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Austin versus San Antonio on ridesharing

The Current reviews the state of play.

Uber

In the spring of 2014, Lyft led the way in Austin, but the company launched without city approval and was eventually banned, along with Uber, which launched in the capital a short time later. Roughly a year ago, Austin’s city council eased its fight, allowing ride-hailing companies to operate. Last week, Austin policy makers approved requiring drivers to pass finger-print based background checks. Now Uber and Lyft are warning that they may cease operations in the city.

Sound familiar?

Lyft

Around this time last year, city council amended its vehicle-for-hire ordinance to include regulations for Lyft and Uber. Part of the new rules meant that drivers needed finger-print based background checks. So the companies threatened to leave the city, and followed through about three months later. That move came two months before a mayoral election, and bringing the companies back became a regular campaign talking point.

However, over the summer, San Antonio’s city council worked out a compromise with the companies: a 9-month pilot program with a driver option for finger-print based background checks that provide those who pass with a city-certified badge in the ride-hail applications. Lyft immediately agreed to return when city council narrowly approved the pilot program in August, and Uber returned in October.

See here for some background on San Antonio, and here for some on Austin. As the story notes, it’s unclear what will happen when San Antonio’s pilot program, in which fingerprint background checks were an option but not a requirement, comes to an end. I suppose that will depend in some way on how things play out in Austin, whether Uber and Lyft make good on their threat or if Austin’s City Council blinks. Remember, there’s another player in this, which is Get Me, and they have agreed to abide by the fingerprint requirement. They may wind up with the Austin market to themselves, and who knows what effect that could have. I will note that Houston has a fingerprint requirement, and Uber has chosen to stick it out here anyway. They claim to be thriving here, which seems to me to undermine their argument that having fingerprint background checks is a dealbreaker for them. Whatever else happens, all this strongly suggests to me that we will see another attempt to pass a law setting regulatory guidelines for transportation network companies in the 2017 Legislature. What we have now isn’t politically stable for the long term.

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One Comment

  1. Joshua ben bullard says:

    Its almost like Washington DC,I can’t see where the Austin city council isn’t over playing there hand by forgetting that all the Tx state officials work there and are only encouraging the 2017 lege/to completely take this out if their hands ,which if I were a betting man,I would take odds on the state taking 100% over site over transportation ,for hire.