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A flock of electronic scooters descending on Austin

Not actually one of the signs of the apocalypse, though I’m sure it was annoying.

Scooter!

Seemingly overnight, Austin was buzzing with electric scooters last month. Scooter riders weaved through crowded sidewalks and traffic downtown and zoomed out of drivers’ blind spots near the University of Texas campus, catching motorists and pedestrians alike off guard.

Bird Rides, a dockless scooter company, deployed a fleet of thin, black scooters in April that quickly grew to almost 700. Then came LimeBike, which flooded the streets with their own white and green Lime-S scooter models on April 16.

Then, just as quickly, they disappeared last weekend.

The appearance of rentable scooters across the city briefly threw Austin’s political leaders into a frenzy as city government officials rushed to roll out a plan to regulate the businesses, which had started operating before a city-led pilot program could begin.

“In order to forestall a predictable and unmanageable swamping of our streets with thousands of vehicles, ATD recommends a more nimble response than our previously expressed pilot timeframe,” Robert Spillar, director of the Austin Transportation Department, said in a letter to the mayor and Austin City Council members.

The council worked until after 2 a.m. Friday to change city code and prohibit leaving dockless scooters or bicycles on city sidewalks and streets until a permitting process begins. Violators can have their scooters impounded and face a $200 fine for each seized scooter.

Over the weekend, both California-based companies pulled their vehicles from Austin city streets — but not before the city’s transportation department impounded about 70 of them.

[…]

Both companies placed their scooters on sidewalks and street corners throughout the city. Customers could download a smartphone app that allowed them to see the vehicles’ locations in real time, unlock them and pay the rental fee. Both Bird and Lime-S charge a base fee of one dollar, then 15 cents per minute of use.

Austin initially planned to begin a pilot program for what it calls “dockless mobility” — meaning vehicles that aren’t kept in racks or docking stations — starting May 1, but Bird and LimeBike deployed their scooters before it went into effect.

So the city pivoted to the new permitting process, which will require a $30 fee for each vehicle and cap the initial number of vehicles per licensed operator at 500. The city plans to roll out the new process shortly.

And not a minute too soon: The Austin Transportation Department said it’s coordinating with 15 different dockless mobility companies that have expressed interest in coming to Austin.

If you’re having flashbacks to the early days of Uber in Texas, congratulations. You’re not alone. At least in this case the scooter companies were noticeably less pugilistic in their press releases. But then, both of them had done the same thing in San Francisco; as my old music teacher used to say, once is a mistake and twice is a habit. So be forewarned, Mayor Turner and Houston City Council, because these guys are coming, sooner or later. And that rumbling sound you hear in the distance is the early gestation of a lobbying effort to pass a statewide rideshare bill for scooters in the Lege. Again, don’t be caught off guard. We’ve seen this movie before.

RideAustin tries to hang on

I wish them luck.

The return of Uber and Lyft to Austin has put the city’s only ride-hailing nonprofit in a fight for survival.

RideAustin, one of several small companies that started operations in Austin after the ride-hailing giants left the city in May 2016, is now seeing its ridership cut in half since the two returned to town. The company is slashing expenses and cutting staff, said CEO Andy Tryba.

“We always knew that at some point Uber and Lyft were going to come back. So we’ve always prepared for it,” Tryba said in an interview with The Texas Tribune, adding that RideAustin expected a big drop in rides — but didn’t think it would happen so fast.

[…]

RideAustin, which began operating in June 2016, was notable as the first ride-hailing company to run on a nonprofit model that promised better pay for drivers and allowed riders to donate to local charities through the app. It’s seen ridership steadily increase over the past year — which spiked to more than 110,000 weekly rides during the South by Southwest festival.

But RideAustin’s fortunes turned during the Legislature’s 85th regular session this year, when lawmakers passed a statewide regulatory framework for ride-hailing companies that supersedes local ordinances — including Austin’s. Gov. Greg Abbott signed it into law on May 29, and Uber and Lyft returned to Austin the same day.

The drop in ridership for RideAustin was swift and dramatic: last week, the company provided 22,000 rides — less than half of the 59,000 rides it operated in the week before Uber and Lyft returned. Tryba attributed part of the loss to UT-Austin students leaving town for the summer, but he also acknowledged that a large share of rides was recaptured by Uber and Lyft.

[…]

RideAustin is working to avoid the same fate as Fare, a Phoenix-based ride-hailing company that shut down operations in Austin just a week after Uber and Lyft’s return. In an email to customers, the company said it couldn’t “endure the recent loss of business.” Other ride-hailing services that had started operating in the initial vacuum have also gone out of business over the past year.

The city’s ride-hailing market changed significantly after Uber and Lyft left. Researchers from the University of Michigan, Texas A&M and other universities conducted a study about how Uber and Lyft’s departure changed riders’ behavior in Austin. They found that only 40 percent of respondents transitioned from Uber or Lyft to other ride-hailing companies, while 60 percent started making similar trips using other transportation, like biking, walking or driving a personal vehicle.

Chris Simek, a researcher at the Texas A&M University Transportation Institute that authored the study, said that among those who chose another service, “about half reported using RideAustin most often to make that type of trip. About a third reported using Fasten most often, and about one in 10 reported using Fare most often.”

Simek said the research team plans to do a follow-up study to analyze the market now that Uber and Lyft are back.

See here and here for some background. I had hope that the Uber-less Austin model of multiple firms actually competing to be better or at least different than each other would successfully fill the void, but either there wasn’t enough time for people to adjust or they just liked Uber and Lyft too much. That survey suggests there was something to the latter point. Be that as it may, I hope RideAustin can hold on and develop into something that could be replicated elsewhere. Anything that provides a better way for the drivers to earn a living is worth having.

Help Metro figure out its Regional Transit Plan

Here’s your chance to get involved and shape the direction of transit in the greater Houston area going forward.

What is your vision for transit service in the Greater Houston region?

METRO needs your help in creating a bold vision for the region’s transit network. METRO’s Board of Directors, led by Chair Carrin Patman, is developing a new plan for transit services in the Houston region. We intend to focus on providing more transportation choices to more people, and it is critical that we get your input.

The Regional Transit Plan will build on the foundation laid by METRO Solutions, the long-range transit plan approved by voters in 2003. METRO Solutions laid out a vision for the future transit system that included light rail, an expanded local bus system, new commuter bus facilities and much more. Since that time, METRO has been working to deliver that plan.

Our transit system must help people get to where they need to go today, as well as in the future. Through this process, we will look for ways to better serve the needs of our current customers, as well as develop strategies to attract new customers to the transit system. The regional transit plan will be designed to serve area residents through 2040.

The METRO Board of Directors established the following goals and guiding principles in developing the Regional Transit Plan.

Goals

  • Improve Mobility
  • Enhance Connectivity
  • Support Vibrant Communities
  • Ensure a Return on Investment

Guiding Principles

  • Safety
  • Stewardship
  • Accessibility
  • Equity

With these thoughts in mind, we invite you to join us in developing a plan for a transit system that best serves our area’s residents, businesses and visitors.

We’re Listening

  • What kind of transit system would best serve your needs?
  • How do feel about the goals of the 2040 Regional Transit Plan?
  • If you do not use transit today, what would entice you to use it tomorrow?
  • What are three important things METRO should keep in mind as it develops the Plan?

See here, here, and here for the background, and click the link at the top for the Regional Transit Plan presentation and the link to give your feedback. Metro will be holding a series of community meetings through July and August, beginning on June 27, to solicit feedback. I and several other bloggers had the opportunity to get a preview of this earlier in the week – see Glissette Santana’s writeup in the Urban Edge blog for some of the details – and I can tell you that Metro has been thinking about and planning for a lot of possibilities. The starting point is the 2003 referendum and the unfinished business it leaves behind, and it includes rail, BRT, bus system improvements, coordination with other regional transit agencies, partnerships with rideshare services, pilot programs for automated vehicles, and more. Community input is needed both to highlight underserved areas of need and to build the political capital that will enable passage of the next referendum in 2018. Check it out, attend some meetings, and let Metro know what is important to you and for them.

Uber and Lyft come rolling back

To Austin:

Texas Gov. Greg Abbott on Monday signed into law a measure creating a statewide regulatory framework for ride-hailing companies, overriding local measures that prompted businesses such as Uber and Lyft to leave Austin and other cities.

Uber and Lyft said they resumed operations in Austin on Monday. Lyft also said it would relaunch in Houston on Wednesday (Uber is already operating in Houston.)

“What today really is is a celebration of freedom and free enterprise,” Abbott said during a signing ceremony. “This is freedom for every Texan — especially those who live in the Austin area — to be able to choose the provider of their choice as it concerns transportation.”

House Bill 100 undoes local rules that the two companies have argued are overly burdensome for their business models. It requires ride-hailing companies to have a permit from the Texas Department of Licensing and Regulation and pay an annual fee of $5,000 to operate throughout the state. It also calls for companies to perform local, state and national criminal background checks on drivers annually — but doesn’t require drivers to be fingerprinted.

“Today’s bill signing creates a ridesharing network in Texas that benefits consumers, expands transportation options, maximizes access to safe, affordable rides and creates expanded earning opportunities for Texans,” Lyft spokeswoman Chelsea Harrison said. “Riders and drivers are the real winners today.”

And (for Lyft) to Houston:

Ride-hailing company Lyft will officially return to the Houston market.

San Francsico-based Lyft will return to Houston on May 31 at 2 p.m., according to Chelsea Harrison, Lyft’s senior policy communications manager. The move comes shortly after Gov. Greg Abbott signed House Bill 100, a statewide comprehensive transportation bill, on May 29. Lyft has been ramping up its local marketing, recruiting drivers and offering discount codes to riders since the bill went to the governor’s desk for signing.

“Today’s bill signing creates a ridesharing network in Texas that benefits consumers, expands transportation options, maximizes access to safe, affordable rides and creates expanded earning opportunities for Texans. Riders and drivers are the real winners today,” Harrison said in an email.

[…]

HB 100’s rules are expected to go into effect in September.

Actually, that law went into effect immediately after Abbott’s signature, as it was passed with a two thirds majority in both chambers. The normal rule is that bills go into effect after 90 days, but with a supermajority they go into effect immediately.

You know how I feel about this. I think it was reasonable for the Lege to clear the way for TMCs to operate outside of cities, and I can see some value in a uniform approach to regulating them. I don’t care for the ongoing contempt for local control, and the gratuitous “definition of gender” amendment really sticks in my craw. In the end, I largely agree with this:

Following the passage of the bill in both chambers, however, Austin Mayor Steve Adler issued a statement saying he was “disappointed” the Legislature voted to nullify regulations the city had implemented.

“Our city should be proud of how we filled the gap created when Uber and Lyft left, and we now must hope that they return ready to compete in a way that reflects Austin’s values,” Adler wrote.”

There’s clearly a demand for what Uber and Lyft sell, but let’s not kid ourselves into believing that HB100 has just ushered in some free-market nirvana for ride-seekers. I mean, surely at some point in the future Uber will succeed in buying up Lyft, thus making it a functional monopoly in that market. How exciting will it be then to have the equivalent of a cable company for ridesharing? The brief period in Austin where a bunch of companies actually competed for drivers and riders is what a free market looks like. Too bad none of the rest of us will get to experience that.

Senate passes statewide rideshare bill

It’s a done deal.

After a debate among lawmakers over the best way to regulate services like Uber and Lyft, the Texas Senate on Wednesday backed a proposal that would override local regulations concerning ride-hailing companies.

House Bill 100 would establish a statewide framework to regulate ride-hailing companies and undo local rules that the two companies have argued are overly burdensome for their business models.

“Regulating them at the city level will always be challenging,” the bill’s Senate author, state Sen. Charles Schwertner, R-Georgetown, said. “Transportation, by nature, is a regional concern.”

His bill passed in the upper chamber in a 20-10 vote on its third and final reading. The measure now heads to the governor’s desk.

