The house at 94 Main St. in Northfield, one of the grand homes built by the Stearns family in 1811, stands out in the historic town center.
But as timeless as the Centennial House Bed and Breakfast seems, the owners are facing the same timely issue other B&Bs are seeing: competition from Airbnb.com. And it doesn’t take much time to get Joan Stoia, who runs the inn with her husband, Steve, sounding off about what she considers unfair competition from in-home operations, whose precise locations she doesn’t know.
“I think there are two in Northfield, but you can’t even find out the address until you book it,” she says. “It’s a secret, and that’s a red flag. If they were above board, they’d be advertising like we do. What Airbnb is hiding is that it’s encouraged people to break the law and circumvent regulation.”
The San Francisco-based online hospitality business is facing pressure from the Massachusetts Legislature to begin paying the same rooms tax that hotels, inns and B&Bs renting more than three rooms do. It is criticized for creating an unlevel playing field — even in Franklin County, where about 60 Airbnb properties are listed, with about one-third of those in Greenfield.
Stoia, who helped form the Five College Bed and Breakfast Association when she and her husband lived in Belchertown, says her business isn’t facing the same stiff competition as in the Amherst area, but that it’s still unfair competition.
“If you provide a good product, people come back and back,” she says. “We have a 30 percent return rate, which is pretty high,” she said, but they have still decided to look into listing rooms on Airbnb.com, as some existing commercial operations do for added exposure.
Instead of asking for documentation of insurance and town business registration, as she’s used to on B&B promotional sites, Airbnb was asking “nonsense” about her hobbies and why she likes meeting new people.
“I’ll take care of the friend piece, thank you. I love my guests. First and foremost, I want to have emergency lighting and emergency exits. I’m taking proper food safety courses, and have trained if people are choking. I have the proper exits. I’ve had building and health inspectors come in and tell me how I’m doing. We have an obligation to the public. And by the way, I register with the State of Massachusetts and pay taxes. Hello? So you can tell I’m pretty annoyed with this.”
As a business owner who says she pays nearly $4,000 a year for commercial insurance, and who has to set up a separate kitchen area to prepare breakfasts for guests with food allergies, she balks at the “hands-off approach” that boards of health take toward Airbnb. She said she plans to begin asking her local health board to strengthen the health code to assure that those operations don’t serve breakfasts without proper inspections or training.
Former Shelburne Selectman Joe Judd said he had never even heard of Airbnb before hearing a complaint a couple of years ago from a landlord who had rented out his house in town and found that the tenant was renting part of it as an Airbnb.
An insurance company that had come in to do a routine inspection discovered the operation and raised concerns about the status of the building, said Judd, who is a retired insurance agent.
He brought it before the Selectboard, which decided it wasn’t the board’s purview, but rather a matter to be considered by the Board of Health, the Planning Board for possible regulation and maybe the Zoning Board of Appeals over usage of the property.
“That was the first time we ever heard of it,” said Judd, adding that from an insurance perspective, there could be liability concerns if a renter rents out rooms to Airbnb users.
“If I was a landlord, and found out that a couple I was renting to were using it to make money from Airbnb rentals, I would be pretty upset about that.”
Bob Gilmore of Gilmore and Farrell Insurance in Greenfield said his agency has been called by a couple of clients wanting to set up an Airbnb in a cottage or other structure on their property, but were declined by their insurance carriers.
“We’re finding it more and more difficult to find carriers that even want walk down that road because of the nature of the situation,” he said. “You’re dealing with kind of an unknown. Is it a three-day rental or a 10-day rental, or an overnight? There are so many ups and downs that it’s hard for underwriters to get their hands around it. It’s hard to define.”
Differences in regulation have prompted some bed and breakfast proprietors, hoteliers and state and local officials to raise red flags about the rise of Airbnb, asking whether private “hosts” should pay taxes, undergo the same inspections and have the same level of public scrutiny as traditional innkeepers.
These concerns are prompting the state Legislature and Gov. Charlie Baker to unveil proposals aimed at requiring that Airbnbs remit room occupancy taxes and submit to inspections.
Chris Lehane, a spokesman for Airbnb, said the San Francisco-based company is looking forward to addressing these worries with the state of Massachusetts and, as needed, municipalities such as Northampton and Amherst.
Lehane, a 1990 Amherst College graduate, said Airbnb supports efforts to have its guests pay the same tourism taxes as guests of traditional hotels and B&Bs.
“Our preference is to keep it simple and to make it broad-based,” Lehane said last week. “We want to pay our communities’ fair share of taxes.”
Airbnb already has 275 tax “partnerships” with various governmental bodies, Lehane said, in which Airbnb is authorized to collect room taxes from guests and remit them to the governments.
Lehane said he likes the idea from the State Senate Ways and Means Committee, which in its budget proposal states that a 5 percent state tax would be imposed on all rooms rented for at least $15 a night, with local governments having the option to add up to an additional 6 percent.
Those tax rates would match what hotels and all but the smallest B&Bs now charge their guests. Currently, B&Bs with three or fewer rooms aren’t required to levy a room tax.
Statistics provided by Airbnb show that there are 12,800 hosts in the state, renting rooms for an average of 39 nights and $6,100 income each year.
With total income of $118 million statewide, and estimated $312 million in additional spending by the guests on restaurants and other local businesses, Airbnb says its hosts generate $430 million in economic activity each year — a figure that continues to grow.
