Tensions were high Thursday evening at Seattle City Hall as councilmembers debated how to regulate new app-based transportation companies like UberX, Sidecar and Lyft.
After much back-and-forth, the City Council voted 5-4 to cap the number of Lyft, UberX or Sidecar (Transportation Network Companies) drivers active at any given time on each system to 150. That means UberX would be allowed 150 drivers at one time during the day or night — same goes for Sidecar and Lyft. The legislation, which still needs official approval next month, would mark the city’s first attempt at regulation after nearly one year of discussions.
The council tossed around a bevy of other options — see section eight of this document — on Thursday, from removing any sort of cap whatsoever to allowing a total of 400 total TNC drivers altogether across all the companies.
Councilmembers Mike O’Brien, Kshama Sawant, Nick Licata and Bruce Harrell were in favor of the 400 driver limit — instead of allowing an unlimited amount of drivers — but needed one more vote for approval.
After that proposal failed, councilmembers Tom Rassmussen, Sally Bagshaw, Tim Burgess, Jean Godden and Sally Clark voted for the 150 cap — a decision that will allow for an unlimited amount of TNC drivers and one that left representatives from both Uber and the taxi industry disappointed.
Each councilmember voiced their opinions on this controversial issue on Thursday, and we’ve pulled together some of their thoughts below. First, though, here were the four options on the table:
A: Leave the language as is and cap the number of TNC drivers to 300.
B: Cap the number of TNC drivers to 400.
C: Limit the number of drivers active on a TNC network to 200 and remove the cap on the number of TNC endorsements
D: Remove the cap on the number of TNC endorsements
Whose position do you most agree with? Voice your opinion in the comments section below.
“I want to argue on behalf of no caps. I believe councilmember O’Brien is right: Drivers do need to have power and control. But I also think the government should get out of the way with setting artificial limits.
One group that has not been heard from much are the riders, the customers. We need more transportation options in this city, but we’ll never get it built out the way we we’d like to see it built out. We simply need more jobs and we need more drivers, and frankly we need more women drivers. Less than one percent of our drivers are women. Frankly, I think if we talk about a social justice issue, I want to see more women driving, which means frankly, since cab and for-hires haven’t done this, that we open up door for Lyft, Uber, and more TNCs to encourage more women drivers.
I think we ‘ought to be focusing on the consumer, the riders, the customers. I respect the fact that we have over 3,000 drivers that are currently licensed — I too want to see them keep their jobs and expand their jobs. I think that our No. 1 goal here in taxis should be, let’s make sure that there are rides available when people need them and to get there is no caps.”
“The TNCs have quickly changed what’s possible in the dispatch market and done that with much higher level of customer satsifcation rates according to the city’s surveys. As long as we treat regulation issues like public safety, licensing, training, and insurance the same for all drivers, I do not favor limits.
I think we need to find ways to encourage innovation in this industry, while still allowing longstanding participants to thrive. I think we can do that. Innovation like we’re seeing from the TNCs and like with Yellow Cab moving toward in their own app applications, that kind of innovation pushes everyone to provide better service and that’s a good thing.
I do not believe, as some of my colleagues apparently believe, that this is a zero-sum game. The more services we make available, the more people we have that are willing and able to make a living, the more people we’ll have in our city without having to have their own car or at least not use it not as much, and more business we have in the market, that’s a good thing. I’m supporting option D. It’s good for affordability, good for environment, good for reducing congestion in our neighborhoods, and it’s good for drivers.”
Sally Clark, who proposed “option C,” — the regulation that capped active drivers on any system, which was eventually approved with a slight change.
“There is something that is really attractive to me about the idea of capping the total universe of drivers, except in playing out how you do that. I haven’t figured out how we do that in a way that lands the number in the right place and accounts for the churn — that’s not a great way of saying it, but the in-and-out qualities that the drivers will have.
We’ve talked about different ways to [monitor] this — we can do quarterly checks and have new licenses come in if no one has driven more than 10 percent of the time or something. But the administrative and fact check burden of this became too heavy to my mind and so I came back to, what’s the simplest way that figures out how to make sure there’s capacity on the system that’s reasonable during this time period and that also gives drivers the opportunity to work without also constraining the world of drivers who have access to this possibility.
Now, the cap on how many can be live on the system — it’s unlikely, but you could get up to 200 drivers live in the system. Maybe the Mariners go to the playoffs and it’s a big night. I think it’s highly unlikely and I think the numbers are far lower than this.
The idea of saying, look, anybody can be this driver and if you have time and want to be on system, go ahead and try to log in and ideally there will be capacity most of time. I think it’s unlikely where there could be people on this where someone is not able to log on as a driver. That’s my thinking around coming back to capping the total number live on system at any given time.”
