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Mobility Committee considers future of Lyft, Uber

Thursday, March 26, 2015 by Tyler Whitson

Transportation network companies such as Lyft and Uber have come a long way since they launched outside of Austin’s regulatory framework last May. Still, they have more distance to travel before they can be considered a permanent part of the city’s transportation system.

Transportation Department staff presented the City Council Mobility Committee with a set of recommendations Wednesday that would go into an official pilot program for the relatively new smartphone-based ground transportation service companies, also known as TNCs. If adopted, the program would replace the interim ordinance Council passed in October.

Transportation spokeswoman Sam Alexander said her staff recommends that the city collect 1 percent of the gross revenue that TNCs earn in Austin to cover administrative costs, and that it require more specific data reporting, Americans With Disabilities Act compliance, 20-point vehicle safety inspections and vehicle markings.

Though the interim ordinance requires that TNCs give potential riders the opportunity to indicate whether they need an accessible ride through their smartphone apps, Alexander noted that it is her understanding that the feature is not currently available.

Alexander said her staff also suggests that the city require TNCs to provide their drivers with more comprehensive insurance coverage than is currently acceptable when they have indicated that they are available but have not committed to a ride yet. That was a major sticking point in the negotiations between Council and TNCs that led to the interim ordinance.

The interim ordinance requires that TNCs provide drivers with a $1 million insurance policy from the time they accept a ride to the time they drop off a customer, but allows for a far less comprehensive plan in the stage to which Alexander referred.

“In the city’s perspective, if you’re on the phone, if you’re looking for rides, then there should be coverage for what incidents could happen when you’re in that operating mode,” said Alexander. Transportation staff’s recommendations would substantially increase coverage requirements during that window, though not to the level set in the stages after one accepts a ride.

Based on an overwhelming desire from committee members to compare the proposed TNC regulations with those in place for taxicab companies, it appears the overhaul may also involve some adjustment to cab regulations. Transportation staff is bringing that comparison information to the committee and Council for re-examination.

Council Member Ann Kitchen, who chairs the committee, was the first to request the side-by-side analysis. The other three members echoed her request throughout the meeting.

“There’s a number of policy issues that we’ve raised, and I’m sure there’ll be more,” Kitchen said. “One of them is: to what level do we regulate? The other one is a fair playing field.”

Though the city signed temporary operating agreements with four TNCs in November, only Lyft and Uber are currently operating in Austin. The others are Sidecar and zTrip.

Transportation Director Robert Spillar explained that his staff does not know how many TNC drivers are working in the city. “That is a piece of information that we do not have access to,” he said.

Alexander noted, however, that Lyft and Uber, per the interim ordinance, submitted their first set of quarterly reports in January. Staff will work with a third-party auditor shortly to confirm that the information in the reports matches the raw data. Though the reports do not include the current number of drivers, they include ridership data that is likely valuable to the city.

Council Member Sheri Gallo questioned why the city should limit the number of taxicab permits it provides to 756 when there does not appear to be a limit on the number of TNC drivers that can operate in the city.

“That seems to be that we are injecting ourselves into companies’ business models versus letting the service provide as much service as possible as competitively as possible,” Gallo said.

Transportation Assistant Director Gordon Derr said that his department has been tracking taxicab ridership data to see if it has changed since the city signed operating agreements with TNCs. He said that for January and February, “the numbers for total trips are comparable to what they were in December and last year.”

“We’re not seeing, at this point, a dramatic drop in taxi operations,” Derr continued. “We’ll continue to track this month by month to see if there’s a point where there is an impact on the actual operations.”

For now, staff suggested, the city should continue to collect data on TNCs and keep an eye on Texas state legislation that could effectively pre-empt the interim ordinance and any pilot program the city may adopt in the near future.

HB 2440, filed by Rep. Chris Paddie (R-Marshall), and SB 1555, filed by Sen. Kevin Eltife (R-Tyler), could take away the city’s regulatory authority over TNCs and transfer administrative fees to the state rather than the city, according to Alexander.

The Mobility Committee will hold a public hearing and hear more staff recommendations at its next meeting April 1.

Photo by Pkg203 (Own work) [CC BY-SA 3.0], via Wikimedia Commons


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