The stakes are high as Jersey City residents vote on Airbnb

Airbnb poured millions of dollars into a campaign opposing stricter regulations ahead of it’s anticipated IPO.

Nov.November 05, 2019 05:30 PM
Airbnb CEO Brian Chesky and Jersey City Mayor Steve Fulop (Credit: Twitter, iStock, Airbnb)

Airbnb CEO Brian Chesky and Jersey City Mayor Steve Fulop (Credit: Twitter, iStock, Airbnb)

After a fraught campaign in which both Airbnb and the hotel lobby were accused of underhanded tactics, Jersey City residents are heading to the polls Tuesday to decide whether to restrict short-term rentals.

The ballot was prompted after hosts challenged an ordinance passed in June that puts 60-day cap on short-term rentals at properties where the owner is not on site, and bars short-term rentals in buildings with more than four units.

The ensuing battle pitched residents against residents, and the startup against its former ally, Jersey City Mayor Steve Fulop. Jersey City in 2015 struck an agreement with Airbnb to collect a 6 percent hotel tax on homes rented on the platform – a first of its kind in the tri-state area and a sign that lawmakers were open to accepting and regulating Airbnb.

But in recent months, Airbnb has poured $4.2 million into an opposition effort led a political action committee, “Keep our Homes.” On the other side, the Hotel Trades Council and the Sharebetter Coalition (which is bankrolled largely by the hotel industry) spent a little over $1 million on a campaign in support of regulation.

Jersey City is a relatively small market for the $31 billion startup, with just 3,000 listings and 1,500 hosts. However its proximity to New York City — where Airbnb has been locked in a dispute about regulations for years — raised the stakes of the campaign. The outcome will be closely watched by observers across the country as Airbnb, which is expected to go public next year, seeks to clear up its lingering regulatory issues.

At a pro-Airbnb event at El Cocotero restaurant in Jersey City last week, Airbnb host Felicia Palmer told a small crowd that she used the extra income to support her family. “I am not here to represent Airbnb because Airbnb has enough corporate representation, money and resources,” she said. “I’m here to represent working families; neighbors like me and you who are responsibly and legally earning an income with Airbnb.” Restaurant owner Luis Quintero said he supported Airbnb because his sister, a single mom, relied on the income she got from renting an extra room in her house.

But the Hotel Trades Council and its allies, including housing group Jersey City Together, say the law doesn’t target individual homeowners. They say it’s designed instead to go after commercial operators who come to Jersey City from New York and buy properties in bulk as a way of getting around New York’s ever-tightening regulations.

“We have seen the impact of big, commercial, short-term rental operators firsthand as we have knocked on doors in rent-controlled buildings and as we have talked to members of our congregations who see the impact on their neighborhoods,” Jersey City Together’s Diane Maxon said in a statement.

Another point of contention that has emerged between the camps is about what the law will actually do. Airbnb supporters argue it amounts to a total “ban” on listings — “ban the ban!” is a campaign chant — but Mayor Fulop, who sponsored the law, said they’ve got it wrong.

“I think [the law] is fair and reasonable, he told listeners during an impromptu dial-in to the Brian Lehrer radio show on Monday. “Most of the reasons that people bring up that they’re voting ‘no’ are just really rooted in misinformation.”

He defended his decision to push for restrictions despite initially welcoming Airbnb to Jersey City four years ago. “When I supported it in 2015, there were about 300 Airbnbs in the city and it was home-sharing in the truest sense…that’s changed over the last four years,” he said.

“It’s no longer Mrs. Smith sharing a room or an apartment — it’s companies coming across the river from New York that are buying five and ten houses on a block and turning them into illegal hotels.”

Airbnb spokeswoman Liz DeBold Fusco said Fulop’s U-turn had pulled the rug out from under residents who were benefiting from the boost to local tourism that Airbnb had generated.

“These thousands of residents may be in serious financial jeopardy, with some even at risk of foreclosure or bankruptcy — all because of the Mayor’s short-term rental ban, crafted at the behest of the hotel industry’s special interests,” she said.

Polls will close at 8pm.

Write to Sylvia Varnham O’Regan at [email protected]

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