By on February 18, 2014
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Georgia is now seriously weighing in House Bill 907 which opponents have dubbed the, “Taxi Monopoly Protection Act.”

It would effectively outlaw ride sharing services like Uber and Lyft. While also making cab companies victims of the usurious fees that they are required to pay to remain in business.

My solution to all this would be politically tone deaf and probably DOA in GA. My special interest is simply a personal one. I want to see better ideas work for the general public.

So here’s my deep dive into the rabbit hole that is government balancing one man’s freedom with another man’s fears.

 

The nuts and bolts of using your own personal property to transport other folks shouldn’t take much. If I were king governor of Georgia, this would be the way I would do it.

1) Don’t require taxi cab companies to pay for medallions and other mandated fees that serve no purpose other than inflicting financial harm on these businesses.

2) Do require that anyone who wishes to operate a taxi business (which Lyft and Uber are in practice) pay the insurance required to operate those businesses. If these companies want to pay for it themselves, that’s fine as well. But I believe this should be where the level ground should exist, and your insurance company should automatically be notified if you decide to operate this type of business.

3) Anyone who wants to sign up to be a taxi driver should have their license automatically run through the DDS web site every time their services are used to ensure that they still have a valid license. The way it is structured now, drivers can have their history gone through one time, and are okay thereafter.

This is the type of solution that makes no one 100% happy.But yet, it represents the fact that we need to let the government become an enabler of free enterprise. Instead of a perpetual conduit for special interests. It also represents the fact that there are some minor sticky issues that would need to be ironed out should this remote possibility ever come to pass.

The first has to do with handicapped folks.

It cost a lot more money to convert a new vehicle into a handicap accessible one. Since the costs of serving this population is far higher (to the tune of several thousands of dollars per vehicle), should handicapped customers pay more for these transportation services? Or should there be some sort of assistance, somewhere, to subsidize it?

The second issue has to do with vehicle inspections.

Should they exist? And if so, who should pay for it?

The quality of transport requires more than cheapness and minimal standards. Precious few of you are willing to spend a lot of money being transported in a 22 year old Corolla with no a/c (in Georgia), bald tires, and the smell of body odor permeating your nasal passages. Should owner reviews and corporate follow-up handle these issues? Or should there be some type of government standards that prevent the public from bad service?

Finally, what about the children?

Should there be certain child seats that must be required usage on these vehicles? I am sometimes tempted to go back to a 1970′s styled, “Put the kids in the back of the wagon!”. However the young human body is especially fragile, and I think that either the parent or the company should provide kids with adequate protection. So pick one, pick none,  or pick both.

Adults with needs, cars with needs, and kids with needs. The current bill sponsored by 5 Republicans and 1 Democrat doesn’t even pretend to serve their interests. But let’s say we live in a fictional world where the special interests on both sides are mere midgets compared with the general welfare and collective powers of the electorate. Let’s be kings instead of pawns today and try to solve the world’s problems one used car ride at a time.

How would you solve it?

 

 

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44 Comments on “Hammer Time: Hey Taxi!...”


  • avatar
    eManual

    Steven – Does the driver need a commercial (livery) license? This requirement shouldn’t be too much of a burden, and levels the playing field against some “fly-by-night” business.

    • 0 avatar
      Steven Lang

      I don’t think that a mandated chauffeur’s license or CDL should be required for a regular car. I do think limos, commercial trucks, and other vehicles that are unique in their riding characteristics should require a special license.

      • 0 avatar
        eManual

        Steven – Understood. I’m also a private pilot (my Avatar is the Aerocar III) where we cannot charge people (other than sharing gas) when we fly unless we have a commercial pilot license. I guess if the company and insurance are OK with the driver, that should be enough.

  • avatar

    Running a license every time a ride is booked seems excessive, even if automated it would waste a lot of electricity. The state knows when a driver is not permitted to drive, they should maintain a database the cab services log in to and check their drivers periodically to make sure the licenses are still valid. Also, when someone has their license pulled for DUI or whatever, the cab company should be notified by the state to pull that driver from service, etc.

    As far as car seats go, certify and train the driver to strap in the approved model seat in X minutes. Have the parent sign off on the install via app/text, & remove at destination. In areas with high cab use by parents, you could leave the company booster/car seat(s) in and advertise the fact. Emblazon the cab with a BABY ON BOARD wrap. If your other fares are one or two at a time, a car seat shouldn’t get in their way if it’s way over, or if it were a wide enough back seat like Crown Vics used to have.

