It’s a mistake to think of Bill de Blasio as pro-consumer or anti-business. He’s a cronyist, supporting favored businesses with government regulation and protecting them from competition.
One set of businesses he’s out to protect – at the expense of consumers – is the city’s incumbent hotels.
De Blasio is proposing to eliminate the ability for new hotels to be built ‘by right’ as long as they conform to zoning laws, and instead require a special permit in “a process that would effectively grant the local City Council member veto power over any new hotel room.”
- The largest hotel owners in the city say “they’ll rest easier if the city severely restricts the construction of competing accommodations.”
- The “major hotel brands supported the mayor’s special permit initiative” as well.
- That’s because incumbent players don’t like competition that might drive down the city’s sky high room rates and affect their profits.
In the ‘upside-is-down’ world of spin, hotel owners argue that (1) new hotels will drive down rates, (2) which will hurt their business, and (3) they pay taxes — so more hotels mean less taxes. It’s not for their benefit but the benefit of the city’s coffers that competition needs to be limited. After all, while new hotels will pay taxes, they don’t pay taxes yet!
You’d expect hotel unions to back more hotel industry jobs that come from more hotels, but new hotels aren’t yet unionized so they want to stamp out competition too.
In 2015 New York’s city council voted for a moratorium on converting hotels to condos. They needed hotels! Which is it? You’d think the city would want more hotels since they need somewhere to house the homeless. Of course this wouldn’t be the first absolutely backwards New York City hotel law.