It’s not a private use of property—it’s opening a public accocmodation or business, for which we already had specific legal restrictions. If you were to actually obey the existing laws (which these “homesharing” sites did not) you’d have to register your home as an actual Bed & Breakfast, including regular safety inspections and many more requirements. Is that what you’d prefer?

        • Posted by iiii

          My upstairs neighbor has been handing out keys to the front door of the building I live in to anyone with $100 and an airbnb login. So far he’s been unwilling to hire someone to man the front door 24-7 out of his profits, or even pay for the doors to be re-keyed.

          Profits for him, increased risk to his neighbors – and we have had no effective recourse.

          • Posted by Pioneer

            Complain to airbnb. Complain to the office of STR. Complain to the mayors office. Complaints drive enforcement.

      • Posted by EBGuy

        Is it time to go long Hyatt?

    • Posted by Chris

      Sara, I am not sure you understand how zoning laws work, but they are perfectly legal and they have been upheld over and over all across the country.

      Also, there is no law or Constitutional prohibition against “economic profiling.” For example, wealthy people are legally required to pay higher taxes.

      In short, your comment is ill-informed and just plain silly.

    • Posted by JR "Bob" Dobbs

      Other things that I cannot do in my home:

      Operate a slaughterhouse
      Store dynamite
      Sell methamphetamine
      Perform surgery
      Operate an auto repair service
      Manufacture plastic goods

      Economic profiling! Unfair targeting of productive people!

      • Posted by unlivable city

        Unless you live in the Mission. There you can pretty much do anything you want. Unless you are a little old lady from Marin and roll through a stop sign. Then the UCSF Police will ticket you like a sows ear at a state fair.

      • Posted by soccermom

        If this is true, it’s past time to clean my garage.

    • Posted by Stop Driving

      Productive? Please! The productive people are running the Four Seasons and people like you are ripping them off.

    • Posted by K. Alexander

      This is very simple, the SF Board of Directors are all in place by unions and for unions. They can’t stand that someone or some organizations are very successful without any union workers. They use the hotel tax as a cover, but there are not any union dues paid by AirBNB, and they can’t stand this and won’t let this happen. The veil of hotel taxes and disturbed neighbors is what they hide behind, but ask any consumer or citizen, and they love Air BNB and Uber – again a huge succes without any unions…so the unions went and unionized Uber workers…just great.

  2. Posted by Sabbie

    Common sense legislation. Thank you BOS for disrupting the disruption.

  3. Posted by Billy

    The apartments can all go back on craigslist where they were before Airbnb copied their listings to start their business. 🙂

    • Posted by Chris

      There is a reason people have switched to Airbnb and other platforms. Craigslist does not help you collect money, nor is it particularly user-friendly for searching for apartments for rent. I do not think the city is terribly concerned about Craigslist (or just plain old-fashioned flyers). Sure, some people will still try to illegal rent units, but it will go back to being much less convenient for them to do it.

  4. Posted by parklife

    In reading through the amendment I don’t see how this would ban an unregistered host from renting his/her bedroom/unit/house for 31 days with the rent paid on a weekly basis. Cancellation of the “31 day lease” would be at no cost. This would appear to skirt the ban. Of course, one would then be covered by rent control and normal tenancy laws, but at the typical Airbnb rate I doubt you’d see many owners having a problem with an ongoing tenancy.

    • Posted by Chris

      There have already been cases of individuals refusing to vacate Airbnb units and forcing expensive and costly legal proceeding while skipping out on making any additional payments. Now, imagine if those people got all of the protecting of SF’s rent control laws. Yes, you can evict someone for failure to pay rent, but it is a super expensive legal nightmare to do it. No, thank you. There is a good reason people avoid having their units subject to SF’s rent control laws.

      • Posted by parklife

        Yes, all true. Although one could avoid the 75 day restriction and the mandate that one live in the unit. For certain individuals it might be worth the risk/cost.

        • Posted by Michael P.

          There is already a robust market for 31+ day, temporary rentals to business travelers. AirBnB can easily use their platform to serve this very lucrative market. They can facilitate weekly payments, and even process cancellations of 31+ day leases should the business traveler decide stay for shorter periods.

          On a personal note, after multiple experiences with litigious tenants enabled by an out-of-control regulatory regime, I will never again serve traditional, long term tenants in San Francisco. 31+ day rentals have worked out really well for me.

    • Posted by that_dude

      Great point, parklife.

  5. Posted by Skeptical

    Yay! The progressives finally got rid of their bogey man. Will they admit that we need more housing after prices continue to rise?

