Tougher terms for Uber, Lyft in works
Services say proposals for fees, background checks could spur exit.
Ride-hailing companies like Uber and Lyft would have to pay substantial fees to the city of Austin and conduct fingerprint-based background checks on all of their drivers undera recommendation advanced by an Austin City Council committee Wednesday.
The committee, pressed for time after a two-hour debate, put off until early November another potential amendment that would require so-called transportation network companies to provide much more detailed ride data to the city than they do now.
Those possible changes to a 2014 city law will have to clear several more procedural hurdles before actually going into effect, including approval by the full council of the con
cepts and then later of a specific ordinance. Council Member Ann Kitchen, who chairs the council’s Mobility Committee and proposed the changes, said a final council vote on that ordinance likely won’t take place until Nov. 16.
Representatives of Uber and Lyft, while saying their compa
nies could accept some level of
regulatory fee payments to the city, opposed all of the specific changes endorsed by the committee. April Mims of Lyft and Adam Blinick of Uber implied that requiring fingerprint background checks for drivers might force the companies to leave Austin, listing other cities where they withdrew after such laws were put in place.
Both companies currently provide their own background checks of drivers, using identifiers such as Social Security numbers and driver’s license numbers.
The company officials argued that requiring fingerprint-based checks would discourage many potential drivers from signing up with them and thus damage their ability to respond quickly to ride requests. Houston mandates such fingerprint-based checks and Uber still operates there. Lyft does not.
“It does seem pretty clear that if a fingerprint requirement is put in place, we might not have transportation network companies here any longer,” said Council Member Ellen Troxclair, who does not serve on the Mobility Committee but was sitting in on Wednesday’s meeting.
Kitchen, who said fingerprints are the only way to make sure potential drivers are who they say they are, flashed anger at that suggestion.
“To threaten to leave, simply because we are trying to protect public safety, cannot be my deciding factor,” Kitchen said. “There are other transportation network companies, and they will be here.”
The committee also voted in favor of charging ride-hailing companies an annual fee of either 1 percent of gross revenues or a per-driver permit fee identical to what taxi companies pay. That figure is currently $450 per year for each driver.
The companies would have a choice of which fee option they would prefer.
Uber and Lyft have not revealed what their Austin revenues are. Uber officials, however, have said the company has 10,000 Austin drivers; if they were charged $450 per driver, the company could face a $4.5 million annual fee.
The changes, taken one at a time, were supported by the committee 3-1, with Kitchen and Council Members Delia Garza and Sheri Gallo in favor and Council Member Don Zimmerman opposed in each case.
Representatives of Uber, meeting earlier this week with American-Statesman editors and reporters, said the council should stick with the interim ordinance passed a year ago. Among other things, that measure allowed the transportation network companies to conduct their own background checks of drivers, while the city of Austin continues to provide fingerprint-based background checks on taxi drivers.
“Austin put forward an ordinance that was very progressive and very modern,” said David Plouffe, formerly an official in the administration of President Barack Obama and now a strategic adviser at Uber. “It’s odd to see Austin backtracking, especially when it’s working so well.
“If something’s not broken, don’t fix it.”