Arizona Gov. Ducey Signs Bill Blocking Local Airbnb Bans

Published June 11, 2016

Arizona lawmakers have signed into law a bill preventing local governments from banning Airbnb and other peer-to-peer economy companies that connect tourists seeking short-term housing and hosts providing places to stay on their property.

Gov. Doug Ducey (R) signed into law Senate Bill 1350 in May, preventing local governments from passing ordinances prohibiting vacation rentals or short-term rentals. It will also restrict local governments’ ability to regulate Airbnb hosts’ use of their property.

The new law will go into effect on December 31, 2016.

Criminalizing Citizens

Christine Sandefur, executive vice president of the Goldwater Institute, says local governments in Arizona have effectively been criminalizing innocent people under their peer-to-peer economy laws.

“What they were doing was shutting these enterprises down and, in some cases, turning property owners into criminals by telling them it was illegal to rent their homes for less than 30 days,” said Sandefur. “And if they rented their homes for less than 30 days, they could be fined thousands of dollars or thrown into jail.”

‘Outright’ Bans Banned

Sandefur says the new law allows cities to regulate in the interest of protecting public health.

“Cities and towns can’t prohibit vacation rentals outright,” Sandefur said. “If they want to regulate in the interest of health and safety, they can do so, but they have to do so in a way that’s narrowly defined to promote health and safety. [They can] enforce noise ordinances, enforce trash ordinances, put a limit on how many people can stay in a particular dwelling, but [they can’t] ban an activity outright.”

Preventing ‘Grassroots Tyranny’

Sandefur says the bill’s restrictions enhance liberty.

“We like local control as a means to an end of protecting freedom,” Sandefur said. “Sometimes it’s helpful to have those checks on power. They call it grassroots tyranny, and this was one of those cases. We don’t promote local control as an end in itself. We promote it as a means to achieve liberty.”

Sandefur says local governments were abusing their power when they banned Airbnb and other similar services.

“When it becomes destructive of those ends, when it’s in fact being oppressive, then absolutely we believe in state control,” Sandefur said.

Government Lobbying Government

Arizona State Sen. Debbie Lesko (R-Peoria), the bill’s sponsor, says lobbyist organizations representing the interests of local governments opposed the bill.

“The [Arizona] League of Cities and Towns opposed the bill, although we worked with them on it,” Lesko said.

Taxpayers and Homeowners Win

Lesko says the new law will benefit taxpayers all over the state.

“To me, I think it will help homeowners,” Lesko said. “Now, all of a sudden, they’re not going to get an audit and have to pay a bunch of taxes they didn’t realize they had to pay.

“We [passed] legislation last year that helped Uber and Lyft, and now we’re doing legislation this year that frees up people to make a living and grow our economy without burdensome regulation,” Lesko said. “We believe our economy can grow if we just let people go.”

Danedri Herbert ([email protected]) writes from Kansas City, Kansas.