Uber and Lyft Go to City Hall

Will Austin finally have permanent rules governing TNCs?

Uber and Lyft Go to City Hall
illo by jason stout

If the rules seem murkier than ever, it’s because they are. Last night, after five hours of discussion, Council started down the path toward a (please, please let it be) permanent ordinance laying out a new set of regulations transportation network companies must comply with if they want to operate legally in Austin.

“Comply” seemed to be the operative word last night in negotiations. As recently as Thursday morning, conditions of the ordinance hinged on a matter of eligibility; in addition to the other terms held within the language, drivers would need to pass fingerprint-based criminal background checks in order to be eligible to drive for a TNC – which, until recently, meant little else besides Lyft and Uber. The two companies have been adamant in their refusal of that term as it was scripted, however, and stated on repeated occasion – with Uber even taking out a sappy, underdogged full-page ad in Thursday’s paper – that implementation of a requirement for fingerprinting drivers would necessitate that the companies abandon Austin’s market. (What both companies actually meant was that implementation of the requirement would result in their ditching post because they chose to.)

Council’s intent leading up to yesterday’s third reading was to pass the language detailing this requirement, company desires be damned – but a last-minute press conference Thursday afternoon headed by Mayor Steve Adler and Mobility Committee Chair Ann Kitchen revealed that city officials feared the TNCs calling their bluff. Put simply, Austin can’t afford to operate without the presence of TNCs anymore. Many of its residents have grown too dependent on the service for transportation – whether for commuting purposes or a sober ride home at night. Passing an ordinance that gave cause for Uber and Lyft to pull out overnight – or at any point before other suitors, like GetMe, which launched this week and has consented to the city’s requirements, were equipped to handle Austin’s demand – would have wreaked legitimate havoc on the city.

As explained in detail during the hearing, the new plan was to create an incentive program for drivers who did get fingerprinted – make it easier for fingerprinted drivers to prosper and more difficult for those who withstood the expectation – and eventually tighten enforcement of the expectation to the point that, by Feb. 2017, 99% of drivers will be fingerprinted by the city. Council expects 50% of drivers to be in compliance by Aug. 2016 and 85% by Dec. 2016. Changes are expected to go into effect in February. The city has agreed to help pay for each fingerprinting, and expedite the processing of each background check. Adler considered it an interpretation of the incentive-based ordinance currently active in San Antonio “on steroids.”

What was not explained in detail was what those incentives and disincentives would actually be: Council punted that to the Jan. 28 meeting. The ordinance passed simply reads: “The department will implement programs, processes, and procedures to incentivize drivers to become eligible drivers [i.e., those who have passed fingerprint-based background checks] and incentivize consumers to use eligible drivers.”

Through a series of audience polls, most conducted by D10 CM Sheri Gallo, it became clear that very few actual drivers in attendance had any problem with the regulations. It should also be noted that, again by show of hands, most of the audience members who had been fingerprinted for their independent contractor jobs were the many taxicab drivers assembled throughout the gallery.

Council’s redirection may be appropriately chalked up to a shared desire for public safety, but remember too that the body’s insistence on fingerprint checks comes from that same place. Uber and Lyft will contest this, but including fingerprint in the onboard process for new drivers makes their systems safer. And in a city in which police are actively investigating more than one hand’s worth of sexual assault claims against their drivers, neither company stands on solid ground here. One assault’s too many, and requires drastic change where possible. Council – and most every reasonable city resident – agrees that fingerprinting drivers for increased accountability is a step in the right direction.

Adler and Kitchen’s last-minute audible sent Thursday’s vote into a frenzy. Council members both for and against regulations for TNCs lamented the late changes, saying that they didn’t understand exactly what they were considering, and the conversation slagged a while on the back end while new amendments were introduced in an effort to re-personalize each requirement. Making matters more difficult were the ways in which other Council members – mayor included – cross-examined each speaker witness to arrive at the conclusion they wanted. (Though it’s always fun to watch TNC reps skirt around providing requested information they’d like to keep proprietary, as Uber rep Adam Blinick does so often.)

There has got to be a more efficient way to do that, but alas. The ordinance passed 9-2, with CMs Ellen Troxclair and Don Zimmerman both voting against it, just as it had in each of its previous two readings. Lyft will continue to operate here, and presumably maintain operations through 2016’s great fingerprinting onboard process. Uber has yet to release any statement, but is registering on its app as active in the city. What happens after that process reaches 99% completion now remains anybody’s guess. A 1:20am statement Friday morning from Lyft spokesperson Chelsea Wilson said: “Lyft will operate in Austin until mandatory fingerprint requirements force us to leave. In the meantime, we will remain at the table in an effort to create a workable ordinance and preserve the benefits ridesharing brings to visitors and residents. We do not operate in cities that require mandatory fingerprint background checks.” Late Fri­day, Uber released a statement indicating that the new laws could not be considered “a solution that would keep Uber in Austin.”

In addition to the fingerprint requirements, Council also approved new regulations that mandate companies pay a 1% fee of their annual in-city revenues; prohibit drivers from handling pickups and drop-offs in travel lanes; increase reporting requirements; and require trade dress for each in-operation vehicle. Each of the aforementioned received very little consideration during last night’s proceedings. All the hang-ups revolve around the expectations for fingerprinting, which will now extend all the way into the 2017 calendar year.

Hopefully without a day as eventful as the one we had on Thursday. However, considering how many major issues got pushed to the Jan. 28 meeting, that hope will most likely soon be dashed.

View the new ordinance here.

This post has been updated to clarify that the incentives mentioned in the ordinance passed have yet to be drafted, and to include Uber's statement in response to the new ordinance.

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