Dozens of Mainers, including retired homeowners and vacation property managers, spoke out passionately Monday against a bill that would require licensing of short-term residential lodging in the state.

Speaking at the bill’s initial public hearing in Augusta, some said the income they collect from hosting guests through websites such as Airbnb has saved them from losing their homes or resorting to welfare. Others said the proposed law would destroy Maine’s billion-dollar vacation rental industry.

The bill’s sponsors, including two lawmakers who work in the lodging industry, say licensed innkeepers are suffering from a double standard that requires them to prove their facilities are safe and clean, while imposing no such rules on Airbnb and other short-term vacation rentals.

“It’s a fairness issue, when you really look at it,” said the bill’s lead sponsor, Sen. John Patrick, a Democrat from Rumford. “If you do have a business, you should be licensed.”

Gov. Paul LePage is one of the bill’s opponents, according to a representative who spoke at the hearing.

LePage spokeswoman Holly Lusk said the governor would prefer to eliminate the existing double standard by deregulating all types of lodging, although she did not provide any specifics. Doing away with hotel inspections would free up additional manpower to catch up on the state’s backlog of overdue restaurant inspections, she said.

The bill, L.D. 436, would require state residents who rent out their properties for short periods to follow the same rules as owners of hotels, inns and bed-and-breakfasts. Those subject to the proposed law would include the vast majority of Airbnb hosts and owners of vacation rentals.

L.D. 436 would require those listing properties on Airbnb, a popular website for renting out empty rooms or entire homes, to obtain innkeeper’s licenses from the state Department of Health and Human Services’ Division of Licensing and Regulatory Services. The law also would apply to owners of traditional vacation rentals. A license costs $125, but opponents of the bill said most residential properties would never pass the required inspection.

“You will be putting a lot of people out of business,” said Audrey Miller, an opponent who owns and operates Cottage Connection Vacation Rentals with her husband in Boothbay.

LICENSING TO ENSURE GUEST SAFETY?

Maine law requires licensing for lodging facilities with at least four rooms, cottages or condominiums under the same management. The bill would expand the requirement to cover properties of all sizes.

It also would eliminate an exemption for vacation rental homes in which guests stay for short periods. Under the current law, all houses, apartments and condominiums that are rented for “vacation, leisure or recreation purposes” are exempt from licensing requirements. The bill would preserve the exemption only for properties in which guests stay for at least a week at a time.

Although its supporters say they are not trying to wipe out Airbnb rentals in Maine, the proposed legislation would have a deeply chilling effect on the state’s fast-growing market for the short-term rental of houses, condominiums and apartments.

Speaking before the Legislature’s Joint Standing Committee on Health and Human Services, Miller questioned the motives of the bill’s sponsors, particularly their contention that licensing is a way to protect the safety of short-term guests.

“Why is it safe to stay in a rental for seven nights and not for four?” she said, eliciting applause from the standing-room-only crowd.

Portland resident Elizabeth Burke told the committee that the income she has earned from renting out spare rooms in her home on Airbnb has allowed her to pay for property improvements and taxes while bringing out-of-state dollars to Maine. She also owns a traditional vacation rental that would be affected by the proposed law.

“Airbnb has made my life possible,” she said.

CALLS FOR COMPETITIVE FAIRNESS

Opponents of the bill took issue with the lodging industry’s claims that unlicensed owners of vacation properties operate outside the law by failing to collect and pay the proper taxes. Still, some said they would be unwilling or unable to make the kind of property improvements required under the proposed law, such as installing fire-safety sprinkler systems in their homes.

Advocates for the bill, most of whom represent or work in the lodging industry, were equally adamant in their support.

Greg Dugal, president and CEO of the Maine Innkeepers Association, who was involved in drafting L.D. 436, said the bill is designed to address three key concerns: guest safety, zoning violations and competitive fairness.

Dugal said the reason the bill preserves the current exemption for vacation rentals of at least seven days is that more accidents and other problems tend to arise when guests stay in unfamiliar homes for a short time, often without ever meeting the owners.

“We believe overnight lodging is where the danger starts,” he said.

Dugal noted that much of the business facilitated by sites such as Airbnb already is illegal, either because of local ordinances or fire safety laws.

Innkeeper Kathleen Thrall, who owns The Inn at the Rostay in Bethel, told the committee it makes no sense that the state’s 1,400 hotels and inns have to be licensed, while 22,000 unlicensed vacation properties are being allowed to provide the same type of service.

“This would not be an issue if everyone was required to get a license,” she said. “There needs to be minimal standards for all rental properties.”

This story was updated at 10:30 a.m. on Friday, April 17, 2015 to correct the description of Elizabeth Burke’s experience renting on Airbnb.


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