Lyft And Uber Just Moved Much Closer To Being Legal In Austin — But Not Everyone Is Along For The Ride

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Austin City Council voted 6-1 on first reading to approve regulations allowing Transportation Network Companies (TNCs) like Lyft and Uber to operate legally within the city.

TNCs are defined as a company, “that provides on-demand transportation services for compensation using an online-enabled application (app) or platform to connect passengers with drivers.”

The proposed ordinance was sponsored by Councilman Chris Riley and co-sponsored by Councilman Mike Martinez and Mayor Pro Tem Sheryl Cole. Multiple amendments were offered by Councilwoman Kathie Tovo that were sought by the taxi cab industry and would have potentially jeopardized the viability of Uber and Lyft’s business model. However, none of these amendments passed, and the final vote was 6-1, with Councilwoman Laura Morrison the sole dissenting vote. Discussion will continue before a final vote is taken but the issue appears to at least be moving forward faster than rush hour traffic on I-35.

The meeting included public testimony from supporters of TNCs as well as the legacy taxi industry — the latter generally either opposes TNCs altogether or wants stricter regulations that more closely mirror that which cab companies themselves must comply. The interest in such regulations is incredibly high, as are the stakes in the outcome of council’s actions.

The room was at capacity and there was a line to get in, with the waiting room itself filled to the brim with black and bright green shirts representing Uber and taxi cabs respectfully.

Austin is one of the nation’s most congested cities and working towards transportation solutions remains a goal of the current council. Transportation is a focus of most candidate campaigns for the new 10-1 council that will convene in January of 2015. Even if Prop 1 (the urban rail plan) passes in November, it will be years before commuters can ride the train as an alternative to sitting in traffic, so many observers and politicians view TNCs as a more immediate and tangible way to remove at least some cars from the road in the meantime.

The other major aspect for both sides of the debate is public safety. Traditional taxi supporters argue TNCs are a public safety hazard because drivers are not required to have a chauffeur’s license, but many supporters of TNCs, including the Austin Police Association believe the public safety priority remains reducing the number of drunk drivers on the road.

That brings up another point of contention — surge pricing. The practice of allowing market forces to increase the supply of drivers by increasing the driver’s compensation (read: higher rider fares) is one way that such companies are helping to meet the demand caused by essentially every bar in town shooing drunks into the street at the same time.

Sure folks can wait endlessly for a cab at 2 a.m., but most cab drivers who operate as independent contractors can not be required to work any specific hours and tend to avoid working the night owl shift and lugging around intoxicated passengers. On the other hand, allowing those willing to pay more for faster service could have an effect of reducing the overall time one must wait for a legacy cab. The main concern is how much companies will be allowed to “surge” their rates, for how long and whether consumers are completely aware of the cost before committing to pay by taking a ride.

That question and answer is all wrapped up in one of the bigger issues between TNC representatives and Council members — how much data companies are willing to share with the city regarding their trips, drivers and passengers. TNCs view this as proprietary information while the city views at least some of the data as a way to ensure good faith practices.

Taxi cabs have used this as a wedge issue along with the unsolved problem of how to deal with passengers with various disabilities — something that even under the current model has proven difficult.

All this is not happening in a vacuum for the taxi industry as a separate but tandem effort is under way to reevaluate their regulations as well, including to allow more cab permits which was inserted into the proposed ordinance by the Urban Transportation Commission.

In the end TNCs, just like technology itself, seem to be an inevitable part of our future — especially for fast growing progressive cities like Austin. However, the issue itself is far from stuck in the left/right paradigm. The Republican National Committee Chair has called for TNCs to be embraced based on free market principles and Uber has recently hired former Obama campaign guru David Plouffe as a top consultant in DC.

The GOP may not be a natural ally for millennials but when it comes to this issue there is real resonance with the classic rhetoric charging liberals with having a penchant for overregulation.

After this fall, when Austin elects a new council from 10 geographic districts, we may no longer be a city with unanimous votes for progressive policies. But if the current council can put something on the books that would make TNCs a legitimate industry then maybe we can keep our violet crown — even if it is a few shades redder than many of us would like.

Follow me on Twitter at @joethepleb.

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About Author

Joe Deshotel

Joe was born and raised in Beaumont, Tx, but live music and politics brought him to Austin. He has worked in and around government and elections for over a decade including for a member of US Congress, the Texas Legislature, the Mayor of Austin. He currently serves as Communications Director for the Travis County Democratic Party. He is most interested in transportation, energy and technology issues. He also likes Texas Hold'em and commuting on his electric skateboard. Follow me on Twitter at @joethepleb.

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