    • Posted by seriously

      oh, of course not! it will simply be time to regulate the next scary thing from the future. progressives against progress! i bet these same people will fight driverless cars.

      • Posted by metaworldpeace

        Yes and yes. I’m glad there are at least two people in this city I can agree with.

  6. Posted by JR "Bob" Dobbs

    10-0 — about as veto-proof as one can get.

    I’m in favor of this. Current law already allows for:
    (a) short-term commercial tourist rentals in homes up to 75 days/yr (previously, this was not allowed at all, and it was a criminal violation to do so);
    (b) short-term commercial tourist rentals in homes that are zoned for residential, non-commercial use.

    All it required in return was registration to ensure that the law was complied with and the same taxes that apply to all hotels were paid. Yet Airbnb hosts have largely continued to ignore the law, enabled by Airbnb, VRBO etc. Laws need reasonable enforcement mechanisms, and this is just that – an efficient enforcement mechanism. Will this “cure” the SF housing problems? No. But to my knowledge nobody has claimed it would, and that is not the only goal in any event.

    Anyone who thinks homes should be available for hotel use 365 days/yr are free to gather signatures and put an initiative on the ballot, or lobby the supervisors. It will be a waste of time and money as the voters will soundly reject it, but that is how democracy works.

  7. Posted by BobN

    mandates that Platforms respond to demands from the City for information regarding the compliance of any listing within one business day

    Meanwhile, I’m in my 10th month of trying to get a straight answer out of the Treasurer’s office about a misallocation of my payroll taxes from 2011 (or 2008, they’re not sure where the mistake began). And the mistake is theirs, not mine.

    Perhaps AirBNB should set up a special 311 number to take the City’s calls.

    • Posted by parklife

      Yes, I thought the one day provision was rather imperious. The City has a problem responding to most requests in timely manner, but can then demand a response from a private company within one business day. This has nothing to do with the need or appropriateness of the amendment, but is merely a poke in the eye to the Hosting Platforms.

  8. Posted by Oh Dear

    The one and only problem i have with with short term rentals is exemplified by my neighbor renters who live in a $350 rent controlled unit and let it on short term rental for about $250 a night, without getting the owners permission. Then bragging to me about how they paid for their vacation in the south pacific for three weeks, and had enough to come back and pay two months rent. Folks that is outright unfair to the owner of the unit and the neighbors who have to deal with the parties and impacts that short term vacationers bring. They flat out do not care about their surroundings since they dont live here.

    • Posted by Fishchum

      Report him to the landlord. Most leases are boiler-plate documents and usually don’t allow a tenant to sublet their unit.

    • Posted by oscar

      amen, totally ridiculous

    • Posted by Serge

      Those sound like rare cases, but it would be a delight for your landlord. Let the landlord know about this. They will get evicted and the landlord will get a nice new market-rate tenant.

  9. Posted by soccermom

    Fantastic. If we are going to have these rules, let’s enforce them.

    I’m in favor of this because of general fairness and because a broader cross-section of San Franciscans will be required to grapple with the (diminished) revenue side of housing provision and the city bureaucracy.

    • Posted by Hunter

      Agreed. Why wasn’t this included in the first round of legislation?!

  10. Posted by Stop Driving

    If you want to run a hotel, buy a hotel. Just because someone made an app doesn’t mean you’re a hotelier without any regulations.

  11. Posted by Skeptical2

    Amen @ Stop Driving.
    Isn’t the approval process for Airbnb unconstitutional? I haven’t read much about this – although I know some AAs and studies have shown discrimination while trying to book. But isn’t the profiling itself unconstitutional? I mean, you run your house a hotel, if someone wants to book, you have to book them right, you don’t get to pick and choose

    • Posted by Stop Driving

      Yes. A hotel is bound by the interstate commerce clause that says anyone who can pay gets a room, table, etc.

      • Posted by Skeptical2

        So shouldn’t that be a pending issue for them moving forward/now? I don’t understand how that is possible then that people need to be ‘confirmed’ before booking?

        • Posted by soccermom

          Someone pointed out to me on this site that under certain circumstances, a property owner is exempt from the Fair Housing Act (Such as an owner occupied building, with four or fewer units).

          My guess is that if you are permitting strangers to stay in your spare bedroom, even for money, the law provides a carve out that you are not obligated to rent to every joker who has a web profile. I also expect this is a rapidly-evolving area of real estate law.

