A new legislative proposal by State Representative Aaron Michlewitz would enforce a three-tier regulation on properties being rented on a short-term basis through online portals such as AirBnB, HomeAway, and Vacation Rentals By Owner (VRBO). This issue first arose two years ago when, driven by neighborhood questions and concerns, State Reps Aaron Michlewitz and RoseLee Vincent proposed a bill to introduce regulations on short-term rentals. Since then this industry has expanded, creating national debates over AirBnB and similar sites that have driven states to impose limits and fines on these services. In Massachusetts and the City of Boston, we too have questions about these rentals and our state leaders are working to address them.
At a January meeting with the North End / Waterfront Neighborhood Council (NEWNC), City Councilor Sal LaMattina spoke about Boston’s upcoming proposal. In line with the City’s efforts, Michlewitz has filed a bill with the state legislature calling for similar, but stricter regulations. Both the city and state proposals focus on generating tax revenue, protecting housing stock and, most importantly, ensuring neighborhood and renter safety.
“First, and foremost, we must maintain that any, and all, public safety measures are undertaken, and adhered to, for the protection of both renters and residents in the neighboring community. Inspections, proper insurance, and greater levels of transparency with access to information are vital to ensure this.” – State Rep. Aaron Michlewitz
All units to be used as short-term rentals will be required to register with the state and this information will be made available to the public. Units will undergo annual inspections and hosts will be required to make renters aware of fire extinguishers, gas shut off valves, emergency exits, and other safety resources. Rentals must also be covered by a homeowner’s insurance of at least $1 million per unit. In addition, Michlewitz’s bill proposes three categories of hosts:
“Residential Hosts” are individuals who use the unit or home to be rented as their primary address. They cannot rent the unit for more than 60 days per year and they must pay a 4% state tax and up to 5% local tax.
“Commercial Hosts” are individuals who rent out units for more than 60 days per year and / or rent multiple units as short-term rentals. They must pay an 8% state tax and up to 10% local tax.
“Professionally Managed Hosts” are business entities or individuals that have a rent management system to oversee properties. Units offered for rent must be for at least five nights and hosts must pay a 5.7% state tax and up to 6% local tax.
With the regulations proposed in Michlewitz’s bill, an estimated $50 million in revenue will be generated for state and local government. A significant portion of these new funds will be allocated towards programs for low and moderate incoming housing.
View the video above to hear State Rep. Aaron Michlewitz speak to the NEWNC earlier this week. At the meeting, Michlewitz discussed short-term rental regulations and also a few other main points he is focusing on this session. Addressed in the video is another important bill he has filed with the Department of Public Safety addressing concerns about regulating sex offenders who are registered at homeless shelters. Michlewitz is advocating for stricter guidelines around re-acclimating sex offenders into society.
This article originally appeared on NorthEndWaterfront.com on February 16, 2017.