Jean Godden, who agreed with “option C,” but wanted to allow only 100 drivers to be active on each system instead of the 200 proposed by Clark.
“200 is quite high per TNC. 100 still allows customers who value them to have access to them while giving taxis the opportunity to adjust to a new option. I believe the taxis need to be given an opportunity to thrive because they provide a transportation option to those without smartphones and have other issues. A 100 cap wouldn’t be impacting badly on the taxi cab industry, one that we have regulated heavily.
We are trying to do our best to balance, including providing options. I think our customers are the one that come first. I must say I was dismayed to hear councilmember Bagshaw say that we haven’t heard from customers. We do hear from customers. We heard one earlier this afternoon who said she lives in Uptown and does not have a smartphone and that she does need taxis. I think we need to balance those interests. When we add up all the possible options, we are seeing that there are 3,000 possible drivers. That would be for a town of 700,000 people, which is one cab for every 200 people. One wonders if that would be right.”
Bruce Harrell, who originally voted for “option B” — the 400 cap.
“It astounds me how hypocritical the city becomes at times. We pride ourselves on making strong policy decisions based on data and statistical research. We use that data to make informed decisions. I hear this time and time again when we look at social service contracts, public safety measures.
In this situation, if we were to be consistent, our only choice would be to support option B. The reason I say that is because if our 5-year goal is to sort of get out of the regulatory scheme, which I think it should be, that you quantify the issue and build on top of that. By that I mean we don’t know the number of Uber drivers out there. We don’t know the number of ride-share providers out there. The challenge with option C is that although we would have 200 drivers on the grid at one time, we could conceivably have 800 drivers and a backload of drivers waiting to get on the system. And per councilmember O’Brien’s point, there is not an equal bargaining playing field between the driver and these companies that are capitalized by the likes of Google — $250 million dollars in capitalization — they don’t have the same negotiating power.
In 2012, when we look at how we treated Car2go, we did it the way were supposed to do it. Car2go said, here’s the demand study and where we think service will be and only asked for 330 car2go’s in the city. The transportation chair (councilmember Rasmussen) looked at that in the scheme of other transportation services and we unanimously agreed that 330 was the right number. We then revisited that issue in 2013 because [Car2go] said, ‘Hey, wait a minute, there’s demand for this, here’s 18,000 people that signed up for this.’ They wanted to increase by 170 to a total of 500. We said yes, we have data to do that.
The fact of the matter is, no matter how great, sexy and cool these application services are, they are unlawful in the city of Seattle. There are really hardworking drivers using them and the stories are marvelous about people laid off and now making money — I want to build their success as rapidly as possible. But the fact of the matter is, if we are to be data driven, we would then quantify and limit the number of entrants into this industry, back off of regulation — even in the number of taxi licenses, by the way. We must remember just 30 minutes ago we were looking at the number of taxi licenses and we were concerned about demand. So how then do you say un-limit the number of ride-share services in the same conversation when we do not have the data? If we were to be data driven, option B is the only one that makes sense.”
“I view this as a conflict between two different public transit service models. We have traditional taxi system where we have licensed drivers and licensed cars who are subject to very stringent regulations. The other model, the newer model with TNCs, is an open sourced model with less stringent certification and is designed and run by the private market.
I think our basic concern should be, and is, public safety for both the passengers and drivers. I think you get to that public safety through public regulation and rules. That’s why we are here. The overarching argument now is, do we extend regulations to TNCs or by how much. In that dialogue, I see that we need public regulation to establish insurance limits and the kinds of insurance. We also need to look at how many vehicles are out there because if we are regulating one half of the traditional market, you can’t ignore the new open-sourced market because you create an imbalance between two of those and as a result, you will ultimately endanger the public safety.
I see having caps on the TNC vehicles as extending public regulation over this private market in order to create a more fair market and, for the long run, a more efficient market for all drivers and also a safer market for all passengers. For that reason i support option B.”
I think the critical decision we have to make is probably less about the number of caps issued today — because I’m pretty confident as we learn more about the market, we will be changing that number — and more about actually who do we give the right to drive to: the companies or the drivers?
Proposal B gives those rights to the drivers themselves. What I think is important there is then the companies, whether it be Uberx, or Lyft, or Sidecar, they have to compete for drivers’ attention and say, ‘I want you to come drive for me because you have something that only you have, and I don’t have as a company.’ And that means I have to figure out what is the way that I’m going to make this attractive to those drivers, whether I’m giving them a better cut, whether I’m giving them bonuses, whether I let them keep tips — whatever it is, that’s going to be the relationship between driver and company. And the only way that is somewhat balanced in a power dynamic is if those drivers have something of value to give. What we’ve seen today in the market is that there are plenty of people that want to drive and make a living, which is much more than have historically have done that, and that’s great — I want lots of people to have that opportunity. But if we give the power to the companies as opposed to giving the driver the rights I worry that we upset this.
