Several months ago, I wrote a column outlining some of the legal and policy issues raised by Airbnb’s operations in Arlington. That column presented public information about the scope of Airbnb’s Arlington activities and concluded:
Right now, Arlington County should NOT go down the path of cities like Richmond, Charlottesville and Roanoke by spending time and energy looking for strictly local ways to regulate and tax Airbnb or its participating property owners. Instead, Arlington first should focus on seeking a fair and uniform state-wide regulatory framework for Airbnb and entities like it. A Virginia state-wide solution ultimately might lead to an agreement by Airbnb and similar entities to act as the tax collection agents for localities like Arlington. Airbnb already has worked out such deals in D.C., San Francisco and Portland, Oregon.
The possibility that there might be a Virginia state-wide regulatory framework to regulate Airbnb’s operations has moved a step closer. Del. Chris Peace (R-Mechanicsville) has filed a relevant bill (H.B. 812).
As currently drafted, H.B. 812 would do three things:
- Establish a uniform, state-wide regulatory framework to regulate operations like Airbnb and FlipKey
- Preempt any local ordinances and regulations inconsistent with that state-wide regulatory framework
- Allow limited regulation by localities like Arlington so long as that regulation only relates to areas specifically authorized in the state legislation.
State-wide Regulatory Framework
H.B. 812 uses the term “limited residential lodging” (§ 55-248.53) to define the types of stays that platforms like Airbnb facilitate. Limited residential lodging means:
the accessory or secondary use of a residential dwelling unit or a portion thereof by a limited residential lodging operator to provide room or space that is suitable or intended for occupancy for dwelling, sleeping, or lodging purposes, for a period of fewer than 30 consecutive days, in exchange for a charge for the occupancy, provided only that…the primary use of the residential dwelling unit shall remain as a household living unit.
The Virginia Department of Taxation would be authorized to collect a tax from either the residential lodging operator or a hosting platform like Aribnb, and to remit a portion of those revenues back to a locality like Arlington. H.B. 812 would not apply to limited residential lodging of 90 or more days in a calendar year (§ 55-248.54 (C)).
Limited Local Regulatory Authority
Localities like Arlington would retain authority to regulate residential lodging operators with respect to nine subcategories of issues (§ 55-248.55) such as noise, safety, and liability insurance.
The status quo — in which Airbnb and other similar hosting platforms operate in Arlington and throughout Virginia in a legal never-never land — is not good public policy. Whatever its prospects in this legislative session, H.B. 812 represents a significant step forward in identifying the kinds of issues that state-wide legislation must address.
However, the 90-or-more-day carve-out from the “limited residential lodging” definition is far too harmful to hosts and should be scrapped.