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Monday, February 17, 2014

The City Council Should Not Cap Rideshares, Flat-Rate Cars, or Taxi Cabs

Posted by on Mon, Feb 17, 2014 at 2:19 PM

(This guest post is by Sally Bagshaw, a member of the Seattle City Council, which is currently divided on how to regulate competing transportation companies.)

A year's worth of meetings about the future of transportation reached a crescendo this past Friday morning in Seattle City Council chambers. In a room packed with drivers and supporters, council members discussed how the city will regulate taxis, “for fire” vehicles, and rideshare services going forward. We are calling these rideshares Transportation Network Companies (TNCs), which include UberX and Lyft. We reached preliminary agreement on a number of issues. We also have one outstanding area where the debate goes on. Here are four important matters of regulation upon which we all agree:

Insurance: All drivers of commercial vehicles irrespective of mode must have adequate commercial-level insurance from the moment the driver logs onto the system.

Training: All drivers should take an exam and pass the same updated training focusing on relevant and current safety and consumer protection elements.

Drivers and Cars: All drivers must pass a rigorous background check, and all cars must pass an appropriate safety check by the city or a third party.

Hailing Rights: Give “for hires” hailing rights. This means “for hire” drivers will be able to legally pick you up when you signal them from the sidewalk. (Many For Hire drivers will pick up passengers on the street now anyway, but risk fines and other penalties for doing so. The change will put taxis and for hires on more equitable footing).

We council members have one major area of disagreement: CAPS. Capping the number of rideshare drivers and vehicles ignores our growing transportation needs.

Caps impose inappropriate limits to the growing rideshare industry, and unfairly reduce job opportunities for current and interested new drivers. Caps will slow the growth of burgeoning rideshare opportunities and frustrate those of us who want to get around our city without a car.

Caps compromise our ability to experiment within the marketplace to see how great the demand is for transportation alternatives. Data shows that a significant percentage of Seattle residents would love to live car free, if fast response time for rides were consistently available. Let’s see how fast we can make it.

Rather than mandating artificial limits, Seattle should take full advantage of all available technology to respond to consumers’ transportation needs. Our city is known for innovation. We are the vanguard of technology that works for people.

We are also a city that desperately needs many transportation options. That’s precisely why we must promote the growing rideshare industry, not stifle it.

UberX and Lyft are loath to tell us how many total drivers are in their systems. My estimate is roughly 1,200 drivers are signed up with UberX, and Lyft drivers tell me there are about 500 of them with Lyft. The cap as proposed would eliminate all but 300 of those drivers and their cars. Ridiculous. That’s a policy that takes us backward.

UberX reports that 95 percent of their drivers are from East Africa, India, and Pakistan, and Lyft proudly states 25 percent of its drivers in Seattle are women. These numbers are encouraging. I want to see more jobs, more drivers, more WOMEN drivers for that matter, faster response rates and higher standards across the board.

Caps on the number of taxis are a legacy of a mid-20th century system. That system may have worked for many last decade but it doesn’t address our needs now. New technologies and innovative ideas will help reduce congestion in all our neighborhoods and improve the ride experience for consumers if we will just let the technology work.

From a social justice standpoint, opening the door for more drivers—not reducing their number—helps everyone involved. Refugees and immigrants will continue to drive and support their families in taxis, for hires as well as TNC’s.

Drivers who have wanted to lease or buy their own taxis could be able to do so now. Rather than paying someone else for the privilege, they will be able to drive for themselves. Similarly, women, students, and part time drivers who choose to make money while providing the rest of us with rides will have increased opportunities to do so.

More rides, more riders. Fewer cars on the road. Less congestion. Less angst.

The cap as written would be temporary for two years. Why wait? I recommend that we get moving. Phase it in if we must, but let’s go. Yes, the city should regulate training, safety, insurance requirements and provide a platform to assure transparent fares. From that point on, I recommend we get out of the way.


Comments (26) RSS

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Baconcat 1
Removing caps on rideshares thoughtlessly will cause a market flood by a well-capitalized multi-city entity that can remain buoyant with VC money whereas existing taxi companies, which provide a local control with dispatch, repair and employee management, would simply sink.

