New York Attorney General Eric Schneiderman has subpoenaed the user data for the roughly 15,000 New York City residents who rent out rooms using Airbnb. In response, Airbnb's head of global public policy wrote on the company's site, "We always want to work with governments to make the Airbnb community stronger, but at this point, this demand is unreasonably broad and we will fight it with everything we've got."
According to Matt Chaban, the AG's investigation is the first step in an attempt to bring Airbnb in compliance with the law, including the enforcement of the hotel occupancy tax that so far the site and its users have skirted. The AG asked for the data by Monday.
A few days ago an Airbnb user in the East Village had his fine for violating city rental laws revoked by the Environmental Control Board. In a blog post discussing the decision, Airbnb CEO Brian Chesky wrote that he wanted to work with the state in assessing a tax for the service, which he noted was used by 225,000 New Yorkers.
"Our hosts are not hotels, but we believe that it makes sense for our community to pay occupancy tax, with limited exemptions for those who earn under certain thresholds," Chesky wrote, adding that he was also "eager to work with New York to remove bad actors in our community that are causing a disturbance to their neighbors."
It wasn't just Airbnb who received a subpoena for user data. Other sites that offer similar services to Airbnb received subpoenas for their data.
An Airbnb user who rents their Park Slope apartment out tells us that the Attorney General's actions may have unintended consequences.
"If people are not capable of using a service like Airbnb, they'll just find other, much less reliable and often shadier outlets, like Craigslist," says the renter, who requested that their name be withheld because what they're doing is technically illegal.
The renter asks for $100/night to stay in their 1-bedroom, and has no trouble finding tenants. But the increasing legal scrutiny has forced them to "pause" their account activity. "I'm worried I might be hit with fines or taxes that aren't worth the few hundred bucks I'd make when out of town," they say.
Marie Reine Jezequel, the founder and CEO of New York Habitat, a site that offers short-term housing along with traditional rental properties and charges all required taxes and fees, said in an email that the AG's actions could be helpful to the industry.
"If Airbnb complies with the law, it levels the playing field between small companies like New York Habitat, who are real estate brokers and must abide by state licensing rules and codes of conduct, and companies such as Airbnb and Craigslist, who are not subject to such constraints," Jezequel said.
The Hotel Occupancy Tax for renters whose rooms are let for more than $40/night, for more than 14 days or more than twice a year is 5.875% plus $2 per day.
"Why don't they just include the tax into the regular fee? If it's something that is split between the renter and AirBnB, I'm sure it would be universally welcomed by its members," the Park Slope renter asks. "Especially if it's done in time to take advantage of all that Super Bowl money that will come flooding into our city this winter. Right, Mayor Bloomberg?"