State legislators expect to consider new regulations in 2015 for fast-growing “sharing economy” companies like Uber and Airbnb.
The businesses – which allow anyone to become a taxi driver or innkeeper through an online app – don’t face the same rules as traditional cabs and hotels. Sen. Bill Rabon, a Southport Republican, said legislation should make sure the state isn’t losing revenue because of the services.
“Are these drivers paying taxes on their income?” he said during a legislative hearing Tuesday. “Do we have a way of tracking that? If not, we should.”
Other legislators said they want to make sure drivers and short-term rental hosts carry adequate insurance and maintain safety standards. Sen. Floyd McKissick, a Durham Democrat, said North Carolina should look to states like California and Colorado that already regulate the services.
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Traditional taxi companies and inns say customers are deserting them for the online services that undercut their pricing by avoiding taxes and regulatory hurdles. Doris Jurkiewicz, who owns the Oakwood Inn in Raleigh, told legislators that the competition could force her bed and breakfast to close.
Much of Tuesday’s discussion focused on insurance. Oyango Snell, a lawyer for Property Casualty Insurers, said drivers for Uber or Lyft aren’t fully covered. The companies’ insurance only kicks in when the driver gets a ride request – and until then, they’re on their personal insurance policy.
Snell said companies should provide insurance whenever a driver logs in. April Mims of Lyft said that requirement would be unnecessary and expensive. “We anticipated that this could increase our insurance costs up to 500 percent,” she said.
Thomas Powers, a city attorney for Charlotte, said municipalities want the power to regulate all ride services. The General Assembly banned cities from regulating the online services in 2013. Longtime taxi companies, Powers said, are adding an app and “saying they’re exempt from all of our regulations.”
Rep. Julia Howard, who chaired Tuesday’s hearing, said legislation will likely be introduced when the General Assembly returns in January.