Uncle Sam Might Be Joining Your Uber Pool
Grace Boatright

Companies like Uber and Lyft have forever changed the meaning of terms like “getting around” and “public transportation,” affording anyone with a smartphone and a credit card the luxury of their own car and driver.

Uber’s debut in 2009 officially launched this industry of ride-sharing, also called ride-hailing or transportation networking, and government is now struggling to catch up.

Government typically regulates, not innovates, working to corral and adjust that which has already taken off and become popular with the general public, aka constituents and voters. Uber, Lyft and the immense success of the industry as a whole are an excellent example of this.

Overall, the majority of consumers who have used Uber, Lyft, or other ride-hail companies have enjoyed positive experiences and thus the industry continues to thrive and grow. Predictably, that immense growth has led legislators, both at the state and federal levels, to take notice of this booming industry and examine the rules (or lack thereof according to some) governing its operation.

Industry advocates argue that Uber, Lyft and companies like it are providing the public with an invaluable service by easing the process of getting from A to B, offering mobility to those who can’t afford or drive a car, preserving the environment by taking more cars off the road, and even saving lives by reducing instances of drunk driving.

Those pushing for increased regulation of the ride-sharing industry argue that companies like Uber and Lyft put riders in danger by failing to perform thorough background checks on their drivers and unfairly bypass the expensive regulatory requirements imposed on taxicabs, limousines, and other transportation services.

For example, the New York City Council is currently debating whether to require that ride-hail companies pay the same 50-cent-per-trip surcharge imposed on taxis, funds that go directly into the MTA’s budget to fund maintenance and repairs for mass transit systems like the subway. Advocates of the surcharge argue that ride-hail companies like Uber are taking customers away from taxis and the subway, and are thus boosting their own profits while simultaneously taking significant funds away from the MTA. Opponents of this proposal argue that Uber and Lyft are already paying sales taxes, funds that go into the state’s general operating budget and could then be used to maintain and improve mass transit systems.

Irrespective of arguments for or against the ride-sharing industry, at this point they are unlikely to go away. Uber’s valuation currently stands at over $65 billion, while Lyft’s stands at slightly over $7 billion. Those numbers will no doubt increase as both companies continue to expand and improve their business models.

The questions are now these: How will regulation of this booming industry change over the next few years? And how will that oversight impact end-users who will no doubt be the recipients of any additional operating costs imposed by said regulations?

Roughly 19 bills have already been enacted at the state-level so far in 2017, mostly imposing filing and application fees, special vehicle registration prerequisites, and other clerical regulatory requirements on ride-sharing service companies. Only one has been enacted at the federal level this year - H.R. 274 Modernizing Government Travel Act, which works to provide reimbursement to federal employees for use of such services.

Presently, four bills have been filed and are still awaiting consideration by the 115th Congress that pertain to car-sharing services: H.R. 2241, H.R. 336, H.R. 274, and S.78. These also deal more with how federal employees are reimbursed for use of such companies than the actual regulation of the companies themselves.

Roughly 125 bills in total have been presented at the state-level, aimed at regulating and taxing transportation network companies, New York (27), Florida (16) and Nevada (12) having the most.

Of the total 131 bills at the state and federal levels, Unfold’s bill passage predictor (which enjoys a 96% accuracy rating) gives 3 of them an 80% or higher chance of passing and 3 of them a 60 to 80% chance of passing. The rest are unlikely to make it all the way into law.

-Oregon HB 3445: Relating to labor practices of transportation network companies; declaring an emergency.

-Colorado SB 17-043-2017A: Transportation Network Company Drivers Medical Certificate Not Required.

-Kansas HB 2236: AN ACT concerning motor carriers; relating to drivers of taxis, limousines...

-Oregon HB 3424: Relating to licensing requirements for transportation network companies; declaring an emergency.

-Maine LD 1010-128: An Act To Allow For The Regulation Of Transportation Network Companies At...

-Vermont H 143: An act relating to automobile insurance requirements and transportation network companies.

Time will tell how many of these proposed legislative initiatives actually become law and are imposed upon Uber, Lyft and other ride-sharing companies. One thing is certain though: this relatively new industry is generating long-term discussions across the country about how to best protect consumers and play fair with taxicabs, subways, buses, and other well-established transportation systems and commuters everywhere should pay close attention.