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lyft-pinkA new ordinance from Seattle’s City Council Committee for Taxi, For-hire, and Limousine Regulations proposes to cap the number of Lyft, Sidecar and UberX drivers while increasing the number of taxicabs in Seattle.

The committee, which is set to vote on the two-year pilot program Friday, just updated its ordinance and it includes a few minor changes from the original draft proposed in December.

The first draft limited the “transportation network companies” — Sidecar, Lyft, UberX — to no more than 100 vehicles each. Now, the updated draft states that the city will issue 300 total TNC driver permits by lottery.

So, instead of capping the number of drivers each company may have, the city wants to cap the overall number of TNC drivers. That means, for example, Seattle could end up with just 300 Lyft drivers, which would exclude Sidecar and UberX from having any drivers. In the original ordinance, each company was allowed up to 100 drivers each — now, however, one company could have more or less than 100 drivers depending on the lottery winners.

The new ordinance keeps the original 16-hour per week limit for each driver. However, here’s a new addition:

TNC drivers shall not be in control of a for-hire vehicle for more than 12 hours spread over a total of 15 hours in any 24-hour period. Thereafter, such TNC driver shall not drive any for-hire vehicle until 10 consecutive hours have elapsed.

The new ordinance also requires TNC vehicles to be no more than seven years old; the original ordinance had a 10-year requirement.

There are also new insurance regulations that have been added:

Transportation network companies shall provide a written insurance disclosure to TNC drivers. The written insurance disclosure must include the following: A personal auto insurance policy may not provide any insurance coverage when one is driving for a commercial purpose; in the event of an accident the insurance provided by the transportation network company may not provide sufficient insurance coverage, such as coverage for the TNC driver’s bodily injuries or damage to the TNC driver’s vehicle; and the TNC driver may need to consider buying a commercial auto policy. The written insurance disclosure must be signed by the TNC driver.

Aside from slight changes to the wording, this insurance rule has remained the same:

In the event the TNC driver fails to maintain personal or commercial auto insurance or the TNC driver’s insurer denies coverage for the claim, the Transportation Network Company’s auto insurance shall be primary. In the event the limits of liability provided by the TNC driver’s personal or commercial auto insurance are exhausted due to claim payment and/or settlement, the transportation network company’s auto insurance will drop down over exhausted limits.

The city also wants to add 75 taxicab licenses in 2014, and 75 more in 2015.

[Related: As Seattle decides fate of ride-sharing startups, Washington state gets involved]

If approved by the committee this Friday and then by the Full Council and Mayor next week, the regulations will take effect 30 days later. The original ordinance called for the pilot program to end on December 31, 2015; the new ordinance calls for a June 30, 2016 sunset.

For comparison, Seattle’s proposed regulations are far more stiff than that of California’s, which do not have caps on drivers or the number of hours they are allowed to drive.

New Seattle Mayor Ed Murray.
New Seattle Mayor Ed Murray.

We sat down with Mayor Ed Murray just a few minutes ago and he offered his perspective on this issue. First and foremost, Murray said he’s concerned with the TNCs and their insurance policies, particularly in light of the lawsuit Uber is fighting in San Francisco.

“They’re not covering the level of insurance that I believe they should cover,” he said.

The new ordinance requires the TNCs to have auto liability insurance that provides a minimum of $1,000,000 per accident coverage for accidents involving a TNC driver and vehicle while active on an app’s dispatch system.

lyftapp

Lyft, which just updated its insurance policy, has had a $1,000,000 excess liability policy in place. Sidecar has a similar $1,000,000 policy, as does Uber.

However, Murray said that if the TNCs “commit to a level insurance that the Council wants and that I want,” he’s in favor of removing any sort of caps for the TNCs and adding more taxi licenses in Seattle.

“I’m very concerned about caps,” Murray said. “I’m very concerned that the ridesharing companies are actually assisting us in getting people to not buy cars or drive cars. But you have to balance it out with the safety issue.”

You can read the new ordinance here. Here’s the agenda for Friday’s meeting:

NOTICE: Public comment sheets will be available for sign up at 9:00 a.m. in front of Council Chambers. There will be four lines and four comment sheets available: “from or supporting the taxi industry,” “from or supporting the for-hire industry,” “from or supporting the transportation network companies,” and “other interested parties.” Please only stand in the line and sign up on the comment sheet most relevant to you. You may only sign up on one sheet. As we are anticipating a large crowd, we ask that you please be patient with the process and with each other.
Please Note: Times listed are estimated.
A. Call to Order
B. Public Comment
(10 minutes)
C. Items of Business
Transportation Network Company, Taxi, and For-Hire Vehicle Regulations— Relating to companies and drivers of a new type of for-hire vehicle in order to create a pilot program for transportation network companies and affiliated drivers and vehicles: establishing minimum operating requirements for transportation network companies and affiliated drivers; creating a permit system; imposing vehicle inspections; imposing a zero tolerance drug use policy for affiliated drivers; imposing minimum insurance requirements for transportation network companies and affiliated vehicles; requiring rate transparency for transportation network companies; and establishing licensing fees; raising the maximum number of taxicab licenses issued by the City; revising terminology; adding new sections and amending various Sections of Chapter 6.310 of the Seattle Municipal Code.
BRIEFING, DISCUSSION, AND POSSIBLE VOTE (60 minutes)
Presenter: Tony Kilduff, Council Central Staff
Continuing Workplan for Taxi, For-Hire, Limousine, and Transportation Company Regulations—Requesting that the Department of Finance and Administrative Services implement a work plan to further resolve and clarify issues relating to taxi, for-hire, limousine, and transportation network company regulations.
BRIEFING, DISCUSSION, AND POSSIBLE VOTE (30 minutes)
Presenter: Tony Kilduff, Council Central Staff
D. Public Comment (10 minutes)
E. Adjournment
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