    The cabs could be certified for use with a quick brake/tire/etc inspection at nominal cost, covered by the owners but done by state approved shops and be good for x/months/miles. Any bribery or passing unsafe vehicles comes back on the shop AND the cab company AND the driver/owner.

    The insurance companies should be chomping at the bit to partner with the state on forming a database, and ensuring that every licensed driver that owns a car is covered by an insurance policy in the state. So many people drive without insurance that it raises the costs for the rest of us. This is something that could be beneficial to all drivers, make the insurance companies link to their drivers in a state database and the police will know you’re insured when they run your plates or ID number. When a policy is superceded by a renewal or change in insurer, the state is notified, and if the new policy is dropped, the state is notified as well.

  • avatar
    danio3834

    Steve is right, things like medallions and zone permits inflict unnecessary financial burden on operators, don’t offer the public any benefit, but do offer a nice kickback to the coffers of the elected officials. The only ones in the industry that would support further regulation would be the rent seekers looking to put more barriers to competition in place.

    Frankly, I couldn’t give a sh1t if the taxi I’m riding in has all these worthless permits. Is the car clean and in reasonable condition? Driver doesn’t appear to be wasted? Good, lets get to the airport already.

  • avatar
    thx_zetec

    Mandating handicap access is an enormous waste of money. 99.99% not needed, and much more costly and makes vehicle less fuel efficient.

    I can see local governments pushing this on ride sharing as a way of hobbling the business – but even they are not crazy enough to mandate full handicap access for cabs etc (yet).

    • 0 avatar

      No reason to make every cab handicap accessible, but maybe a certain percentage–No reason you couldn’t specify you need accessibility when you reserve transportation. Not providing this service might run you afoul of the ADA Act.

  • avatar
    Timothy

    We’ve had UBER in Boston for quite some time. The local cabbies were up in arms over it for a while until they realized that they could get in on the action as well so long as they carried an UBER iPhone. Now I have a choice of Taxi, Uber X, Black Sedan or a Black SUV (winter, it’s nice). The competition is fair, the prices are balanced, and you know what? The goddamn cabbies have straightened the hell out.

    The cabs I’ve ridden in lately have been in better condition, the drivers more courteous, and it’s really nice to be able to hail a cab when YOU want vs waiting for one to drive buy.

    Open the damn industry up, give as much competition as the local economy can support, and let the people decide what form of transport they wish to use.

  • avatar
    I've got a Jaaaaag

    Steve, were you in Atlanta in the early 90s? Before the Olympics came to town Taxis were loosely regulated. Grabbing a cab was a crap shoot. Would the car have air conditioning, would the car have all of its body panels, would it smell of rotting fish? The legislature passed a law limiting the age of the Cabs, requiring AC usage, and inspections. Just going on past history, the inspections should be mandatory and the cab company or owner operator should pay for them. It is the cost of doing business.

    • 0 avatar
      Steven Lang

      Fair point.

    • 0 avatar
      snabster

      And just to build off that, that is basically the rule in DC.

      Almost anyone can run a cab. Until 2-3 year ago there was minimal regulation.

      The result was a load of African immigrants in 10 years cop cars that refused to pick you up and had terrible service. And no ability to drive.

      And the cabbies liked it that way. Low barrier to entry, low wage, but a step to the American dream.

      Things have gotten better with new regulations. If anything we need more.

      As with many free market solutions, you’ve got to divide it up a bit more. Sometime it works in areas with high deamnds — like taking some fat tourists to a hotel – but doesn’t work well for other uses.

      Uber has been very popular in DC as a result. Just having a cab with a GPS makes a big difference — I got very tired of having to give directions.

  • avatar
    Landcrusher

    Right now, the livery license is an issue because you can’t walk into some state’s offices and get the license without someone else signing off that they intend to hire you.

    Child seats should be the responsibility of the parents, period. Too many variables.

    Handicapped get subsidized service now in my area.

    All in all, most of these regulations were nonsense at the start anyway. Inspections should be required for the things people can’t reliably check before riding. Get the state out of it by using bonding services. Customer reviews on the web have really changed the options, but we have to be vigilant those review systems stay reliable.

