by Chris Butler
February 6, 2017
Reprinted with Permission from the Tennessee Watchdog
(Bureau chief’s note: This is the second in a three-part series about home-sharing programs and Nashville’s attempts to regulate them)
Nashville Metro Council members who push for new regulations on Airbnbs seem to do so at the behest of powerful hotel interests, which resent the competition and are now leaning on government for support.
Many people have made the claim, and evidence exists to support it.
Nashville Metro Council member Burkley Allen has put forward new licensing requirements for anyone in the city who runs an Airbnb or a similar home-sharing program.
As reported, these home-sharing options operate much like an Uber app. Instead of people using their cars to compete with cab drivers, they share their homes.
Burkley told Tennessee Watchdog in an email she got involved only after Airbnb’s competitors reached out to her.
“This issue was first brought to my attention by properly zoned historic bed and breakfast operators who asked that the city level the playing field between them and properties that were operating short term rentals without any regulation,” Burkley wrote.
According to the Beacon Center of Tennessee, a Nashville-based free-market think tank, “leveling the playing field” means hurting the competition.
“What got Councilmember Allen to begin was a disgruntled business competitor,” Beacon staff wrote in legal filings.
Almost immediately, Beacon went on, the bed and breakfast operators hired lobbyists from the hotel industry and “began to coalesce around a shared political goal.”
These efforts reached a new level of urgency after the 2016 Country Music Awards Fest. Nashville Convention and Visitors Bureau reports said spending at the event decreased by 1.5 percent because use of home-sharing options in the city doubled — from 4.9 percent to 9.2 percent, Beacon said.
The bed and breakfasts and members of the hotel industry, Beacon went on, called upon the American Hotel Association to step in.
A recent story by Business Insider says, “the AHLA isn’t shy about its antagonism towards startups like Airbnb.”
“The AHLA is trying to spur local governments to crack down on the short-term rental threat,” the Business Insider reported.
“The AHLA is circulating new ‘model legislation’ that it hopes state and city lawmakers will adapt to regulate the startups.”
Those plans include home-sharing operators paying thousands of dollars in registration fees and undergoing regular health and safety inspections.
“This is all about protecting the hotel industry,” said Beacon spokesman Mark Cunningham.
“If you’ll notice, many of the people encouraging these regulations are associated with the hotel industry.”
Greg Adkins, spokesman for the Tennessee Hospitality and Tourism Association, said his industry wants a level playing field because “hotels are more regulated than any industry that churns out pollution.”
Regulations imposed on hotels include liquor licensing, building code requirements, occupancy permits, and wage compliance rules, among many others.
Thus, hotels must pass down the extra cost of doing business to their customers, Adkins said.
Airbnbs, he went on, aren’t similarly regulated.
“Our interests are to not make the public sick, and that is why we feel very strongly that Airbnbs should not serve customers food because they can get sick and die potentially from a food borne illness,” Adkins said.
Shan Canfield of East Nashville said the fire marshal already inspects the Airbnb she manages.
Meanwhile, Alece Ronzino, who runs a competing Airbnb, said she doesn’t understand why Adkins worries about a customer getting food poisoning.
“If that were to happen, as awful as that would be, how would that affect him in the hotel industry? Why is that an issue to him?” Ronzino asked.
“Airbnbs are not trying to be hotels at all. People are intentionally trying to get away from the hotels’ corporate, sterile feel, yet there are plenty of people who will still prefer to stay there. The rate at which new hotels are continuously being built in Nashville shows they are not struggling.”
Ronzino said the proposed regulations, if enacted, would hurt her revenue stream.
Airbnb spokesman Benjamin Brett said in an emailed statement the proposed regulations are “unworkable, unenforceable and punish middle class people trying to make a little extra money.”
A recent Washington Post article quoted a New York state hotel executive, who said Airbnbs in his state would help his company raise prices on his hotel rooms.
Allen said she could not comment about what goes on in New York.
According to a recent NewsChannel 5 report, council members are pushing for an amendment to temporarily stop issuing new city permits for non-owner occupied short-term rentals. It’s a move to determine how best to regulate home-sharing properties.
“The properties are operated by landlords who don’t live at the homes they’re renting and are often looking to cash in on Nashville’s popularity,” the station reported.
As Tennessee Watchdog reported, while Nashville officials seek ways to regulate Airbnbs they’re also giving millions in taxpayer dollars to high-priced hotels — which compete against Airbnbs.
Cunningham said last year some of those hotels charge as much as $400 a night.
These proposed regulations, Ronzino said, are bad for the city.
“You think about all that growth we’re having in tourists and all the write-ups about Nashville being the ‘It City,’” Ronzino said.
“The more space we can offer to people in a reasonable and economical way then that is just better for our city.”
Contact Christopher Butler at [email protected]