Though the vote on the bill was originally announced as 20-10, senate records later showed it actually passed 21-9, meaning more than two-thirds of the Senate supported the measure. That distinction matters because of a provision in the bill that allows it to go into effect immediately after the governor signs it instead of on Sept. 1 if it receives support of two-thirds of the members in both chambers. As the measure passed the House in a 100-35 vote, it means ride-hailing companies like Uber and Lyft could potentially return to cities like Austin as early as this summer.

You know the story on this one. The offensive “definition of sex” amendment is still in there, which I have to hope winds up not meaning much in the grand scheme of things. And I agree with mayor Turner that this is “another example of the legislature circumventing local control”, but all things considered it’s less of that than it could have been. I know I’m rationalizing, but such is how it is these days. Expect to see the pink Lyft mustache in town again, as they have been recruiting drivers in anticipation of this. Maybe some other services will come to town as well. Whatever you think of this soon-to-be-law, there will be one fewer obstacle to entry.

Rideshare bill advances in Senate

It was almost different and then it wasn’t, but it still could be.

Rep. Chris Paddie

Paid ride companies such as Uber and Lyft are one step closer to the statewide oversight they crave, after a state Senate committee approved a revised plan to regulate them, as opposed to cities.

Members of the Senate State Affairs committee approved the bill, unchanged from what was sent by House lawmakers in HB 100, sponsored by State Rep, Chris Paddie, R-Marshall. The bill establishes statewide rules for paid ride companies that connect willing drivers and interested riders by smartphone. State rules would eliminate any city regulations, while still giving cities control to regulate taxi and limousine drivers and companies.

State Sen. Charles Schwertner, R-Georgetown, at first proffered a substituted version of the bill, then rescinded the substitute without discussion so the committee could approve the original version.

“Several senators expressed a desire to offer additional changes to HB 100,” said Thomas Halloway, chief of staff for Schwertner, in an email. “In the interest of moving the legislation forward, we agreed the most appropriate action was to move the original bill to the floor so all senators have the opportunity to offer their own thoughts.”

As a result, the bill the senate will consider retains a clause added by House lawmakers that defines sex as “the physical condition of being male or female.”

See here and here for some background. Sen. Schwertner had originally stripped that bad amendment out of the bill, so I am hopeful that it will get amended out on the floor of the Senate. We’ll see.

Uber and Lyft speak on the “biological sex” amendment in statewide rideshare bill

It’s a start.

Five days after a controversial amendment defining “sex” as “male or female” was added to a statewide ride-hailing bill, representatives from Uber and Lyft called the addition disappointing and unnecessary — though both companies stopped short of saying they’d withdraw their support.

“We are disappointed that this unnecessary amendment was added to legislation that should be focused on adopting a consistent statewide framework for ride sharing,” Uber spokesman Travis Considine said. “Uber’s comprehensive national nondiscrimination policy will not change.”

“The adopted amendment is unnecessary, as Lyft’s strong nondiscrimination policy remains in effect no matter what local or state statutes exist,” Lyft spokeswoman Chelsea Harrison said.

Neither Considine nor Harrison said their respective companies would pull back support of the bill over the amendment, which would define “sex” as the “physical condition of being male or female.” Considine said Uber’s existing nondiscrimination policy won’t change — it prohibits “discrimination against riders or drivers based on race, religion, national origin, disability, sexual orientation, sex, marital status, gender identity and age, among other things.”

See here for the background. It would have been nice if they would have spoken up sooner, but at least they have now done so. I’m glad they have reiterated their nondiscrimination policies, which I suppose makes that Tinderholt amendment moot for them, but the door is open for a company that would discriminate on the basis of gender presentation or identity if this bill gets passed in the Senate as is. The goal here is to take that out of the final version. The statements from Uber and Lyft help, but it’s going to take more than that.

The post-Uber Austin rideshare experience

Texas Monthly notes the issues that some people faced during SxSW hailing a ride, and considers the rideshare landscape in Austin post-Uber and Lyft.

But the thesis that Austin is experiencing a crisis around ride-hailing apps is an old one, and it’s incomplete. RideAustin, which as a non-profit makes all of its numbers public, gave its millionth ride in February. Drivers are happy with the rates they make on RideAustin (which gives them the full amount of the ride) and Fasten (which takes a flat fee out of each ride, rather than a percentage like Lyft does). Most of the year, the companies’ servers can handle the load, and it’s likely that they’ll each be improving their servers based on what happened at SXSW.

Still, despite the fact that the city seems much happier with the current state of its ride app regulations than the tech fellas who come in for SXSW, things might end up getting a lot friendlier for Lyft and Uber anyway. That’s because the disruptive innovators in the tech world have an ally in the Texas Legislature, which seems increasingly likely to pass statewide regulations that would prevent cities like Austin (and Houston, which has a similar ordinance—and which keeps Lyft, but not Uber, from choosing to operate in the city) from determining what the rules that drivers and the companies through which they find passengers will have to follow will be in each city.

There are three different bills in the Lege, all of which would create a statewide rule that would supersede local regulations, and the Senate began debating them last month. (Similar legislation was proposed in 2015, though it ended up dying without a vote.) This time, though, momentum is on the side of the companies that hope to see the legislation passed—the Texas Tribune reports that “at least one of the bills is widely expected to eventually move on to the full Senate for a vote,” which, in an environment that’s increasingly hostile to the idea of local control, has a strong chance of passing.

All of which is to say that the question of whether or not Austin’s leadership “ruined” ridesharing is ultimately the wrong thing to focus on. It’s true both that Austin tends to get around pretty well without Uber and Lyft, and that the two companies are pushing hard for legislation that would change the dynamic there dramatically. Perhaps the real question, then, is what happens to Fasten, RideAustin, and the rest if Uber and Lyft come back?

That’s a tougher question to answer, but it’s the one on which the future of ride-hailing in Austin hinges. For now, RideAustin and Fasten are doing a job that satisfies customers and drivers. But if Uber and Lyft decide to cut costs to consumers for six months, eating the expense of the service, they could easily make RideAustin and Fasten seem like overpriced relics of a bizarre moment in the city’s history. It may not prove sustainable (currently, Uber’s passengers pay for only 41 percent of each ride, and the company was projected to lose $3 billion in 2016), but it doesn’t have to be sustainable: it only has to chase away the competition.

I have mostly resigned myself to the fact that the Lege is going to pass a statewide rideshare law that will forcibly overrule the ordinances passed in cities like Austin and Houston regarding these services. The bills that are being considered have some good points to them, and there is certainly an argument to be made that a uniform statewide approach makes more sense and will serve customers better. But I think that latter part will only be true if there is robust competition among multiple rideshare companies, ant not just an Uber/Lyft duopoly with a legacy cab service for a declining share of riders. As such, I have two hopes for what happens after Uber and Lyft make their mandated returns to Austin. One is that they will find a market that isn’t as into them as before thanks to the presence of many other viable services, which forces them to innovate and compete not just for riders but also for drivers. And two, if Uber and Lyft take the approach of trying to kill off their competition instead by leveraging their billions in market capitalization to subsidize their service until they’re the only players left standing, that the Legislature recognizes this anti-free market in a way that some people say taxi regulations are, and take action to correct it. Let’s just say I have more hope for the former than for the latter.

House passes statewide rideshare bill

Made it farther than it did last session.

Rep. Chris Paddie

After a lengthy debate among lawmakers over the best way to regulate services like Uber and Lyft, the Texas House backed a proposal that would override local regulations concerning ride-hailing companies.

House Bill 100, by state Rep. Chris Paddie, R-Marshall, would establish a statewide framework to regulate ride-hailing companies and undo local rules that the two companies have argued are overly burdensome for their business models. Cities enacting such rules say those regulations bring a needed layer of security.

As of mid-morning Wednesday, 79 members in the 150-member House — including Paddie — had signed on to the bill as authors or co-authors.

“HB 100 is not about a particular company or any particular city,” Paddie said Wednesday on the House floor. “Statewide regulations for transportation network companies have become the best practice across the country.”

His bill was tentatively approved by the lower chamber in a 110-37 vote after representatives tacked on several amendments, including one that seeks to define “sex.” The measure needs final approval from the House before it could be considered in the Senate.

At times, the debate over the bill appeared to veer into one of the most contentious topics this session at the Capitol: gender identity. In the Senate, Lt. Gov. Dan Patrick has prioritized a “bathroom bill” that would require transgender people to use the restroom in some places that matches their “biological sex.”

On Wednesday, state Rep. Tony Tinderholt, R-Arlington, successfully amended the ride-hailing bill to define “sex” as the “physical condition of being male or female.” The amendment, which passed 90-52, drew some concern from Democrats, who questioned whether it was a way to exclude a certain group.

“I can assure you that it is not my intent,” Paddie said, adding that he accepted the amendment because he views it as “further defining something that’s already defined.”

HB 100 would require ride-hailing companies to have a permit from the Texas Department of Licensing and Regulation and pay an annual fee to operate throughout the state. It also calls for companies to perform local, state and national criminal background checks on drivers annually — which would override an Austin ordinance.

See here for the background. Two related Senate bills were heard in committee, with SB361 by Sen. Nichols getting passed out. I don’t know what to make of the “biological sex” amendment beyond the continued obsession of certain zealots. What’s more important is what do Uber and Lyft, who have been pushing hard for a statewide rideshare bill, think of it?


Well, Uber and Lyft? What do you say? Those of you who use Uber and Lyft, what do you want them to say about this? I would recommend you tell them. Maybe this will get stripped out going forward, but that almost certainly won’t happen without some pressure. Now is the time to bring it. And kudos to the members who pulled their support for this bill in response to the needless amendment.

The Chron adds some details.

The bill would give oversight of companies that connect willing drivers and interested riders via smart phone to the Texas Department of Licensing and Regulation. The companies that operate the smart phone app and process payments between the riders and drivers would pay a $5,000 annual licensing fee, and certify that its drivers meet a number of requirements already common among the companies.

Uber and Lyft have aggressively sought state rules in Texas because of their opposition to city requirements, notably Austin and Houston. In Austin, both companies left the city after new rules that included fingerprint background checks went into effect nearly one year ago.

[…]

As with the contentious fights at the local level, discussion also focused on requiring the fingerprinting of drivers. The companies vigorously oppose fingerprint background checks, favoring their background checks based on Social Security numbers.

Numerous attempts to require fingerprint checks or allow cities to require them failed as amendments to Paddie’s bill.

“We should not take chances with any life,” said Rep. Yvonne Davis, D-Dallas, noting many professions in Texas are subject to the fingerprint background check.

Paddie deflected the requests for fingerprints and efforts to allow cities to require more strenuous permitting, noting fingerprints can’t predict future behavior.

“We have 150 teachers in this state under investigation for improper relationships with students,” Paddie said.

Seems like you could use that reasoning to justify a lot of things, but whatever. I feel like one way or the other, something is going to pass. As I’ve said, I’ve basically resigned myself to that, but I still don’t approve of the assault on local control. I hope this winds up being the outer edge of that assault, but I’m less than optimistic about that. The DMN has more.

Senate committee hears rideshare bills

One of these, in some form, is likely to become law.

Senate Bill 176, by state Sen. Charles Schwertner, R-Georgetown, and Senate Bill 361 by state Sen. Robert Nichols, R-Jacksonville, received a joint hearing after [Senate Business & Commerce Committee] chairman Kelly Hancock, R-North Richland Hills, noted their similarities. Both bills establish a statewide framework to regulate ride-hailing companies like Uber and Lyft and undo local rules that the two companies have argued are overly burdensome for their business models.

A majority of about 30 witnesses supported the bills at Tuesday’s hearing, including representatives with Uber and Lyft. Austin councilwoman Ellen Troxclair, who opposed the city’s ride-hailing rules last year, testified in favor of a state law that would override them. Troxclair said the departure of both ride-hailing companies hurt Austin businesses and led to a rise of a transportation black market.

“A Facebook group with over 40,000 members offers to connect people, anybody who wants a ride or anybody who’s willing to give one, regardless of an affiliation to a ride-sharing platform or a background check required,” she said.