  • avatar
    05lgt

    Not familiar with the services, but I’d like to throw another want on the list: Accesability from ‘hoods with poorer demographics. The market would tend to only supply cabs from downtown to airport to nicer digs. That’s where the most money is. Also, living in PDX I have to ask about seeing eye dogs…

    • 0 avatar
      Toad

      O5lgt, YOU take a 2nd job driving a cab in sketchy neighborhoods for a couple weeks, then get back to us on requiring other people to do so. Point blank (pardon the pun) it is just too dangerous to be picking up strangers in some neighborhoods, especially if you are presumed to be carrying cash.

      I wouldn’t presume to ask somebody to serve an area that statistics and experience show is too dangerous for most retailers and delivery services.

      • 0 avatar
        Signal11

        Uber and Lyft don’t do cash. You pay through the app on your smartphone, which is location trackable by law enforcement.

        The risks of being assaulted in poor, underserved neighborhoods particularly while you are in your vehicle is overblown.

  • avatar
    Atum

    Having lived in Georgia my whole life, I can say that the taxi system is horrible. Most of the taxis now are late 90′s minivans, such as Siennas, Odysseys, and Grand Caravans, that are painted orange and EXTREMELY beat up.

    With car seats: nowadays, they have this 4’9″ standard thing, even with safer seats and safer vehicles. Back in c. 2005, when I last used my booster seat (a simple cushion with a plastic lift, no back or anything), I was only four foot, and was riding in the passenger seat by age 8/4’6″. This was in an MPV, which, as you can see below, has dismal safety ratings.

    http://www.iihs.org/iihs/ratings/vehicle/v/mazda/mpv/2003

    However, never having been in an automobile accident, I can’t speak for how safely a car holds up. But since most cabs have the lack of safety that my mom’s MPV did, they should have a Top Safety Pick booster seat installed in the car. That’s just me, judging from my experiences.

  • avatar
    Dan

    Why is a taxi different from any other private vehicle from a standpoint of inspections or driver licensing? The other people operating their cars three or four feet away from mine didn’t have their license OK’d by Big Brother this morning. Nobody checked their air conditioning or tires. And that’s just fine.

    Riding in or purchasing a ride in a junker without airbags, air conditioning, or child seats should be the decision of the rider.

    People who aren’t riding in it should do what’s apparently the most difficult thing in the modern world – mind their own goddamned business.

    • 0 avatar
      Landcrusher

      The inspections are different because of the mileage and the transfer of self interest. Being in the car with no brakes is more dangerous than being on the road near one. Also, there is strangely a big difference in the willingness to defer maintenance in your personal vehicle and a work vehicle. Some virtuous people might be better at keeping up the work one, but there are a lot of nuts who will abuse the work car.

  • avatar

    So do these new livery guys have to maintain any standards? Are their numbers limited in any way, or will we now have an unlimited number of vehicles competing for rides at the airport? Will some areas of town be under served because the new livery guys only want to go where the pickings are best? Will their vehicles be identifiable so law enforcement can tell who is livery and who isn’t? How will anyone know if the driver of said vehicle is the same driver who is licensed for a particular vehicle, or is that even important?

    • 0 avatar
      Timothy

      In MA every livery car as a special “Livery” license plate. Very easy to tell.

    • 0 avatar
      Landcrusher

      No. Its chaos. People will be driving other people around. It will be secret and shady. You won’t know who is in the cars next to you, where they are going, or even whether those people in them know each other. Anarchy. Pure anarchy.

      • 0 avatar
        Timothy

        Except that in MA you can’t be an Uber driver without first obtaining a livery plate which is only through the RMV. Now the RMV is in an of it self a place of tyrannical torture, but it’s far from anarchy.

        I can’t speak to how things operate at the Georgia DMV(RMV) but if there are already special plates / registrations for livery drivers it seems to me that’s it’s very controllable.

        Or was that just sarcasm. The winter blues I’m experiencing make it tough to tell at times.

        • 0 avatar
          Landcrusher

          Sarcasm. I do realize there are real issues here, but I think it should be a good opportunity to go back and reevaluate the existing laws on taxis. Modern autos are very safe, and most of the existing rules are more about taxes and rent seeking than safety really.

