Legislation aired in a Senate committee Wednesday would set insurance requirements for Uber and other smartphone-based personal transportation services, while shielding them from most local government regulation.
The statewide rules were proposed by Uber itself.
Customers use phone apps to summon drivers and pay for their trips with California-based Uber Technologies and two other companies doing business in North Carolina – Lyft and Sidecar. Uber has resisted efforts across the country to make its drivers comply with local taxi rules, and it is pushing states to endorse its way of doing business.
“Uber has come up with a model that 30 states are looking at right now,” Sen. Floyd McKissick, a Durham Democrat, told members of the Senate Finance Committee. “What we are doing in North Carolina is based upon that national model, and we have adopted substantial portions of that national model.”
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McKissick’s co-sponsor is Sen. Bill Rabon, a Brunswick County Republican. They are still negotiating with the company over some details, but Senate Bill 541 would “basically codify Uber’s way of doing business,” legislative researcher Greg Roney told the committee. Each “transportation network company” would have to get a state permit for $5,000 a year, “which is the amount that Uber and Lyft have suggested as the appropriate fee level,” Roney said.
The bill was revised after Mike Landguth, the Raleigh-Durham International Airport CEO, complained that airports would suffer unintended harm if they were not allowed to make Uber drivers pay fees and obey curbside rules. Under federal aviation laws, Landguth said, taxi and limousine drivers would benefit from any exemptions granted to Uber drivers.
New legislative language gives airports some authority over Uber and the other companies. But RDU would no longer collect fees from individual drivers, who use their personal cars, or make them display “For Hire” license plates. Landguth praised the legislation Wednesday as “a workable compromise.”
Commercial insurance would replace the driver’s personal insurance whenever the driver was dispatched to pick up a rider. Insurance would cover up to $1.5 million in losses from a single incident – more than the $1 million coverage that Uber says it carries.
The committee didn’t vote on McKissick and Rabon’s bill, but two Republican members said they opposed state regulation.
“Why not just let it be?” asked Sen. Ralph E. Hise Jr. of Mitchell County. “Why not just, one line, take out the ‘for hire’ requirement – and let it operate and let the free market run this?”
Sen. Tommy Tucker of Union County said state rules would make Uber raise its prices.
“What you’re trying to do here is you’ve got a winner, and you’re going to try to make it a loser,” Tucker said.
Uber spokesman Taylor Bennett said the company is working with legislators “to develop a permanent framework that ensures consumer safety and access to greater choice and opportunity.”