Critics of the bills included the Texas Municipal League and Austin City Council member Ann Kitchen. Kitchen, the City Council member who introduced the rules establishing the Austin fingerprinting requirements that prompted Lyft and Uber to leave the city, defended the city’s fingerprinting requirement, and said that the city has fingerprinted 8,000 drivers. At the time the city adopted the rules, she said, the city’s police chief, Art Acevedo, told the council that fingerprinting increased security.

“Fingerprinting is the most effective means to make sure the person you are checking is the person who they say they are,” she said.

See here for some background. Both bills were left pending, but as noted I expect one of them to get a floor vote and to pass. There’s a very similar bill to these two in the House, authored by Rep. Chris Paddie. Any of them could wind up crossing the finish line, and I’ll be surprised if that doesn’t happen.

And on a somewhat tangential note:

Uber and Lyft ramped up their Texas lobby expenditures after Austin voters invited the ride-hailing giants to leave their hi-tech city in 2016 if they refused to comply with a local law requiring them to fingerprint their drivers.

With Texas lawmakers [Tuesday] considering several bills to block cities from regulating such ride companies,1 Uber has increased its state lobby spending 23 percent over last year. It now is spending up to $1.6 million on 26 lobbyists. Lyft meanwhile boosted its lobby spending 88 percent, to pay 14 lobbyists up to $760,000. Together, the two San Francisco-based
companies are spending up to $2.3 million to preempt the powers of local Texas governments.

The two ride giants handed out a total of $40,500 in corporate contributions in 2016 to Texas’ two dominant political parties and to several legislative caucuses.

[Tuesday] the Senate Business and Commerce Committee also is hearing proposals to prevent local governments from curtailing the use of plastic grocery bags or to regulate short-term property rentals.

You can think whatever you want about these bills, but you can’t argue that they don’t come cheap. The Austin Chronicle has more.

Paddie files another rideshare bill

From the inbox:

Rep. Chris Paddie

Texas State Rep. Chris Paddie (R-Marshall) has filed legislation proposing a statewide regulatory framework for transportation network companies (TNCs) such as Uber and Lyft. House Bill 100 will help bring economic opportunity and access to safe, reliable transportation to more Texans.

“It is time to end the inconsistencies of regulations across the state that stand in the way of transportation innovation and adopt a uniform, common sense law focused on safety and access to new technology,” said Rep. Paddie, who is also the former Mayor of Marshall. “In order to encourage growth and innovation, businesses need consistency and certainty. Statewide rules are necessary so riders and drivers can travel from places like Center, TX, to Carthage using ridesharing technology without hitting regulatory barriers.”

About H.B. 100:

Regulatory Certainty: There are more than 1,000 cities in our state and TNC drivers cross invisible lines of jurisdiction with riders on a daily basis. With trips occurring all over Texas and between cities, it’s clear statewide rules are necessary. 36 other states have passed statewide bills regulating TNC’s.

Public Safety: Requires TNCs to conduct a local, state and nationwide criminal background check, including checking the national sex offender database. Requires that applicants convicted of certain offenses are prohibited from being TNC drivers. TNCs also play a role in helping to reduce alcohol-impaired driving in communities where they operate.

Economic Opportunity: TNCs contribute significantly to the local economies where they operate and are on the forefront of innovation improving rural & urban mobility. People from all walks of life choose to drive because it provides a flexible opportunity to earn based on their own schedules and priorities.

Rep. Paddie was the author of a rideshare bill that got the most traction in 2015. His bill joins three others in the Senate and would seem to have a decent chance of passing or being very similar to a bill that passes. Along those lines, I emailed Rep. Paddie’s office after receiving this press release to ask if 1) HB100 was basically the same as HB2440, his bill from last session, and 2) how much it was like the three Senate bills. I was told that it was in fact basically the same as HB2440, with the exception of the insurance provisions that did pass last time, and HB100 was most like the Nichols and Schwertner bills in the Senate, though all of the bills have differences. So add this to your list of bills to watch, and we’ll see which ones make it to the finish line.

Three rideshare bills

The Texas A&M Transportation Institute Policy Center looks at the (first) three bills relating to ridesharing that have been filed in the Lege:

Three bills have been filed so far in the 85th Texas Legislature, regular session, addressing transportation network companies, frequently referred to as ride-hailing or (less accurately) as ridesharing. The bills are

  1. SB 113 Relating to the provision of and local regulation of certain for-hire passenger transportation.
  2. SB 176 Relating to the regulation of transportation network companies; requiring an occupational permit; authorizing a fee.
  3. SB 361 Relating to transportation network companies.

SB 113 and SB 176 have been referred to the Senate Business and Commerce Committee. SB 361 is expected to follow when it is referred to committee.

SB 133 prohibits municipalities from regulating any vehicles for hire (including taxis) and imposes minimal state-level regulation in its place. SB 176 and SB 361 also remove municipal authority over TNCs but introduce state level regulation. There are differences between the latter two (permit fees, for example), but the provisions of both bills are similar to those passed in other states. SB 361 further clarifies that TNCs are not motor carriers and, thus, not regulated under the motor carrier statutes.

There’s further analysis there, so go read the rest. SB361 is by Sen. Robert Nichols, who chairs the Senate Transportation Committee, SB176 is by Sen. Charles Schwertner; it has five co-authors, including Democratic Sen. Juan Hinojosa. SB113 is by Sen. Don Huffines, and it’s basically a part of his plan to turn cities into helpless wards of the state. That’s the order in which I’d rank them from least to most objectionable. I’d be fine if nothing passes, but something likely will, and if that is the case I can live with either of the first two. There’s room to make them less daunting for cities, and I hope that happens. We’ll see how it goes.

It’s bill-filing season

And they’re off.

Today is the first day of early filing in the Texas Legislature. Lawmakers in both the House and Senate may begin filing the bills that will be discussed when the legislature convenes in January 10, 2017. So how does that work and what does it mean?

For the most part bills are numbered in the order they are filed. However House Bill 1 and Senate Bill 1 are reserved for the Appropriations Bill (the state’s budget) and the first several bills in each chamber are reserved for the Speaker’s priorities and the Lt. Governor’s priorities, respectively. Last session it was the first 40 bills in the House, so the first bill filed on early filing day was HB 41, and the first 20 bills in the Senate, so the first bill filed was SB 21.

There’s no real particular legislative advantage to filing on the first day. Once the session gets going and bills sent to committees they are typically referred in batches of a couple hundred. The House and Senate will send the few hundred bills filed today to committee in the first couple of days of referral and the dozen or so bills filed tomorrow will follow them the same day or the next. Since the chairs of committees have almost complete discretion about when to schedule bills for hearings, a bill filed today could easily be heard in committee after a bill filed tomorrow or three months from now – or not at all.

So why bother to traipse up to Austin to file a bill the first day?

The bills filed today aren’t an indication of what’s most likely to pass next session, but they are an indication of what will be the major topics of conversation. Today’s bills represent the top priorities for lawmakers – and, since every media outlet that covers the lege will run a “what got filed on the first day of early filing” article they are more so the top priorities of the lawmakers who really know how to capture the media’s attention.

That’s from Daniel Williams’ blog, and he has several other posts devoted to first-day filings. Daniel knows legislative procedures like Scott Hochberg knows school finance, so do yourself a favor and read his blog.

The Trib has a good rundown on what has been filed so far. There are actually a fair number that run the gamut from “not bad” to “really good”, though take heed of Daniel’s advice about how little Day One means. There’s also some demagoguery, and more than a few bills making a repeat attempt at passage, including such things as a statewide ban on texting while driving and a bill to authorize online voter registration. New hot topics include a bill to life the cap on special education enrollment, and a bill to authorize and regulate ride-sharing at the state level. There were more than one of those bills; the one that I’d keep an eye on is SB176 by Sen. Schwertner, who has been talking about this since the Austin rideshare referendum. His press release on the bill, which covers the basics of it, has some bombast over that referendum and a bit of BS about how local regulations of rideshare companies were restricting competition, but the bill itself seems reasonable enough. It’s not too hard to see the writing on the wall for this one, and all things considered this approach seems to be workable. Ask me again after it comes out of committee.

Anyway. There’s plenty more out there, and this is of course just day one. In the end, thousands of bills will be filed, and the vast majority of them will die a quiet death. There will be plenty to keep an eye on between now and sine die. The Chron, the Trib, Trail Blazers, Dallas Transportation, the Current, the Austin Chronicle, the Rivard Report, and Out in SA have more.

Google enters the rideshare market

This will be worth watching.

Google is moving onto Uber Technologies Inc.’s turf with a ride-sharing service to help San Francisco commuters join carpools, a person familiar with the matter said, jumping into a booming but fiercely competitive market.

Google, a unit of Alphabet Inc., began a pilot program around its California headquarters in May that enables several thousand area workers at specific firms to use the Waze app to connect with fellow commuters. It plans to open the program to all San Francisco-area Waze users this fall, the person said. Waze, which Google acquired in 2013, offers real-time driving directions based on information from other drivers.

Unlike Uber and its crosstown San Francisco rival Lyft Inc., which each largely operate as on-demand taxi businesses, Waze wants to connect riders with drivers who are already headed in the same direction. The company has said it aims to make fares low enough to discourage drivers from operating as taxi drivers. Waze’s current pilot program charges riders at most 54 cents a mile—less than most Uber and Lyft rides—and, for now, Google doesn’t take a fee.

Some years ago, I remember reading a story in the Chronicle about Houston drivers cruising through the park-and-ride lots in the mornings to pick up passengers for the commute into downtown. They were doing this because having an extra person or two meant they could take the HOV lane, thus greatly reducing the drive time they’d face if they went solo, as they would have done otherwise. This was done more or less ad hoc – I’m pretty sure this was all before Facebook and smartphones were things – but it seemed to work pretty well. I bring it up because that’s what this story reminds me of; having the smartphone app and the financial backing of a behemoth like Google just formalizes what had been an ad hoc process borne of frustration and impatience. I have no idea how well this will scale outside of a unique environment like the San Francisco area, but if anyone can make it into something viable, it’s Google. Slate and the Associated Press have more.

How do other states regulate ridesharing?

The Texas Legislature would like to know.

Uber

As Texas lawmakers consider filing legislation next year related to ride-hailing companies, they learned Tuesday that more than 30 states have passed laws calling for some level of regulation of companies like Uber and Lyft.

A report presented by Texas A&M University’s Transportation Institute analyzed state and municipal regulations since 2012. It found that 24 states passed legislation requiring ride-hailing apps, sometimes referred to as transportation network companies, must apply for a state permit before operating. The report also found that 30 states require background checks on the driver before or a specific amount of time after the driver begins working.

Lyft

“Transportation network companies have expanded rapidly to cities worldwide,” Ginger Goodin, a senior research engineer and director at the institute, told House Transportation Committee members at a hearing Tuesday. “However, they do not fit neatly within our current regulatory schemes.”

[…]

According to Goodin, there is no statewide policy in the country that requires fingerprint-based background checks. The group did not look into the number of municipalities that require those checks.

“There are many questions and unknowns,” Goodin said. The institute expects to continue to research the ride-hailing companies in the future.

You can see a copy of the report here. It seems very likely we are going to get some kind of statewide Uber/Lyft bill, it’s just a matter of whether the bill is a complete sop to them or if it tries to balance their interests with those of the cities and existing cab companies. The two Transportation chairs – Sen. Robert Nichols and Rep. Joe Pickett – are decent, and the guy who introduced the statewide bill last session (Rep. Chris Paddie) took the process seriously, so if those three are among the main movers, it’ll probably be all right. Just keep the chuckleheads like Sen. Don Huffines away from it, that’s all I ask.

Rideshare companies in Austin are complying with its fingerprint requirements

Well, what do you know?

Uber

All eight of the ride-hailing companies operating in Austin met a city requirement to have at least half of the rides they provided in July come from drivers who passed fingerprint-based background checks, according to a city memo released this week.

Achieving that Aug. 1 benchmark — the first major regulatory milestone since the Proposition 1 election in May — shows how quickly the smaller competitors built their networks of drivers, even with the fingerprinting checks and other requirements that prompted Uber and Lyft to leave Austin.