      • 0 avatar

        Well, the most free market solutions always have an element of chaos associated with them. For example, I like the idea that someone I buy insurance from is forced to actually reserve some capital to pay potential claims. I expect there to be water and air standards. We take a lot for granted. Is there regulatory over reach. You da*n betcha. Its all about the balance.

  • avatar
    Steven Lang

    Nice questions Ruggles. But about those questions I mentioned above? What would seem to be reasonable from your perspective?

    Livery operators in Georgia already have to maintain strict standards and I would expect that any private operator is going to use their asset as they see fit when it comes to serving certain neighborhoods. The government can’t change that salient fact.

    Livery vehicles already require special plates in Georgia. From my point of view, I would encourage that the playing field be level for all participants and that the fees/taxes levied reflect the actual cost of auditing these services.

    I know… a perfect world doesn’t exist. We can all dream.

    • 0 avatar

      RE: “1) Don’t require taxi cab companies to pay for medallions and other mandated fees that serve no purpose other than inflicting financial harm on these businesses.”

      I’m really not qualified on this issue. I’d like to hear both sides on the issue of medallions and the other fees.

      RE: “2) Do require that anyone who wishes to operate a taxi business (which Lyft and Uber are in practice) pay the insurance required to operate those businesses.”

      I sure don’t want to be riding with someone without proper insurance, so some level of regulation seems to be in order.

      RE: “3) Anyone who wants to sign up to be a taxi driver should have their license automatically run through the DDS web site every time their services are used to ensure that they still have a valid license. The way it is structured now, drivers can have their history gone through one time, and are okay thereafter.”

      Never thought of this one, which tells me I”m better of not to have an opinion until I gather more information.

      I recently talked to a young man who had decided to start a business doing demo drives on behalf of auto dealers. His company gained immediate credibility when it was found that ex GM Chairman Rick Wagoner was an investor. In a 45 minute conversation with the company’s founder it became apparent quickly that there was a LOT he hadn’t considered. I’ve read some stories about some of these folks who are trying to reinvent the livery business. We have many trying to reinvent auto retail. Many of the these ideas run afoul of the law. ANd some of those laws are in place for good reason. I’m a lot better qualified to discuss auto retail than the livery business, but I’m certainly curious. I appreciate your post.

  • avatar

    From what I understand Uber/Lyft/ect have a fair amount of user reporting – people can pick which driver based on reviews, and can submit reviews on their driver/vehicle. That, for a lot of people, is enough to take the place of regulation, especially for stuff like cleanliness or having AC that is less of a safety issue and more of a comfort/convenience issue.

    • 0 avatar

      RE: “From what I understand Uber/Lyft/ect have a fair amount of user reporting – people can pick which driver based on reviews, and can submit reviews on their driver/vehicle. That, for a lot of people, is enough to take the place of regulation, especially for stuff like cleanliness or having AC that is less of a safety issue and more of a comfort/convenience issue.”

      There is simply no validity to consumer reviews. It becomes nothing but noise as soon as bad players and their imaginations get involved. A plumber here in LV decided to get creative and arranged for his competition to have a bunch of bad reviews lodged against them. He also arranged for his own company to have many good ones posted for himself even though he and his company are schmucks at best.

      I know a guy who stayed at a hotel, which was part of a chain. They arbitrarily charged his credit card $250. because they say he smoked in his room. Frankly, he probably did but he was upset about the arbitrary nature of the assessment on his card. His review of the hotel included the wrods “bed bugs.”

      YELP has taken reviews to a new level. I hear they now have a practice where they hit merchants up for promotional revenue. Those who pay get “managed” reviews. Those who don’t, don’t.

      CSI in the auto business has become so heavily manipulated it isn’t valid any more. I could go on but reviews are only beneficial when everyone is knowledgeable and truthful. But that’s not the world we live in.

      • 0 avatar

        the consumer reviews are within the lyft/uber app. That means that they can check to make sure that the customer actually had a trip with that driver before letting them post a review. The company also has a pretty good incentive to make sure that their reviews are trustworthy – if they aren’t, they will find that customers will stop using their service because they can’t trust them.

      • 0 avatar
        Landcrusher

        Reviews can be managed better than most are. You need volume and game theory to figure it out and make it work. The referee needs to be someone with an incentive for accuracy rather than positive reviews.

