lyft-pinkJust as the fate of ride-sharing startups like UberX, Sidecar and Lyft in Seattle is decided this month, the state of Washington is now showing interest in determining how to regulate these new app-based companies.

Seattle’s City Council Committee for Taxi, For-hire, and Limousine Regulations will meet Friday at 9:30 a.m. to vote on a two-year pilot program that requires ride-sharing companies, among a bevy of other rules, to obtain a $50,000 annual license to operate as a transportation network company, and have its vehicles driving a maximum of 16 hours per week. A final decision from the committee is expected to be made Friday and the Full Council will vote on the matter next week.

Companies like Lyft and Sidecar, which say that the regulations would make it impossible for them to conduct business in Seattle, have been operating without licenses — the city deems this illegal since the startups are not being regulated by government. This has angered taxi companies, who are regulated and are losing business.

Meanwhile, House Bill 2782 was introduced by State Representatives Tarleton (D-36th) and Habib (D-48th) last week. The bill would direct the state’s Joint Transportation Committee to study the taxi, limousine, and ride-share industry and make recommendations regarding a state regulatory framework. The bill reads:

The legislature finds that Washingtonians are early adopters of technology and have come to rely on services provided by mobile application-based personal transportation services. The legislature further finds that a piecemeal approach to regulating such services could result in a patchwork of conflicting standards, stifle innovation, and reduce consumer choice.

If enacted, the bill aims to conduct a study by December 2014 and adopt a statewide regulatory framework by 2015. Bob Pishue, director of Washington Policy Center’s transportation arm, said that the state’s regulations could end up superseding any rules set forth by a city — much like how Seattle has to follow the state’s current limousine regulations.

Pishue also noted that HB2782 is “consumer-based.”

“It’s based on safety for the consumer, mobility for the consumer — things like that,” Pishue said. “The Seattle City Council’s regulations are about protecting the way things have typically been done and isn’t really focused on the consumer. It’s focused on the taxi companies.”

Lyft co-founder John Zimmer.
Lyft co-founder John Zimmer.

HB2782, which has four sponsors, still must be brought to the House floor and be approved by the Senate. Furthermore, it is only proposing a study for now.

Still, it’s clear that Washington has taken interest in the ride-sharing situation, especially after seeing other states like California enact their own laws.

“If the state is looking at this, it obviously sees the need for these services in cities,” Pishue said. “This is a big issue.”

Lyft co-founder and president John Zimmer, who is flying to the Emerald City today for a rally on Wednesday to “save ride-sharing in Seattle,” has voiced his disappointment with Seattle’s proposed regulations for companies like his. But Zimmer told GeekWire today that he’s encouraged by Washington’s interest.

“They want to have a thoughtful process on the state-level,” he said. “They see the value for the entire state — the value of innovation and having transportation options that help people get out of cars. They are concerned that one city could have a negative impact on that.”

We’ll be live at the City Council meeting on Friday, so check back on GeekWire for more coverage then.

Update, 8:40 a.m., Feb. 12: 

Sally Clark, who chairs the City Council Committee for Taxi, For-hire, and Limousine Regulations, said that she’s in favor of the state getting involved in establishing uniform insurance standards.

“Seattle is out front trying to get the TNC’s legal and safe, but many smaller jurisdictions will need help with setting regulations,” she said. “The state could bring much needed light to the safety and insurance standards needed for passenger, driver and public safety.”

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  • Slaggggg

    I have a beef with this sentence: [Companies] “have been operating illegally in the city since they’re not yet regulated by government”
    I seem to remember from Civics class that we are free to engage in commerce without asking the government for permission first. An entity is not operating illegally “since it is not yet regulated by the government”.
    If that is the case, GW itself is illegal since it is not regulated by the government.

    • Taylor Soper

      Here’s how the City Council describes it in the ordinance:

      “The Council finds that unlicensed drivers using
      application dispatch technology are providing trips as for-hire drivers via a
      new type of for-hire vehicle because they are operating motor vehicles used for
      the transportation of passengers for compensation and these drivers are
      currently operating illegally without for-hire driver licenses or regulatory

      • tim_in_seattle

        Taylor Soper – is that the proposed ordinance, or something that has been enacted?
        I had the same beef as Slaggggg

        • Taylor Soper

          It has not yet been enacted. Regardless, the City still maintains that these services are operating illegally because they are offering rides for compensation without the “regulatory oversight.”