Taken as a group, the smaller companies provided more than 350,000 trips in July, almost 11,300 a day, during what would normally be a slack period because enrollment is light at area colleges during the summer.

[…]

Lyft

The city since January has received 3,771 fingerprint-based, criminal background reports on potential ride-hailing service drivers, according to the memo from Austin Transportation Department Director Robert Spillar to the Austin City Council.

All of those, including those whose checks occurred earlier in the year, were vetted against a list of disqualifying criminal offenses set out in a June 2016 ordinance, Austin Transportation Department spokeswoman Cheyenne Krause said. Of those applicants, 86 were rejected for failing their background checks.

The companies, most of which still have some drivers working for them who haven’t been fingerprinted, reported having 8,985 drivers. However, the memo says, individual drivers might be counted two times or more in that total because many of them work for more than one of the eight companies: Fare, Fasten, GetMe, InstaRyde, RideAustin, Tride, Wingz and Z-Trip.

The companies, by city ordinance, had to by Aug. 1 have at least 50 percent of their rides for the preceding month provided by a city rules-compliant driver, either as a percentage of hours driven or miles driven. According to the memo, using information supplied by the companies, Wingz and Z-Trip were at 100 percent. RideAustin was next, at 89 percent, followed in order by InstaRyde (86 percent), Tride (73 percent), Fare (69 percent), Fasten (58 percent) and GetMe (55 percent).

It gets harder from here – by next February, 99% of hours driven or miles driven must be provided by compliant drivers. I suspect the city may wind up being a bit lenient on that, if the companies lag and it makes sense for them to do so, but we’ll see. Point is, the companies that are in Austin post-Prop 1 have cleared the first hurdle. Was that so hard? You tell me.

New study questions Uber effect on DUI

Interesting.

Uber

The introduction of ride-sharing services such as Uber and Lyft hasn’t had any impact on the number of fatalities related to drunken driving, a newly published study finds.

Researchers at the University of Southern California and Oxford University looked at the 100 most populated metropolitan areas, analyzing data from before and after the introduction of Uber and its competitors, and found that access to ride-sharing apps had no effect on traffic fatalities related to drinking alcohol.

Uber has repeatedly pointed to drunken-driving reduction as a benefit of its service. A 2015 blog post on its website, titled “Making Our Roads Safer For Everyone,” notes a survey Uber conducted with the group Mothers Against Drunk Driving that found anecdotal evidence that people believe their friends are less likely to drive drunk since the introduction of Uber.

[…]

In the latest study, published in the American Journal of Epidemiology, the researchers analyzed county-level data from 100 metropolitan areas in dozens of states and controlled for the effects of state laws that could affect drunk driving fatalities, such as bans on texting while driving, marijuana-related legislation and taxes on alcohol.

The authors also separated total alcohol-related traffic fatalities from those that occurred on weekends or holidays, and found no reduction in deaths with the introduction of Uber in either case.

So, why? The authors of the study speculated that drunk people might not want to shell out for the services.

The abstract is here; it looks like the full study is not freely available. I tend to give Uber and its ilk the benefit of the doubt here, as they do provide an option for people who may not have, or may not think they have, any alternative to driving. It may be a few years before we can feel confident in an answer to this. In the meantime, add this to the pile.

El Paso revises its rideshare rules

Uber gets its preferred regimen.

Uber

The El Paso City Council approved an ordinance designed to ease regulations and fees on taxis and ride-sharing companies like Uber.

Amendments to the Transportation for Hire Ordinance, which Council approved unanimously on Tuesday, requires all businesses have an operating authority permit and drivers pass a background check. It will also do away with 26 fees and cut costs up to 95 percent.

[…]

Other loosened regulations include no longer requiring drivers to have a medical certification and outdated two-way radios. City vehicle inspections will be eliminated and driver and vehicle permits will not be required. The age limit on vehicles has also been removed.

The newly-passed ordinance also requires companies to provide wheelchair-accessible vehicles upon request. That means Uber would have to have an agreement with a cab company to pick up a client if they did not have a vehicle available.

See here for a preview of the vote, and this story from May about the direction El Paso took in redoing its rules. They basically took the approach of easing or removing regulations that had been in place for traditional cab companies rather than retrofitting existing rules to Uber. And yes, that means no fingerprint requirements, which as you can see from that first story is not what the cab companies wanted. As is their way, Uber had threatened to leave El Paso if the rules weren’t changed; their triumphant press release following this action congratulates them for becoming “the 13th Texas city to adopt modern ridesharings rules”. One presumes Lyft has an interest in this as well, but as of today they don’t operate in El Paso, so we’ll see if that changes.

Fort Worth adopts minimalist rideshare regulations

This ought to be interesting.

Uber

Months of work redrafting the city’s vehicle-for-hire ordinance wrapped up Tuesday night when the Fort Worth Council approved new rules that require transportation companies only to register with the city.

The approach chosen by Fort Worth avoids more onerous regulations — including requirements for fingerprinting drivers — that proved problematic in other cities. And it gives Uber, Lyft and others the hands-off regulatory environment they had pleaded for in the city.

The City Council long ago began exploring how to cover the fledgling industry with an ordinance, only to realize months into the process that it didn’t want to regulate the transportation companies, saying smartphone app-based ride share companies had changed the business landscape.

Council members opted for free-enterprise and competition despite a last-minute plea from the traditional taxicab companies that wanted the city to continue to regulate their industry. Taxicabs have always been regulated, they said, and that’s what the public expects.

Jack Bewley, president of Yellow Cab, said the proposed ordinance did not ensure safety for the passengers. He warned the council the city could see an influx of one-man cab companies with owners who have criminal backgrounds and can’t get insurance.

“This ordinance is being set up where an individual … can come down here and say I want to start a taxicab company,” Bewley said.

Lyft

The council voted 8-0 to approve the new ordinance. Councilman Jungus Jordan was absent.

Mayor Pro Tem Sal Espino said the ordinance meets market innovation.

“Council, in articulating its vision for the regulatory framework, decided the best way is the free-market approach. At this point in time, in the evolution of the ride-sharing services and the transportation services, this is just another option. After much debate, after much discussion, we’re ready to move forward.”

Mayor Betsy Price said, “We just must embrace all forms of transportation to avoid gridlock in our city and allow our citizens to get around. Part of our job is to not cause undue burden on businesses or citizens. Unlike other cities that have gotten so hung up in the hot potato politics of this, Fort Worth is going to do it the right way.”

[…]

Under the new ordinance, which takes effect Oct. 1, companies, whether motorized or non-motorized, will pay a $500 operating license fee that’s good for two years. The companies will be required to annually certify that they have done national background checks on their drivers, that their drivers hold valid driver’s licenses and that drivers and vehicles are properly insured.

The ordinance does come with a strict penalty if the company is found not to be in compliance — it will lose their operating license for two years. Passengers can file complaints with the city.

Well, that’s one way to do it. I sent an inquiry to Uber about how Fort Worth’s ordinance differs from those in San Antonio and Dallas, and I was informed that while Uber’s screening process is the only mandatory background check for those cities, San Antonio offers drivers an opportunity to voluntarily undergo a fingerprint background check, and drivers in Dallas are required to obtain a City permit. The only additional step drivers are required to complete to obtain that permit is undergoing an additional vehicle inspection.

It will be interesting to see what the response is when the inevitable problems arise. Bad apples will always slip through, as they have done in the pre-Uber days, and some of them will turn out to be the kind of person you’d really want to be the kind of person to be identified by a background check as a bad risk. It’s Fort Worth Mayor Betsy Johnson and the members of their City Council who would face any consequences from this. It could easily be overblown by sensationalist news coverage, but if something bad does happen, it could really blow up. Just something to keep an eye on, and to keep in mind as the legislative session approaches.

Not addressed by this story is the question of access to rides for people with disabilities. One of the reasons why cab companies have been regulated the way they are is because they have a mandate to provide service for residents who can’t get themselves around town. How will that work under this structure? In Houston, Uber agreed to provide a certain number of vehicles that can accommodate people with disabilities, and in their more recent threat to leave they stated that accommodations for the disabled could be achieved under a regulatory scheme that was more to their liking (scroll to the bottom). In some cities, this UberACCESS service has partnered with transit agencies as well. What responsibilities do rideshare and traditional cab companies have in this new environment? There’s already litigation over the issue of disabled Texans being denied service by rideshare companies. I’m sure they’ll be watching what happens in Fort Worth with great interest.

All that said, this could work out fine. It may be that the issue of access for disabled folks will continue to be addressed in a way that is acceptable to all, and it may be that the number of problems with drivers of questionable backgrounds is vanishingly small. This will certainly provide fodder for that debate. It’s not the approach I would take, but that doesn’t mean it’s wrong. We’ll just have to see how it goes. The Chron has more.

Lawsuit filed in Austin over short-term rental ordinance

Geez.

The gig economy — specifically, the short-term rental industry that includes HomeAway, Airbnb, and VRBO — is under attack by the city of Austin, Texas, according to a lawsuit filed in state court June 20, which was sponsored by the Texas Public Policy Foundation.

The lawsuit asks the court to issue an injunction halting the enforcement of an Austin city ordinance, which became effective March and governs short-term rentals.

The seven plaintiffs named in the lawsuit are people who either have sought to stay in short-term rental properties or to ease their residential properties for less than 30-day periods.

Neither the short-term tenants nor their landlords engage in any activities that should cause them to lose their rights to privacy and to assemble freely, according to Robert Henneke, general counsel for the Center for the American Future at TPPF.

But the lawsuit alleges that Austin’s short-term rental ordinance violates precisely those rights of the tenants and landlords.

Specifically, the ordinance bars the gathering of more than 10 people inside the short-term rentals and more than six in the front or backyards of the homes. It also limits to sleeping or “any joint activities” in the homes after 10 p.m.

The ordinance also requires the landlords and tenants to permit law enforcement officers into their homes to “enter, examine, and survey, at all reasonable times, all buildings, dwelling units, guest rooms, and premises,” even if the officers don’t present a search warrant.

The ordinance represents part of a trend that allows for the “Californization” of the central Texas city or a region where more government regulation, rather than less, is the norm, said James Quintero, director of the Center for Local Governance at TPPF.

You can see a copy of the lawsuit here, via the Austin Business Journal, which also provides some info about the rental ban, which passed in February. I know nothing about this saga, but I do know that aside from a few stray criminal justice issues, the TPPF is wrong about pretty much everything, in particular matters relating to government regulation. Which doesn’t mean they can’t or won’t prevail in court, of course, just that one should never expect them to be on the side of the greater good. The state of Texas does not currently play a role in regulating short-term rentals. Given this action, I won’t be surprised to see some kind of statewide AirBnB bill pushed in the next legislative session, in the same way that a statewide Uber/Lyft bill is being touted; the TPPF name-checked Uber and Lyft in their statement, so you can see how that will play out. The Statesman has more if you have access to their premium content.

Rep. Isaac asks FTC to step in on Austin rideshare regulations

Seriously?

Rep. Jason Isaac

State Rep. Jason Isaac has asked the Federal Trade Commission to investigate Austin’s rules for ride-hailing companies, raising concerns that the city’s “burdensome regulations” are anti-competitive.

In the letter dated June 7, Isaac said he thought the city “erected a pernicious barrier to competition” through its rules, which have become a point of contention in the statewide discussion about which layer of government should ultimately regulate the industry.

“I think this turned into an immature battle that left some people really scared and things were done out of a vindictive nature,” Isaac, R-Dripping Springs, said in an interview Thursday. “I personally believe that this is anti-competitive in nature, but I want to ask the FTC if they think it’s anti-competitive.”

[…]

In his letter, Isaac suggested the Austin City Council knew adopting the fingerprinting ordinance would spur Uber and Lyft to leave the city and, in turn, would “return the marketplace” to taxi companies.

“Despite knowing the ramifications of their vote, the Council added burdensome regulations and put the city at risk,” Isaac wrote.

Jason Stanford, a spokesman for Adler, said the city wants to have ride-hailing services.

