Bed, Breakfast & Bureaucracy: How Seattle Quashes New B&Bs

John Kramer
John Kramer · March 1, 2005

Seattle.—The City of Seattle claims it wants to encourage residents to open new bed and breakfasts, but its recent actions against Greenlake Guest House B&B owners Blayne and Julie McAferty of Seattle belie that claim. On February 14, 2005, the City of Seattle Department of Planning and Development office issued an order that the McAfertys’ B&B shut down by March 31 or face fines of $75 per day. Today [NOTE TO EDITOR: MARCH 1, 2005], a lawsuit filed by the Institute for Justice Washington Chapter in King County Superior Court in Seattle on behalf of the McAfertys seeks to sweep aside the City’s irrational limits on new B&Bs and, in the process, set an important precedent to help other entrepreneurs across the state vindicate their right to economic liberty—the right to earn an honest living free from excessive government regulation.

“Although the City of Seattle claims to have passed its 2003 bed and breakfast law to encourage residents to open B&Bs, the City now enforces this law to make it practically impossible to do just that,” said Jeanette Petersen, an attorney with the Institute for Justice Washington Chapter (IJ-WA). “The McAfertys are the first new B&B owners to open under the new law and the first to learn their business is not welcome by the City.”

What was the City of Seattle’s excuse for demanding the Greenlake Guest House close down? With off-street parking on the busy street and quiet guests, it certainly wasn’t any public inconvenience. The City’s stated reason was that the McAfertys had enlarged one dormer and added another to their home to enlarge their upstairs guestrooms—supposedly illegal exterior alterations. The City initially told the couple that such alterations were permissible under the new law, but later changed its mind. To make matters more ridiculous, if the McAfertys are forced to sell their home/B&B because of this change in the City’s interpretation of its law, the next owner could open that same home as a B&B, but the McAfertys, who lovingly renovated their home, may not.

“Upset by our guests waving hello to them in the street, certain neighbors complained to the City of Seattle, and the City is now doing their bidding by shutting down our small business,” Blayne McAferty said. “My wife and I always had the dream to open a B&B so we could share our love of cooking and entertaining with others and spend more time with our two young boys. After opening in August 2004, the first months running our establishment were wonderful. Meeting and interacting with our guests was even more rewarding than we expected, and we enjoyed an occupancy rate of well above the national average. Then, to our shock, the City of Seattle buckled to some neighbors’ complaints and ordered us to shut down our business. The dormer we added to which the City objects is no different than you see on homes in this or any neighborhood.”

McAftery added, “We are providing a much-needed service to guests and tourists visiting Seattle. The City’s interpretation of the B&B law virtually guarantees that no successful bed and breakfast will actually open in residential areas in Seattle, which defeats the reasoning behind the passage of the law in the first place.”

William Maurer, executive director of the IJ-WA, said, “The City’s job here should be to protect the rights of the McAfertys, who are merely trying to peacefully earn an honest living. Instead the City is once again more interested in placating very loud private interests than helping entrepreneurs pursue the American Dream.”

“After allowing the McAfertys to open their B&B, the City changed the rules in midstream and violated their constitutional rights,” Maurer added. “The McAfertys are suing the City of Seattle, the City of Seattle Department of Planning and Development, and Diane Sugimura, in her official capacity as Director of the City of Seattle Department of Planning and Development. The goal of the Institute for Justice Washington Chapter in filing this lawsuit is to restore economic liberty—the right to earn an honest living—as a fundamental civil right under the Washington Constitution.”

Since its founding in 1991, IJ has scored significant legal victories on behalf of entrepreneurs and, in the process, opened up long-closed markets. These include:

  • Craigmiles v. Giles—In 2003, a federal appeals court upheld a lower court ruling that found Tennessee’s government-imposed cartel on casket sales was unconstitutional. This is the highest pro-economic liberty court decision since the New Deal. (IJ has a similar challenge to Oklahoma’s casket retail law now up for U.S. Supreme Court consideration.)
  • Farmer v. Arizona Board of CosmetologyIn 2003, as a result of an Institute for Justice Arizona Chapter (IJ-AZ) lawsuit, the Arizona legislature exempted hairbraiders from the State’s outdated cosmetology scheme.
  • Clutter v. Transportation Services Authority—In 2001, IJ defeated Nevada’s Transportation Services Authority and its entrenched limousine cartel that had stifled competition in the Las Vegas limousine market.
  • Ricketts v. City of New York—In 1999, IJ helped commuter vans fight a public bus monopoly that would not allow vans to provide their service in underserved metropolitan neighborhoods in New York City.
  • Cornwell v. California Board of Barbering and Cosmetology—In 1999, IJ defeated California’s arbitrary cosmetology licensing requirement for African braiders.
  • Jones v. Temmer—In 1995, IJ helped three entrepreneurs overcome Colorado’s protectionist taxicab monopoly to open Denver’s first new cab company in nearly 50 years. IJ also helped break open government-sanctioned taxicab monopolies in Indianapolis and Cincinnati.
  • Uqdah v. D.C. Board of Cosmetology—In 1993, IJ’s work in court and the court of public opinion led the District of Columbia to eliminate a 1938 Jim Crow-era licensing law against African hairbraiders.

IJ is also currently litigating a federal lawsuit in Louisiana on behalf of three would-be florists challenging the State’s anti-competitive, anti-consumer florist licensing law. Louisiana law requires florists to pass a State-mandated licensing exam before they are allowed to work. No other state in the nation forces people to pass a test just to sell flowers. And finally, IJ is also litigating to end arbitrary licensing of African hairbraiders in Mississippi and the state of Washington, as well as on behalf of construction waste haulers in Seattle.