          • Posted by Skeptical2

            Hmmm seems to me that wouldn’t be exempt from either Fair housing (which is for residential right?) or whatever the law is that applies to hotels/other businesses that serve the public. Just seems like another hole in the sharing economy business model (Uber/airbnb), that ironically, is now a problem b/c there is a paper trail online. The irony is it’s harder to prove the institutional discrimination in the old school taxis and rentals. In other words, taxis would neglect to pick up a black driver and one who rents an apartment would meet all prospective tenants first. It will be interesting to see how this unfolds.

          • Posted by JR "Bob" Dobbs

            Anything I know in this area is a foggy memory from law school – but I believe that if you are renting space in your own home, you can largely do whatever you want. Just like you can pick your own roommates (or dinner companions) regardless of race, religion, etc. The law is likely unsettled as to whether these general principles apply to something that is, in essence, a hotel use. You would be on far shakier ground discriminating among renters in a unit in which you do not live.

            I suspect the “Platforms” have policies on this that state the law correctly (or they just say – “hosts should be aware of the laws”), and if a host violates the law, the Platforms could just point the finger right back at the host rather than at themselves.

      • Posted by anon

        Is that really true?

        IANAL, but my understanding is that the interstate commerce clause merely puts businesses such as hotels under the jurisdiction of federal law. And federal law bans certain types of discrimination (race, gender, religion,…). So I think you do get to pick and choose, just as long as you don’t choose based on certain specific prohibited criteria.

        If someone only books rooms to people with over a certain rating or with a certain length of rental history, I don’t think that’s prohibited.

  12. Posted by Dave

    As someone above said this is opening a private residence for use as a business. For which there are regulations. The large majority of Airbnb users were apparently by-passing regulations. This response by the City it toally appropriate.

    That said, in my neighborhood a large number of owners are renting out parts of their home to single techies. Most are not going the Airbnb route.

    I have no idea if all the owners are reporting the rental income or not, but this is a huge under the table way to bypass any regulation. Practically, I don’t see this rightful tightening of the law making much of a difference. Many of these non-compliant Airbnb folks will/may shift over to renting out to young single techies.

    • Posted by Mark F.

      People ignoring the government. Imagine that!

  13. Posted by SFRealist

    I think we should (a) require hosts to register AND (b) make it simple to register. Both

    • Posted by tsf

      As a SF homeowner planning to soon AirBnB a spare room in my house I can attest that the City already requires hosts to register and it’s a pretty simple process – it took 1 day to get an appointment at the Short Term Rental Office and the necessary paperwork and homeowner verification was minor.

      Sounds like this new legislation is simply the City’s attempt to enforce the current law, is that about right?

  14. Posted by EBGuy

    And, as always, don’t forget the Business Personal Property tax (PDF alert) rate of 1.1826% on furniture, appliances, equipment, and supplies used in the [short term] rental activity.

  15. Posted by A. Vandelay

    This was a waste of time and over regulation. If the Muni charges 2.50/ride, I can go buy a bus and charge the same patrons 2.00/ride. Similar concept if I buy a house, I can use it as I please aside from the illicit drug labs and underground dance parties. If I host “friends” it’s the same thing. These “friends” pay me money instead of in beers. With sky high hotel/motel rates, it only makes sense for those who want to visit to find nice cheap places to stay. And sheesh how long did it take them to find out 75% of Airbnb listings were not up to snuff? All that time and energy could’ve been put into getting projects through the pipeline a lot faster. O wait, Prop C just passed, now even more hoops to jump through before we get more housing.

    • Posted by SocketSite

      That’s a fantastic example. There’s nothing stopping you from buying a bus and offering people rides, at a discount or premium. But if you fail to secure the proper permits and licenses for said service, regulators will shut you down.

    • Posted by Government Shrinkage

      This is not a good example, at all. Established players very often use laws and regulations (through lobbying) to make entry into their market expensive and difficult.

      The industries we’re talking about here – Uber and rental housing – are perfect examples. The regulations you invoke in such reverent tones are mostly the product of decades of lobbying by narrow interest groups at the expense of the public. Taxis and Uber are such a perfect example that I don’t need to go into it. But so is rent control, where a set of entitled ‘first comers’ make housing unaffordable for the broad middle class, and thereby creates a de facto, self-perpetuating local political majority.

      These regulations usually stay buried and ignored because the status quo is hard to change because of communication, coordination, and transaction barriers Technology, of course, disrupts all three and expose regulations for what they are: legal protection and extortion for a set of powerful people for which we all pay.