“Nothing we’ve done would prevent Uber and Lyft from operating now in Austin just as before, and they are welcome to come back at any time,” he said in a statement. “All such companies operating here would be entitled to receive the same kinds of support and encouragement.”

You can read Rep. Isaac’s letter to the FTC here. Putting aside the absurdity of a Tea Party legislator calling in the Federal Government to intervene in a local matter – does Rep. Isaac want someone to pin a “Primary me!” sign on his back? – there’s the small matter of ridesharing startups sprouting in Austin like bluebonnets in March since the Prop 1 vote and subsequent Uber/Lyft pullout. How terrible can these regulations be if new options keep appearing in Austin (here’s another one!) seemingly every week? I pity the poor FTC official who will have to reply to this silliness with a straight face.

Another lawsuit filed over Prop 1 ballot language in Austin

Sure, why not?

Uber

It’s Uber Zimmerman!

Litigious District 6 Councilman Don Zimmerman sued Mayor Steve Adler in his official capacity Thursday, challenging the outcome of the Proposition 1 election on the grounds the ballot language “misled voters and omitted main features” and did not conform to the required format, case caption information shows.

A copy of the lawsuit, apparently filed late Thursday, was not immediately available.

“I’m deeply concerned about how the process, about how that went down,” Zimmerman said, late Thursday. “What I noticed from the campaign is that both sides were confused by the ballot language — the people for it and the people against it.”

If you’re keeping score, this is the second lawsuit filed over ballot language; there are also lawsuits over the use of automated text messages sent during the campaign, and over claims that Uber and Lyft’s exit violated federal labor law. The full Statesman story adds some further details.

A statement from the city of Austin defended the ballot measure and its language, saying, “The City Council respected the citizen-initiated petition process and voted to call a May election. The council made every effort to ensure that the ballot language fairly represents the petition’s intent.”

“The city prevailed in the pre-election lawsuit filed on this same topic, and is prepared to defend the actions it took as part of this election process,” the city’s statement said.

Zimmerman and his lawyer, Jerad Najvar of Houston’s Najvar Law Firm, argue that “the City’s much-touted fingerprint background check regime” will be enforced too slowly and “lacks any enforcement teeth” even once it’s fully implemented.

[…]

Zimmerman and Najvar asked in the suit that their complaint be consolidated with any other challenge to the same election to conform with a requirement under state law. They specifically cited the May 10 suit brought by Austin lawyer Martin Harry, who also objected to the city’s ballot language.

I still think the ballot language argument is dumb. Honestly, was there anyone in Austin who didn’t understand that Uber and Lyft wanted you to vote Yes on Prop 1? The proposition itself could have been written in Esperanto for all that it mattered. But as always, you never know what will happen once this sort of thing gets inside a courtroom. Engadget has more.

What’s the roadmap for ridesharing regulations look like?

This is going to be a challenge, no matter how you feel about it.

Uber

Several state legislators have made it clear they’re eager to take control of rules for ride-hailing companies in Texas, shifting power from individual cities to the state. But with six months until the next legislative session, there’s no clear consensus on how exactly to go about it.

The Legislature has tried before — and failed — to come up with statewide regulations sought by industry heavyweights Uber and Lyft to free them from conflicting local rules.

But the recent decision by voters in Austin — the conservative state’s liberal capital — to reject rules sought by the ride-hailing giants has been a rallying cry for lawmakers.

“We don’t live in a democracy,” said. Sen. Don Huffines, R-Dallas. “All the authority cities have comes from the Legislature. They exist by the mercy of the Legislature. So we have a distinct role in overseeing all political subdivisions that we create, and we’ve got to make sure that they don’t trample economic liberty, personal liberty and freedoms.”

After the Austin election, Huffines immediately called for state regulations, or what he called “deregulations,” and was unconcerned with overriding the will of local voters.

Lyft

“People get riled up, and they pick up their pitchforks and they run to the ballot box or they run to the barn and tar and feather or lynch someone,” he said. “We have rules of law relating to protecting the views of the minority.”

Huffines wasn’t the only state legislator whose ears perked up at news that Austin voters upheld city rules for ride-hailing companies over those backed by Uber and Lyft. His Senate colleague, Georgetown Republican Charles Schwertner, also pledged to draft legislation.

“We’re exploring all options,” Schwertner said. “There’s the background check and then there’s fingerprinting, those are two separate issues. There’s competing discussions … I personally have not made any decisions as to what is the best statutory language to put in the bill.”

[…]

For Schwertner, the layered concerns of ride-hailing companies, drivers, riders and municipalities indicate that statewide regulations would be the best route forward.

“I think the safety issue in my mind is paramount,” he said, pointing to concerns with drunk driving. “[There is] the mobility issue, economic issue — it’s multi-tiered. It’s not just a local control versus state regulation issue. It’s all those things. When you look at the totality of the concerns, it favors statewide, uniform, consistent and fair regulation.”

I’m glad to hear that from Sen. Schwertner, since his initial statements following the rejection of Prop 1 were mostly bombast. I’m still not convinced that the Legislature needs to step in on what has traditionally been a local issue, but if we can have a reasonably serious discussion about what we want ridesharing regulations to accomplish, and if we can get Uber and Lyft to be more forthcoming with their data, then this could be a positive experience. My personal preference, if this must happen, is for the state to provide a minimum set of standards that cities and counties are then allowed to add onto as they see fit. And if we really care about having a free market and not just a greased skid for the two major players, then let’s be sure to not impede the new players who are trying to fill the niche that Uber and Lyft voluntarily left behind.

On the matter of overriding municipal ordinances, that appears to now be on the table:

After a visit Wednesday from top Uber brass, Texas state Rep. Joe Pickett, D-El Paso, appeared to soften his position against a possible statewide bill that would replace city ordinances regulating rideshare companies.

As the chairman of the House Transportation Committee, Pickett’s position on the matter is crucial. Any bill regulating how companies such as Uber screen their drivers likely would be assigned to his committee, where Pickett would have power to block them.

[…]

Immediately after [the Austin Prop 1 rideshare vote], two Republican lawmakers said they would introduce bills in the 2017 legislative session that would overturn fingerprint requirements in Austin and Houston. Pickett said he would oppose such bills since they would thwart the will of local voters.

However, the El Paso lawmaker this week said there might be some room for compromise.

Houston Chronicle business columnist Chris Tomlinson in May speculated that the real reason Uber and Lyft are opposed to fingerprinting drivers is that their turnover rate is so high that many drivers won’t wait the 10 or so days it takes for the checks to be completed.

An Uber spokeswoman Thursday did not respond directly when asked if that is the case.

But Pickett said that on Wednesday he discussed a compromise with Uber brass that might solve that problem. Under it, riders could specifically request drivers who had undergone fingerprint-based FBI background checks.

“I told them that on the surface, it seemed like a hybrid that could work,” Pickett said.

Pickett goes on to say that he’d want to see if this idea is acceptable to cities and his colleagues first. It’s also not clear if Uber and Lyft would go for this; the basic idea has been floated in Austin with no apparent interest. There’s still a lot of moving parts here, and it’s not clear what if anything will be the consensus position, or at least the position that a majority will approve.

On a side note, good Lord is Don Huffines an idiot. Please, Dallas Democrats, find someone who can run against him in 2018. I know that’s an off-year and all, but his district isn’t that red. Even in the dumpster fire of 2014, SD16 was what passes for competitive, with Greg Abbott leading Wendy Davis by a 57.5-41.0 margin; not close, obviously, but slightly less Republican than the state as a whole. Please find a decent candidate and put some money into that race. Surely we can do better than this.

What a free market in ridesharing looks like

It looks like Austin right now.

Uber

When Uber and Lyft left Austin last month, they thought they were sending a message to the Austin City Council and other local governments looking to regulate them. Instead, their departure may pave the way for a revamp of ride-hailing in Austin that could draw the notice of other cities.

At least six new companies have launched in Austin, all emerging from the ashes of the Proposition 1 election that left the capital city without the two industry giants in vehicle-for-hire apps, which are also sometimes referred to as transportation networking companies.

“What [Uber and Lyft] have left us with appears to be the only open TNC market in a major city in the world, maybe,” said Austin Mayor Steve Adler. “In the marketplace, when you have a monopoly, or in our case a duopoly, that leaves town, what you would expect to see in the market is innovation and competition. And that’s what we’re now seeing happening in Austin.”

[…]

While other companies offering similar services had operated alongside Uber and Lyft, none had seen anywhere near the same level of success. An estimated 10,000 drivers found themselves out of work after the two companies ceased operations.

Newer faces have quickly flooded the market. There’s Arcade City, getme and Fare. There’s also Fasten, Wingz, zTrip and RideAustin. And InstaRyde will have its official Austin launch later this week.

Many of these companies, most of which have business models similar to those of Uber and Lyft, are still finding their footing, rushing to get drivers on the road and apps on Austinites’ phones in the race to emerge as the face of peer-to-peer transactions in the city. Some sprouted roots in Austin before Uber and Lyft left but have seen a recent boost in business.

Yet all of these firms still operate in the shadow of the two ride-hailing giants, struggling to distance themselves from their competitors while still offering comparable services. Even now, it’s unclear if any of these new companies will be able to offer the same level of coverage or see similar success.

[…]

Despite the turmoil from the election, Adler said he stands by the council’s decisions, even as the fallout has captured national attention.

“I have talked to mayors from around the country about this issue,” Adler said. “My position on this is that cities need to be as innovative and creative as are the industries and businesses and economies that it intersects with … There’s a suggestion that what’s happened here demonstrates that Austin is not an innovative city, and I don’t think what happened here indicates that at all … Austin is where ideas go to become real.”

Adler said it was unclear what the ride-hailing environment will look like down the line, but he said he is certain there will be “choices operating at scale in the city.”

The future could depend on whether the Legislature decides to take action on the issue next year. Immediately following the departures of Uber and Lyft, Sen. Charles Schwertner, R-Georgetown, said he will file legislation on the issue next session that emphasized a free market. Other GOP lawmakers expressed similar concerns on social media after the election.

Adler said while statewide regulation is “certainly an option” the Legislature can use, the atmosphere in Austin has already significantly shifted since the election.

“I think that when some of the legislators initially spoke, it was uncertain as to whether or not Austin had adopted something that would prevent the market to function,” Adler said. “I would say the evidence at this point would at least suggest that the market is working well.”

There’s little the Legislature can do until the 2017 session, but the House Committee on Business and Industry is holding an interim hearing on Wednesday to discuss “how Texas can support shared economy growth in the state.” Uber General Manager Sarfraz Maredia has been invited to testify.

In the meantime, the future of Austin ride-hailing will be determined by the market, Adler said, “as opposed to government deciding.”

Boy, wouldn’t that be a kick in the pants? I wonder if Sen. Schwertner and his Republican colleagues will recognize it if it is happening. I’ve been harping on all this for awhile, so I’ll try to restrain myself here. I don’t expect all these companies to be successful – frankly, if one or two of them make it, that will be great. Austin represents a unique opportunity for these companies. Let’s see what they can do.

Former drivers sue Uber and Lyft over leaving Austin

This ought to be interesting.

Uber

A pair of former drivers for Uber and Lyft filed dual class action lawsuits Thursday against the ride-hailing companies over their abrupt exit last month from the Austin market.

The lawsuits, filed in the U.S. District Court in the Northern District of California, claim that Uber and Lyft violated the federal Worker Adjustment, Retraining and Notification Act when they pulled out of Austin in May because they failed to properly notify their employees. Uber and Lyft have long maintained that their drivers are independent contractors and not employees.

[…]

Lyft

Todd Johnston, the driver behind the suit against Uber, drove for the company since May 2015 while David Thornton, the driver on the Lyft suit, drove for Lyft since October 2015. According to the suits, Johnson and Thornton, along with other Austin ride-hailing drivers, “lost their jobs” after the companies left Austin.

“Lost in the political theater surrounding the Uber and Lyft versus Austin City Council battle was the real-world effect on the thousands of Austinites who suddenly lost their incomes when Uber and Lyft abandoned Austin,” said Michael Slack, an attorney for Johnston and Thornton.