Additional revenue from Airbnb hosts would supplement the $180,000 in annual room occupancy taxes collected by Greenfield. Deerfield, the other Franklin County town that has adopted a local room tax option, collected $188,000 last year, and could also benefit from Airbnb rentals.
Senate President Stanley Rosenberg, D-Amherst, said estimates show the Senate committee plan would generate $18 million in revenue for the state in the first six months.
“They definitely want the taxation,” Rosenberg said of Airbnb. “They accept reasonable regulation, but are concerned with overregulation.”
“The idea is to level the playing field and treat everyone the same,” said David Sullivan, legal counsel for Rosenberg’s office (not the Northwestern District Attorney).
But how much regulation remains a topic of discussion.
Lehane and local Airbnb hosts say the online booking service provides an important source of extra income for homeowners who are working to make ends meet. Lehane noted that Airbnb takes a 3 percent cut of room rentals, less than other online reservation services charge traditional innkeepers.
But Georg Burwick, co-owner of The Brandt House B&B in Greenfield, sees Airbnb as “almost a different product” from what his nine-room Highland Avenue guest house offers. “We’re probably not in direct competition. It’s two different things.”
But not having to abide by all of the regulations that are imposed on his B&B does probably give “a competitive edge” to Airbnb, he admitted.
“The Airbnb concept was never designed to be a true bed-and-breakfast experience,” says Burwick. “It was originally like an air mattress on the floor, temporary B&B. What it’s evolved into is people turning it into a little bit of a business. But people who choose Airbnb are not expecting quality; they’re expecting a place to stay for the weekend. Over the years, it’s become a more competitive marketplace, and they’re putting more effort into it, with prices going up.”
Burwick, who uses Airbnb as “another place to market” one of The Brandt House’s “lesser rooms’’ — one with a shared bathroom — says he believes that all of the larger lodging operations should probably pay taxes.
But Lehane said there is no getting around the fact that many young adults prefer Airbnb to traditional rentals.
“Airbnb is how millennials want to travel,” Lehane said, citing the interactions between guests and Airbnb hosts who open their homes to travelers. “They’re looking for an authentic experience.”
Under the Senate proposal, Sullivan said it will be up to the Department of Revenue to establish a process for cities and towns to pass regulations for licensing and inspection.
The draft language reads that “a city or town, by ordinance or bylaw not inconsistent with this chapter, may regulate operators and impose penalties for violations of those ordinances or bylaws. An ordinance or bylaw may require registration, licensing and inspection and may regulate the existence or location of operators.”
Lehane said Airbnbs have a strong element of self-policing, with guests rating their hosts in a public way — and vice versa, which tends to encourage responsible behavior by travelers.
He said a “pass-through” registration system could also allow the company to give local officials more specific information about the location of Airbnbs.
But he cautioned against making regulation overly cumbersome for people just renting out the occasional room .
“Regulations have to be consistent with the way people are living their lives,” said Lehane, adding that if the process becomes too burdensome it will turn people to the black market, using classified ads or Craigslist.
Depending on what comes out during development of the legislation, government officials may finally be able to know exactly how many Airbnb rooms are being rented, how the trend is impacting the conventional lodging and whether there are legitimate safety concerns.
“It comes up all the time,” says Ann Hamilton, the longtime former Franklin County Chamber of Commerce president. “The biggest thing is that they don’t pay room tax to the state, but equally concerning is that they are not regulated — they don’t have to have food inspection or building inspection,” as do commercial operations.
Hamilton, at one point, ran workshops encouraging people to establish B&Bs in their homes as a way of adding to the lodging options as well as boosting the home-grown tourism economy. She says she knows of a couple of Airbnb operations in her Highland Avenue neighborhood alone. The lost rooms tax can add up for some communities that have adopted a local tax option, especially if several families rent a couple of rooms at graduation time for prep schools or colleges.
“There are B&B networks, too,” Hamilton said. “A lot of B&Bs are well established, and people go back two or three times a year sometimes. I think Airbnb is the new B&B.”
Carmela Lanza-Weil, executive director of the Shelburne Falls Area Business Association, said, “Occasionally, I’ll get an earful” about the unfairness of Airbnb operators not having to abide by the same regulations that traditional B&Bs do.
An added concern for her is that people may be buying houses to convert into vacation rentals or into Airbnb rentals — taking properties out of the inventory of houses in what has become a tight housing market in and around Shelburne Falls.
But neither Judd nor Shelburne Planning Board Chairman John Wheeler say they have seen evidence of that kind of real estate speculation.
For all of the concerns raised, however, Airbnb can be a boon for someone who simply has a room or apartment available to people visiting the area.
Betsy Evans, who with her husband, Jeff, rents the bottom floor of their house through Airbnb, agrees that the company should be subject to the same tax requirements as other B&B rentals — although in that case her one-room apartment would be excluded.
The Evans’ apartment, which used to house The Giving Tree School that she founded and ran, had been rented through the nearby Northfield Mount Hermon School before she turned to Airbnb. She noted she hasn’t been accepting rentals until recently because she’s been too busy.
“It’s just a nice way have some use of that space,” she says. “It provides a little bit of money, but I wouldn’t describe ourselves as Airbnb people. I’ve been snoozing the site. … There’s a limit, sometimes, to how much you want to play hostess.”
You can reach Richie Davis at rdavis@recorder.com
or 413-772-0261, ext. 269