Portland’s tightly regulated cab industry is about to become a free-for-all.
The city's Private For-Hire Innovation Task Force—tasked earlier this year with crafting new rules for a fast-changing market—on Thursday approved a final set of recommendations it will present to city council on April 9. But some details still need to be worked out.
The city council is scheduled to vote April 15 on changes that would allow so-called transportation network companies (TNCs) like Uber (waiting in the wings since the city booted it in December) to operate within city limits … at least for a 120-day trial period.
Among the sweeping changes the task force will recommend: no limits to what TNCs may charge, no cap on the number of for-hire vehicles (that includes taxis and TNCs), and a possible fee for TNCs that would help provide transportation for people requiring specialty vehicles.
Under current rules, cab companies have a $2.50 base price, meaning the minute a rider enters a cab, before going anywhere, the fare is already $2.50. The city has imposed a maximum per mile rate of $2.60.
The task force's recommendations would keep those regulations in place for cabs, while TNCs are allowed to set rates wherever they want, barring abnormal market conditions—such as during an earthquake or snowstorm. In other cities, Uber drivers sometimes charge more during “surge” times, when demand for rides is higher.
“We (taxi drivers) are just fine with surge pricing, but we can’t compete with Uber when they undercut our rates,” says Wynde Dyer, a driver for Green Transportation. “We can’t go around giving out vouchers for $20 rides like Uber can do.”
Dyer claims fare deregulation and dissolution of permit caps gives TNCs an unfair advantage, but members of the task force say easing regulations will help both the city and the for-hire transportation companies.
“What we’re trying to do is remove the bottleneck in the permitting process that we’ve seen for decades,” said task force member Jewel Minarik. “Part of what you’ll see in these recommendations is relieving those bottlenecks so we can get permits issued in a more timely manner.”
Taxi drivers, under current code, apply for a driver's permit as an individual. One of the ways the task force suggests expediting the process is to issue those permits to the TNC or taxi company rather than each driver. This would free up city resources and put the company on the hook for ensuring drivers meet regulations rather than the city.
“During the 120 day period, any qualified TNC can be permitted in Portland if they’re in compliance with the regulatory framework,” said task force member Richard Lazar. “The TNCs will be responsible for permitting drivers within that framework.”
This four-month "Phase I" period could begin April 15, if city council agrees with the recommendations—setting off a chaotic stint in which officials will attempt to figure out how to accommodate companies like Uber without (what some say will be) flooding the city with TNC drivers that could put existing cab companies out of business.
“Caps have been imposed on the for-hire industry to balance supply with demand, while ensuring drivers the ability to make a living wage,” said Kelliann Amico, a spokeswoman with the Transportation Fairness Alliance, a partnership of six Portland cab companies. “Allowing deregulation to occur before all of the relevant issues are carefully considered will prove problematic. And, trying to place regulations on Uber and Lyft after the fact will be impossible.”
City officials agree that they don’t know how they’ll rein in the Wild West approach once the gates are opened.
“That’s a really good question,” said Portland Bureau of Transportation’s Private for-Hire Transportation Program Manager Frank Dufay. “We really don’t know how that would work.”
The task force is also unsure exactly how they’ll improve admittedly lacking service to Portlanders who request wheelchair-accessible or otherwise specialty equipped vehicles.
At a Tuesday meeting, the group tentatively settled on charging TNC companies 10 cents per ride during the 120-day trial period. That money would go into a fund that would be spent to analyze data collected in Phase I to determine the extent of unequal service levels for disabled riders and implement methods to bring service to acceptable levels. By Thursday’s meeting, that 10 cents per ride had jumped to $1.
“That seems like an incredibly arbitrary number and the fact that the changes were made after we voted (on Tuesday) brings up the process as being suspect," said Sue Stahl, a task force member representing the Commission on Disability. “I retract my support. I am simply feeling defeated … I don’t feel the task force has done a good job. The system is still broken.”
Bryan Hockaday, a policy advisor in Transportation Commissioner Steve Novick’s office, suggested imposing a flat fee on TNCs during the trial period rather than a per-ride surcharge, saying that TNCs would likely pass that on to customers.
“The goal is to fund data analysis and a surcharge would place the funding on passengers, not TNCs,” he said. “We should charge the company as opposed to enacting a fare fee, which actually charges the passenger.”
It’s unclear how the revenue from the fee would be used to find solutions to providing equal access, but that, like many other topics the task force tackled, was shelved until a second phase begins mid-July.
“My thinking is to put a system in place during the interim period. We know the current system doesn’t work, so which system will work best?” Lazar asked. “I’m not sure it’s feasible to implement in Phase I, and I don’t know if we could get it up and running.”
The task force can deliberate all day, but April 15 is when the rubber meets the road, both literally and figuratively, and it’s now up to city council to determine how to regulate that playing field.