Enjoy the following sneak preview from tomorrow's Mercury—an abridged version of our lead news story. Read the whole shebang once we hit newsstands tomorrow!

Mayor Charlie Hales’ office plans to release proposed rules for a controversial expansion by Airbnb to multifamily buildings by the end of the month, the Mercury has learned. The proposed limits—flowing from talks among landlord and renter lobbyists, housing advocates, city staffers, and even Airbnb itself—might even become law by the end of the year.

But while Airbnb has cheerily said it welcomes the city’s embrace, participants in the talks also say the company will have plenty to grumble over. Meanwhile, even some participants are worried the proposed rules won’t do enough to address problems with discrimination and affordability—an especially acute issue at a time of rising housing costs.

“I’m hoping we get to consensus,” says Jackie Dingfelder, the policy director for Hales who presided over three separate meetings on the new rules this summer. “It may not be what everybody lands on to the ‘T,’ but I think we’re going to be able to address the majority of the concerns we’ve heard.”

Most consequentially? Hales’ office wants to maintain the city’s current ban on short-term rentals in homes that aren’t someone’s primary residence. Further, it will suggest a cap on the number of primary residences that can legally be offered up as short-term rentals.

The current thinking would allow licenses for at least one unit in every building citywide, but for no more than 10 percent of units in a larger complex, Dingfelder says—a smaller number than a 25 percent figure sources say was floated in discussions.

It’s similar to a regime first crafted in Austin, Texas, which allows 25 percent of buildings to be rented on a short-term basis in commercial zones, and just 3 percent everywhere else. (Austin also caps the number of available single-family rentals in each of its federal census tracts.) Airbnb supporters lobbied against the caps in Austin, and sources say the company pushed back during meetings here with city hall.

“They don’t like the idea of a cap,” said one source close to the talks, who also gave the company credit for “sitting at the table.” “They believe people should be able to use their residences as they see fit.”

Airbnb was sanguine.

“Portland is embracing home sharing and we have been proud to participate in discussions about this matter,” the company told the Mercury in a statement.

Hales’ office has stressed it’s open to revising its proposals, during a 30-day public comment period before the city council votes this year, or even after they’ve been in place for some time. Dingfelder says the office also has proposed several other restrictions or exhortations meant to ease concerns. Among them:

• Landlords, property owners, or homeowners associations must sign onto applications seeking permission for a short-term rental license. If you’ve signed something saying you’re not allowed to do the rentals, nothing in city code will supersede that. The city hopes to track which units in which buildings are up for rent—something Airbnb doesn’t do on its own.

• Smoke and carbon monoxide detectors must be present—and that means units will be inspectedbut the proposed rules would still leave inspections to the fire marshal.

• Hosts must send notices, with contact information, to neighbors above, below, adjacent to, and across the hall from their unit. They also must notify their local neighborhood associations.

Dingfelder says city hall is fully aware that dozens of apartments are already up for rent on Airbnb without a license—and without landlords in control. If the new rules are too draconian, she says, that might continue.

“The market is ahead of us, frankly,” says Dingfelder. “What’s the right amount of regulation. And how do we balance health and safety and affordability?"

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