In regard to operational efficiency. Under my proposal (option B), we’re talking about over 1,000 drivers out there including taxis, for hires, TNCs. It’s going to be pretty easy once we start getting data, which we don’t have beause the companies refuse to give us any data, but once we start collecting the data, we will have a pretty good idea of, do we have the right number to meet demand on friday night, are there too many during week, etc. We can start adjusting that overall number of rights that I would suggest we would give to even more drivers to reach that balance.
The technology the companies are using is great. It allows us at any moment to see if there is enough supply on the road. While there are a lot of Uber drivers in here right now, I can tell you there are still some out on street because i see them on my app. It would be relatively easy to look on any given night at any given location and see how long the wait is on different platforms. If we decide that there are unacceptably long waits, we can pretty quickly pull people off that endorsement wait list and add to it, and adjust it.”
“One thing we know is that these ride-share companies and TNCs have been really embraced by people of Seattle. People love them. The question is the cap, and I think the cap is ineffective. We’re always playing catch up for what the number should be and it’s rife with politics. I really question whether the City Council should be setting caps at all, whether it’s for TNCs or even for taxis.
First of all, Seattle needs more transportation choices. We’re growing in last month, there are 1,200 new apartments going to be built downtown. Seattle has to have alternatives to driving your own automobile. People want those alternatives and that’s why they’ve turned to TNCs and Car2go. Publicly funded transportation systems cannot and will not meet our needs for decades. Councilmember Sawant talked about why don’t we have world class public transportation system. I wish we did. The reason is the voters have turned it down time and time again for decades during my lifetime. Now they are supporting public transportation system, but there will be decades before we become a city like London or paris.
In the meantime I think private transportation systems such as Uber and Lyft are helping us meet our transportation needs, especially during the big events and nights on weekends. It also provides services to neighborhoods such as my neighborhood in remote west Seattle, which do not have transit services. The TNCs have been well-received, they are meeting a need and I urge you not to stand in the way of these kinds of services.
Competition will benefit passengers and drivers if we don’t have caps on TNCs. If taxis face fair and regulated competition with the TNCs, it’s likely that they will rise to the challenge and improve their services. If our current taxi regulations have prevented taxi companies from improving their services or using new technology, then we need to get rid of those regulations that are holding the taxi companies back.
There are significant benefits to passengers that the public is crying out for. The overwhelming reports that we get from public is that they are very unhappy with taxi services. I think competition will help. What happens when someone complains about taxi service with Yellow Cab? Nothing happens. If they complain with Uber or Lyft, action is taken. Which would you choose: A company that doesn’t respond to consumer complaints, or a companies that do?”
“There has to be a large public expansion in public transportation and instead we have a giant mess. My office has met with hundreds of drivers from taxis, Uber, Lyft, for-hire, and also heard from hundreds of customers. What we’ve learned is no surprise. Everyone wants to make a living and everybody deserves to make a living. The taxi system is a mess with a legacy system where a few individuals own a huge number of taxi licenses and rent them out to drivers at such high prices that the drivers can barely make a living. And while they are competing for fares, they are now getting further pushed into poverty with all their fees and many of them don’t even make minimum wage. And, while they face all these constraints already, the multibillion dollar TNCs have come to Seattle.
I do not believe for one moment that the TNC companies have any interest other than their own profits, as councilmember O’Brien has said. Otherwise they would not be taking 20 percent from every fare, not be in lawsuits over taking tip money from their drivers, and right now they playing nice in Seattle because the council is discussing it, but what will we do if they turn around and take much more, maybe 50 percent from drivers. I have talked to several Uber drivers and they are concerned about getting fares now because so many people are driving.
On the other hand everyone deserves to make a living and the lack of living wage jobs and good transportation is the root cause here. I feel like there is no perfect option on the table at this moment. The question of the caps is a question of whether or not the council is willing to put in place a stop gap measure at this moment in order to make sure the already-marginalized communities are not further marginalized. That is the point here.
Given all the factors under our consideration, it is absolutely appropriate at this point to choose option B, which is cap of 400 with the endorsements going to the drivers, not the companies. If the TNC drivers share one big union, I invite them to stop by my office we will put them in touch with union organizers.
This is not a competition. Competition is a word you use when there different sides are more or less equal — here they’re not. If there are no caps, [TNC companies] will flood market with their drivers and the existing taxi drivers will not get enough business. The reality is the TNC drivers also will not get enough to make livelihood, but the corporations will still be making profits. That’s what they care about.”