All Lodging Establishments Are Not Created Equal

Just because that cute little bed and breakfast with the cheap rate has a website doesn’t mean it’s a legitimate business.

I was talking to some guests the other day and they were commenting on the large number of B&Bs in Asheville (somewhere between 40-50 in the Asheville area).  I happened to mention that there are even more if you count the illegal B&Bs and vacation rental properties. Well, that started a round of questions.

What do you mean illegal B&Bs? How is that possible? How can we tell? And so on. So we talked for the next 20 minutes about ways to spot a legal versus illegal establishment. So for anyone else who might be wondering, keep these things in mind:

  • Legal lodging establishments comply with local, state and federal requirements including obtaining and displaying a business license and Health Department Inspection certificate. We all must display these in an area where guests can see them. Before you book with a place, ask them if they are licensed and inspected. Legitimate places will have no problem answering that question. And once you arrive, look for those certificates to make sure they are up to date. Remember that a health inspection means that the establishment is cleaning the property/dishes and storing food in the proper manner. They also check the guestrooms to make sure certain standards are met in cleanliness and room safety.
  • A legitimate establishment with 5 or more rooms is collecting and paying occupancy and sales taxes. If you are not being charged taxes, ask why not? If you are purchasing a package, ask if the taxes have been figured into the package price. In Buncombe County and the City of Asheville, tax paying properties (don’t assume a 4-room B&B is illegal because it does not have to collect taxes) get a listing on the official tourism website. If you come across lodging in the county that rents out 5 or more rooms and it’s not listed on, ask the owner some questions.
  • An illegal establishment is less likely to comply with fire and safety requirements because, quite frankly, they can be restrictive and/or costly to maintain. Ask if each guestroom has a fire detector and if the fire alarm system is monitored and hard wired to notify the fire department if it goes off. Are there fire extinguishers throughout the house and kitchen? Again, small establishments with under 5 rooms for rent are not considered as “commercial” properties and are not required to comply, but do you want to put your safety or the safety of your family at risk? Small B&Bs that operate on the up and up will take fire safety seriously and will have measures in place.
  • Find out if the establishment has liability insurance in case of an accident. Commercial lenders (and B&Bs of more than 5 rooms are usually considered commercial) require a certain amount of liability insurance. Even a place with less than 6 rooms should carry liability insurance if rooms are to be rented out for short or long-term.
  • In some areas, the proximity and number of B&Bs is limited. For instance, after 1997, in the Historic Montford District, no new B&Bs could be opened within 500 ft. of another B&B. All existing B&Bs were grandfathered in so that is why you see 2 and 3 in a row. But someone who wants to rent out their house for the summer that happens to sit next to an operating B&B is actually not permitted to, but people do it. Therefore, that house is illegally operating as a vacation property (not licensed, tax collecting, inspected, etc.). You should really think twice about renting it, just to save a few dollars because you could end up paying with much more than money.

Don’t get me wrong, I understand the need for someone to make a little extra money by renting out their property, but I run my business legally and I feel that everyone else should too. An illegal B&B can undercut my prices because they aren’t collecting taxes or paying for a license or insurance. The trade-off as far as I’m concerned is too high. Just do yourself a favor and ask a few questions before booking your next trip, whether here (I hope it’s in Asheville) or Albuquerque or St. Augustine or Austin. You’ll feel a lot better knowing that your safety and comfort are worth more to the B&B owner than money.

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