Listing and renting homes on the Airbnb.com website might soon be subject to regulation by the Corpus Christi City Council after complaints were lodged at a recent meeting and council members realized tax revenues were being lost.
The complaints came after a request to rezone a home on Convair Drive from single-family to single-family with a special permit to operate a bed-and-breakfast. Council denied the zoning change at the Jan. 22 meeting but not because it was a bed-and-breakfast; rather, because the home was listed on Airbnb.com.
Airbnb.com is a marketplace website matching vacation rentals to travelers looking for a unique place to stay. Landlords rent out bedrooms, garage apartments or even entire homes, all online. It’s as simple as posting a photo, description and price. Airbnb collects and distributes the money between renter and host. The short-term rental company lists properties in more than 65,000 cities, including Corpus Christi, in 200 countries.
Since the meeting, Airbnb has indicated its willingness to work the Corpus Christi on a way to collect taxes. “We are committed to working with the City of Corpus Christi on fair, common-sense regulations that protect neighborhoods and allow families to share their homes to help pay the bills,” said spokesperson Laura Spanjian, Airbnb Public Policy Director, Southwest in an email to Corpus Christi Business News. “We are committed to helping our community pay its fair share of taxes, and have reached agreements to collect and remit taxes in 340 jurisdictions around the world, including the State of Texas,” she continued. “These agreements generate meaningful revenue for communities and streamline the process for our hosts, and we hope to reach them with cities around Texas, including Corpus Christi, soon.” 

COUNCIL MEETING COMPLAINTS

Neighbors of the Convair Drive property complained that renters took up scarce parking spaces and changed the tenor of the neighborhood. Several said they feared property values would decrease.
Council members had their own objections. Much like internet-based ride-sharing companies such as Uber and Lyft, Airbnb listings bypass some city regulations, such as paying hotel occupancy taxes.
“We can’t just let them operate without paying any taxes,” council member Carolyn Vaughn said. “Hotels pay taxes through the state comptroller’s office, so what do (Airbnb listings) do?”
Airbnb.com does collect and pay some taxes. As of May 1, 2017, it began collecting a 6 percent state hotel occupancy tax on Texas short-term rentals. Before that, hosts were expected to collect the money from renters upon arrival to the property. Hosts also had the responsibility of reporting and remitting that money to the state. The agreement between Texas and Airbnb put the web-based company in charge of collecting the taxes and remitting taxes — at least on the state level.
To collect the additional local hotel taxes, Corpus Christi, which charges a 9 percent tax, would have to come to its own separate agreement with Airbnb. According to the Dallas Morning News, the company is currently working on a deal with Dallas, which charges an additional 7 percent in hotel occupancy taxes on top of the 6 percent state taxes. That could mean an additional $1 million a year in revenue for Dallas. If the state agreement had been in effect in 2016, Airbnb would have paid $8 million into the state’s coffers.
During the City Council meeting, Vaughn noted that Airbnb listings are “cropping up all across the city.
“Can these facilities just be located anywhere in a neighborhood?” she asked.
The answer seems to be “yes.”
On the Airbnb website, more than 300 Corpus Christi properties are listed as available for rent. Prices range from $22 a night for a “roomy garage conversion” to $149 per night for “Salty Toes Beach House” with five beds. And that’s just on the first page of the listings, which continue for 17 pages at 18 listings per page.
“This city is losing a significant amount of hotel, motel tax,” council member Greg Smith said. “We need to address that.”