Much of the city’s strategy for reining in illegal short-term vacation rentals with tougher rules and enforcement was set in motion when Ordinance 19-18 took effect in August 2019, though the new law deferred kickoff of two key provisions to fall 2020. Now, both provisos have been pushed back to late April: one to permit up to 1,700 hosted bed-and-breakfasts; the other to require online platforms, such as Airbnb, to file booking reports with the city.
Although there is eagerness and need for tighter regulations on vacation rentals, this pause is particularly appropriate given that Honolulu is poised to install a new mayor and undergo a major shift in City Council makeup. In January, five of the panel’s nine members will be newcomers, district winners in this year’s election season. This new set of leaders should take its own hard look at the vacation rentals law, to gauge optimal alignment with our new normal.
City Councilman Ron Menor — who introduced the now-enacted Bill 50 to delay the new vacation-rental provisos — said the most pressing reason for delaying launch of new B&Bs is to avoid the possibility of further COVID-19 spread in residential communities. Also, he said, the half-year “pause” would allow “time to assess the future course and direction of our tourism market” in the aftermath of collapse. Both are solid points.
Come April, though, the city must double-back on carrying out Ordinance 19-18 in full and tackle the deferred business of:
>> Establishing a registration and permitting process to increase the count of hosted B&Bs for the first time in more than three decades, adding up to 1,700 B&Bs to the current inventory of about 800 permitted hosted and unhosted rentals.
>> Requiring online home-sharing platforms, like Airbnb, to file periodic reports with the city that list information about their home-sharing clients.
Currently, under the city’s four-tiered COVID-19 reopening framework, permitted short-term vacation rentals may open for business starting at Tier 2 — based on a seven-day average of 100 or fewer coronavirus cases, and a maximum weekly positivity rate of 5%. Rightly prohibited is providing accommodations to anyone directed to quarantine.
Further, operators are required to assist in contact-
tracing efforts in cases of exposure to the virus, and notify guests about Oahu’s mask-wearing and physical-distancing mandates. Also, the city calls for compliance with Center for Disease Control and Prevention guidelines, and advises to allot at least 24 hours between guest stays to ensure sufficient time for cleaning and disinfecting.
These conditions must be abided, in order to safely revive the legal vacation rentals sector, which had been entirely shut down for many months.
Before the new ordinance, strong visitor demand for vacation rentals — often less-expensive alternatives to hotels — had long outmatched weak city law, resulting in an estimated 8,000 to 10,000 illegal rentals in recent years. Contributing to the problem has been online platforms’ booking practice of withholding most of a client’s contact information, including the accommodation’s physical address.
Online platforms have asserted that the federal Communications Decency Act (1996) shields web providers from liability for third-party content on their websites. As has been the case in other cities, this clash may touch off a legal fight. It’s encouraging that in at least one dispute in recent years, the 9th U.S. Circuit Court of Appeals supported reasoning that web-based transactions should heed local laws.
The Council’s current pause gives the city Department of Planning and Permitting additional time to draft rules and create the software needed to initiate more effective enforcement and registration processes.
Tight rules and enforcement are needed to move forward. The city must remain vigilant, to safely put in place all elements of its new law while balancing ongoing public health and economic recovery challenges.
