The ride-sharing controversy can break a couple of ways: Cities can accept that Uber and Lyft are popular services and try to harmonize them with traditional taxi service; or they can erect roadblocks to the future.
Spokane is choosing the smarter route, with the City Council working out rules that would place ride-share drivers on a level playing field with cabbies, without stifling innovation.
Ride-sharing is popular because it’s a logical extension of our smartphone lives. Prospective riders download an app and tap it when they need a lift. The software locates the nearest driver, who can show up in a matter of minutes. Payment also is handled through the app, so there’s no fumbling for money or anxiety over tips.
So, sure, it’s cool, but is it fair?
Ride-share drivers use their own cars and aren’t subject to the same fees and licensing requirements imposed on taxi services. As cabbies correctly point out, they could charge less if ride-for-hire regulations did not increase their expenses.
So cities are faced with either applying the taxi regulations to Uber and Lyft drivers, or reassessing those mandates. The City Council is leaning toward deregulation by dropping cab fees for six months and charging ride-share companies 10 cents a ride to offset the foregone revenue. The city gets only about $28,000 a year from taxi fees and licenses, but the nod to fairness is important.
The city hopes to enter into a memorandum of understanding with rideshare companies by the end of summer. Insurance is another sticking point, but that’s an issue the Legislature will have to address. For the time being, Uber and Lyft have agreed to provide umbrella coverage to fill in gaps drivers may have in their own auto insurance policies. Ride-share companies are working with insurers to devise policies tailored to their new service.
Ride-sharing has disrupted traditional cab service in many cities, and some have responded by cracking down on the newcomers. Undercover officers in Miami have run a sting operation to bust Lyft and Uber drivers. Portland has banned the service to protect the jobs of cab drivers, but there are signs that city soon will allow competition.
The Seattle City Council initially capped the number of ride-share drivers at 150, but when a popular uprising threatened to put the issue to a citywide vote, the mayor wisely stepped in to work out a compromise. The cap was lifted and taxi companies were granted more licenses.
If problems arise in Spokane, new regulations may be necessary. For example, Uber and Lyft conduct background checks on drivers and require they carry insurance. The city can add its own safeguards if the two services don’t do the job.
The issue of ride-sharing vs. taxis will be determined by the marketplace if regulations are fair. Either the best service will win, or we’ll discover there’s room for both.