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Austin Moves Closer to Legalizing Ridesharing Services, Uber & Lyft

Wikimedia Commons user Bull-Doser
Services like Uber Black are technically legal under the law. Drivers must have a chauffer's license and charge a minimum amount of $55.

The Austin City Council voted Thursday evening to move forward with plans to allow temporarily ridesharing services to operate legally in the city. But with many details still to be worked out, ordinance sponsor Chris Riley moved to vote to approve only on second reading.

"Given the concerns we've heard from both of the companies in the room and the uncertainty as to whether this will work at all, then I'm inclined to suggest that we just pass this on second reading and give this further consideration, because I don't think we want to give something final approval on an emergency basis only to find that it just doesn't work," Riley said just before the vote.

Among the issues discussed Thursday afternoon: insurance, access for people with disabilities, equity for taxicab operators, limits on the number of consecutive hours drivers could be on the roads, limits on surge pricing at times of emergency, driver background checks -- what about taxes?

The measure passed on second reading, with only Council Member Laura Morrison voting no. The Council will revisit the matter at their next meeting on October 16.

September 26 post: Austin City Council debated a proposal that would temporarily legalize app-based ridesharing services like Lyft and Uber until just after midnight, ultimately passing Council Member Chris Riley’s proposal on first reading in a 6-1 vote, with Council Member Laura Morrison voting against the measure.

The ordinance would allow drivers to continue services while a city workgroup finalizes a pilot program to regulate transportation networking companies (TNC’s) thathave flourished in Austin despite their illegality. Supporters say the apps expand limited public transit options for Austinites. Opponents argue Uber and Lyft’s drivers aren’t as stringently regulated as traditional drivers.

Ed Kargbo of Yellow Cab Austin said the ordinance give preferential treatment to TNC’s, and that under the ordinance Uber and Lyft have unrestricted price flexibility and an unlimited number of drivers in contrast to the capped number of cab drivers allowed by the city. He also added that many cities, including San Francisco and Los Angeles, have had difficulty with TNC’s bending the rules of pilot programs.

“Companies that pride themselves on being outlaws are not the type of companies you want to negotiate with,” Kargbo said.

April Mims of Lyft said the company’s app has been downloaded by 20,000 Austinites, and argued that ridesharing providers Uber and Lyft have more expansive commercial insurance policies than is required by Austin’s cab industry. Still, she said, the ordinance would be a crackdown compared to the company’s agreements with other municipalities.

“We believe the proposed temporary operating agreement actually goes far beyond what’s needed to regulate TNC’s,” Mims said.  “In fact, this ordinance would authorize the most onerous temporary operating agreement that Lyft has ever considered.”

Still, the council moved on to propose more amendments to the ordinance; some were minor language tweaks, others – including the seven proposed by Council Member Kathie Tovo – sought to clarify when exactly a TNC’s insurance policy would take effect for drivers, to limit the companies’ practice of charging inflated rates at peak hours and to allow the city, not third-party vendors, to conduct driver background checks.

Council Member Laura Morrison opposed the ordinance’s creation of a “new kind of driver” under the proposed ordinance and that drivers should have the same commercial liability insurance as cab drivers even though many drivers use their personal vehicles for fares.

As council debate wound down, Tovo said she supported the idea of legalizing the services, but felt that Riley’s proposal needed more scrutiny and input from the city’s stakeholder group.

“I really have to question why we’re rushing forward when, as you see, we’ve spent hours talking about it because there are so many thorny issues to resolve,” she said. ”To me, to rush forward like this was unnecessary.”

Council will take up the issue on second reading and the city’s stakeholder group is expected to weigh in on TNC’s in the next few weeks.

Andrew Weber is a general assignment reporter for KUT, focusing on criminal justice, policing, courts and homelessness in Austin and Travis County. Got a tip? You can email him at Follow him on Twitter @England_Weber.
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