Chicago Ordered to Put Airbnb Regulations on Hold

by | December 15, 2016 AT 11:55 AM

By Ally Marotti

A judge has ordered the city of Chicago to hold off on implementing new restrictions on Airbnb and other home-sharing platforms after a group of homeowners sued the city last month.

The lawsuit targeted the city's new home-sharing rules, which place restrictions on homeowners renting their living spaces out on Airbnb, a platform that has become a thorn in the hotel industry's side.

The new regulations call for an extra tax on home-sharing hosts, a limit on the number of units in buildings that can be rented out on the platforms and a requirement that hosts maintain records on guests, among other rules.

Keep Chicago Livable, a nonprofit made up of homeowners who oppose Chicago's regulations, filed the suit Nov. 4 in the U.S. District Court for the Northern District of Illinois, saying "this new law is designed as a particularly cruel trap for the unwary."

The new rules were scheduled to go fully into effect Dec. 17, but Judge Sara Ellis ruled Monday to push that date back until Feb. 28. Some provisions of the new regulations were exempted from the ruling.

"I would characterize this as a timeout to allow the judge and the parties to examine and analyze whether this law should be suspended pending a final judgment," said Shorge Sato, attorney for Keep Chicago Livable.

The provisions the city must wait to implement include the requirement that hosts maintain records on guests and the limit on the number of units in buildings that can be rented out on home-sharing platforms.

Requirements regarding zoning changes and fees the city can collect from home-sharing platforms were among those exempted from the judge's order.

The city has until Dec. 30 file a response. A hearing is scheduled for Feb. 1.

Benjamin Thomas Wolf, president of Keep Chicago Livable and a plaintiff in the case, told the Chicago Tribune in November that he quit renting out his condo in light of the regulations.

"We now look forward to working alongside our council members and the mayor so that we may collectively create a new and more reasonable law," Wolf said in a statement Tuesday evening about the judge's ruling. "Most importantly, this outcome allows for the continued protection of our communities and the citizens of Chicago."

Airbnb was not involved in the lawsuit. Spokesman Ben Breit said in a statement that the company had been working with the city and was set to begin delivering host registration data this month.

"We respect the city's decision and remain ready to move forward with our obligations under the ordinance when the stay is lifted," Breit said in a statement.

There are 6,400 Airbnb hosts in Chicago, the San Francisco-based company said in November. About 371,000 guests stayed in the city between Nov. 1, 2015, and Nov. 1, 2016.

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