Real Estate

Miami Beach Considers Charging Unlicensed Airbnb Hosts With Misdemeanors UPDATED

Photo by Geoff Livingston / Flickr
Update: Gelber's office has now revised its proposal and slightly backed off plans to criminalize Airbnb hosts. The mayor now proposes issuing $1,000 and $3,000 fines before filing criminal charges as a third strike. But charges could still rack up quickly, as the city would consider each day operating without a license as a separate, "new" offense.

There are perfectly legitimate worries that Airbnb gentrifies neighborhoods and makes cities even less affordable than they already are. But so far, cities have had a hard time figuring out exactly how to handle the service, which lets homeowners rent their properties for days at a time. New York Mayor Bill de Blasio is locked in a fierce fight with the company over his city's plan to crack down on Airbnb.

For better or worse, Miami Beach has been mounting its own attack on Airbnb rentals for years. Tomorrow the city will consider a dramatic new proposal from Mayor Dan Gelber: potentially criminalizing some illegal rentals.

As it stands, it's illegal to rent residentially zoned properties in most of Miami Beach for less than six months and one day. To legally rent out such properties, owners must obtain a business tax license from the city and pay annual fees.

Gelber will present two new proposals to the commission tomorrow that seem designed to crack down on the rental service: One proposal would force companies such as Airbnb to remind users they need those business tax licenses to operate legally and require property owners using such sites to include their license numbers in any online ads. The ordinance would also make it illegal for platforms such as Airbnb and HomeAway to work with rentals that don't have the licenses.

But Gelber's second proposal is more draconian. It would ratchet up penalties for anyone caught operating a business without a license. Currently, the first penalty for operating businesses without tax licenses is a civil fine of $1,000. Gelber wants to increase that first-time penalty to a misdemeanor crime, which could net an offender a $500 fine or up to 60 days in jail.

Gelber's proposal notes that the stiffer penalties are needed because residents "continue to engage in or conduct business without a business tax receipt as required by the city in spite of existing civil penalties."

Though Airbnb hosts seem to be the obvious targets of the plan, it would also criminalize anyone operating any kind of business without a tax license. That could include everything from residents who sell food out of their homes to people cutting hair in their living rooms.

A spokesperson for Airbnb in Florida, Ben Breit, declined to comment on the proposal. Gelber's spokesperson, Veronica Passye, did not immediately respond to a message from New Times.

But other news outlets have warned that a crackdown was coming. In May, CNBC published a large piece about Miami Beach's attempt to shut down illegal rentals through civil fines. The following month, CNBC reported Gelber was debating a package of new Airbnb regulations.

"Airbnb's business model is not compatible with the kind of recognition that short-term rentals are not broadly in the public interest in cities," Gelber told CNBC earlier this year. "So they're either going to fight or they're going to change."

Civic activists and politicians continue to hotly debate whether services such as Airbnb are detrimental to urban areas. In May, McGill University urban planning professor David Wachsmuth released a study suggesting Airbnb has had a "dramatic," and negative, impact on the New York City housing market. Wachsmuth found that after listings for short-term rentals flooded New York, the local affordable-housing supply dropped and neighborhoods gentrified. Wachsmuth also discovered that 12 percent of New York-area rentals were owned by "commercial operators" with multiple rental units rather than families or homeowners renting out spare rooms or apartments.

Given that Miami Beach is already suffering its own affordable-housing crunch, Wachsmith's study raises alarm bells about the services' effects.

Other cities have devised their own proposals to crack down on the services. De Blasio has proposed requiring platforms including Airbnb to hand over data on every host in town, including the hosts' names and addresses. Roughly half of the 50,000 rentals in New York are illegal, according to Wachsmith's study.

At the same time, however, Airbnb has long maintained that Miami-area officials are just aiming to protect the area's powerful hotel industry at the expense of residents who want to make some extra income. There's some evidence to support that claim: In 2017, New Times obtained emails that showed then-Miami Mayor Tomás Regalado coordinating with hotel lobbyists to propose a ban on short-term rentals that wound up not passing. In that case, a hotel-industry lobbyist forwarded Regalado a copy of Fort Lauderdale's ban on short-term rentals, which Regalado's office then shoddily edited before submitting the ordinance in Miami. (De Blasio has also been accused of helping the hotel industry instead of residents.)

But even with major civil penalties in place, Miami Beach has struggled to rein in unauthorized Airbnb rentals. The city adopted a $20,000 first-time fine — then the nation's costliest penalty — for illegal renters in 2016. The city has since issued millions of dollars in fines but has struggled to collect the money from property owners.

In June, Miami Beach resident Natalie Nichols sued the city over the high cost of the fines. In an August court motion, the city argued the fines were "necessary to deter residents from violating" the ban on short-term rentals. In the meantime, the Miami area remains one of Airbnb's most lucrative markets.
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Jerry Iannelli is a former staff writer for Miami New Times from 2015 to March 2020. He graduated with honors from Temple University. He then earned a master's degree in journalism from Columbia University.

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