Airbnb and City Settle Lawsuit Over Host Disclosure Rules

On June 12, 2020, Mayor Bill de Blasio and Airbnb announced a settlement of their years-long lawsuit regarding Local Law 146 of 2018.

Signed in August 2018, Local Law 146 aimed to regulate short-term rental services such as Airbnb by requiring them to file monthly reports with the NYC Office of Special Enforcement. The mandatory monthly reports require hosting websites like Airbnb to disclose the names and addresses of hosts using the service, their contact information, and fees received, among other items. Airbnb filed a lawsuit to prevent enforcement of Local Law 146 shortly after Mayor DeBlasio signed the new law. In January 2019, U.S. District Judge Paul Engelmayer of the Southern District of New York issued a preliminary injunction preventing New York City from enforcing Local Law 146, based upon the Fourth Amendment of the U.S. Constitution. The Fourth Amendment prohibits unreasonable searches and seizures and requires the government to have probable cause to obtain a search warrant to inspect records.

With the newly announced settlement, Airbnb agreed to dismiss the lawsuit against the city and give the city the specified host and transaction information subject to a proposed local law detailed in the settlement. The settlement is subject to the New York City Council passing an ordinance approving the terms and won’t go into effect until 180 days after that. It’s likely therefore that the new rules and host-information transfers won’t begin until 2021.

The local law proposed in the settlement would require quarterly reporting for a qualified group of short-term rental users, instead of monthly reporting for all users. Reports would be required for listings that generate five or more nights of bookings per quarter, and offers the entire home or permits three or more guests at a time. Reports won’t be required for listings of private or shared rooms, for two or fewer guests, for less than five nights per quarter, or listings that qualify as traditional hospitality locations. The reports themselves will include the physical address of the listing, host information, the number of days booked, the amount received by the host, and the listing’s name, number, and URL.

The settlement doesn’t ease New York’s restrictions on short-term rentals. The New York State Multiple Dwelling Law restricts certain short-term rentals for stays of fewer than 30 days unless the host is present. That effectively bars super hosts and corporations with multiple dwellings unless they have hotel licenses. The Mayor’s Office of Special Enforcement may impose fines of up to $2,500 per day for building and unit owners found in violation of the law.

In addition, with the settlement, host information won’t be subject to the Freedom of Information Law, which requires public records disclosures. The deal isn’t retroactive, so Airbnb won't need to provide the city with host and listing information prior to implementation.

The City Council Committee on Housing and Buildings held a public hearing on the proposed bill amendments on June 17, 2020. The Mayor’s Office of Special Enforcement testified, but there were no questions or comments.