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Vote coming on how short term rentals operate

Posted at 11:21 PM, Dec 05, 2018
and last updated 2018-12-06 06:11:19-05

The heated argument over what it will take to make money off of guests who stay in Baltimore at short-term rentals will have a resolution on Thursday.

Baltimore City Council will vote on a bill that includes a 9.5% hotel tax on Airbnb-style stays.

Linda Smith bought the historic Rachel's Dowry bed and breakfast two years ago. 

She said short-term rental hosts on the same block take away business by charging a similar base rate without the taxes and regulations.

“My guests are penalized 15.5% tax,” said Smith. “My guests are penalized for the cost of me running a legitimate business while my neighbors, some of whom have three buildings are not having to pay any of those fees."

Rachel Indeck has organized over a thousand short-term rental hosts in the city.

She said they've always been willing to pay the taxes and make the homes safe.

“We have said all along that people should pay the tax,” said Indeck. “From day one we have agreed to pay the 9.5% occupancy tax. We believe that everyone should be licensed and operating safely so all along we've said there should be regulations and licensing.”

City council's solution is a bill that would put regulations and taxes on short-term rental hosts that use booking platforms like Airbnb and Travelocity.

Indeck said that move would hurt small business owners who depend on short-term rentals.

The bill would also make it so short-term rental hosts can only do business at one home.

There is a grandfather clause that will allow current hosts to continue renting at two homes.

“Any of the new high rises that are coming up that are able to rent as furnished short term rentals if they are not using a booking platform they will be able to continue renting out furnished short term rentals. As many as they like, they will not be restricted to one license, they don't have to pay the tax there's no mechanism for collecting it.”

Smith said the bill will level the playing field for everyone.

“This bill does not change the law but it enables the city to be able to enforce the law that says today if you can sleep more than five people in your building that you are effectively a hotel and therefore must be licensed, must be registered.“

The bill was tabled on Monday because it didn’t have the support to pass and amend a bill on the same day.

Councilman Eric Costello, the bill’s lead sponsor amended the bill on Monday to help people from outside the city take advantage of the grandfather clause.

If passed the tax goes into effect at the end of the year and all of the other factors will start at the end of 2019.