The federal notification act cited in the suits requires employers to notify their employees before any mass layoffs or the closure of a “facility” or “operating unit.”

I Am Not A Lawyer, so I have no idea if this suit has any merit or not. We do know, as the story says, that Uber and Lyft are very adamant about the whole worker-classification thing, so you can be sure that will be a key to their argument against the plaintiffs. How successful they are, and how successful the plaintiffs are at getting terms like “facility” to be interpreted in their favor, will determine how far this gets. Any actual attorneys want to comment on this?

First rideshare legislative hearing

There will be a lot more where this came from.

Uber

Representatives from Uber and Lyft urged lawmakers to adopt statewide regulations for the ride-hailing industry during a Texas Capitol hearing on Wednesday, citing what they called burdensome local ordinances that have driven them to leave Austin and other Texas cities.

The companies fielded pointed questions from members of the House Committee on Business and Industry about safety concerns and how local regulations, like those in Austin, impact their operations.

“I think we first need to recognize the obvious – technology is changing our lives,” said Committee Chairman René Oliveira, D- Brownsville, at the start of the hearing. “These changes are going to be very profound; you’ve already seen that in Austin … but this is not just an Austin, Travis County issue.”

Currently, regulations for ride-hailing companies are handled on a city-by-city basis. The Legislature discussed potential regulations during the 2015 session, but those bills failed to gain any traction. Now, several months ahead of the next session, lawmakers are revisiting the issue after Austin citizens voted in May to keep in place a requirement for ride-hailing drivers to undergo fingerprint-based background checks.

[…]

Lyft

Oliveira said while he tends to favor local control, “there are some issues that demand state intervention.”

“I am neutral on this issue,” he said. “What I am concerned about is finding out the necessary facts to determine – is this an issue that the state of Texas should get involved in or is it an issue of local control?”

During the hearing, he asked both [Rena Davis, a public policy manager for Lyft] and Sarfraz Maredia, the general manager for Uber in Texas, if they had data to support claims that they offer safer rides than taxis. Neither Davis nor Maredia provided specific numbers, to the frustration of the committee.

“I can’t believe [Lyft] or Uber doesn’t have data that we could look at that involves drivers and what the incident rate is,” Oliveira said, referring to the number of violent encounters between drivers and riders.

Both Maredia and Davis assured the panel they would provide lawmakers more information.

So let’s talk about regulations and transparency. After that post was publushed, Uber pointed me to this safety report on their website that goes over their criteria for background checks and what causes a potential driver to be eliminated. I appreciate the feedback and commend them for making that public. I also have this memo from Sarfraz Maredia on Uber’s safety procedures, as well as Maredia’s written testimony to the committee. A lot of what’s in those documents are things we have heard before from Uber, though perhaps not as much lately as the argument has largely defaulted to “do it our way or we’ll leave and then you’ll be sorry”. The thing is, I think Uber and Lyft could have done a lot better in Austin if they had focused on the things they do for customer safety instead of bludgeoning everyone to death with nonstop misleading ads and automated text messages. They could still gain some ground, in Houston and in Austin if they want to, by going back to that emphasis on their methodology and by being forthcoming with their data to back up their claims. Show us the numbers, on how many drivers they reject and for what reasons, compared to the cities, and how many incidents per capita there are in cities that do it their way versus cities that impose “unnecessary” regs on them, however they want to define that. If the cities in question can’t or won’t provide adequate data to allow them to make the comparisons, then so much the better for them and their argument that the cities are making them jump through hoops for no good cause. And if some of the numbers don’t show them in as positive a light as they’d like, be honest about it and see what can be done to improve. These guys say they’re bold innovators leading the way to a better future, well then do the math and show us the analytics to prove it. I promise to keep an open mind.

Since the Austin election and Uber and Lyft’s departure, startups and smaller ride-hailing companies have swarmed the city and its newly open market.

One company that has seen success in the capital city is getme, which has offered rides since December. The company’s founder, Michael Gaubert, told lawmakers Wednesday the company opposes statewide regulation of fingerprint background checks .

“The notion that there should be a state law ban on fingerprinting is not the correct way to go on this,” said Gaubert, who was joined at the hearing by former Dallas Cowboys player Michael Irvin, who he described as a close friend.

But lawmakers seemed committed to pursuing some sort of regulation next session, particularly Rep. Jason Villalba, R-Dallas, who cited concerns with the “patchwork quilt” of regulations across the state.

“It may not get to the governor,” he said of potential legislation, “but we’re going to try something.”

It would be nice to think that the Lege will look at the data and put forth reasonable proposals to address what can be done while allowing cities to take the steps they need to get the service they want. I doubt that’s what will happen, but it would be nice to think. Trail Blazers has more.

What do we really want from rideshare regulations?

From Medium:

Uber

To help ensure people have a fair chance at earning a living, Uber’s screening process embraces protections codified in the Fair Credit Reporting Act and other similar laws, ensuring lookback periods are reasonable and arrests without convictions or charges are not considered, among other indicators. We have said time and again that fingerprinting may not be the best way to determine whether or not someone is qualified and able to provide a safe and reliable ride. Further, there’s no evidence to suggest it would improve safety for passengers and it has costs to privacy that other approaches to background checks do not.

We believe the right path forward is to continue to improve the level of transparency and accountability that’s built-into our service and the processes available for screening drivers. Instead of relying solely on flawed databases that are known to have information gaps, our technology makes it possible to focus on safety before, during and after every trip.

When so many people’s lives are deeply affected by their inclusion in a potentially faulty database, it’s important that the public has the time and ability to analyze what’s in it and how it’s being used. We hope the DOJ and FBI not only grant these groups’ well-warranted request for an additional 30 days to comment on its proposal but also, consider the quality of the database and whether or not people should know how it may affect their lives.

From Jay Aiyer, in the Chronicle:

Historically, taxis have been one of the most heavily regulated local industries. City governments have restricted everything from the number of taxi licenses issued to whether a driver can use a cellphone while operating a vehicle. The list can be quite long and intrusive. Ride-sharing companies often argue that these regulations are unnecessary. After all, no other industry is subject to this level of restriction. Municipalities place no restrictions on the number of fast-food restaurants, nor do they require background checks for cable employees entering people’s homes. So why vehicles-for-hire?

The simple reason is the quasi-public function they serve. While private businesses, vehicles-for-hire serve a distinct public transportation function that is unique and still necessary in our society. They are an extension of the city in welcoming visitors, transporters of last resort for transit-dependent populations, and a critical safety valve for impaired drivers. They are simply not the same as a fast-food franchise or the cable company. They are a critical part of a community’s transportation network.

If we accept the need for some restrictions, the obvious question is: what kind? Public safety, access protections and insurance requirements seem obvious. We have a high expectation of safety and security when using a vehicle-for-hire, and having fingerprint-based criminal background checks to determine basic eligibility to drive is important. But even those restrictions should be relatively limited.

While we can agree we don’t want those convicted of serious crimes driving, we need to be more flexible to allow individuals who have paid their debt to society to be employed. Similarly, having broad insurance requirements is a critical need to ensure general public safety and avert catastrophic medical costs. We can’t have accidents with uninsured passengers or drivers. Finally, there should be no debate over the need to protect access to transit services. All people, regardless of neighborhood, should have access to vehicle-for-hire services.

So let’s talk about fingerprints for a minute here. Everyone agrees that there are some people we would rather not have driving cars we pay to ride in. We do background checks, which include checks of criminal records, to try to identify these people that we want to exclude. Fingerprints are an obvious entry point to this data. I presume there are others, for if not then I’m honestly unsure how Uber and Lyft can claim to check these records, but assuming there are then the argument we’ve been having is mostly about whether this is the most effective way of looking at arrest and conviction information.

The discussion we should be having comes back to that question about who we want to keep out of the driver’s seat. Ideally, that should involve a risk assessment of some kind. Not all criminal records are created equal. Violent crimes are a big red flag, but it’s also reasonable – our national conversation about drug reform notwithstanding – to prefer to not have people with drug convictions serve as drivers. There’s also a difference between being arrested and being convicted, and between recent arrests and those that happened ten, twenty, thirty years ago. How do we assess this information and come to reasonable, consistent decisions about who we grant permits to and who we refuse them to? And if we’re going to argue about what if any role fingerprints should have in this process, then it would greatly help to know how Uber and Lyft arrive at their conclusions about those who apply with them. What are their criteria for determining who’s in and who’s out? If they want us to trust them, we need to know that.

As I say, this is the discussion we should be having. It’s hard to do in an environment where a key stakeholder refuses to engage beyond “let us do it our way or we’re outta here”, but that’s where we are. To be sure, the current process mandated by the city could be improved, to make it more convenient and less time-consuming for would-be drivers. I don’t know the specifics so I’ll skip the part where I make suggestions, but I’m sure if Uber or anyone else wanted to make their own to the city, they would be amenable to them. It would help if Uber backed down from the ultimatum first, of course. You know, as a show of good faith. I for one would like to see Uber and Lyft and some other competitors operate in Houston. I’d also like for us to come to a consensus about who we do and don’t want doing the driving. I feel like if we can do this, the rest will follow. Who’s with me?

In the meantime, the State House Committee on Business and Industry is holding a hearing in Austin on Wednesday at 10 AM to discuss the sharing economy. Uber General Manager Sarfraz Maredia has been asked to testify, as have representatives from Houston and Dallas. A livestream of the hearing can be seen here. I’ll be very interested to see the reporting on this.

RideAustin

Another new player gets set to enter the Austin rideshare market.

Adding to the growing number of ride-hailing options in Austin since Uber and Lyft’s wholesale evacuation, a new nonprofit, community-based app called RideAustin was introduced today at the Alamo Drafthouse on South Lamar.

The app is being described as “innovative,” as well as made “by Austin, for Austin,” according to Joe Deshotel, RideAustin’s PR representative.

The initiative is a collaboration of Austin-based tech entrepreneurs and community leaders, for service that “[brings] the community together to build local solutions for Austin’s ridesharing future.” Formed as a nonprofit, and led by billionaire Austin tech giant and Trilogy founder Joe Liemandt and Crossover founder Andy Tryba, RideAustin’s overarching goal to become a “community asset,” per Deshotel, begins with uniting tech advancement with social responsibility.

Only two weeks in the making – Deshotel himself joined the group a week ago – the app joins Get Me, zTrip, Wingz, and still-in-the-works Warp Ridesharing. The RideAustin app will go live for iPhone users this morning, with service starting in June. (The Android version of the app is also expected to roll out in June.) Prospective drivers can start the on-boarding process, and get themselves scheduled for fingerprinting.

Blue-sky success would involve a smooth scale out from its initial services areas: the Austin-Bergstrom International Airport and the Downtown area, for which exact parameters haven’t been set. Not having “to worry about shareholders” as a nonprofit, it “will allow drivers to earn more [RideAustin will take a smaller than industry-standard commission] and riders pay less while helping local charities.”

Initial ride pricing itself is unknown, but unlikely to be as low as Uber and Lyft, at least to start. As reported previously, the best current option, Get Me, has been struggling with driver/rider matches, often forcing riders to wait longer than 10 minutes – Uber took an average of three minutes – and pay significantly higher prices.

Two unique RideAustin app features include a fare roundup option and “optional surge pricing,” says Deshotel. The fare roundup feature would allow riders round their fares up to the next dollar over the fare, to be given to a choice of as-yet-determined charities.

The more interesting (and potentially problematic) feature, optional surge pricing, would allow riders to opt-in to surges, allowing them first ride at premium cost. Riders electing not to opt-in, or financially unable to do so, will remain in driver queues, placed behind those accepting surge pricing. Though RideAustin is surely a business in all contexts, even with its additional aims at targeting the underserved and disabled, locating balance will be paramount, and could throw its first-look presentation as community-facing into immediate question.

