Valley officials seek fairness between Valley lodgings, Airbnb

Robert Inglis/The Daily Item An Airbnb property on Second Street in Lewisburg.

HARRISBURG — Airbnb reports its hosts in Pennsylvania made $122 million last year.

Critics say the online short-term room sharing program has unfair advantages, like regulations and tax collection, over the traditional lodging industry.

There are now 14,200 Pennsylvania hosts who share their homes via Airbnb, typically earning about $5,200 annually in supplemental income, the online site announced in late December.

All told those hosts welcomed 1 million guest arrivals last year.

“2018 was another great year for Airbnb in Pennsylvania, with more local residents and small businesses able to benefit from the economic opportunities created by home sharing than ever before,” said Josh Meltzer, Head of Airbnb Northeast Public Policy. “We look forward to continuing to help families across Pennsylvania earn extra income while allowing countless communities to enjoy the tourism economy in 2019.”

Earlier this year, Airbnb announced that it delivered $21.2 million in tax revenue to the state in that time.

Those in the lodging industry, though, have questioned whether the booking site is paying as much as it should.

“Those of us in the travel industry don’t have anything against Airbnb hosts, as long as they are competing on a level-playing field,” said Lisa Rager, executive director of the Greater Johnstown/Cambria County Convention and Visitors Bureau. “They are part of the lodging community.”

Small inn and bed-and-breakfast operators feel particularly pinched because not only are there questions about whether the short-term hosts are collecting taxes, they are not being expected to comply with regulations for things such as handicapped accessibility and insurance.

“It’s a problem,” said Ryan Mercer, the owner of Terra Nova House in Grove City. He owns the only traditional bed-and-breakfast in Grove City but he’s competing with a half-dozen short-term rental hosts, he said.

And while the state has gotten a tax payment from the site, few counties have, said Melissa Bova, vice president of government affairs for the Pennsylvania Restaurant and Lodging Association.

In Pennsylvania, all short-term rentals, those lasting less than 30 days, are supposed to include the state’s 6 percent sales tax. Also, most counties levy an occupancy tax.

Cambria, Crawford and Lawrence counties collect 5 percent hotel tax, according to the state Department of Community and Economic Development. Mercer, Montour, Northumberland, Snyder, Somerset, Venango and Warren counties tax hotel stays at 3 percent. Union County raised its rate to 5 percent last year.

Legislation set to take effect later this month will help. Act 109, signed into law by Gov. Tom Wolf in October, will mandate that online travel sites collect hotel taxes.

The law was signed in October, but there was a 90-day period before it went into effect.

A fiscal note completed by Senate staffers estimated the new law will generate approximately $7.7 million in fiscal year 2018-19 andincrease to $23.6 million in the full fiscal year 2019-20.

Bova said additional reforms are necessary to regulate the short-term housing industry, particularly in light of other concerns, including the difficulty local municipalities have in trying to regulate hosts with little information about who or where exactly they are.

Last month, Massachusetts became the first state to enact a broader short-term rental law. The Massachusetts law requires hosts to have insurance, register with the state and collect the lodging tax. Indiana has passed a law aimed at the home-sharing industry, as well. That legislation bars local municipalities from banning home-sharing.

Here in Pennsylvania, the state House last June passed legislation that would have created a registry of online hosts for the state and counties to use to better confirm whether lodging taxes are being paid appropriately.

The Senate didn’t act on that legislation.

Bova said that with the Massachusetts law in place, lodging industry officials expect that similar bills will start to move in other states, including Pennsylvania.