D.C. Should Tread Lightly on Short-term Rental Regulations


If you look around in many American cities today, you will notice new features that weren’t there just a few short years ago. You may notice the Bird scooter on the sidewalk, or the Postmates worker delivering food, or the family walking down the street that has a short-term rental in a nearby home. You might even see all this while picking up an Uber to meet up with friends. The gig economy is here – and here to stay.


These 21st century innovations have been positive for the American economy, offering new jobs, increasing our GDP, inserting competition into the market, and presenting consumers with more choices than ever before.


Just take a look at the numbers. Uber found that 23 percent of their drivers did not have a job before they began driving for the ride-sharing service, and that the company produces $17 BILLION in GDP for the U.S. annually. An Airbnb report found that 52 percent of hosts are considered “low-income,” with the opportunity to rent out spare space providing extra income for families. Postmates found that their business could account for $6.6 billion in economic activity in 2017.


And those are just the numbers. Ride-sharing services have provided consumers with new transportation options. Short-term rentals have opened up the possibility of visiting new cities for families who otherwise might not be able to afford a hotel room. Postmates has given businesses a new way to sell their products, allowing them to grow at a rate nearly 4 times faster using on-demand delivery services.


While all of this is great for consumers and economic growth in the U.S., as with many emerging industries, there is trouble on the horizon. A great example of this is happening right now in Washington, D.C.


Last year, local D.C. Councilmember Kenyan McDuffie introduced a bill, B22-0092, to unreasonably restrict short-term rentals in the District. The bill was tabled until it was brought back up for a vote earlier this month.


Thankfully the vote was delayed for three weeks when other members of the council raised concerns over an estimated $104 million over four years the city would lose as a result of the regulation. The $104 million figure, by the way, came from D.C.’s own Chief Financial Officer, Jeff DeWitt.


Placing restrictive measures on short-term rentals has terrible ramifications. It means less income for D.C. homeowners and families, less tourism for local business owners, and less tax revenue for the city.


Despite this, Councilmember McDuffie is charging ahead to limit short-term rentals in D.C. And all of this before you even mention that the D.C. Council has given $252 million in crony capitalist deals to the hotel industry over the last decade.


That’s not all though. Not only will this bill leave D.C. footing the bill to the tune of $104 million, it will also cut off a vital lifeline for many local residents who the City Council claims to serve. Last year, District residents made over $83 million dollars in supplemental income. Nearly all of which would be shut off if the City Council passes B22-0092.


Short-term rental hosts have produced nearly $16 million in tax revenue for the city and close to $37 million in economic activity in D.C. What happens to these figures if the City Council passes B22-0092? You guessed it, the numbers are slashed significantly.


Like other attempts to over-regulate the gig economy in other locales, the D.C. City Council is out of step with its constituents. 80 percent of all District residents believe short-term rentals help locals afford their homes, and more than 60 percent believe they help local businesses.


D.C. should not follow the lead of other major cities that have stymied the gig economy unnecessarily with out-of-touch policies. With a vote scheduled for November 13th, time is running short for the D.C. Council to do the right thing.


When D.C.’s own constituents and CFO are telling the Council this is bad policy, don’t you think they should listen?