The apparent economic goal of services like Uber is to destroy the taxi. It's disruption -- you see an incumbent, you gut it, you dress yourself in the entrails and then you leave the local market to basically subsist on what's left over. Uber may seem like it's this new wave of transportation that wants to co-exist but its newness and agility in the market are actually a stinging liability to users of the service while representing the sort of vulture capitalism that ravaged post-regulatory economies throughout the world in the 1970s to today surge of neoliberal "all walls down" economics.

As far as "opening the door to more drivers" being about social justice? That's farcical, Sally. The market can sustain only so many before everyone sees lower returns. For Uber this is the model, but for drivers and taxi services this is fatal. Lower wages, fewer hails, and then obsolescence.

Meanwhile, creating an easy pigeonhole for new immigrants of certain skill levels like driving people around smacks of an awkward servant-master relationship between new citizens and old. Oh, welcome to Seattle, now drive us around because what else are you going to do! It should be choice-based, but as you undoubtedly know (and if you don't, then c'mon, Sally) your position is treating it as a primary option that should be expanded. Why should it be that way? Instead of making more driver's seats why not more training and jobs in other industries?

And what happens to the drivers when Uber overtakes the market and decides to maximize returns? There's no local control, and since keeping fares low is vital this leaves essentially one person who gets the pinch: the driver.

Sure, go ahead and lift caps but don't pretend there isn't a threshold where Uber wins and a lot of people abruptly lose. That's basically the economic model they're built off of.
Posted by Baconcat on February 17, 2014 at 2:47 PM · Report this

Your rhetoric about the immigrant driver issue is dumb. You understand quite well that the author talks about this because it has been brought up as an issue, and that the taxi companies employ largely immigrant labor forces too. There're reasons immigrants tend to go for these jobs, such as driving being an internationally transferable skill set and English fluency being less implrtant than many other lines of work, and I assume that you can grasp these reasons because they're so obvious. Seriously, concern about a master-servant relationship in a *service job*? Please drop this point and focus on things you can argue honestly.
Posted by Da5id on February 17, 2014 at 3:17 PM · Report this

Your rhetoric about the immigrant driver issue is dumb. You understand quite well that the author talks about this because it has been brought up as an issue, and that the taxi companies employ largely immigrant labor forces too. There're reasons immigrants tend to go for these jobs, such as driving being an internationally transferable skill set and English fluency being less implrtant than many other lines of work, and I assume that you can grasp these reasons because they're so obvious. Seriously, concern about a master-servant relationship in a *service job*? Please drop this point and focus on things you can argue honestly.
Posted by Da5id on February 17, 2014 at 3:19 PM · Report this
I can't believe The Stranger hasn't been flogging this issue since day one, especially given their 'Cars Are Evil' dogma. You'd think anything that reduced single occupancy vehicle traffic would be a good thing...

As far as I'm concerened, fuck taxis. With their crappy service and disgusting vehicles, I wouldn't shed a tear if they completely died.

I'm actually somewhat surprised that the City Council is willing to take on an issue that will directly piss off their constituents. It's one thing to make back room deals with billionaire developers as part of this city's Quixiotic quest to become a 'world class city.' No Developer Left Behind, right? It's another thing when everyone I know loves Uber and Lyft and universally hates taxis. Way to piss off the voters.

If the City Council screws us on this, some heads are gonna roll and some asses are gonna get bounced in the next election.
Posted by CPN on February 17, 2014 at 3:30 PM · Report this
Cornichon 5
The problem with licensed taxis is that (many of) the drivers pretend not to know where anything is, pretend not to understand foreigners, and generally take advantage of visitors to Seattle. And who uses Uber/Lyft/Sidecar? Locals, primarily. The same folks who'll hop into a Car2Go or a Zipcar (to name two well-funded out-of-state companies).

One alternate solution that hasn't been discussed: COMPLETELY ELIMINATE THE TAXIS, not the free-market competitors.

By the way, the Port of Seattle should become involved in this issue, as should the Seattle-King County Visitor Bureau and the Downtown Association. They all have vested interests in a safe, efficient and accessible transportation for visitors to Seattle.
Posted by Cornichon on February 17, 2014 at 3:48 PM · Report this
Jubilation T. Cornball 6
I thought a "for fire" vehicle was a big red truck with hunky dudes on it...
Posted by Jubilation T. Cornball on February 17, 2014 at 3:52 PM · Report this
fletc3her 7
Taxis can't pick up hailing passengers? That's why they never stop.
Posted by fletc3her on February 17, 2014 at 4:03 PM · Report this
"Caps on the number of taxis are a legacy of a mid-20th century system. That system may have worked for many last decade but it doesn’t address our needs now."

what was the original purpose of that cap, what need was it addressing?
Posted by sanotehu on February 17, 2014 at 4:03 PM · Report this
seandr 9
Can someone explain why permit caps were created in the first place. I'm assuming they were created for a reason and not just pulled out of someone's ass.