      And yes you can argue – rightly – that this is our political system, so suck it. But once it sees a huge benefit – such as Uber – the public will not be so compliant. At first, it will ignore the law, and later demand that it be amended. This is why Uber is no risk of disappearing, and why AirBnB – for all the hoopla – will survive and thrive here and abroad.

  16. Posted by Simon

    As voters, we voted down a similar initiative last year (Prop F – City of San Francisco Initiative to Restrict Short-Term Rental). In what world do these bureaucrats think it is their right to skirt the will of the people and pass this legislation?

    I have seen initiatives pass and politicians voted into office that I did not vote for, but I believe in democracy and think the will of the people should be carried out. This is a clear mockery of the very tenants of our political system.

    • Posted by Jake

      This is how our political system works, per our city charter and state constitution. The Board of Supervisors is our local legislature. Writing these laws is part of their job. The 10 members of the BOS that voted for this were all elected by the people of San Francisco. They are not bureaucrats, they are much more nefarious, they are politicians with power.

      The SF laws that this legislation would amend have been around for generations and will surely be amended again in the future, sometimes by ballot and sometimes by the BOS.

      BTW, for anyone with an interest in the very long history of short term rentals and residential hotels in SF and the USA, I strongly recommend “Living Downtown; The History of Residential Hotels in the United States” by Paul Groth, UCB (free online at namelink). The advent of legislation and regulations in CA and SF is in Chapter Eight — From Scattered Opinion to Centralized Policy.

    • Posted by soccermom

      This proposal in my opinion is much more sensible than Prop F, which would have relied for enforcement via neighbor complaints. Far better, and at a much lower cost to the system in terms of time, money, and “community harmony” for AirBnB housing providers to have the real expectation that they need to be registered, and for AirBnB to have the obligation to report partners.

      That said, I’m awarding Comment Of The Day status to, “a clear mockery of the very _tenants_ of our political system.” I suspect you meant ‘tenets’ though your spelling is, at least as appropriate for our local issues.

      • Posted by Government Shrinkage

        Well, what *I* like the best about it is that it will not work at all for short-term rental services based in foreign countries that don’t give a flying hoot what the City and County of San Francisco require them to disclose.

        This City would truly thrive if the regulation it put in place was light, sensical, practical, and with an emphasis on freedom and entrepreneurship. As usual, it isn’t, and as usual, it will not work well.

      • Posted by Sal Zigtal

        I don’t know enough about architecture or psychiatry to tell if that qualifies as a Lloydian slip.

  17. Posted by anon

    While I like ride and apartment sharing as a service, the initial position taken by the likes of Uber and AirBnB that they could simply ignore or bypass any laws or regulations was totally ridiculous. They are businesses and if expect to reap the rewards of being huge businesses then they should be treated on similar footing as other like businesses.

    But its also worth pointing out that there’s quite likely a great deal of regulatory capture perpetrated by the hotel and taxi industry in order to reduce supply of hotels and taxis in order to drive up prices.

    • Posted by an architect

      i wish SS had a *like* button.

    • Posted by Shmendrick

      Not quite. If we are interested in facts, the various police and taxi commissions in San Francisco have a long history of not allowing the taxi companies to increase their fleets. (They simply didn’t want to issue more and more medallions). The is the real reason it was hard to get a cab…it it’s what left a big vacuum for uber to fill.

  18. Posted by an architect

    this legislation is not nearly as haunting as so many comment-ers are lead to believe. registration is a simple and short process, and the taxes are totally reasonable given the revenue generated. if all units anty-up, then the price of all units will increase in tandem, and the taxes will come from the pockets of tourists. how can anyone object to that?

    on another note — i know from credible sources that airbnb has *known* this legislation will eventually come down on them. they’ve been giving the middle finger to the city for as long as possible to make as much money as they can before enforcement methods are solidified. AIRBNB IS NOT PROTECTING TENANTS STRUGGLING TO MAKE RENT who need extra cash from toursists. AIRBNB CARES ABOUT ITS OWN POCKETS – all you bleeding heart libertarians need to wake up.

    • Posted by Bart Samsung

      well said. that’s the way all these people operate – lie, defy the law and delay delay delay to make a buck for themselves…and laugh when their unpaid minions troll for them on line!

  19. Posted by Bart Samsung

    Air BnB spent millions on a dishonest political campaign full of ads and mailers, and later spent money along with all of tech to make the Democrat Party in SF a locally owned PR machine. Both times they spent a lot of money and ended up getting their asses kicked.

    When do we kick out their stupid buses and raise the tax on their expensive coffees?

  20. Posted by SocketSite

    UPDATE: Airbnb Sues San Francisco to block the amended law.

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