Our Take: Ridesharing amendment, a step in the right direction but still requires more work

UPDATE December 9, 2014: We were in City Council chambers until 7:30 p.m. yesterday listening to testimony as part of the first reading of the amendment. No changes to the amendment were proposed by any council members. The second and final reading (if no substantial changes are made) will be sometime in January.

Our Take is where Bungalower lays out the facts on a specific issue and then shares with our readers what our take is on the topic.

Today we tackle an amendment to the vehicles-for-hire ordinance impacting the so-called transportation networking companies like Uber and Lyft. These are companies where users can request a driver (not employed by a cab company) via an app to pick them up and take them to their destination.

At today’s City Council meeting the council will hear the first reading of an amendment to the vehicles-for-hire ordinance. The idea is to allow for a new category for transportation networking companies (TNC) like Uber and Lyft.

Both Uber and Lyft operate within the City of Orlando, but neither are permitted by the city to do so and are therefore operating illegally. The problem is the current ordinance does not allow for transportation networking companies.

The new amendment comes after pressure from all sides to include the TNCs in the city ordinances. The problem is that while the new ordinance is a step in the right direction it still won’t allow these companies to operate in the efficient and effective manner they do today nor does it allow them to compete from a fare standpoint with taxis.

Creating a new category
The amendment creates a new category called livery vehicle. This new category fits in between your traditional taxi cab and a luxury town car.

There’s even an acknowledgement that vehicles in this new category might be taking fares via a “Transportation Network Company” and in that case the name of the company would need to be displayed on a small sign.

The new category allows livery vehicles to opt out of some of the things taxi companies are required to do such as operating a 24/7 dispatch.

Permitting and Vehicle Inspection
Currently a driver of any vehicle for hire must go to City Hall to get a permit. In addition their vehicle has to also be permitted. In the case of most taxis and luxury vehicles for hire, the company that they are driving for owns the vehicle and takes care of this permitting process.

A driver for Uber or Lyft, who would be using their own vehicle, would have to apply for their own permit at City Hall. This includes creating a business entity with the state of Florida and filing for a business license with the city (and possibly the county and other municipalities). It would also require them to take their vehicle into the city for inspection. The permit costs $500.

Minimum Fare
As part of the ordinance the livery vehicles would be required to charge 25% more than minimum fare the taxicabs are required to charge.

Currently a ride from College Park to Downtown Orlando costs about $7 on Lyft and would cost at least $9 if they were charging 25% above the taxi rate. That’s also removing any fees that Lyft currently charges.

The city contends that livery vehicles (and luxury vehicles for hire) need to have a higher minimum fare to ensure that they are not discriminating or hurting service that is needed by consumers who rely on the wheelchair accessible vehicles provided by taxis or by those who cannot participate in TNCs because they don’t have a smartphone or credit card.

Our Take
First it is worth noting that having TNCs such as Lyft and Uber in our city is important as our city focuses on becoming a tech hub trying to attract top talent and companies to move here. Even if we didn’t want the TNCs here, we think our city has a responsibility to allow new and potentially disruptive companies to operate within our city so long as they do not discriminate in their service and offerings.

We agree that TNCs should not be treated like taxicabs, but we don’t think that stops at the requirments for two-way radios and a 24/7 dispatch. There’s no apparent reason the city and the TNCs can’t figure out a way that their drivers don’t have to go into city hall to file for a business license, vehicle for hire permit and do a vehicle inspection with the city. Instead we think this can be handled by the companies and subject to inspection and audit by the city. The idea of requiring every new Uber or Lyft driver to wait hours in permitting at City Hall just doesn’t make sense for the driver, the company or the city. Other cities have figured out ways to allow the companies to handle this process we think Orlando can too.

When it comes to the minimum fare, the main issue is guaranteeing that there are options available for those without a credit card and/or mobile phone and for those requiring wheelchair accessible vehicles. The amendment attempts to do this by offering a competitive advantage to the category of vehicles that have historically offered these options. If the goal is to reward, subsidize, incentivize or protect the companies that offer these services, then the competitive advantage should be tied to a company providing those services and proving that to the city.

Currently, nowhere in the ordinance could we find where taxi cabs are required to accept cash payments, provide wheelchair accessible options or demonstrate to the city that they are doing these things. As a matter of fact they are restricted on how many permits they can have for wheelchair accessible vehicles.

If a TNC provides for either of these options (wheelchair accessible vehicles or cash payment), they are still required to charge an increased fare. It would be better for the city to reward/incentivize any company offering wheelchair accessible options and require them to provide reporting back to the city to show that the level of service for wheelchair accessible vehicles is on par with standard vehicles. Let’s make sure we tie any competitive advantage being given out to data that shows the company is providing that service.

One can look at Austin, where their city entered into an agreement with the TNCs that requires them to provide wheelchair accessible vehicle options via their app and conduct outreach to the community to recruit drivers who have wheelchair accessible vehicles. The companies then have to report back to the city on their progress.

If the goal is to provide more options for all residents and visitors, it would be most beneficial to incentivize everyone to offer these services.

The current amendment as written is a step in the right direction to allowing innovative companies to operate within the city. However, the legislation, as written, does not create a workable framework for the existing companies to operate within the city let alone any future ideas that may come.

We hope that the city will work with the TNCs to create a fair ordinance for both parties. Furthermore we sincerely hope that the companies will work with the city to come up with creative solutions to meet the needs of our community and not just use public pressure to fight every ordinance that comes forward.