One obvious benefit of removing them is more people can find employment as tax drivers.

The downside is that an oversupply of cabs means they'll all be working for less. However, the increased supply would likely also increase demand if it means people can get a cab more quickly.
Posted by seandr on February 17, 2014 at 4:08 PM · Report this
Sally Bagshaw is a neo-lib. It's official now. I guess if you have invested years as a cab driver it's time to move on to a $15 an hour job at McD's.
Posted by hmmmmm on February 17, 2014 at 4:17 PM · Report this
As a former and now unemployed horse and buggy driver, I want protection from the horseless carriage mafia and the big banks that support their manufacture.
Posted by Bring back the telegraph too! on February 17, 2014 at 4:31 PM · Report this
Sorry those of you who've invested years as a cab driver. I guess if you can't compete with the rideshare and for-hire apps, then you should maybe go join them because they're doing the exact same thing as you are.

Cheers to Sally Bagshaw. I'm personally okay with preserving hailing rights to taxis, because that ensure that those hailing a cab (which suggests they've had minimal time to do research) can get a uniform rate, and won't have to spend time haggling with the driver over the cost of the fare. If you call for a car service/rideshare, including using an app like Uber or Lyft, you presumably had time to do your homework, can see the rate you'll get on the app (plus estimate for the trip if you want one), and can make an informed decision before agreeing to the ride and having someone drive over to you.
Posted by madcap on February 17, 2014 at 5:02 PM · Report this
Except, Baconcat @ 1, that the taxi companies with their local control and whatever else are doing a resoundingly shitty job of providing the service that UberX and Lyft are providing better and, in some cases, cheaper. So why, again, are we protecting these local entities if they can't do the job as well? Just because they're local? So what? The drivers for UberX and Lyft are independent, too. They're not employed by the dispatch service. And what's more, it's empowering them to start businesses that, if they're smart, they can grow! That's *better* than the continued oligopoly of the three or four big taxi services in Western Washington providing half-assed service protected by regulatory caps that serve no other purpose but to stifle competition from new, better ideas.

If the cab companies were worried about competition, they should've done a better job building consumer loyalty. As of now... they've managed to throughly piss so many of us off that no one's going to come rushing to their defense unless they're a politician looking for a campaign hand out. Good on Bagshaw for standing up for the right thing. Bye, bye cab companies.
Posted by pheeeew!crack!boom! on February 17, 2014 at 6:02 PM · Report this
Baconcat 14
Haha, 'cuz Uber and Lyft won't ever be profit-oriented outfits that will capitalize on cannibalizing the existing market currently dominated by cabs.
Posted by Baconcat on February 17, 2014 at 7:30 PM · Report this
Aaron 15
Domenic, you're the editor of this coverage, and please correct me if I'm wrong, but I can't help but wonder why slog has failed to cover Sawant's position as a new and very vocal council member on this issue (so long winded she was cut off in chambers).
Could it be because unlike you, she seems to be in favor of protecting the lousy service that the current licensed taxis provide and says that the TNCs are for rich people? It is a stupid position and deserves discussion and I can't understand why this critique of Sawant has been avoided. But hey, if I'm wrong and slog has covered her on TNCs, please correct me...
Posted by Aaron on February 17, 2014 at 7:36 PM · Report this
espato 16
fuck taxi companies and especially fuck "for hire" taxis that pick up unsuspecting ride-needers on the side of the road and then tell them halfway to their $10 destination that it will be $40 (when the drunk passenger realizes there's no meter…?)
Posted by espato on February 17, 2014 at 7:45 PM · Report this
Eric Arrr 17
Right on, Ms. Bagshaw. Agreed 100%.

@8 & others: the original purpose of caps was to set a price floor. The worry that motivates caps is that too much supply will turn driving a taxi into a race to the bottom, a situation where there are so many drivers that driving a taxi no longer pays a living wage.