      • 0 avatar
        Hillman

        Posting a fake review is a great way to get sued. The courts have already weighed in on this subject.

  • avatar
    CapVandal

    The whole point of disruptive technology is to be … disruptive.

    And the disruption from car sharing is based on new types of information being cheaply available.

    The customer can demand whatever information they want — if it is an inspection, knowledge of English or whatever.

    And whatever the customer doesn’t demand, let the trial lawyers and insurance companies clean it up. This is America, no? They will be doing it anyway, so why assume in advance that they can’t/won’t.

    • 0 avatar

      Disruptive is one thing. Not to be depended on is something different. The more information there is available the more potential for disinformation. Data is everywhere. Good interpretation of data is what is wanting. In this new era we will certainly see a lot of new ideas, and trends that come and go.

      • 0 avatar
        Timothy

        This is an article from boston.com regarding a new Uber driver who also happens to be the ex CEO of BOLOCO. Talks about the technology from the drivers perspective.

        Also speaks to the review process and how your ratings directly effect Uber drivers (they don’t put up with any bullshit). “Uber takes their rating system very, very seriously. Stay above a 4.5 rating and you’re fine. Fall below and you face removal from the system. No stories. No excuses. No phone calls.”

        Also… John’s Über car is his Tesla Model S so that alone makes me want to take Uber.

        Link to article: http://www.boston.com/business/technology/innoeco/2014/02/what_happened_when_a_boston_en.html

  • avatar
    Lorenzo

    If you read about the early history of Checker Motors and Yellow cab in Chicago, you can understand the reason for regulation. In the 1920s, opposing taxi companies were sabotaging each others’ cars and beating up drivers (and sometimes customers), and low,low fares turned out to be not so low at the end of the trip.

    As with all regulation, a board or commission is set up, regulators turn into dictators, and the necessary fees turn into revenue sources for local governments. It seems no system will work well forever, it has to be shaken up periodically. Uber and Lyft are serving that purpose now.

  • avatar
    Pch101

    “Don’t require taxi cab companies to pay for medallions and other mandated fees that serve no purpose other than inflicting financial harm on these businesses.”

    Presumably, those fees pay for the regulatory body that oversees the taxis. If the cabbies (and by extension, their passengers) don’t cover those costs on their own, then everyone else will.

    Do you want to have those who don’t use taxis pay for those who do use them? There’s no right answer to that question, but you should at least under the implications of what you are suggesting. And unless you want to have cabs be completely unregulated, there is a cost that will need to be paid by someone.

    The easy answer would be to offer a medallion for ridesharing services. Perhaps it would make sense to create a special type of medallion for these purposes.

    • 0 avatar
      Steven Lang

      Unfortunately, that presumption of a regulatory body being solely by medallions is completely false.

      I wish that were the case because Atlanta wouldn’t be “offering” $40,000 for the right to operate one’s personal property as a taxi at this point.

      Most of my positions (taxation, licensing, regulation, etc.) are centered around three common ideas.

      1) Keep the barriers of entry for new entrants as low as possible.

      2) Ensure a reasonable level of safety and a code of ethics.

      3) Taxes and fees should only be used to support the absolute basic requirements.

      There are plenty of fuzzy areas where you need to reconcile the unique need (the children and the handicapped) or the unique legitimate interest (insurance requirements, driver license verifications, etc.)

      The question then becomes whether these costs should be allocated to the user who needs it, the consumers that use these services directly, the business operator, or the greater community through indirect taxation.

      That’s never an easy question, butit’s far better than proceeding down the road of passing the proverbial buck to our kids and grandkids via debt.

      Hope this helps…

      • 0 avatar
        Pch101

        My knowledge of the Atlanta situation consists of a whopping three minutes on the internet, but I can tell you that the medallions are paying for about one-third of the police department’s budget.

        If you got rid of the medallion fees without making any cuts, then other taxes and fees would have to be raised by an average of roughly $130 (give or take) per resident in order to cover the difference.

        Are households eager to pay another few hundred dollars per year in exchange for free medallions that go to a relatively small number of people? I doubt it.

        Similarly to hotel and rental car taxes, a lot of these are paid (in this case, indirectly) by visitors who neither live nor vote there. Locals tend to like taxes that they don’t have to pay.


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