As state representatives prepare to vote to regulate and tax short-term rentals, Boston Mayor Martin Walsh is withdrawing his own plan to govern the industry in the city, citing a need for more time to refine it.
In a letter to the Boston City Council Wednesday, Walsh said he plans to refile a proposal “in the coming weeks” and work with the council “to produce the most effective policy.”
“During a robust process, including a public hearing and two working session, important and complex questions were raised,” Walsh wrote. “Members of the City Council and I agree that more time is necessary to ensure that we enact the best and most effective policy and regulation regarding short-term rentals in Boston.”
On Jan. 19, Walsh proposed an ordinance that would allow short-term rentals to continue in the city in what he described as “scenarios that are non-disruptive” to neighborhoods.
Under Boston’s charter, any ordinance filed by the mayor takes effect if it is not voted on within 60 days of its filing.
Walsh’s plan called for dividing rentals into three tiers, differentiating between a space in a primary residence rented while the operator is present, a “home share” in which the entire primary residence is rented, and an “investor unit” that is non-owner and non-tenant occupied.
There would be no annual limit on the number of booked nights for “limited share units” in a primary residence with the operator present, while home shares and investor units would be capped at 90 nights per year. Owners would have to register their rentals with the city and pay an annual license fee.
As the short-term rental industry has grown, it has been left unregulated at the state level and some cities have adopted their own local measures.
As they seek to impose new oversight on the short-term rental market and web platforms like Airbnb, an effort that has stretched on since 2015, policymakers have been grappling with questions around the effects on the housing market, public safety and competition with hotels that are subject to the lodging tax and state regulations.
The House on Thursday plans to vote on a bill (H 4314) that would create a state registry of short-term rental owners and addresses, and tax the rentals at levels ranging from 4 percent to 8 percent depending on how many units a host offers.
The bill would also give municipalities the option to impose local taxes of between 5 percent and 10 percent, depending on the type of hosts. Communities that opt for the local tax would need to adopt ordinances or bylaws requiring any residential units offered as short-term rentals first undergo a safety inspection, the costs of which would be charged to the host.
Airbnb has called the proposal “onerous and overly burdensome,” a position that prompted pushback from the Massachusetts Lodging Association, which represents the hotel industry.
“By opposing this common sense legislation, it is abundantly clear that Airbnb’s goal has nothing to do with protecting middle class home sharing and everything to do with protecting the wealthy investor class hosts who have made it a big business to buy up scarce housing and convert it to illegal, unregulated and untaxed hotels at the expense of local residents and neighbors,” association President and CEO Paul Sacco said in a statement.
House lawmakers have filed 29 amendments to the bill, including a Rep. Timothy Whelan proposal to exempt units from the tax if they are the host's primary residence.