Note: This will be the first in a series of articles about the ridesharing fight over Austin Texas. We will continue to update this coverage as time progresses.
- For our latest post we welcome our latest guest contributor, Ben, to share his insights on the fight between the city and rideshare drivers in Austin, Texas. Ben has been a rideshare driver for quite some time now, and will discuss his experiences within this article, both past and present.
A Quick Summary of the Fight
Voters in Austin just shot down a proposal that would keep Uber and Lyft operating in the city. The heart of the debate was over fingerprinting and running every driver through a FBI background check. However, there was much more to the debate than that.
On Saturday May 7, 2016 the citizens of Austin, Texas voted NO on Proposition 1. Proposition 1 is primarily known for the City of Austin requiring all TNC (Transportation Network Companies) drivers to undergo full FBI background checks including fingerprinting. While this is partially true, proposition 1 included much more than simply fingerprinting and background checks.
Even though over 10,000 signatures had been collected to overturn the city coucil ruling made in December 2015, the voters did not agree. They voted Proposition 1 down.
There has been a lot of speculation over the fate of prop 1. Many rideshare drivers were furious over the specific wording the city of Austin used on the ballots. They felt the wording was misleading on purpose. Others speculate that the ridesharing companies spent too much money on the issue which backfired on them. Others speculate that the public wants enhanced background checks and simply didn’t believe that Uber and Lyft would leave.
Many speculate that the signers of the petition were not necessarily Austin residents. Even though we had 10k petition signers many of them may not have been eligible (or bothered to) vote in the Austin election. Finally, people speculate that the public simply wasn’t properly informed on the issue.
On Monday May 9, 2016 Uber and Lyft ceased operations within the city limits of Austin.
This is the rest of the story.
Proposition 1 was to overturn the city ordinance from December 2015
You need to understand that proposition 1 was about several issues. Fingerprinting and background checks was only part of the issue.
Other areas of the city ordinance included:
- Fingerprinting required for all drivers
- FBI background checks for all drivers
- Reporting of driver/trip data on a monthly basis
- Daily reporting of accident reports provided to city every Monday
- Suspending of TNC if they fail to report within 15 days of deadline./li>
- Changes to dynamic pricing. No dynamic pricing during “abnormal market disruptions”.
- Enhancements to handicap accessibility including ability to request accessible vehicles in app (a great idea actually.)
- Cannot use travel lanes (including bus stops) for stopping, standing, parking, loading, or unloading of passengers.
- Vehicles must go through an inspection (in addition to the ones vehicles already go through) and display a sticker.
- Trade dress required on all vehicles.
- Onboarding process must include face to face interviews with every driver. Onboarding process requires drivers to demonstrate ability to drive safely.
- Drivers limited to 12 hours driving within any 24-hour period.
- TNCs must create driver training programs.
- Up to 2% fee instead of just 1% fee to the city
More to the story
If you followed the news stories you’d think the fight was just about fingerprinting. There was certainly a lot more to the city council ordinance than fingerprinting!
Let’s take for example the issue of reporting. Does Uber and Lyft have the ability to generate the reports to the city council? Are they worried about providing data on all passenger pickups and drop offs to the city? Is this information available to competitors like the taxi companies? If the app doesn’t allow for these reports to be generated how much does Uber and Lyft have to spend in time and money to generate these reports?
But reporting was simply one issue. In addition, there are a host of other issues that also were taken into account.
As a driver I’m not happy with the idea of getting rid of dynamic pricing. The idea that during “abnormal market disruptions” the price won’t go up is actually a horrible idea. That is when drivers do not want to drive. Let’s take for example severe weather. Many drivers do not like to drive in the rain, much less a severe storm. However, that is a time when there is high demand for drivers. If there is no dynamic price increase what is the incentive to drivers to drive? I understand if you’re evacuating the city you want people to be able to get out. However, for a flood when you’re asking drivers to drive when most sane people don’t want too… Shouldn’t the driver be compensated for that?
Trade Dress on vehicles
This seems ok, to you the reader, right? Why shouldn’t the car have a Lyft or Uber sticker, as clearly noted in the vehicle requirements for Uber? I can tell you why. Taxi cab drivers! Taxi cab drivers are at war with Uber and Lyft drivers. My friends have had violence threatened against them. They’ve had taxi drivers damage their vehicle.
Overall there is a lot of tension beginning to show, and frankly, things are getting dangerous. This issue is a double-edged sword, which definitely is currently swinging both ways.
If there isn’t a bus coming, why can’t we drop off there? That is actually one of the safer places to drop off and pickup. I understand if there is a bus right behind me. However, there are limited places in downtown Austin to pull over and let out passengers. You don’t want us blocking traffic. We can’t pull over in a taxi area (taxi cab drivers will take offense and verbally / physically threaten you.) What should we do? Is the city going to make more spots for TNC drivers to pull over?
The city is doubling their fee from 1% to 2%. There are two separate 1% fees that TNCs will be responsible for, up to the maximum of 2%. (A smaller TNC can use one of the alternate methods of calculating their fee.)
Onboarding process for Uber would have to change. Lyft had mentors in place to meet with drivers, do a training session, and a quick ride. Uber would have to make those changes to their process. This is significant cost. Lyft mentors are paid I believe $40 per mentor session.
Drivers limited to 12 hours per 24 hour period
This is a significant change to what we currently have in the city. We currently have a 6 hour mandatory downtime. This ordinance seems to mandate a 12 hour downtime. What if I want to go home and sleep for 6-8 hours and then get up and drive at noon the following day? Am I forced to wait until 2 PM to drive again? How many people work jobs where they close the store one day and open the following day? During festivals and conventions this is going to seriously limit how much driving each driver can do.
Then let’s talk about the FBI background checks themselves. There are several reasons why the TNCs do not want to REQUIRE background checks.
- The primary issue is REQUIRED background checks vs. optional. The TNCs favor optional fingerprinting as opposed to requiring them for all drivers. This is how the city of San Antonio compromised with the TNCs.
- FBI background checks will cause delays in getting new drivers processed.
- Fingerprinting and background checks will cause part-time drivers to be less likely to sign up to become a driver. Uber says 20,000 drivers in Houston decided NOT to go through the background check and instead quit driving.
- TNC company attorneys are afraid that all these extra driver regulations will open them up to lawsuits of drivers being employees rather than independent contractors.
- Costs. The city ordinance is rather vague about who is paying for these extra background checks. The cost increase to the TNCs is roughly 10 times what their current background check costs.
- Fairness: Up until April 2016 Taxi drivers didn’t have to pass nationwide background checks.
- Complications: Regulations mean complications. Houston passed enhanced background checks. Lyft left the city. Uber still operates there but is threatening to leave if the city doesn’t change their regulations.
This battle is just beginning. Stay tuned for more articles as we talk about the mayhem and anarchy in the wake of Uber and Lyft leaving the city.