Penn State professor in tug-of-war between hotels, Airbnb

A Penn State professor is at the heart of a battle between old-school hotels and new-school entrepreneurship.

John O’Neill is the director of the Penn State School of Hospitality Management’s Center for Hospitality Real Estate Strategy. He’s been with the university since 2001.

He also has a long list of consulting clients. His page on the International Society of Hospitality Consultants website lists work with Marriott International, Hilton Worldwide, Choice Hotels International, Shaner Hotel Group and others.

The page lists his consulting arm, Hospitality Advisory Services LLC. Records searches show that company was established in 2002, a year after he joined Penn State.

But a nonprofit watchdog group, Checks and Balances Project, has lodged an ethics complaint against O’Neill.

Evlondo Cooper, a senior fellow with the project, submitted the complaint to Clint Schmidt, director of the Conflict of Interest Program at the university on Dec. 8.

According to the complaint, Cooper requested Schmidt investigate ethics violations, suggesting O’Neill violated three specific university policies on private consulting, disclosure and conflict of interest.

It was not the first time the group lodged such complaints, sending them to Ann Crouter, dean of the College of Health and Human Development, in November. The group also posted the issue to its website in October.

Among the issues Cooper and C&BP Executive Director Scott Peterson have raised are corporate funding for O’Neill’s research and studies conducted by the professor and funded by the American Hotel and Lodging Association.

“If Penn State’s ethics standards are to mean anything, then university officials should seriously investigate our serious conflict of interest complaint against (O’Neill). So far, the reception has not been encouraging,” Peterson said. “It appears that professor O’Neill is not only using university resources to host his private business, but he is using the imprimatur of the university to increase the credibility of his corporate-funded research on behalf of his hotel lobby clients. This seems to be in clear violation of university ethics standards. Yet Penn State is looking the other way.”

But at the same time, O’Neill also seems to be a target of a different corporate entity.

“Airbnb approached us,” Peterson said. The company gave funding to the project.

According to C&BP’s website, the nonprofit accepted an “offer of public funding” from Airbnb.

C&BP’s mission had been related to climate change and sustainability issues. Peterson talks about work in Arizona with solar energy projects that led to an FBI investigation of an energy company.

So how does that relate to a multibillion dollar company arm-wrestling with hotel chains?

“Peer-to-peer home sharing is more sustainable than hotels,” Peterson said, explaining how the innovative tech company valued at $30 billion got involved in a Penn State professor’s life.

“He’s the go-to guy for the hotel industry,” he said.

O’Neill did publish a study this year called “From Air Mattresses to Unregulated Business: An Analysis of the Other Side of Airbnb,” one of those studies paid for by AHLA. C&BP calls it “one of the main lines of attack in the hotel industry’s fight against home-sharing platforms.”

Airbnb created a new economic opportunity for individuals with homes in much the same way Uber did for anyone with a car, a way to make money when you aren’t using something you have at your disposal. But just as Uber has faced disgruntled cab drivers over its service, Airbnb is ending up in pitched battles with the hotel industry and its lobbyists.

“It’s fair to say that the hotel lobby has consistently fought regular people who share their home,” said Airbnb’s Nick Papas.

Around the country, it’s something that different levels of government and regulatory agencies are struggling to codify. In Centre County, the State College borough zoning board has faced questions about “tourist homes” and what that means for area laws about who can live where and what needs to happen for that to be permitted.

Penn State receives millions of dollars annually from a variety of sources that fund research, including government agencies like the National Institutes of Health or the U.S. Navy, and private companies like General Electric, which put $10 million into a new gas research center in 2014.

“The Checks and Balances group has in fact brought this to our attention and, as we would with any issue of this type, we have referred the matter to Penn State’s Office of Ethics and Compliance for independent review,” said Penn State spokeswoman Lisa Powers. “We continuously work with faculty to ensure compliance with university policies and do appreciate them reaching out to us about their concerns.”

O’Neill said his work is aboveboard and in line with Penn State’s requirements.

“I strive to conduct research that’s relevant, informative and grounded in hard data, and that’s the case with my work on Airbnb, which has grown to become a company valued at some $30 billion,” he said. “I make certain to follow Penn State’s compliance policies. Throughout my work on Airbnb over the past several months, I talked and met with several Penn State administrators to be sure that’s the case with this project too.”

This story was originally published December 17, 2016 at 10:15 PM with the headline "Penn State professor in tug-of-war between hotels, Airbnb."