Council Committee Doesn’t Shut Down Ride-Shares, But Does Move Toward Regulation

Despite some fear to the contrary, the Seattle City Council’s Committee on Taxi, For-Hire and Limousine Regulations was not going to shut down upstart ride-share outfits like Lyft, UberX and SideCar today. From the very start of today’s scheduled committee meeting - during which regulatory options for taxis, for-hires and ride-shares were discussed in-depth - Committee Chair and Council President Sally Clark made that abundantly clear. There would be no formal vote.

“If you’re here because you’re worried we’re going to shut down UberX today,” Clark told those gathered in Council Chambers for the proceedings, “that’s not happening. It may never happen.”

What did happen, however, was a robust discussion on what the regulatory landscape of Seattle’s taxi industry - including what Council Central Staff’s Ben Noble likes to call “taxi-like services,” which is another way of referring to the Lyfts, UberXs and SideCars of the world - is going to look like in the future. From there, directives on how to proceed were forwarded to council staff, with the goal of creating both long-term and short-term answers.

To no one’s great surprise (or, at least those who’ve been following the evolving debate), the three councilmembers that comprise the committee - Clark, Bruce Harrell and Mike O’Brien - all expressed an interest in finding a way to regulate the burgeoning ride-share industry in Seattle. That said, all - with the occasional exception of Harrell - also expressed a desire to find a way where ride-shares can continue to operate in Seattle in the interim, albeit with far more oversight from the city.

After discussing three possible scenarios for moving forward - which (heavily simplified) included 1) enforcing current standards for taxis and for-hires, and treating ride-shares as such (an option that would doom ride-shares and would open up ride-share drivers to the possibility of misdemeanor penalties), 2) lifting the cap on for-hire licenses but requiring ride-shares to play by those rules, with both drivers and cars licensed through the city (an option that, as Noble noted, would “significantly challenge” the ride-share business model), or 3) a more “embracing” option for ride-shares that would allow the app-based outfits to continue to exist but require all drivers to obtain for-hire licenses (an option that Noble says might allow ride-shares to “potentially thrive) - the committee opted to direct council staff to explore option three, while continually noting that some aspects of the first two options could still be drawn from moving forward.

“These are starting points,” O’Brien said of the options discussed.

(All three of the options can be found in detail here, including much more info on the delicate balance the city is trying to find between taxis and for-hires, which is an issue of far more importance to many cabbies.)

While the committee was largely focused on the long-term, there was the tricky matter of how to react in the short-term - or until a new regulatory scheme was devised. It was here that fears that ride-shares would be (at least temporarily) shut down in Seattle arose. Issuing a cease and desist to ride-share companies was discussed as a possibility.

This is also where incessant “genie in a bottle” references started to gain steam (and, no, that’s not a Christina Aguilera reference).

“I don’t think the genie’s going back in the bottle,” said Clark of the new ride-share companies, explaining that, in her opinion, even if the city did issue a cease and desist to ride-shares the problem wouldn’t disappear.

Harrell took a sterner stance toward ride-shares. To be certain, he’s obviously the most skeptical councilmember on the committee that will go a long way toward deciding the industry’s fate in Seattle. Of ride-shares Harrell said he doesn’t agree that they’re simply a “new opportunity that we necessarily have to accept.”

Harrell’s blatant skepticism aside, in the short-term Clark’s committee opted to avoid moving to shut down ride-shares while a regulatory scheme is crafted, and instead instructed council staff to start exploring legislation that would set the groundwork for the previously mentioned long-term vision - a system where ride-share drivers are licensed as for-hire drivers. That legislation is expected to emerge in about four weeks, with the goal being to expediently set minimum operating standards for ride-shares, likely including, according to Noble, clarifying insurance requirements and setting a date by which ride-share drivers are required to be licensed.

“I personally would not see a reason to shut [ride-shares] down in the interim,” said Clark, who has never been shy about wanting to find a way where ride-shares can continue to exist in Seattle, while also ensuring safety for riders and drivers.

“People want ride-share in Seattle. Last week California became the first state to regulate alternative transportation services making them safer and even better for our communities,” said SideCar spokesperson Margaret Ryan when reached for comment on today’s committee proceedings. “We hope Seattle follows California’s lead and moves in favor of safety, innovation and consumer choice.”

After spending a full two hours wrestling with the problem - which only came in addition to the nearly six months the committee has already spent on the subject- it’s clear many questions still remain. Harrell seems most concerned with protecting existing taxi and for-hire drivers, and specifically the possibility of an unfair flood of ride-share drivers. O’Brien repeatedly expressed a desire to avoid over-regulating, something he believes has historically prevented needed innovations in the market. Clark expressed a concern about what the landscape will look like in three or five years, and whether or not ride-shares like Lyft and SideCar will live by the community-minded ideals they preach.

“If it really does become a new, cheaper way to run around as a taxi all the time … then this isn’t going to work,” Clark said of the future of ride-shares in Seattle. “The problem is we’re not going to know that for a while.”

To be continued.

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