Oklahoma City covers more than 600 square miles, and completely surrounds several communities. That can lead to lost or delayed revenue, which is becoming even more problematic with the rise of so-called “gig economy” businesses like Uber, Lyft, and Airbnb.
During Tuesday’s city council meeting, Oklahoma City’s assistant treasurer Matt Boggs said Oklahoma City recapture $1.1 million in lost revenue during the fiscal year that ended June 30.
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“They got about $304,000 in uncollected sales and use taxes. $145,000 that came from an audit by a third party, and then an additional $167,000 in hotel tax collections,” said The Journal Record’s managing editor Adam Brooks. “The biggest chunk, though, was from problems with Oklahoma City’s boundaries. That brought in more than $500,000.”
Because Oklahoma City touches and surrounds several communities, taxes businesses submit to the Oklahoma Tax Commission sometimes get misdirected.
It’s also difficult to figure out how much tax money the city loses due to residents who rent out rooms through Airbnb. City Manager Jim Couch says Oklahoma City has issued citations due to complaints from neighbors about the lodging business.
“We’re not proactively going out and doing it,” Couch said. “It’s almost impossible to do it proactively because they don’t give the address.”
Assistant city manager Laura Johnson told the council there’s now more overall awareness of these types of businesses.
“Our biggest issue right now is that as much as this is growing, the neighborhood operation is growing also, and we get complaints about that,” Johnson said.
A search of Airbnb for Oklahoma City listings turned up dozens of entries on the website, according to The Journal Record’s Brian Brus:
In order to legally regularly operate as a commercial business in a residentially zoned area, Johnson said, a homeowner has to purchase a $2,700 special permit. An Airbnb participant qualifies as a commercial hotel under city ordinances; a building with five bedrooms brings the operation under fire marshal codes as well as Americans with Disabilities Act regulations. Even renting one room turns a homeowner into a bed-and-breakfast business operator, Johnson said. When asked if breakfast would be required as well, she said, “Throw a granola bar out there, I guess.”
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