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City of Charlotte struggles with rules for ride-share cars

LyftsvsTaxis_3
JEFF WILLHELM - jwillhelm@charlotteobserver.com
A number of Charlotte City Council members appeared on Monday to support making ride-share companies Uber and Lyft be subject to city regulations, a change that the city’s traditional taxi companies say would “level the playing the field.” A Lyft car is shown here.

A number of Charlotte City Council members appeared Monday to support making ride-share companies subject to city regulations, a change that the city’s traditional taxi companies say would level the playing the field.

The digital dispatch services, Uber and Lyft, are different from traditional taxi services in that the companies do not require clients to hail the cars or call the dispatcher if they want a ride. Instead, everything is done on a mobile app, from searching for a driver in the area to paying them afterward.

The California-based companies, which started operating in Charlotte in September, said they police themselves, and that any significant regulations from the city would deter people from choosing to be drivers.

The city’s traditional taxi companies, however, want Uber and Lyft regulated by the city’s Passenger Vehiclesfor Hire board. They are worried that the ride-share companies are able to evade safety regulations, allowing Uber and Lyft to undercut them.

Ride-share companies have clashed with taxi companies across the nation, with protests or lawsuits in cities such as Houston, San Antonio, Cincinnati and Chicago.

The City Council’s Community Safety Committee discussed the issue Monday, but it didn’t take any action on whether Uber and Lyft should fall under the PVH board.

“We aren’t trying to stop you (ride-share drivers) from making a living,” said Democrat Michael Barnes, vice chairman of the committee. “But what I’m more concerned about is public protection and making sure there is a level playing field.”

The General Assembly last year passed a measure that would prohibit the regulation by municipalities of “digital dispatching” services, a change supported by Uber.

But the city of Charlotte has argued that the ride-share companies can be regulated, leading the committee to consider what, if any, new rules should be put in place.

Jonathan Fine, chairman of the Passenger Vehicle for Hire board and a Charlotte School of Law professor, said there are three main areas in which Uber and Lyft should be regulated.

The first is subjecting all drivers to PVH-handled background checks. The second is having proof that drivers have the correct insurance. The third is that their vehicles be inspected for safety.

Both companies said Monday they conduct criminal background checks and Division of Motor Vehicles record checks for their drivers, all of whom are required to be at least 23 years old. They said they have a zero-tolerance drug and alcohol policy, and that drivers who drive high or drunk are fired. They said their cars are inspected annually, and they have insurance.

Fine, however, said the city should “trust but verify.” He said that the PVH board should scrutinize Uber and Lyft’s drivers and vehicles to make sure they are safe.

The PVH board’s 11 members are appointed by the mayor, the City Council and the city manager’s office. Four of the 11 members are either taxicab drivers, owners or limousine owners.

The city’s taxi industry has been divided over a 2011 decision by council members to restrict the number of taxi companies that can operate at Charlotte Douglas International Airport. Companies that weren’t given airport access have complained that they lost business and are on the verge of closing.

Uber and Lyft can pick up passengers at the airport, so long as the customer requests the ride from the smartphone app. They can’t wait for “on-demand” cab fares.

But in the fight against Uber and Lyft, the city’s taxi industry is united.

Republican councilman Kenny Smith favors letting more taxi companies operate at the airport. But he was the most supportive of Uber and Lyft during Monday’s meeting.

“If a city as progressive as San Francisco can (have Uber and Lyft coexist with taxi companies) then Charlotte can do that, too,” he said.

Fine had said allowing Uber and Lyft to self-regulate is akin to the “fox guarding the henhouse,” in that Uber and Lyft’s first motivation is making money.

Lyft was created in 2012 with the intention of “filling cars’ empty seats,” both minimizing the drivers’ carbon footprints and allowing them to make money from giving neighbors rides, said Jim Black, Lyft’s executive vice president.

At the end of the ride, passengers pay a donation of their own choosing through a smartphone. Black said drivers and passengers rate each other through the app. If the ratings aren’t good, the driver and passenger won’t be matched again.

Uber differs from Lyft in that it offers two different services.

UberBlack pairs with local taxi companies to hire professional drivers and performs in the same manner as a traditional cab service. UberX, which is similar to Lyft, has community drivers and charges less than UberBlack and traditional taxis.

The UberX fees, however, are not donation-based. The company has “surge pricing,” in which rides cost more during busy periods.

Some council members were concerned that surge pricing could gouge customers, especially during events, such as the CIAA basketball tournament.

“The feedback we get (from out-of-town visitors) is that they are hosed,” Barnes said.

Fine, of the PVH board, also said that Uber and Lyft drivers sometimes “cluster” near popular venues, such as the NC Music Factory searching for customers.

Black, of Lyft, said his drivers can only pick someone up if they used the app. He said Lyft drivers may congregate near a venue to give people faster rides.

“If it’s illegal to go to a Starbucks near a concert … then tell me, ” he said.

Montana Roberts contributed.

Harrison: 704-358-5160
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