Establishing a level playing field for ride-hailing companies in Spokane

Rideshare car
Stakeholders are arguing the current Spokane regulatory system for rideshare businesses is flawed. With a temporary agreement in place, the city council must determine how to revamp the system by the end of the year. Photo: Mark Warner

As the city of Spokane proceeds with a temporary contract for ridesharing businesses such as Uber or Lyft, one city councilmember and taxi cab stakeholders are vocal that the current regulatory system for those companies needs a rework. They argue the current contract is not being followed, and ridesharing drivers are allowed an unfair advantage over their taxi cab driving cousins.

Problems arose three years ago, according to Spokane city councilmember Mike Fagan, after taxi cab drivers reported that independent rideshare drivers were engaging in unapproved advertising and hailing rides in unauthorized zones. Also, those ridesharing drivers were found to occupy taxi zones, which is not allowed under their agreement.

Unlike for taxi cabs, Lyft or Uber drivers are not required to obtain a business licenses to operate within Spokane.

“In dealing with taxi cab association in Spokane, what they are asking for is a little bit more fairness in the process,” said Fagan.

Luis Castillo, owner of the Bull Dog cab company, described his frustration with the current system to the Spokesman Review.

“They come here and take all our fares. If Uber wasn’t here, it would be quick,” he said, describing the current competition when picking up people from the Spokane airport.

Castillo noted a drop in the number of pickups since the implementation of Uber and Lyft, and hinted that he might have to retire if efforts aren’t made to make both taxi cab and rideshare businesses more equal.

He suggested adding regulations for Uber and Lyft drivers to obtain business licenses and use meters, like taxi cab drivers have to.

Fagan said the council had high hopes that the legislature would have addressed the issue of regulating those Transportation Network Companies (TNCs) during the previous session. He added the passage of SB 5620 would have made Spokane’s job much easier when deciding on new agreements.

The bill would have created a statewide framework for TNCs, which stakeholders argued would lessen the confusion surrounding rideshare drivers who operate within multiple cities. Under the legislation, the drivers would be considered independent contractors, and would have to pass both a multijurisdictional and national background check.

The Senate approved the bill in a 34-15 vote, but failed to receive a vote in the House.

In July, the Spokane council voted whether or not to engage in new agreements with Uber and Lyft. Fagan cast the lone vote against, and the council decided to allow the ridesharing companies to pay a fee and continue operating under existing regulations until the end of the year.

“I understand that it is the wish of the council majority to have some kind of agreement in place, but what I’ve seen in the agreement we’ve previously had is the Uber corporation is unable to control its independent contractors. Until everyone can respect agreement on hand, then I am not going to support it,” said Fagan.

The agreements would have lasted for two years, but Fagan said his colleagues agreed to shorten them to the end of the year in order to look at the current regulatory structure. The council and the businesses were already six months behind schedule on a new agreement at that point.

“We will be looking at the regulatory differences between what we are asking Uber and Lyft to do and what we require the taxi cab association to do, and we will come together and try to evaluate and find a regulatory platform for the independent Uber and Lyft drivers.”

Cab drivers spend between $500 and $600 in government permits to put their vehicle on the road, he added, whereas Lyft and Uber drivers only spend their time and gas under the current regulations.

“Looking at it from that standpoint, it’s nowhere close to a level playing field,” said Fagan.

Uber has indicated its willingness to work with the city to determine a fair contract beginning in 2018, according to Nathan Hambley, a Pacific Northwest spokesperson for Uber.

 “We have successfully worked with many Washington communities of all sizes, including most recently Pullman, to develop reasonable regulations that enable businesses like ours to operate.”

“We have had a strong working relationship with the City of Spokane in the past and have already begun discussions with City officials regarding regulatory changes in the future,” he added.

“As we move forward with some form of regulatory platform, I’d like to require all Uber or Lyft drivers to have a city business license,” said Fagan, which he said would give cab associations more relief.

Over the next few months, Fagan said the council will be compiling copies of municipal ordinances in other cities to see what those communities require of Uber and Lyft. Also, they plan on comparing and contrasting the rights and regulations placed upon taxi cab companies and rideshare businesses.

“The next steps would be to familiarize ourselves with those differences and then bring everyone to the table, hold a series of public forums to discuss a regulatory platform, subsequently a proposal, and hopefully we will have something before the end of this year.”

Efforts to reach other members of the council were unsuccessful. Councilmember Stratton’s office told Lens that although she was one of the leads on this particular issue, she was unable to comment because she has been “very busy through the last few weeks with many different projects with the council.”

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