This piece is cross posted from the Data-Smart City Solutions blog hosted by the Ash Center for Democratic Governance and Innovation at Harvard Kennedy School. The emergence of rideshare as a form of transportation - and how cities are responding to the innovation - is of particular interest to Living Cities as we explore ways to increase the number of low-income people who are able to connect to job opportunities and essential services such as childcare, health services, etc.
As cities respond to the growing presence of ridesharing services like Uber, Lyft, Sidecar, and others, even the name “ridesharing” is up for debate.
Traditionally, for-hire car services have fallen into two broad categories, distinguished by how customers connect with their rides. Taxis, which customers hail on the street and black cars (or limos), which customers arrange for by calling ahead of time. Is something like UberX really a rideshare, closer to carpooling, or is it effectively a cheaper version of black car service? Are these app-based companies more like dispatch services or networks of amateur drivers?
As cities consider how (or whether) they should regulate rideshare services, they must determine whether existing classifications adequately describe them or whether new sets of rules are needed to address concerns for public safety and consumer protection.
The following review of what cities and states are doing now - or considering doing - to respond to rideshare services is not comprehensive, but will hopefully give a sense of the current landscape.
Reclassify & regulate
California: Created category of “Transportation Network Companies” which must be licensed with the California Public Utilities Commission, conduct criminal background checks, train drivers, and hold commercial insurance policies with at least $1M per-incident coverage.
Seattle: City Council unanimously voted to limit each rideshare company to 150 total vehicles. Measure includes increasing number of licensed taxis in city by 200 over the next two years. Mayor Murray has said that this legislation is a “‘necessary first step’ in legalizing TNCs in Seattle, will pursue a more long-term comprehensive solution.”
Arizona: A bill passed by the house and approved by a state senate committee proposes a new classification of “transportation network services” that requires drivers and vehicles to register with the Arizona Corporation Commission (the state Department of Weights and Measures oversees licensing of taxis and other existing for-hire vehicle services). It would also require TNS to do background checks on drivers and obtain commercial liability insurance.
Chicago: Mayor Emanuel proposed ordinance to license rideshare companies and require insurance. Services in the new category of “Transportation Network Providers” would be required to register with city for annual $25,000 fee, submit to annual inspections of vehicles by cities, and hold commercial liability insurance.
Colorado: State senate passed a bill designating ridesharing companies “transportation network” companies. They would be required to hold insurance, do background checks, and driver training as well as submit to utility commission oversight. House still to vote.
Minneapolis: Proposal to add “transportation network companies” to lists of transportation companies that may operate in the city. Currently, rideshare companies must have a taxi license to operate. In neighboring St. Paul, the city’s code narrowly defines taxis as metered vehicles, so rideshare companies currently operate without licensing.
Georgia: House Bill 907 proposed to require rideshare companies to follow the same set of regulation - namely insurance and licensing requirements - as existing taxicab and limousine companies, but the bill failed to reach the floor for a vote.
Fit into existing frameworks
Florida: The state legislature is considering two bills that would prevent local governments from regulating “chauffeured limousine” services. In practice, that would leave the state government as the only body capable of regulating any non-metered for-hire vehicles, including rideshare services.
Jacksonville: City council approved legislation to remove the 30-minute advanced-notice requirement for black car services, allowing rideshare companies to operate as long as they conform to the existing rules and regulations for black car services.
Madison: Mayor Paul Soglin, a former cab driver, has described taxi service as “a legitimate area of government regulation,” citing the need to provide transportation for people with disabilities. He suggests that the city will not create new policies to regulate ridesharing companies as a distinct service, but they will be subjected to the same regulations as existing taxi companies.
Austin: The city has threatened to impound cars in rideshare service over lack of insurance, which led to Sidecar leaving the city.
Detroit: City Attorney says UberX does not comply with Detroit’s licensing requirements. State and local police authorized to ticket cars driving for UberX.
Miami-Dade County: County commissioners stalled bill suggesting changes similar to those rejected in Portland.
New Orleans: Uber has been barred from offering services in the city, and Lyft said it has no plans to enter the market.
Portland: In December the Private for-Hire Transportation Board of Review rejected changes to the city code regulating limousine and black car services, including a minimum lead time of one hour before pickup and fixed 35% premium over taxi rates. The Board is discussing changes to the City Code to better reflect developments in the industry, including smart phone app-centric rideshare services.
San Francisco: Including taxis, limos, rideshares, and any other similar services, there may be about 4,000 vehicles for hire in the city at any given time. As this increased competition leads taxi companies to return some medallions (for drivers likely leaving to drive for competing rideshares), service to the disabled may be disproportionately reduced: the number of wheelchair-accessible vehicles in operation per month has dropped from 1,400 to 600.
Dallas: A transportation-for-hire work group is reviewing city regulations for possible changes. The City Council committee reviewing tech-based transportation services distinguishes Taxi Magic, an app partnering with traditional cab companies representing 750 taxis, from rideshare companies on the basis that it does not connect riders directly to drivers.
The recent leak of Uber’s “secret, ‘proprietary’ insurance policy” lends some clarity to the legal liability debate around ridesharing. Between that and the apparent rise of Uber as a “cause célèbre” in national partisan politics, activity in this sphere is only going to increase. Follow our Local Reg Reform project (@SmartLocalReg) on Twitter to keep up with this national conversation.
Matthew McClellan works as a research assistant and writer for the Project on Municipal Innovation Advisory Group.