Score another victory for the transportation apps. On Wednesday, the DC Council will start marking up legislation to defog the regulatory haze around “ride-sharing” companies like UberX, Lyft, and SideCar and grant the companies official permission to continue operating with just a few minor adjustments.
The “Transportation Network Services Innovation Act of 2014,” first introduced in April by Council members Mary Cheh and David Grosso, would permanently concede that the ride-sharing services are going to be a permanent component of DC’s tranportation menu, much to the frustration of traditional cab drivers and the DC Taxicab Commission. On the consumer end, though, little will change for people who use apps like Uber to get around town. The companies will have to make a few small tweaks, but overall, it’s another win for them.
What does the bill require the ride-sharing apps do?
The biggest priority in the bill is insurance. Under Cheh’s and Grosso’s legislation, DC would require ride-sharing drivers to be covered by an insurance policy—carried by the company, not the driver—of at least $1 million whenever their apps are switched on, regardless of whether there’s a passenger in the back seat. The bill also requires the ride-sharing companies to conduct criminal background checks on their affiliated drivers and to have drivers mark their vehicles with some kind of adornment that identifies them as a ride-sharing vehicle.
Isn’t that what Uber, Lyft, and Sidecar are doing already?
That’s what they say. When UberX launched, drivers were insured by their personal policies and only got the company’s policy when they picked up a passenger, but the company says its insurance has been the primary coverage since early 2013. All three companies already conduct background checks on their would-be drivers. As for “trade dress,” as identifying adornments are known, only UberX leaves its cars unmarked right now, while Lyft cars wear fuzzy pink mustaches on the grill and SideCar vehicles feature jackets over their side mirrors. UberX will likely get with the program, too. Uber told drivers in Virginia this week that they can order a window decal; if the this bill becomes law, the District’s Uber drivers will likely get the stickers, too.
Why doesn’t the taxi commission like this?
For the same reason the commission bristled since Uber’s black cars first showed up: it mostly removes vehicles-for-hire from the commission’s purview. From its first draft, the ride-sharing bill has granted exemptions from most of the commission’s oversight duties, including collecting trip data, keeping vehicle inventories, and enforcing taxicab regulations. The commission’s chairman, Ron Linton, told WAMU that the bill creates a big risk for consumer fraud.
Why don’t cabbies like this?
Apparently, the sight of more than 1,000 taxis clogging Pennsylvania Avenue in June as a protest tactic against ride-sharing didn’t sway the DC Council in traditional cabs’ favor. Traditional taxis are far more stringently regulated than ride-share vehicles, from more frequent car inspections to background checks that include fingerprint scans. Their biggest gripe is that UberX and Lyft can set their own rates far below the city-mandated cab fares. UberX currently charges a $2 base fare, plus $1.25 per mile and 25 cents per minute, while a hailed taxi costs $3.25 plus $2.16 per mile, a price difference that cab companies say have cut revenues between 20 and 30 percent since the ride-sharing apps showed up.
Is there anything in this bill that taxi drivers might like?
The bill doesn’t shut out traditional taxis completely. In fact, it allows any app-based service that books rides to set fares different than the standard rates, which would allow apps like Hailo or Curb, which connect users with regular cabs, to price themselves competitively with the likes of UberX and Lyft. It won’t solve the cabbies’ every complaint, but it could help them compete against a modern mode of transportation that clearly will not be driven out of town.
Find Benjamin Freed on Twitter at @brfreed.