My husband and I invested our life savings into the downtown Raleigh community and purchased the Oakwood Inn 14 years ago. We take pride in our community and recognize that, for our guests, we are their first impression of Raleigh. We work hard to ensure that our customers have a positive experience.
As with any business, there have been ups and downs, but we manage our property responsibly, even surviving the 2008 financial meltdown. While we survived the near collapse of the U.S. economy, we might not survive the Raleigh City Council’s potentially forcing us to compete on an uneven playing field.
On Tuesday, Raleigh will decide how to handle short-term, online rental businesses like Airbnb. Let’s be clear, Airbnb is a business just like ours, with two exceptions. We pay taxes on each of our guests and pay to meet government safety regulations. Airbnb does not.
These regulations do affect everyone’s quality of life. We’ve all experienced the challenge of finding parking downtown. Well, we’re required to have at least one parking spot for every room we rent. We understand why. Here in Oakwood, much of the parking is street parking. If all our guests parked on the street then many of our neighbors would be forced to park a half-mile or more from their homes. But if someone were to buy a house and then use it exclusively as an AirBnB property, the owner would not be required to provide parking.
To comply with Raleigh’s bed and breakfast regulations, we must live on the premises and someone must be present at all times when guests are renting rooms. We believe this requirement is important for guest safety and to help ensure that our business is respectful to our neighbors. An absentee landlord will not ensure that rowdy guests are not nuisance. Will Raleigh hold AirBnB to the same quality of life standard?
We also pay to ensure each of our guests enjoys a safe and clean visit. Obviously, we want this because, if we didn’t, we probably wouldn’t be in business for long. But other lodging operators might be just as happy to run a slum of sorts and save their money. For this reason, local governments have costly regulations in place requiring us to spend money on special permits and inspections. Every time another government inspector comes out, we have to pay for that service. The fees and inspector charges add up to a sizeable amount each year. Like Airbnb, we could charge less if we did not have to pay for smoke alarms, carbon monoxide monitors, fire escapes and other requirements, but then our guests would not be as safe.
While we provide breakfast and an afternoon snack, we do not serve alcohol. A glass of wine might be nice, but for us the cost of an alcohol license and other alcohol regulations does not make financial sense. Who do you think is regulating the sale and consumption of alcohol at an Airbnb? If you guessed nobody, you are correct. Are inspectors going into an Airbnb to see whether underage drinking is occurring? No. Do Airbnb operators provide proper oversight of their alcohol consumption? No one knows because alcohol service and consumption are completely unregulated.
Taxes represent another example of the unfair playing field. We have to charge each guest a “User Tax.” This tax helps pay for the improving infrastructure in Raleigh, but it also means we have to charge more than Airbnb does because those owners are not paying that tax.
Here in Oakwood, there are approximately 20 Airbnb facilities operating. You can imagine my frustration when a former guest stopped by and said, “I would’ve stayed with you, but there was a house just down the street that beat your price by a third.” She was carrying a Raleigh Visitor Guide and an R-Line Map. The User Tax not only contributes to that extra third on my fee, but it also helps pay for that guide and map. I wonder whether the City Council has a new funding source for these perks that Raleigh guests use because Airbnb customers are not paying that user tax.
We don’t want Raleigh to eliminate Airbnb, but we do want a level playing field.
When our local government picks winners and losers in the lodging industry by leveraging unequal regulatory burdens, we all lose.
Doris Jurkiewicz is owner and operator of The Oakwood Inn in Raleigh.