Feb 1, 2023 - Business

San Antonio wants more Airbnbs to pay city taxes

Illustration of the Airbnb logo as a money clip on some folded hundred dollar bills.

Illustration: Aïda Amer/Axios

Thousands of short-term rental operators in San Antonio might not be paying their fair share in city taxes. A proposed new working group is aimed at changing that.

Why it matters: When owners of short-term rental homes don't have city permits and don't pay local taxes, the city loses out on revenue that would otherwise go toward supporting tourism and arts and culture programming.

Driving the news: District 1 Councilmember Mario Bravo, whose district includes the most permitted short-term rentals, asked the city to ramp up enforcement by creating a task force that can recommend changes.

  • "The intent is making sure everybody’s playing by the rules and paying their taxes," Bravo tells Axios.
  • Short-term rentals include vacation listings from multiple sites, like Airbnb and Vrbo.

Context: Residents have seen their neighborhoods change as sites like Airbnb have grown in popularity and as it has become attractive for out-of-town investors to operate rentals.

  • The proliferation of such rentals brings problems with parking, noise and trash, according to Bianca Maldonado, who sits on the steering committee of Tier 1 Neighborhood Coalition, a group of neighborhood associations mostly inside Loop 410.
  • But ensuring the rentals are permitted and paying taxes would help address many of those issues, Maldonado tells Axios.

What they're saying: "If you're not permitted with the city, you're not paying your HOT (hotel occupancy tax) to the city," says Maldonado. "That's millions of dollars the city is missing out on."

  • Shelley Galbraith, chair of the Short-Term Rental Association of San Antonio, has also pushed for greater enforcement — in hopes that it brings more fair competition.
  • "Given the honor system and the fact that auditing is really not in the picture, a lot of these smaller actors see the system as not something that is very serious," Galbraith tells Axios. "And that's sad to me."

By the numbers: The city has collected $8.9 million in hotel occupancy taxes from short-term rentals since fiscal year 2019, per the city's most recent annual report.

  • Officials estimate there are 3,345 active short-term rentals in San Antonio.
  • But the data website AirDNA shows 5,622 active short-term rentals in the city, suggesting that more than 40% of short-term rentals are unpermitted.

Of note: Even some permitted rentals are not paying. More than 1,000 rental owners are delinquent on their taxes, Logan Sparrow, a policy administrator with the city's Development Services Department, told the Zoning Board of Adjustment last month.

  • The city recently began revoking some of those permits, Sparrow said.
  • Officials also created a new team of city employees focused on bringing short-term rentals into compliance, spokesperson Ximena Copa-Wiggins tells Axios. The city is hiring for three of the six positions.

What's next: Bravo's request won't move forward until Mayor Ron Nirenberg brings it to the city's governance committee to discuss, which could take months.

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