Executive Summary for busy PPPers:
Municipalities should explore how the sharing economy could support economic development and improve the quality of life of its most challenged residents and neighborhoods.
The sharing economy is here to stay. That's what happens when an industry was estimated to have $15 billion in global revenues in 2013 and is projected to have $335 billion in global revenues in 2025. Hell, those numbers might be low -- Uber is projecting $10 billion in revenues by itself in 2015! Whether it's Uber, Lyft or Sidecar for transportation, or Airbnb, VRBO or FlipKey for short-term lodging - the sharing economy is changing cities around the world.
However, many municipalities and neighborhood residents are fighting against the spread of the sharing economy. Airbnb and its competitors are being attacked as mostly illegal, a drain on the stock of affordable housing, and bad for housing markets around the world. Residents are calling them disruptive to the fabric of neighborhoods. Uber and its competitors are being hit with unfair competition lawsuits and charges of exploiting its drivers. One Salon article argued that Uber must be stopped.
I don't want to wade into the debate on whether the critics or the champions are right or wrong, but I do want to throw out another perspective:
Leverage Car-Sharing for Good. Through thoughtful public-private partnerships, vehicle-sharing companies could offer subsidized service to low-income seniors who need to get around town. Through P5 Partnerships vehicle-sharing companies could also offer subsidized lower-cost ride shares to lower-income residents who can't afford a car but live in neighborhoods not adequately served by public transit or taxis. As an example, construction workers who don't have a car but have to be at the construction site by 5am can't use public transit to get themselves to work. Residents of certain urban or rural areas only have access to very poor public transit options. A low-cost ride sharing option could bridge these gaps.
Make Short-Term Rentals Have Long-Term Upsides. A report by the NY Attorney General alleges that short-term rentals are disproportionally centered outside of certain neighborhoods.
Short-term rental companies could be incentivized to get more listings posted in urban neighborhoods, rural towns and other areas that could benefit from the additional vibrancy and activity brought by short-term renters. Maybe these short-term renters would realize what they've been missing in these areas. Some of them might consider moving there. Or over time the increased activity might give owners a market-based reason to improve their properties. Or values might rise in those neighborhoods as people see real estate and investment opportunity in overlooked places.
Conclusion. I have no doubt that there are 100 issues to be resolved to make sure these potential sharing economy arrangements are equitable. They must be structured to promote economic development and improve quality of life, not just company profits. These deals won't be easy. However, the potential upside is worth it. Municipalities should explore how the sharing economy could support economic development and improve the quality of life of its most challenged residents and neighborhoods.