Cities keen on ‘sharing economy’ but concerned about safety

Jun 3, 2015, 8:48 AM

NEW YORK (AP) — American cities are enticed by the economic growth and services that “sharing economy” companies such as Airbnb, Uber and Lyft can offer, but officials are anxious about safety in a largely unregulated realm, a city advocacy group found in a study released Wednesday.

Nearly three-quarters of city leaders said they want to see the “sharing” sector grow, according to National League of Cities survey responses from 245 leaders of municipalities large and small.

Yet nearly two-thirds said they were concerned about the safety of using apps and websites that let everyday people rent out rooms, arrange car rides and provide other services to strangers. More than half the cities said they imposed no rules on “sharing” players, though their traditional counterparts — like hotels and taxi companies — often are regulated.

“Cities are welcoming” the rise of the sharing economy, said Brooks Rainwater, one of the study’s co-authors. “But at the same time, because it’s upending traditional service providers and regulatory environments, it’s causing some level of consternation.”

Still, “cities are learning how to work with these companies,” and vice versa, he said.

Companies say they’re safety-conscious contributors’ to cities’ economies.

A look the findings:


The Washington-based cities league included some sharing-economy questions in a broader economic survey sent this year to top elected officials in 986 cities; 245 responded.

The “sharing” or “peer-to-peer” economy can refer to services as varied as co-working spaces and short-term bike-rental programs. The report, like the regulatory debate so far, focuses on “home-sharing” players such as Airbnb and “ride-sharing” companies such as Uber and Lyft.


Many cities are grappling with whether or how to regulate and tax the burgeoning “sharing” sector.

New York taxi regulators, for example, are weighing whether to make ride-hailing services submit data on their trips. Portland, Oregon, is experimenting with allowing ride-hailing companies while deregulating its existing cab industry.

San Francisco agreed last year to permit some home-as-hotel rentals but is now contemplating further limits. Meanwhile, some lawmakers want to expand a squad that investigates complaints about such rentals in New York, where it’s largely illegal to rent out an entire apartment short-term.


While 71 percent of cities said they supported sharing-economy growth, leaders embrace ride-hailing apps more readily than short-term home rentals, by 66 percent to 44 percent.

In general, cities see the biggest benefits as improved services (rated No. 1 one by 22 percent) and economic expansion (20 percent). Smaller numbers cited entrepreneurship, efficiency, tourism and constituents’ enthusiasm.


Sixty-one percent of cities said safety was their top concern about peer-to-peer services. Just 10 percent or fewer named any other potential problem, including effects on established industries, lost tax revenue and workforce issues.


Sharing-sphere companies say they fuel local economies by giving consumers new options and are committed to making them safe. San Francisco-based Airbnb says its service brings tourist dollars into neighborhoods beyond the beaten hotel track, among other benefits.

San Francisco-based Lyft says it conducts criminal background checks of drivers, staffs a round-the-clock safety hotline and has worked on regulations with about 30 cities and states. Austin, Texas-based short-term rental marketplace HomeAway points to its various security guidelines and guarantees, plus owners’ vested interest in keeping up their properties. “Cities should not fear for the safety of their community,” co-founder Carl Shepherd said in a statement.

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Cities keen on ‘sharing economy’ but concerned about safety