          • Slaggggg

            They may be illegal, but not for the reason you state. You say they are illegal “since they are not regulated by the government”. I believe this is false.

            What you probably mean to say is they are illegal because they are operating in conflict with current government regulations.

            It is not true to say that anything not regulated by the government is illegal.

            Or if it is true then someone changed the ending to Red Dawn and we should probably be calling each other comrade.

          • Fuck Taxi’s

            Look how insanely weak most people have become. A business that’s not regulated is illegal? WTF is wrong with some people? And please don’t give me the line about “protecting” people. We aren’t talking about the drug industry or slaughter houses.
            I am not a lawyer but it is very safe to say that until a COURT rules on it these companies at best could be described as “potentially” illegally operating, but of course we know that’s not the real issue.
            The real issue is protecting another ancient, decrepit industry that’s attempting to use regulation to preserve their horrible service.

      • d reeves

        Taylor, I think you’re confusing things when you say “they’re illegal because they’re not regulated by the government.”

        That’s not true. The government’s position is that the activity they’re conducting — operating as for-hire vehicles — *is* regulated, and requires a license. They’re not operating with a license. It’s as if I started driving at age 15 without bothering to get a driver’s license.

        That said — I do hope the government wakes up and allows them with the regulations that really matter, and aren’t beholden to vested interests in the taxicab industry.

        • Taylor Soper

          Thanks for the comment d reeves. I’ve changed the wording slightly to clarify that the city deems ride-sharing startups illegal because they operate with proper licenses:

          “Companies like Lyft and Sidecar, which say that the regulations would make it impossible for them to conduct business in Seattle, have been operating without licenses — the city deems this illegal since the startups are not being regulated by government.”

    • balls187

      Mongolian Beef.

      Ehhh so good.

    • Seeer

      Regulated by the government is different than owned/ operated/ managed by the government. I believe businesses are generally regulated by the government. That’s what business licences, food handlers permits, medical licenses, etc. are for. So not just anyone with a kitchen can sell food and not just anyone with an operating table can perform surgery and not just anyone with a car can start charging people for rides. Like it or not, government regulates most things in your life.

      • Slaggggg

        OMG you have been infected. NO, this is not the way our country works. Businesses are not generally regulated by the government – it’s the opposite. The default is no regulation.

        Government regulation CANNOT be a norm. We don’t have to ask the govt permission to do everything in life. That is the entire point of this country (or, was, at least).

  • Guest

    Hopefully Seattle/Washington takes a lead on embracing the sharing economy and learns from other cities/states who have gotten it wrong/right. Here’s an interesting article highlighting similar challenges for car sharing startup FlightCar in SFO Enough already of the sharing economy blocks. Give Tesla a break too while we’re at it.

  • tim_in_seattle

    So do the existing taxi companies just slide over to providing ride services under an app based delivery system and bypass the Council Committee for Taxi, For-hire, and Limousine Regulations altogether?

    • Cliff Rudolph
    • Guest1

      No one “slides over.” It is called competition. This is something the cab companies haven’t had since the ludicrous medallion programs were put in place. These of course are nothing more then money grabs that almost ensure terrible service.
      Markets do a great job at self regulating and there’s zero need for the government to get involved. It isn’t always pretty but it always works.

      • tim_in_seattle

        I’m with you
        What I am saying is that if the council committee allows lyft etc to keep operating then the existing medallion companies will get out of that business and start providing lyft like services with no govt involvement. ,maybe that is better, not for me to say, I rarely use the service. I do think that the smart lads n he committee see their own demise in allowing lyft to operate unbridled so my money is on no way in hell

  • Patrick Husting

    I just took Uber to the airport from Sammamish and it was great. I’ve done it in a taxi a couple times and would never do it again.

  • boo

    LOL…”public safety” really?! I’ve ridden my fair share of taxis to the airport and feared for my life as I hear the axel rattling and banging under me. And suspension…forget about it! Please, the taxis in this city of some of the worst I’ve experienced in the world.

  • Badmichael

    Please! This is nothing more than a city/state government money grab. Can you imagine amount of salivating going in the City Council as they begin to count the dollars!

  • ClaimsAdjuster

    The Seattle City Council is going to make the Lyft/Sidecar/UberX carry commercial insurance. That is why Lyft and Uber are running to the state – to delay that as much as possible.

    In the meantime Lyft/Sidecar/UberX are still dumping uninsured vehicles on the street.

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