Editor's Note: As previously mentioned, Horwitz previously contracted work for the Clifford Group, a Houston firm that lobbied on behalf of Yellow Cab over the summer. He left the Clifford Group Aug. 22.
This evening, the Austin City Council will vote on a proposal by City Council Member Chris Riley to legalize so-called Transportation Network Companies, such as Uber and Lyft. Simply put, given the realities of the current proposal, the Council should vote no.
Uber and Lyft, app-based companies that serve as a decentralized sort of taxi option, first showed up here in May. At that time, they began operating in defiance of the city's local ordinances, which require strict safety regulations such as 24/7 insurance and metered fares. Originally, Mayor Lee Leffingwell set up a task force full of some of the most capable stakeholders in the community, charged with spending 180 days coming up with a good-hearted piece of legalization that would welcome the TNCs but still protect competition and safety.
Facing an uphill battle for the newly crafted District 9, Riley has tried to abruptly force this issue for a vote, ignoring the valuable work the task force is doing. In a last-ditch effort to attract the student vote, he merely talks in broad platitudes about "transportation options" without actually addressing any of the real problems or details.
Austin obviously has a taxi problem. There are far too few cabs on the road, leaving many people stranded or having to wait for excessive periods. But the number of taxis are capped by the city, and when a proposal was recently floated to raise the cap, Riley voted against it.
We should not be in such a rush to increase transportation options that we damage the livelihood of the average consumer. Last week, the editorial board of this paper expressed its desire for 24/7 insurance requirements for TNCs. Representatives from Uber soon met with us, and expressed their opposition to this and other taxi-centric requirements, proudly exclaiming not only that they are not cabs, but that they do not even compete with cabs. I have trouble agreeing.
If you are an on-demand vehicle for hire, be that a taxi or a TNC, you should carry 24/7 insurance that protects pedestrians and other cars from being trapped in a donut hole of non-coverage. Uber whined about the price tag involved, but a company that might be worth as much as $18 billion and hires some of the most expensive lobbyists in Texas should be able to pony up with relative ease.
Furthermore, Uber desperately defended its so-called "surge pricing," where they charge multitudes of their regular fares — often with little or no warning — just because. Recently, a short trip in Denver cost a local passenger $443. Call it "supply and demand" if you want; it sure sounds like price gouging to me.
I want Uber and Lyft in Austin, but they need to follow some rules first. Riley's proposal takes care of many of these, including background checks, vehicle inspection and customer service support. But commercial insurance and price stability are absolutely necessary before the green light can be given. Ideally, this should come from the capable task force, not a rushed gimmick by an out-of-options politician.
Horwitz is an associate editor.