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Aldermen Call For A Crackdown On Airbnb

By Kate Shepherd in News on Oct 7, 2015 3:23PM

via Airbnb

A crackdown on Chicago residents who rent their homes on Airbnb without a license could be coming. A few aldermen are calling on the city to enforce its vacation rental license law, which they say is only enforced now on a complaint-driven basis.

There are between 3,000 to 4,000 rentals in Chicago listed on Airbnb but only a couple hundred have vacation rental licenses issued by the city, Ald. Michele Smith (Ward 43) said in an interview.

Airbnb's popularity has ballooned in recent years, particularly among young people who are looking to save money and connect with locals when they travel and home-owners and apartment-dwellers looking to supplement their rent or mortgage payments. But it isn't without its detractors. Remember the jerk who rented out his roommate's room on Airbnb while he was out of town?

The city's vacation rental licenses are designed to regulate health and safety features such as fire exits, alcohol service and clean sheets and towels, according to Smith. She said the requirements are meant to be easy to comply with but require a $500 fee, renewed every two years, that would provide the city with much needed revenue.

The lack of oversight on Airbnb is costing the city and state in unpaid taxes and fees
that could amount to $1.5 million every year, wrote Smith, Ald. Brendan Reilly (42nd) and Ald. Brian Hopkins (2nd) in a letter to Maria Guerra-Lapacek, commissioner of the city's Department of Business Affairs and Consumer Protection.

"At a time when the city faces an unprecedented fiscal crisis, we are calling on the department to begin proactive enforcement efforts in order to bring each rental into compliance," Smith said in a statement. "We must also enforce required protections for the public and ensure rentals operate on a level playing field with other hotel operators."

Airbnb has started paying Chicago's 4.5 percent hotel accommodations tax but the
unlicensed rentals are not paying the city's one percent municipal tax and do not
pay any of the state taxes required for hotels.