Having this be a nonprofit is an interesting variation, and while I’m not exactly sure how well that will work, I see no reason why it can’t work. The point is that we should all hope that at least a couple of these new ventures find success, which they are then able to bring to other cities. I’ve heard an awful lot about the “free market” in ridesharing over the past several months, but the truth is that the rideshare market was and currently is entirely dominated by two enormous firms. That’s a “competitive” market in the same way that the broadband and cable/satellite TV markets are competitive. Surely that’s not what we really want here, right? I’ll say again, the single best outcome here is for multiple viable alternatives to Uber and Lyft to emerge. That would be good for riders, good for drivers, and good for city governments that don’t want to be held hostage by a couple of would-be monopolists. The Statesman and Buzzfeed have more.

San Antonio to re-revisit its rideshare requirements

Just when you thought it was all over

Uber

With Transportation Network Company (TNC) tension looming from Austin and Houston, the City of San Antonio is preparing its push to renegotiate with ride-hailing companies such as Uber and Lyft. And one of the officials taking the lead on the talks believes they’ll be a model for other municipalities to follow.

“It’s important that we move forward and set the example. And I think we’re about to for the entire state and possibly the entire country,” said City Councilman Roberto Treviño at a meeting of the City Council Governance Committee. Treviño has spearheaded much of the City’s negotiations with TNCs.

Lyft and Uber left San Antonio in March 2015, after City Council mandated that drivers undergo fingerprint background checks. After a spring and summer without the services, a 9-month pilot compromise was struck to bring them back: The checks were made voluntary, with the City footing the bill for those who wished to undergo them. If a driver submitted to a fingerprint background check, they’d receive a special designation on the app’s screen.

The deal was portrayed as a win for consumer choice and TNCs alike. But few drivers have undergone the voluntary checks. There’s also no way to specifically hail a driver with a fingerprint background check, so passengers who want one must repeatedly hail a ride, then cancel it until they’re picked up by a fingerprinted driver.

Councilman Joe Krier said he hadn’t heard of “a single … bad experience with Uber or Lyft” from constituents. But Councilman Mike Gallagher expressed concerns over if citizens understood how to identify whether a driver has passed the fingerprint check.

“I almost wonder if we need to strengthen the ordinance with something that says ‘Caution: Driver has not passed fingerprint background check,'” Gallagher said.

See here for the background. If you live in San Antonio, there are a couple of public meetings scheduled to discuss this; see the link at the top for more details. One such meeting has already happened, and there’s also an online survey you can participate in. The operating agreements with Uber, Lyft, and GetMe expire in the next few months, with the GetMe one the lasting until October, but it looks like they will all be allowed to go through then. For all the sturm und drang in Austin, I’d say this is the situation to watch. if SA and the TNCs can come up with an agreement that is broadly acceptable to all, including the cab companies, then that could serve as a starting point for Austin and Houston, if they are inclined to redo their own ordinances. If not, well, that will add to the impetus for the Lege to butt in. We’ll see how it goes. Texas Public Radio, San Antonio Magazine, and the San Antonio Business Journal have more.

Abbott comments on Austin rideshare referendum

Sort of.

Uber

Gov. Greg Abbott said Monday the fight is not finished when it comes to regulations in Austin that have driven ride-hailing companies out of the state capital.

“The issue’s not over,” Abbott said in an interview on CNBC. “Republicans in the Texas Legislature have already raised proposals coming up in the next session to override the Austin vote.”

Pressed on whether ride-hailing companies Lyft or Uber would return to Austin, Abbott said: “I’d just say the game is not over. It’s halftime, and we’ll see what happens in the second half.”

Lyft

[…]

In the CNBC interview, Abbott was read a tweet from venture capitalist Paul Graham that said “Austin has zero chance of being a serious startup hub without Uber and Lyft.” Abbott denied that, saying the city is “already a dynamic startup hub.”

“That process has already left the barn, as we say in the state of Texas, and there’s nothing that will slow it down,” Abbott said. “And the dynamics that’s causing Austin to be a startup hub are already in place and will not be diminished by” the Proposition 1 vote.

As we know, legislation has already been proposed to enact statewide ridesharing regulations, though whether such a bill (if it passed in the first place) would include fingerprinting requirements or not remains an open question. Normally, one doesn’t have to parse Greg Abbott’s words closely, but I can’t tell from this story where he really stands. Is this a priority for him? Is he anti-fingerprints? Unclear at this time. I’m not sure if that’s because Republicans are not of one mind when it comes to fingerprinting, and Abbott wants to see how the wind is blowing before he commits himself, or if it was just a vague question asked by an idiot CNBC host that wasn’t designed to elicit a specific answer. In any event, Abbott and Dan Patrick don’t have to single this out as a priority to get a bill to pass, but if they do it increases the likelihood of it happening.

Lawsuit filed over Uber/Lyft referendum language

Oh, for crying out loud.

Uber

Attorney Martin Harry filed a lawsuit — a draft of it was obtained by the American-Statesman — in Travis County state district court late Tuesday contesting the election’s outcome, alleging that the city violated election law by combining what should have been two ballot questions into one.

“I don’t think the voters knew what they were voting on,” said Harry, who is representing himself in the case.

He said voters should have been asked first whether they would like to keep or reject the city’s controversial 2015 ordinance and then whether they accepted Uber and Lyft’s replacement language. He also alleges that the ballot language drafted by the city staff did not match the instructions given by the City Council.

“While we are disappointed to be involved in litigation regarding last week’s election, and would rather be working with companies to help them provide safe and efficient transportation services, we are prepared to defend the lawsuit,” city Law Department spokesman Bryce Bencivengo said.

Lyft

The lawsuit left Austin-based election lawyer Buck Wood stunned.

“I truly have never seen anything like this in my 40-plus years of doing election law,” said Wood, who reviewed a copy of the draft complaint for the Statesman. “I don’t think the court has any jurisdiction to throw it out on the ballot language.”

He added, “I don’t think he’s got a lawsuit here.”

Harry’s lawsuit asks a court to block the city from enforcing the ordinance that the City Council approved in December — which requires fingerprint-based background checks of drivers with ride-hailing apps, among other measures — unless another election is held.

I don’t care about any of the legalistic argle-bargle here. I just have one simple question: Is there a sentient human being anywhere on the planet who was unaware during the leadup to this election that a Yes vote on Prop 1 is what Uber and Lyft wanted, and that a No vote on Prop 1 is what Uber and Lyft did not want? The millions of dollars that Uber and Lyft spent on this election – which by the way included a number of phony claims about Prop 1 – all carried the message of “vote Yes on Prop 1”. That in a nutshell is what this race was about, and as such it is all anyone needed to know. If this lawsuit goes anywhere, it will be an utter travesty.

Yeah, we’re still talking about the Austin rideshare referendum

The tech community was as divided as everyone else.

Uber

Joshua Baer, founder of Capital Factory, the downtown technology incubator, has been a critic of the proposed regulations. He said he believes the vote sent signals that Austin is hostile to startups.

“Losing Uber and Lyft is a major setback to our reputation as an innovative city and technology hub that is already impacting decisions made by venture capitalists and Fortune 500 executives,” Baer said Monday. “It’s critical that the tech community and City Council come together… before our reputation is damaged further.”

But others scoffed at the notion that the Prop 1 vote could do any long-term damage to Austin’s entrepreneurial reputation. Austin economist Brian Kelsey said the vote is unlikely to have negative ripple effects on startups.

“Prop. 1 may be a setback in how the outside world views our seriousness in local policy making, but branding Austin as ‘anti-innovation” is ludicrous,’ ” Kelsey said. ” If the existence of two ride-sharing companies locally has an impact on your business model, then I’d say Prop. 1 should probably be the least of your concerns.”

[…]

Initially, many tech workers and entrepreneurs said they thought the vote would get industry support because of general opposition to more regulation of emerging technology business models.

But they now say Uber and Lyft’s aggressive marketing tactics derailed the discussion.

“I think it backfired in the tech community,” said Austin entrepreneur Richard Bagdonas, who supported the proposition. “I have talked to many people who said ‘I’m pro-Uber and pro-Lyft, but the number of flyers, calls and texts I received pushed me over the edge.’ ”

Lyft

[…]

Turnout for Prop 1 was dominated by “traditional” voters who reliably show up to vote in state and local elections, Littlefield said. Early voting data showed that 70 percent of the Prop 1 voters were these traditional voters, [Baer] said.

“I’ve seen it time and time again,” he said. “There are people who will vote in May elections and there are people that no matter how vitally important the results of the May election are to their own personal interests, they simply do not vote.”

Political experts said Uber and Lyft underestimated whether support for their service translated into votes.

Take David Goss. He’s a 40-year-old systems engineer for EMC Corp. in Austin. He regularly uses Uber when he’s going downtown for drinks and needs a sober ride home. On paper, Goss sounds like he would be for Prop 1.

But Goss said he voted against the measure. “I do love Uber, I use it all the time,” Goss said. But he said he wasn’t in favor with just letting Uber and Lyft write their own regulations.

“I definitely felt that there was some middle ground, we needed to find a way to ensure the rides were safe and make sure the employees were treated fairly,” he said.

Austin marketing veteran and entrepreneur Josh Jones-Dilworth, who opposed the proposition, said he watched as the discussion — and tech workers’ opinions — morphed.

“It started as a safety issue, and then it became an innovation issue, and then evolved into a corporate bullying issue,” Jones-Dilworth said. “It’s a complex issue, and there was never a consensus. I know a lot of people who changed their mind. And I know a lot of people who stayed on the sidelines because they thought this was a no-win situation.”

David Broockman, a business professor at Stanford University and an Austin native, said startups like Uber and Lyft view themselves as the underdog taking on an established industry: taxis.

“In Silicon Valley there is a tendency to view startups as David against Goliath,” he said, but that doesn’t always translate outside the Bay area, he said, where they are viewed instead as the Goliaths.

Hard to be the David when you’re backed by a few billion dollars in market valuation. For all that people like Uber and Lyft’s service, this election has shown us that liking only goes so far. I’d like to think that they will consider whether they should maybe change their approach a bit, to be more conciliatory and open to compromise, but so far there’s no indication of that. Perhaps we’ll see that when the inevitable statewide regulation bill comes up in the Lege. For all the bluster from some Republicans following Saturday’s vote, the passage of such a bill is not a slam dunk. It’s still the case that collaboration gets you farther in the Capitol than a bludgeon.

In the meantime, more players are hitting the scene.

While Uber has grown into a global behemoth by deploying many thousands of independent contractors, many of those drivers aren’t happy. New ride-sharing startup Juno–which has so far only launched in stealth mode in New York City–will try to make those drivers into its secret weapon.

Talmon Marco, former cofounder and CEO of messaging app Viber (which sold to Rakuten for $900 million in 2014), confirmed to FORBES that he is behind Juno, and promised that the new service under development “will have multiple capabilities that will differentiate it from other such services.”

But likely its biggest differentiator will be driver relations. While Uber has demonstrated its willingness to anger drivers by slashing prices and commissions over the last few years, Juno plans to take only a 10% commission from drivers. And it claims to have “reserved” 50% of its founding shares for drivers.

“At the heart of Juno is a belief that it’s time for a ride sharing service that treated drivers right,” Marco tells FORBES. “It’s time for an ethical, socially responsible ride sharing service. And that’s what we are doing.”

Sounds promising. As I said yesterday, the best thing that could come out of the Austin referendum is for multiple new rideshare services to emerge and find purchase. I mean, if part of the problem with traditional cab companies was that they were shielded by regulations from facing a competitive market, then surely we don’t want Uber and Lyft to be the only game in town for rideshare, right? A competitive market implies the need for competitors, after all. There would be a certain justice in all this if Uber and Lyft’s self-imposed departure from Austin helps enable those competitors. Chris Tomlinson, who has a few choice words for how Uber and Lyft treat drivers, and Roy have more.

Are driverless cars ready or not?

GM and Lyft think theirs are pretty close.

Lyft

General Motors Co. and Lyft Inc. within a year will begin testing a fleet of self-driving Chevrolet Bolt electric taxis on public roads, a move central to the companies’ joint efforts to challenge Silicon Valley giants in the battle to reshape the auto industry.

