What is a taxi and what is not?
Angelenos have more options for getting around town than ever before, thanks to the arrival of services such as Uber, Lyft and Sidecar, whose drivers can be summoned with a smartphone app. But to some members of the City Council, that’s a bad thing because the services aren’t regulated the same way taxi companies are — by them, in other words. The city doesn’t need to throw its bureaucracy at these services, however; the state Public Utilities Commission has adopted rules that address the public’s safety concerns without forcing the upstarts to abandon innovative business models.
The main advocate for the city’s power grab is Councilman Paul Koretz, who argues that the new services compete unfairly with city-regulated taxi services. Under state law, however, cities have authority only over transportation services whose drivers can be hailed in the street. Prearranged rides, such as those offered by limousines and shuttle buses, are under the PUC’s purview. Uber, Lyft and Sidecar clearly fall into the latter category; the companies arrange and accept payment for rides exclusively through their apps.
Adopted last month, the PUC’s regulations for “transportation network companies” such as Uber are modeled after its rules for limousines, including mandatory criminal background checks and training programs for drivers, safety inspections for cars and a zero-tolerance policy for drug and alcohol use. The commission also required that the companies carry more comprehensive liability insurance than limousine services do — and more than taxis in Los Angeles must carry. But it brushed aside pressure from taxi companies to treat the new ventures like something they are not — cab companies — just because they compete for some of the same customers.
Koretz says the rules are meaningless because the commission doesn’t have the resources to enforce them. But that argument is rebutted by the PUC’s quarterly enforcement reports, which show that it is issuing fines, sending cease-and-desist notices, disconnecting unlicensed services’ phone lines and bringing criminal charges against alleged limo and shuttle rule breakers.
Granted, it’s strange that the state should regulate some services and the city others, and cabbies may have a legitimate gripe about an uneven regulatory playing field that puts them at a disadvantage. But that’s a problem for the Legislature to solve by ending the division of regulatory labor, or for the council to solve by lifting some of the burdens it places on taxis.
The city certainly can cite drivers for the new services if they pick up passengers who flag them down, in violation of local taxi regulations (and the terms of the drivers’ agreements with Uber, Lyft or Sidecar). Beyond that, the city simply doesn’t have the authority to set rules for companies that offer prearranged rides. The council should stop trying to do so.
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