Crowdsourced bed and breakfast startup Airbnb is celebrating after helping one of its users successfully appeal a hefty fine for renting out a room in his New York City apartment.
The thing about NYC — and several other cities for that matter — is that it’s technically illegal for you to rent out any portion of your apartment or home unless you own the residency. On top of that, some city governments require you to obtain a license before being allowed to rent out your space, which isn’t practical for most people because it’s expensive and the requirements are pretty unreasonable unless you run and operate a hotel business. That said, Airbnb definitely has a vested interest in making sure NYC’s regulations don’t royally derail its business model, which is based on allowing people to rent out their homes to strangers in exchange for a negotiated rate. (Airbnb, for instance, is VERY handy for extremely large gatherings like the South by Southwest festival in Austin, Texas every March because all the hotels in the city are usually booked to capacity several months in advance.)
The regulatory win for Airbnb involved one of its users, NYC resident Nigel Warren, who rented out a room in the apartment he leases. When the NYC Environmental Control Board discovered that Warren was using Airbnb to rent out a spare room, it decided to fine his landlord $2,400. For Airbnb, this is bad for a number of reasons. Not only does it threaten the core of its business model, but now it’s sending up a red flag to landlords that they might need to evict tenants who use Airbnb or similar services. Therefore, Airbnb decided to get involved with the case back in June, hoping to smooth things out.
“This decision was a victory for the sharing economy and the countless New Yorkers who make the Airbnb community vibrant and strong, said Airbnb public policy director David Hantman in a statement yesterday. “As I said last summer, the sharing economy is here to stay, and so are we.”
Warren’s appeal win doesn’t mean that Airbnb is in the clear, but it does indicate that it’s averted the potential larger crisis of more landlords getting fined when tenants rent out their room.
Airbnb isn’t the only crowdsourced-type service that’s experiencing trouble from local governmental laws, either. Ride sharing services like Uber, SideCar, and Lyft are also getting push back from governments in big cities’ whose policies weren’t created to regulate crowdsourced services.
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