Plan to regulate Airbnb might lead to total deregulation in Maine
The growth in popularity of space-sharing services like Airbnb has provided a new, more affordable option for vacationers, in some cases allowing them to rent a cozy cottage overlooking a gorgeous rocky coastal bluff for less than the cost of one room in an inn. But predictably, this new source of competition has not been well-received by the incumbents, and the Maine Innkeepers Association is demanding state legislators in Augusta take action.
But a funny thing happened on the way to the rent-seeking trough. A bill proposed to amend the state’s innkeeper regulations and require that space-sharing rentals submit to licensing has drawn a huge public backlash. Now, some lawmakers – most notably, Gov. Paul LePage – are mulling proposals to move in a very different direction.
Current Maine law requires “lodging places” that rent four or more rooms to the public be licensed by the state Department of Health and Human Services’ Division of Licensing and Regulatory Services. Licensed inns must pay a $125 fee and submit to regular inspections for compliance with the hotel code. The law carves out exemptions for youth camps, non-profit dorms, fraternity houses and “vacation rentals,” which are defined as residential properties rented for anywhere from a day to a month for recreational purposes. Under these terms, most space-sharing properties would easily fit that definition.
But under L.D. 436 – co-sponsored by Republican state Rep. Richard Malaby, himself the owner of the Crocker House Country Inn in Hancock – the law would be rewritten to apply licensing requirements to any property that rents even one room for “overnight occupancy,” defined as a period of less than seven days. The result would be to expand licensing requirements currently applied to the state’s roughly 1,400 hotels and inns to an estimated 22,000 vacation properties.
The Portland Press-Herald reports that, at an April 6 hearing on the bill, Boothbay-based Cottage Connection Vacation Rentals owner Audrey Miller spoke for many vacation property owners when she pointed to the seemingly arbitrary and capricious nature of the seven-day cutoff.
Speaking before the Legislature’s Joint Standing Committee on Health and Human Services, Miller questioned the motives of the bill’s sponsors, particularly their contention that licensing is a way to protect the safety of short-term guests.
“Why is it safe to stay in a rental for seven nights and not for four?” she said, eliciting applause from the standing-room-only crowd.
Portland resident Elizabeth Burke told the committee that the income she has earned from renting out spare rooms in her home and a family cabin on Airbnb has allowed her to pay for property improvements and taxes while bringing out-of-state dollars to Maine.
“Airbnb has made my life possible,” she said.
Speaking after the hearing to the Mount Desert Islander, Malaby himself sounded ready to concede defeat:
Malaby added that as much as he would like to see the bill pass, he believes that it will fail to become law at this time, because Airbnb has a statewide presence that many people are against regulating. He also believes his Republican peers will vote against it, as the bill adds a layer of regulatory authority to state government.
“I got over 400 emails objecting to the bill, which indicates a good amount of opposition,” he said.
There might, indeed, still be a way to create the “level playing field” the bill’s sponsors say they want, but it is likely to look very different from the one for which the Maine Innkeepers Association is agitating. Gov. LePage not only would veto the current bill if it were presented to him, adviser Holly Lusk told the assembled hearing, but he is preparing a plan to completely remove licensing requirements for lodging facilities across the state.
Among the other goals of deregulation would be to transfer inn inspectors to begin to make a dent in the state’s backlog of restaurant inspections. The Bangor Daily News reports that Lusk said the deregulation proposal would be deferred until the 2016 legislative session.