Airbnb ordinance passes committee, but full Council vote delayed

Mayor Rahm Emanuel’s plan to regulate and tax Airbnb cleared one legislative hurdle but not another Wednesday after the latest in a seemingly endless series of changes failed to please both sides.

One day after a marathon hearing drew a standing-room-only crowd, the City Council Committees on Housing and License and Consumer Protection approved the mayor’s plan 17-to-9 — a close vote by Emanuel standards.

That vote occurred even though aldermen had only just been given copies of what Housing Committee Chairman Joe Moore (49th) sarcastically called the “substitute to the substitute to the substitute” ordinance, and appeared to be confused about exactly what they were voting on.

“I have a problem voting on a 55-page document I just received five minutes ago,” said rookie Ald. Susan Sadlowski-Garza (10th).

Aldermen who joined Garza in voting “no” were Marty Quinn (13th), Ray Lopez (15th), Matt O’Shea (19th), Chris Taliaferro (29th), Scott Waguespack (32nd), Michele Smith (43rd), Tom Tunney (44th) and John Arena (45th).

After the vote, Moore declared his intention to hold the ordinance in committee for even more tweaks and not call for a vote on the City Council floor.

“We could pass it out today and it would probably be approved by the City Council. But it’s probably better to take a breather, look at it a little bit more and then bring it up for a vote at the next City Council,” Moore said.

“We’re pretty much there but time is good. Let people digest what we’ve done today, realize that this is a pretty good ordinance. And by the time we get to the City Council vote in June, we’re going to have overwhelming support. … There’s no rush. Let’s take a breather. When everyone has a chance to really examine this, they’ll realize it strikes a pretty good balance of very competing interests.”

Moore scoffed at Airbnb’s threat to file a federal lawsuit on grounds that federal law prohibits the city from regulating Internet platforms in a way that holds the company responsible and liable for the behavior of home-sharing hosts.

“I hope they realize that they got a pretty good deal out of this. They may not realize it, but they really did” come out on the long-end of the stick, Moore said.

Emanuel added, “They’ve had time to look at this. And this just may be the kind of storm and fury before an ordinance as a way to try to grab leverage.”

Lincoln Park Ald. Michele Smith (43rd) accused the mayor of caving to accommodate Airbnb, whose Midwest director is former Ald. Will Burns (4th), one of the mayor’s closest political allies in the African-American community.

“This does not protect residential neighborhoods from real estate investors who are turning housing into hotels on our residential streets,” Smith said.

“We live in residential neighborhoods so we can have neighbors. This will hollow out our neighborhoods.”

Smith then took a not-so-veiled shot at Emanuel for ramming the ordinance through committee just minutes after distributing the lengthy substitute.

“I don’t think this is good for democracy to introduce an ordinance with this many changes at the last minute. We should consider this more. This is typical of the tactics that Airbnb has used in other cities around the globe. I’ve never actually been involved in regulating something when we don’t know what we’re regulating,” Smith said.

But it looks like Smith will be carrying on the fight without downtown Ald. Brendan Reilly (42nd). He’s now on board with the mayor’s office after a last-minute change that would eliminate the possibility of an administrative review process for homeowners to get a hardship exception to the rigid regulations in buildings with five units or more.

“It’s a vast improvement over where we were 24 hours ago and, generally, I support the direction the ordinance is heading in,” Reilly said.

Smith says that change will dump even more short-term renters on the residential blocks in Lincoln Park.

Emanuel’s plan to slap a 4 percent surcharge on home-sharing bookings to generate $2 million to combat chronic homelessness has set the stage for a sharing economy showdown similar to the one brewing between the taxicab industry and Uber and Lyft over a controversial plan to license ride-hailing drivers.

The Airbnb fight features, on one side, homeowners who say they want and need the right to supplement their incomes by listing their homes or rooms within their homes on Airbnb.

On the other side are high-rise residents whose say their quality of life has been greatly diminished by home-sharing invaders and the bachelor-party atmosphere they sometimes bring.

During Wednesday’s committee meeting, aldermen from across the city demanded to know how the Emanuel administration planned to implement the data-sharing requirements of the ordinance within just 150 days of passage and enforce a requirement that the owners of single-family homes be present during all rentals.

The answers they got from city attorneys and Business Affairs and Consumer Protection Commissioner Maria Guerra Lapacek were not reassuring. That’s in part why Moore made the call to slow down and take a little more time.

That will give Emanuel time to make even more changes.