The plan is being hatched a few months after GM invested $500 million in Lyft, a ride-hailing company whose services rival Uber Technologies Inc. The program will rely on technology being acquired as part of GM’s separate $1 billion planned purchase of San Francisco-based Cruise Automation Inc., a developer of autonomous-driving technology.

Details of the autonomous-taxi testing program are still being worked out, according to a Lyft executive, but it will include customers in a yet-to-be disclosed city. Customers will have the opportunity to opt in or out of the pilot when hailing a Lyft car from the company’s mobile app.

[…]

The new effort is directed mostly at challenging Alphabet and Uber. The Google self-driving car program has gained a sizable lead over conventional auto makers via testing in California and other states, and it received an additional boost this week through a minivan-supply agreement with Fiat Chrysler Automobiles NV. Uber, much bigger than Lyft, has its own self-driving research center in Pittsburgh and is preparing to usher autonomous vehicles in to its fleet by 2020.

I alluded to this yesterday. My reaction remains: Next year? Really? That’s pretty darned aggressive. It’s also pretty interesting considering that the people who are making driverless cars have been suggesting that we should maybe slow our roll a little.

Engineers, safety advocates and even automakers have a safety message for federal regulators eager to get self-driving cars on the road: slow down.

Fully self-driving cars may be the future of the automotive industry, but they aren’t yet up to the demands of real-world driving, several people told the National Highway Traffic Safety Administration during a public meeting Friday.

A slower, more deliberative approach may be needed instead of the agency’s rapid timetable for producing guidance for deploying the vehicles, according to an auto industry trade association.

[…]

A General Motors official recently told a Senate committee that the automaker expects to deploy self-driving cars within a few years through a partnership with the ride-sharing service Lyft. Google, a pioneer in the development of self-driving cars, is pushing Congress to give the NHTSA new powers to grant it special, expedited permission to sell cars without steering wheels or pedals.

But many of those who addressed the meeting, the first of two the agency has scheduled as it works on the guidelines, described a host of situations that self-driving cars still can’t handle:

—Poorly marked pavement, including parking lots and driveways, could foil the technology, which relies on clear lane markings.

—Bad weather can interfere with vehicle sensors.

—Self-driving cars can’t take directions from a policeman.

—Inconsistent traffic-control devices such as horizontal versus lateral traffic lights.

Until the technology has advanced beyond the point where ordinary conditions are problematic, “it is dangerous, impractical and a major threat to the public health, safety and welfare to deploy them,” said Mark Golden, executive director of the National Society of Professional Engineers.

There have been thousands of “disengagements” reported in road tests of self-driving cars in which the vehicles automatically turned control over to a human being, said John Simpson, privacy project director of Consumer Watchdog.

“Self-driving cars simply aren’t ready to safely manage too many routine traffic situations without human intervention,” he said.

There’s also the concern that driverless cars, which by definition will be connected to the Internet, will be vulnerable to malware. We’re not at a point where today’s cars can be successfully hijacked, as dramatized on a recent episode of Elementary, but it is something the industry is gaming out now. The larger point here is that our driverless car future may be farther off than we think. Or maybe it’s closer than we think. We’ll see how that taxi pilot goes.

One more thing:

Executives at Lyft and Uber have said one of the top hurdles to their success is navigating a patchwork of regulations that govern the use of autonomous vehicles and liabilities. In an effort to ease regulatory concerns, Lyft will start with autonomous cars that have drivers in the cockpit ready to intervene—but the driver is expected to eventually be obsolete.

“We will want to vet the autonomous tech between Cruise, GM and ourselves and slowly introduce this into markets,” Taggart Matthiesen, Lyft’s product director, said in an interview. That will “ensure that cities would have full understanding of what we are trying to do here.”

Well, at least we won’t be fighting about fingerprints any more. I shudder to think how much money will be dumped into those lobbying – and possibly electioneering – efforts.

Uber and Lyft do what they said they would

They’ve cut and run.

Uber

Uber and Lyft made good on their threat to end Austin service Monday, pulling out two days after voters rejected their $9.1 million bid to overturn the city’s rules for ride-hailing companies.

Their departure came despite offers from Mayor Steve Adler to return to the table to negotiate a compromise. Meanwhile, smaller ride-hailing firms tried to press their newfound advantage.

“If they’re saying the election results mean they had to leave town, maybe they shouldn’t have asked for the election,” said Jason Stanford, Adler’s spokesman.

“The mayor’s been very clear,” Stanford added. “They are welcome to stay, and he invites them to the table, regardless of what they choose to do at this point.”

[…]

Lyft

In notices posted on their apps Monday, both Uber and Lyft blamed their pullout on the City Council’s rules, making no mention of the failed ballot measure to overturn them.

“Due to City Council action, Lyft cannot operate in Austin,” Lyft’s statement read. “Contact your City Council member now to tell them you want Lyft back.”

Uber’s statement was similar: “Due to regulations passed by City Council, Uber is no longer available within Austin city limits. We hope to resume operations under modern ridesharing regulations in the near future.”

Let’s be clear about one thing: Uber and Lyft were not forced to leave Austin. The rejection of Prop 1 simply means that the city’s existing rideshare ordinance – which as I understand it has not actually begun requiring fingerprint checks yet – remains in place. Uber and Lyft chose to leave rather than operate under those conditions, as Uber has done for the past year and a half in Houston and as both of them have done for longer than that in New York. Nothing about the Prop 1 vote requires them to leave. It is entirely their choice. There has always been room for further discussion on this, though it’s hard to do so when the first move is to go to DefCon 5. But despite all the rhetoric and millions of dollars flushed down the pockets of political consultant and media buyers, it’s not too late to start talking.

What should happen now, then?

Fingerprint-based background checks aren’t great. The FBI’s database is known to be flawed with outdated and inaccurate information. It’s kind of like taking your shoes off before you get on an airplane—it provides the feeling of security while also inconveniencing a bunch of people for show. Still, it might turn out to be the best option—more on that in a second—but as the city considers what regulations are in everybody’s best interest, now that it has ensured that it has a full complement of options at its disposal, it should be looking beyond fingerprinting.

Isn’t Austin stuck with fingerprinting now that people voted down Prop 1?

Nope. If Prop 1 would have passed, the city would have been prohibited from passing fingerprint-based regulations. But now the city is allowed to create whatever regulations it deems appropriate. City council can—and should–be looking to tweak the current ordinance with one that, for example, doesn’t prove discriminatory against drivers of color the way that fingerprint checks do. Although we doubt that Uber and Lyft are particularly passionate about that issue when it doesn’t directly concern them, the Austin chapter of the NAACP and the Urban League certainly are, and the objections they raised deserve to be considered and taken into account.

So what sort of background check should Lyft and Uber do?

That’s the zillion dollar question here. The problem is that most jobs have a process that screens out people who raise red flags. For most companies, you go through an interview, meet the people you’ll be working for, and get offered the chance to interact with the public based on the judgment of someone who is responsible for making sure that the company is represented well. (Depending on the job, it can also come with more formal background checks.) Because the “hiring” process for Lyft and Uber is more of a “sign up” process, the system relies on computer checks to do all of that work. That’s going to result in a process that has definite flaws—and it’s going to take creativity beyond just “run a fingerprint check” to address them. What that specifically looks like is hard to say, but between Austin’s leaders and Lyft and Uber, you’d think there would be enough brainpower to consider some viable options.

[…]

So what would make Uber and Lyft come back to the table, if they can just lobby for new rules in the legislature in 2017?

A couple of things: One, they don’t want to give up market share if a competitor picks up steam here over the next year. Two, it’s hard to keep growing a company that’s opted out of too many markets. Investors who see that Lyft doesn’t operate in Austin or Houston, and who know that they may have to make some threats about leaving L.A., have to give some thought to the growth potential of the company.

So what’s the best case scenario here for everybody?

Smart regulations that don’t rely on fingerprinting would be a good place to start. Austin should want Uber and Lyft operating in the city. Uber and Lyft should want to operate in Austin. Austin should want to create regulations that keep people with a history of DWI arrests, or violence against women, or other red flags like that, from driving people around for money—but it shouldn’t enforce regulations that would, say, keep drivers of color (who are disproportionately arrested for minor infractions that don’t put passengers at risk) from working. That system may not exist yet, but creating it ought to be a priority for everybody.

More than anything, a lot of ego is gonna need to be checked. The people who fought against Prop 1, which had a sort of David and Goliath quality to it, need to recognize that the support they received on Saturday was at least as much of a response to the tone of the campaign Uber and Lyft were running as it was a show of support for the specifics of the current regulations. Drawing a hard line around those specific regulations just because they won the vote would be a short-sighted, wrongheaded move.

Uber and Lyft, meanwhile, definitely need to approach Austin City Council with some humility, and consider not just what makes it easiest for them to add drivers to their ranks, but also that there are legitimate safety issues at stake here that the current regulations fail to address.

As Vox points out, Uber in particular has a choice to make about its public image. At the very least, I don’t think this debacle helped them with that. It would be nice if they came up with a solution – even a suggestion – that was more than “trust us, our process is all you’ll ever need, and if you don’t like it we’ll come after your ass”.

As far as the statewide regulation possibility goes, this is a reminder that there are never any guarantees in the Lege.

The chairman of the House Transportation Committee on Monday said that he prefers cities to set the rules for Uber, Lyft and other ride-hailing companies, even after a municipal vote in Austin has prompted new calls for the state to step in.

Rep. Joe Pickett, D-El Paso, said he’s “more interested in what the public thinks” — and that “they spoke in Austin.” Voters there on Saturday rejected a measure to get rid of the city’s current ride-sharing rules, which will require fingerprint-based background checks.

Some Republicans say the election — and the decision by Uber and Lyft to now leave Austin — shows the need for the state to pass industry-friendly rules. That group grew on Monday to include Sen. Robert Nichols, who chairs the Senate Transportation Committee.

But Pickett didn’t join the dog pile.

If the Legislature were to get involved, Pickett said, it should be through a broad discussion about all car-for-hire models, including taxicabs and limos. And if there are statewide rules, he said, fingerprint-based background checks should be part of the agenda.

“Still, the best would be to let the local municipalities decide,” said Pickett, who stressed that he supports all the ride-hailing options, including Uber and Lyft.

[…]

On Monday, Nichols, the Senate Transportation chairman, said in a written statement that “it is important to create consistency with a statewide policy to ensure all requirements for Transportation Network Companies are uniform across the state.”

“It can be difficult for these types of companies to operate when there are different ordinances in cities that are adjacent to each other,” said Nichols, a Jacksonville Republican.

That’s the first we’ve heard from Sen. Nichols since his comment in January that seemed to support a fingerprint requirement in any statewide bill. This story notes that Rep. Chris Paddie’s bill from last session eventually had a fingerprint requirement in it before it passed out of the House committee. We’re a long way from any bills being introduced, and I fully expect this to be a headline fight next year, but all I’m saying is that the signals are mixed right now about what such a bill might wind up looking like. Don’t take any bets on it just yet.

One more thing, from that Statesman story:

Still, the exit of Lyft and Uber from Austin created an opening for GetMe, a small Texas-born ride-hailing upstart.

“GetMe is seeing an unprecedented spike in driver sign-ups, uploads of the app and transactions on the app,” said Jon Laramy, a company co-founder. “I applaud the city of Austin for standing up for, and listening to, the citizens.”

The service had 350 active drivers in the city as of Friday and another 1,600 in the process of joining up, Laramy added, a number that he expects to grow.

[…]

GetMe isn’t alone in the Austin market. San Francisco-based Wingz is primarily an airport shuttle service but plans to expand its “private car service” in the next month, the company’s CEO said Monday.

Another company called zTrip offers a variety of services, including airport vans, limousines and a Williamson County cab service and also is eyeing quick growth, owner Billy Carter said Monday. A third upstart service, Phoenix-based Fare, told the Statesman it’s interested in Austin.

By far, the best thing that could happen as a result of this, regardless of what goes on next year in the Lege, is for multiple viable competitors to Uber and Lyft emerge. I mean, isn’t that how a free market is supposed to operate? Let a thousand flowers bloom now that the field has been abandoned by the top predators. We all win in that scenario.