Tuesday, July 7, 2015

PAII Sponsored Meeting at Mayhurst Inn with US Congress Representative David Brat, 7th District, Virginia 23 June, 2015 – Subject “The Sharing Economy”

PAII Sponsored Meeting at Mayhurst Inn with US Congress Representative David Brat, 7th District, Virginia

23 June, 2015 – Subject “The Sharing Economy”

To:  PAII Board of Directors and PAII Members
Submitted By:  Jack North, PAII, Board of Directors, Mayhurst Inn, Orange, VA.

Attending: Representative Dave Brat and two members of his staff, five local B&B Owners, other local businesses leaders, Town of Orange and Orange County Government Officials, the Chamber of Commerce, the American Hotel and Lodging Association (AHLA) and the press.   It was an "eye opening" experience for many.   

Most attendees had received a copy of the PAII Report on the Federal Trade Commission Workshop on the “Sharing Economy” held in Washington DC on 9 June, 2015.
The meeting opened with an introduction of attendees followed by a quick review of the salient points from the Workshop.  This generated follow-up and clarifying remarks from several Innkeepers and the AHLA Representative (Troy Flanagan, Vice President for State and Local Government Affairs).  Their comments pointed out the stark differences and inequalities between legal lodging establishments (hotels and B&Bs) and some Airbnb, Homeaway and VRBO properties concerning Regulations, Ordinances, Health and Safety, Insurance and Taxes.   The potential risks to the public who are seeking short term lodging, and who don’t realize that a non-legal rental property may not have appropriate liability insurance and may not meet building, fire, safety and health codes, were also discussed.  The number of nearby Airbnb, VRBO and Homeaway properties surprised many of the local government attendees, as did the potential loss of tax and fee revenue.   The point that the various “rating sites (like TripAdvisor) cannot simply replace government regulations (because they are not concerned with guest safety or other legal/liability issues) was strongly emphasized

Representative Brat, while he is certainly opposed to more Government regulations (and so is PAII), clearly indicated that he was an advocate of ensuring that everyone, and every business, is equal in the eyes of the law, and that it was obvious to him that there were significant inequities and unfairness between legal accommodations and those that aren’t.   He also recognized that many local ordinances and regulations had, as their foundation, Federal Government Regulations, and stated that he would look into those to see if any reduction or modifications of those regulations was possible.  He discussed, since Airbnb was providing 1099 and tax information about its member properties to the Federal Government, that perhaps some of this information could be provided to the state governments if they requested it. 

I believe that the sheer size and scope of Airbnb ($23 or $24 Billion Dollar Company with 25 million guests in one year) was a little surprising to the Congressman, although it was obvious that he knew of them (and Uber) and could see the value of the services they offered (as does PAII).  It was also quite clear that he saw the unfairness of a situation when existing legal businesses had to comply with a myriad of laws, regulations and taxes when others did not. 

YOUR PAII will follow up with Representative Brat and is in the process of contacting other Senators and Representatives to inform them of the benefits, challenges, and inequalities of the “Sharing Economy”, and to encourage them to seek solutions that not only support innovation and overall economic growth for all, but that do so in a manner that “does no harm” to existing legitimate small and large business.

See you at the PAII Conference in Austin, TX, January, 2016!

Jack North

PAII, Board of Directors 

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