But the problem with caps is, whoever is lucky enough to secure a license to provide service is effectively handed a franchise that they can lend out, extracting rent from drivers without having to do any work at all. Driving remains a race to the bottom, and all the economic benefit flows to the license-holders.
Posted by Eric Arrr on February 17, 2014 at 7:53 PM · Report this
I wish CM Bagshaw would address the problems that occurred back in the 1980's when we last deregulated the local taxi industry. The system fell apart, and the local travel and hospitality industries clamored for re-regulation. CM Bagshaw, what will prevent this from happening again?

And when I hail a non-taxi cab for a ride, how do I know how much the fare will be when there is no meter? After I'm moving down the road at 30 mph, what rights do I as a paying passenger have when the driver quotes a rate that is exorbitant? Or am I supposed to stand there at the cab door and negotiate the price while the cab is blocking traffic?

And if the non-taxi cabs have hailing rights, they they should have rights to use the taxi ranks at the hotels too, correct?
Posted by Citizen R on February 17, 2014 at 8:11 PM · Report this
McBomber 19
I use taxis maybe 1-2 times per month, always to avoid driving after drinking. I've found the service to be pretty good. Sure it takes a while to get one at closing time, and you do need to watch for the occasional faker who tries to take the long route home, but I'm more comfortable dealing with these issues than the prospect of paying up-front for an unknown fare. Can someone tell me why I should consider a ride-share service instead?
Posted by McBomber on February 17, 2014 at 8:22 PM · Report this
seandr 20
@McBomber: Can someone tell me why I should consider a ride-share service instead?

No fucking idea.

I'm always drunk, so I take cabs all the time. I have no complaints, and have even had a few drivers totally step up for me (e.g., one time my keys fell out of my pocket in the back seat, the driver got my number from dispatch, called me, and returned them to me 30 minutes later).

Someone told me I should switch to Uber because they have an app, but turns out Seattle taxi cabs have the same fucking app. I think Uber drivers once tended to be whiter than cab drivers, if that sort of thing matters to you, but apparently that's all changing now.
Posted by seandr on February 17, 2014 at 9:41 PM · Report this
GlibReaper 21
This doesn't address the serious issue of driver distraction from the apps themselves. It's all well and good to have insurance but if the driver must examine the screen and hit a button within a few seconds of their phone beginning to shriek then that presents a danger that training won't overcome.

The regulation I'd most like to see is that TNC/rideshare/whatever companies be forced to have interactive voice response in their apps so that drivers will be less distracted.
Posted by GlibReaper on February 19, 2014 at 7:25 AM · Report this
I can't believe The Stranger hasn't been flogging this issue since day one

I agree, and part of me worries that their realizing their pet councilmember is on the wrong side here. I wager Conlin would be standing with Bagshaw and Burgess.

Thank you, councilwoman. Please win this fight, and make going carless more viable for residents of this city.
Posted by david jw on February 19, 2014 at 8:45 AM · Report this
Taxis companies have been bribing some of the councils for long time. That why they are against UBER. The novice politician council SAWAN wants to protect her Indian community and extended family who either own Taxis or drive Taxi ..., it doesn't make sense. UBER is operating in every country and no city council can stop despite hefty money they getting from Taxi companies ....we support majority of the people .100% of people like UBER
Posted by Sherif on February 19, 2014 at 2:03 PM · Report this
Lift cap. Free the people. Support the citizen. We need good service. We don't need those taxis with bad hygiene ...they are odoriferous and rude. The council Harrell and Sawant, and Mike O'Brien have been fighting against ride share companies. They must be not elected again. They want stop people's friendly service. Please do not vote for them next term
Posted by Sherif on February 19, 2014 at 2:12 PM · Report this
Councilmember Bagshaw is right on. We need more transportation options, not fewer. Have strict rules on driver skill and training, inspection of the cars, adequate insurance. Also add a robust system that allows those who have been served poorly to complain, get compensation and correct deficiencies.
Councilmember Bagshaw lives in the Urban Center and knows our problems, our issues. and it shows here.

johh Pehrson
Posted by Bigtuna on February 20, 2014 at 5:11 PM · Report this
The reason for the caps is so that the cab/TNC can make enough money to meet their obligations such as insurance, maintenance, and equipment. The TNCs, which have been cutting corners on insurance, have yet to prove that they can meet their responsibilities.
Posted by ClaimsAdjuster on February 22, 2014 at 9:30 AM · Report this

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