Lawmakers move to regulate Uber statewide

By CHEYNA ROTH
Capital News Service
LANSING – Who should be in charge of regulating Uber, the app-based network of independent taxi drivers that’s operating in cities across Michigan?
A state representative thinks the legislature should make the rules to provide consistent statewide regulation.
But local governments that have already negotiated regulations with Uber and traditional taxi companies think the state should mind its own business.

Uber is an entrepreneurial taxi service that connects people in need of a ride with approved drivers through a mobile app. An Uber driver can be anyone over 21 who has signed up, passed a background check, and owns a reliable vehicle with insurance.
Uber reached Metro Detroit in March 2013. Since then, it has popped up in Kalamazoo, Lansing, East Lansing, Ann Arbor and Grand Rapids.
The company is currently regulated by its own standards as well as local ordinances. But proposed legislation sponsored by State Rep. Tim Kelly, a Saginaw Township Republican, would impose one set of restrictions across the state. This would prevent individual municipalities from adding their own restrictions tailored to their area’s needs.
Some of the restrictions that would be imposed statewide include having a specific sticker on vehicles and particular insurance requirements.
Before Kelly introduced a similar bill last year, Lansing and East Lansing officials worked for several months with Uber to create specific standards and regulations unique to the joint concerns of those cities. If the new bill were passed, that work could be negated.
This is not the right way to go, said Rep. Andy Schor, a Lansing Democrat. Although Schor supports regulating companies like Uber to ensure safety, he said communities that have already come up with a system should be exempt.
“To not allow a bill that goes through … to have exceptions for where they already negotiated is disappointing,” Schor said, “and I won’t support the bill unless that is in there.”
Last term Schor offered an amendment that would allow local communities to make changes as they saw fit, but the amendment was defeated. Kelly’s bill died before leaving the House during last term’s lame-duck session.
Uber supports Kelly’s bill, preferring consistent standards over local autonomy. Mike White, general manager of Uber in Michigan, said the company wants to provide “transportation as reliable as running water,” which would be easier if drivers could move across city lines without worrying about conflicting regulations.
Statewide regulation would help with the safety of driving while increasing revenue for drivers, said Michigan State University senior and Uber driver Alex Scharg, from Bloomfield Hills.
But other stakeholders are not so sure this is the right approach for local communities.
“We don’t have a lot of faith that the state can be an effective regulator of transportation network companies,” said Randy Hannan, chief of staff to Lansing Mayor Virg Bernero and chair of the newly created Greater Lansing Taxi Authority. “They’re much like taxis … and local governments have successfully regulated the taxi industry for decades. So we think there is a strong argument to be made for local control.”
Uber has yet to disclose plans for continued expansion in Michigan, but White says the company is constantly looking for new areas with high demand. According to an internal study, 162,037 Uber drivers completed four or more trips in the U.S. during December 2014.
Some pushback has come from the Michigan taxi industry, but Hannan says that is understandable. The industry has indicated that it wants a level playing field and for Uber to operate under the same standards as they do, which is something the Greater Lansing Taxi Authority is attempting to address. Hannan says competition is good for consumers and that these two types of services can live in the same space.
Echoing Schor, Hannan said Lansing and the taxi authority do not oppose state regulation as long as it includes local flexibility to address such issues as taxi stands.
“To completely knock us out of the business of regulating what we are seeing in this industry, we think, would be a mistake,” Hannan said.