Private residential homes for rent are cropping up in Door County and the Tourism Zone Commission is trying to keep up. Web companies like Airbnb offer a platform for homeowners to rent out their space while they are away. The Tourism Zone Commission addressed how to apply room tax to these elusive properties in their meeting on June 18.
“The company is considered a rising star in venture capital. We probably have to get creative with this,” said Bryan Nelson, commission member. Nelson is also owner of the Blacksmith Inn in Baileys Harbor. “I’ve been very concerned about the explosion of Airbnb. The genie is not going to go back in the bottle so we just have to try to stay ahead of the wave as best we can.”
The number of listings on Airbnb for Door County has more than tripled in the past year. Four of the properties are not registered in the county and do not pay room tax.
Airbnb is an online platform for property owners to rent out their entire homes while they are away or single rooms in a communal living experience. The company promotes their Welcome Home tagline as a way for visitors to get a genuine local experience by staying in the home of area residents.
Others view it as the insane idea of letting strangers through your front door to sleep in your bed.
“My perception is the person doing this in Airbnb, the action is almost equivalent to the extreme tea partiers. It’s a rebellion. It’s a scofflaw attitude on the part of many of them,” said Nelson. “Then there are those who just think, ‘Oh quick money, look I can do this,’ and Airbnb makes it so easy.”
The Tourism Zone Commission, tasked with collecting room tax from local lodging facilities, believes these property owners owe equal tax as any major hotel or resort in the county. But commission chairman Josh Van Lieshout admits a big challenge is the casual attitude of the rental owner.
“My impression is that these are folks who end up with an asset of some kind and they say, ‘We’re not going to be there, so what the heck, let’s see what happens.’ These people are in and out of the rental marketplace, it could be weekly if they want it to be. It’s the difference between a guy that’s going to be gone for six months and a guy like Bryan who does it for a living,” said Van Lieshout.
While the majority of listed properties are in compliance and pay the required room tax, the remaining rentals are elusive.
“If I have an idea as to what road it’s on, I log into the land portal for property taxes and I look at the aerial view of that road,” said commission assistant Kim Roberts. “I literally go up and down until I find that house and then I get an address and then I can find whose it is…Airbnb is very protective of people who are using it.”
The commission tossed out ideas for getting properties in compliance, some of which involved litigation such as checking for state permits and getting a subpoena against Airbnb to release property owner’s information.
But Airbnb is well practiced on deflecting these legal claims. Upon the company’s start in 2008, Airbnb maintained that it had no obligation to enforce room taxes because it was not in the lodging business. Airbnb does not own any properties, but rather provides a platform for property owners to connect with visitors. It simply told property owners to check with their local municipalities for any taxes that might be due.
But in 2014, Airbnb began cooperating with big market cities such as San Francisco and Chicago due to pressure from the local governments. Since Airbnb handles the monetary transactions on their site, it can easily impose these taxes. Other sites like Craigslist and VRBO don’t see a dime that gets passed between owner and renter, and thus avoid these tax enforcement claims.
The commission has also pursued these homes by having a member pose as a potential renter. But Roberts explained that some owners only want to communicate via text and once they figure out who she is, the pursuit stops there.
“I want to emphasize that we can’t be against Airbnb, we just have to get them in compliance. They just have to follow the same rules,” said Nelson.
Van Lieshout stated that the commission will prioritize the issue as they review the upcoming budget in the next two months.