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Rideshare companies: state regulation would hurt the industry

  • Rideshare companies, like UberX, face state and local regulations.
Rideshare companies, like UberX, face state and local regulations. (Phil Velasquez/ Chicago…)
April 10, 2014|By Leonor Vivanco, @lvivanco | RedEye

The Illinois House on Thursday voted for a bill to regulate the rideshare industry in the state despite efforts by rideshare companies to stop it, including an online petition with more than 12,000 signatures in opposition.

With a vote of 80-26, the bill sponsored by Rep. Mike Zalewski (D-Riverside) now moves to the senate. Rideshare companies plan to encourage riders and drivers to contact state senators and urge them to vote against the bill.

Rideshare companies claimed the legislation would cripple if not kill the rideshare industry, particularly in Chicago where Mayor Emanuel is working on a proposal to regulate companies and drivers.

bill sponsored by Rep. Mike Zalewski (D-Riverside)
Read more at http://www.redeyechicago.com/news/local/redeye-rideshare-companies-oppose-proposed-state-regulations-20140409,0,2663396.story#z5vqhlIZIS0PwLSm.99

The state bill would establish a two-tier system based on how many hours rideshare drivers work.  If they work more than 18 hours per week, drivers would be required to get a chauffeur's license from the local municipality and distinctive registration plates for their vehicles. Their vehicles would have to comform to the same age and safety requirements imposed by local governments for vehicles used for transporting passengers for hire.

Drivers who work 18 hours or fewer per week would face more relaxed standards, such as they would not need a chauffeur license but would be required to pass a background check and earn company certification that their vehicles passed safety inspections.

Rideshare companies would be required to carry commercial liability insurance and secure an annual state commercial ridesharing dispatcher license. The bill leaves it up to local municipalities to decide places where pick up or drop off by rideshare drivers would be prohibited. If local governments require licensed chauffeurs to provide service to underserved areas and in wheelchair accessible vehicles, rideshare drivers would be subject to the same requirements, under the state bill. 

In a blog post on Wednesday, Uber launched an online petition to save UberX in Chicago. The petition has more than 12,000 signatures in opposition of the bill.

"The bill, as is, will chill a burgeoning industry on the cutting edge of technology that gives Chicagoans high quality, convenient and safe transportation options. The 18 hour weekly driver limit in the bill is an onerous cap and protectionist move that will kill jobs for the sole purpose of protecting the taxi industry's profits," said Andrew Macdonald, Uber's Midwest regional general manager, in a statement.

The legislation is a "backdoor, protectionist attempt to protect entrenched industries at the expense of everyday people," Lyft said in a prepared statement. "These limitations have no bearing on public safety and will ultimately shut down new transportation options in Illinois and eliminate consumer choice for residents who depend on safe and affordable transportation alternatives like Lyft."

Lyft posted a video and encouraged users to email Springfield lawmakers in the hopes of killing the bill.

The Illinois Transportation Trade Association, which is made up of taxi medallion holders, praised approval of the house bill. The association is also a plaintiff in the lawsuit against the city for failing to enforce its own taxi ordinance and allowing rideshare companies to operate.

"We are pleased that the Illinois House has passed this important legislation to level the playing field and protect public safety," a statement by the association said. "Notwithstanding Uber's last-minute dirty tricks in the form of canned and deceitful e-mails, the House members recognized the bill balances the needs of the ridesharing industry and minimum standards designed to protect the public."

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