Houston Rebuffs Uber Threat to Leave if City Keeps Existing Rules

Apr 27, 2016

UPDATE: In a news conference this afternoon, City of Houston officials made clear they did not plan to concede to Uber's demands to repeal the city's current regulations for permitting ride-hailing drivers.

“If the city’s process protected even one person as relates to public safety, it has been worth it, and in this city we cannot afford to compromise public safety,” said Houston Mayor Sylvester Turner.

Turner said he hoped Uber would not leave, but stood firm that the company must comply with the city's current regulations. He claimed to be surprised by a letter from Uber today saying it would cease doing business in Houston if the rules, specifically related to fingerprint background checks, were not altered. Turner said the company had not expressed their need to leave, absent a change, in meetings he had with company officials in the past several months.

Turner called it "ironic" that Uber would make such a demand in the midst of Austin's vote on a measure that would roll back requirements for fingerprinting driver here.

From the Texas Tribune: Uber announced Wednesday that the company plans to cease operations in Houston if the city council does not repeal its existing regulations relating to vehicle-for-hire companies.

Houston is one of two cities in the country where Uber continues to operate despite a local requirement that its drivers undergo fingerprint-based background checks. Uber has recently left three cities in Texas for approving similar regulations and has threatened to do the same in Austin.

The company's main competitor, Lyft, pulled out of Houston over a year ago in response to the new rules requiring its drivers to undergo fingerprint-based background checks. Uber had continued to operate in the city while publicly criticizing the regulation as burdensome.

"We have worked hard and taken extraordinary steps to help guide drivers through the current process in Houston," said Uber General Manager Sarfraz Maredia in a letter to Houston City Council on Wednesday. "However, a year and a half later, it is clear the regulations are simply not working for the people of this city."

Uber also released a report Wednesday detailing, "The Cost of Houston's Ridesharing Regulations." The report claims Houston's regulations have led to a decrease in Uber drivers and in turn, "fewer safe rides."

"Since the regulations were adopted, more than 20,000 people in Houston have completed Uber’s thorough screening process but did not proceed with the City’s multi-step licensing process and as a result, were unable to drive," Maredia wrote in the letter. "Houstonians who could most benefit from such flexible economic opportunities are often the ones who are least able to access them."

Houston's ordinance requires vehicle-for-hire drivers to apply for specialized license in order to operate within the city's limits. This license includes a required fingerprint background check.

Uber has recently ceased operations in Corpus Christi, Galveston and Midland after the cities adopted similar background check requirements. In Austin, voters will decide on May 7 if the city should adopt a proposed ordinance, strongly backed by Uber and Lyft, that would prevent the city form requiring such checks in the city.

Uber said the company will leave Austin if the ordinance is not adopted, despite recent reports from The Daily Dot that Uber has told drivers it will remain operating in the city regardless of the outcome.

Here is the company's letter to Houston City Council: