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Uber and Lyft come rolling back

To Austin:

Texas Gov. Greg Abbott on Monday signed into law a measure creating a statewide regulatory framework for ride-hailing companies, overriding local measures that prompted businesses such as Uber and Lyft to leave Austin and other cities.

Uber and Lyft said they resumed operations in Austin on Monday. Lyft also said it would relaunch in Houston on Wednesday (Uber is already operating in Houston.)

“What today really is is a celebration of freedom and free enterprise,” Abbott said during a signing ceremony. “This is freedom for every Texan — especially those who live in the Austin area — to be able to choose the provider of their choice as it concerns transportation.”

House Bill 100 undoes local rules that the two companies have argued are overly burdensome for their business models. It requires ride-hailing companies to have a permit from the Texas Department of Licensing and Regulation and pay an annual fee of $5,000 to operate throughout the state. It also calls for companies to perform local, state and national criminal background checks on drivers annually — but doesn’t require drivers to be fingerprinted.

“Today’s bill signing creates a ridesharing network in Texas that benefits consumers, expands transportation options, maximizes access to safe, affordable rides and creates expanded earning opportunities for Texans,” Lyft spokeswoman Chelsea Harrison said. “Riders and drivers are the real winners today.”

And (for Lyft) to Houston:

Ride-hailing company Lyft will officially return to the Houston market.

San Francsico-based Lyft will return to Houston on May 31 at 2 p.m., according to Chelsea Harrison, Lyft’s senior policy communications manager. The move comes shortly after Gov. Greg Abbott signed House Bill 100, a statewide comprehensive transportation bill, on May 29. Lyft has been ramping up its local marketing, recruiting drivers and offering discount codes to riders since the bill went to the governor’s desk for signing.

“Today’s bill signing creates a ridesharing network in Texas that benefits consumers, expands transportation options, maximizes access to safe, affordable rides and creates expanded earning opportunities for Texans. Riders and drivers are the real winners today,” Harrison said in an email.


HB 100’s rules are expected to go into effect in September.

Actually, that law went into effect immediately after Abbott’s signature, as it was passed with a two thirds majority in both chambers. The normal rule is that bills go into effect after 90 days, but with a supermajority they go into effect immediately.

You know how I feel about this. I think it was reasonable for the Lege to clear the way for TMCs to operate outside of cities, and I can see some value in a uniform approach to regulating them. I don’t care for the ongoing contempt for local control, and the gratuitous “definition of gender” amendment really sticks in my craw. In the end, I largely agree with this:

Following the passage of the bill in both chambers, however, Austin Mayor Steve Adler issued a statement saying he was “disappointed” the Legislature voted to nullify regulations the city had implemented.

“Our city should be proud of how we filled the gap created when Uber and Lyft left, and we now must hope that they return ready to compete in a way that reflects Austin’s values,” Adler wrote.”

There’s clearly a demand for what Uber and Lyft sell, but let’s not kid ourselves into believing that HB100 has just ushered in some free-market nirvana for ride-seekers. I mean, surely at some point in the future Uber will succeed in buying up Lyft, thus making it a functional monopoly in that market. How exciting will it be then to have the equivalent of a cable company for ridesharing? The brief period in Austin where a bunch of companies actually competed for drivers and riders is what a free market looks like. Too bad none of the rest of us will get to experience that.

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  1. Joshua ben bullard says:

    Every Texan,is now required to pay one man ( Travis kalinik) of uber 29% before they can legally board or hire a driver that has been background checked to state standards,it is still illegal for any citizen to hire the driver (tnc) direct ,even though 60% of the pick up locations are in Major people platforms such as Major stadiums, Hotels ,Airports, Downtown’s, Medical centers,it is illegal for the 80,000 people at NRG stadium to board and hire direct the tx tnc driver= They must first pay uber in San Fran first ,even thought the cars are already out front in the que,there already there at the airports and all Major people platforms. What our genius Money loving Mayor Should do #sylvester turner ,if he would put his mind in the correct area of thinking since he has lead this city with a vision to no where in hired transportation -is abolish the limits of entry for taxi like 90% of the country has done and lower the taxi fares 5% below ubers price.altogether ,abolish the limits of entry currently we have (2400) taxi permits 2000 owned by the man that gave Mayor Turner 100,000$ sss,end the limits of entry and lower the price of the taxi fare 5% lower than the app rates( lower than ubers rate) that way everyone can board direct at Houston’s major people platforms with no wait time,no surge price and pay 5% less than ride share,app rates ,or uber.even hailing a taxi in Houston will be 5% lower than the app rates ,taxi will survive and thrive,if its not done this way ,then you’ll spend the rest of your life paying Travis kalinik of uber 29% just to board the car that’s already out front waiting for you.

  2. C. L. says:

    We get it Josh, you ain’t gonna hire an Uber driver…and you don’t care for Sylvestor Turner….and have no experience with/in separating streams of thought with periods or commas or semi-colons.

  3. Joel says:

    “The brief period in Austin where a bunch of companies actually competed for drivers and riders is what a free market looks like. Too bad none of the rest of us will get to experience that.”

    goodness. did your cab companies leave town, too?

  4. C. L. says:

    @Kuff… I’m with Joel, or at least where I think Joel’s going…

    Let’s say I live in Houston or Austin or Dallas and I need to get from one side of the city to the other and I don’t have a car. With Uber and Lyft in town, I still have the option of hiring Yellow Cab or United Cab or Houston/Austin/Dallas VIP Taxi or any number of other services, right ? How did Uber or Lyft eliminate that option for me ?

  5. CL and Joel, yes, cab companies still exist, but they’re not really participants in a free market, as they are still very regulated by their cities. Also, the people who have been clamoring for Uber and Lyft are not cab riders. But even if you accept cab companies as entrants in a free market for paid rides, a market with two or three dominant players is still less free, and thus less consumer-friendly, than one with multiple players, none of whom control a significant piece of the market. That’s all I’m saying.

  6. Bill Daniels says:

    Whoa. We are all extolling the virtues of a free market system here, of limiting barriers to entry, etc? Outstanding! I picked the right day to peruse this blog.

  7. Joel says:

    Well, since cities just lost the ability to regulate rideshare companies, I suppose they could respond by eliminating regulations on taxis, too. I mean, really why even bother at this point?

    But in any case, I just don’t get the fixation with Uber. Anyone who would take Uber but would refuse to take a taxi is not worth my worry. And taxis continue to be perfectly viable alternatives here in Austin. We even have a new homegrown coop taxi company …

  8. C. L. says:

    @Kuff… Regardless of Speedy Taxi Co., being regulated in the City in which they operate, I, as a consumer of the service, still have the ability to exercise my free market choice, and the number of cab/taxi services in Houston still well exceed the hipster choice of Uber and Lyft, right ?

  9. Joel says:

    I don’t think that last part is true, which is his point I think. Taxi companies can’t compete as long as permits are limited and ubers aren’t.

  10. C. L. says:

    Isn’t that how the free market works ? Businesses that consumers choose to patronize thrive while those they don’t, fail ? Is the deck stacked against Yellow Cab ? Probably, but that’s because the City found a way to ring a dollar out of cab companies by selling medallions or permits or by taxing them in some fashion. If the CoH thought they could squeeze McDonalds for a nickel every time they sold a McNugget inside the city limits, they would. I can’t blaim Uber or Lyft for building a better mousetrap.

    For the record, I haven’t been in a cab in years, and have never used Uber or Lyft.

  11. Bill Daniels says:


    Again, I agree100%

    @Joel: The problem with local regulation of conveyance businesses is, it leads to a byzantine system of rules that most companies could not manage. So let’s say I want to take a taxi from Houston to Alvin. My taxi would have to meet regs from Houston AND Alvin in order to be legal. On top of that, the taxi passes through Pearland, maybe Friendswood, too, just to get me to Alvin. Is my taxi meeting all the rules of Pearland and Friendswood?

    In Mexico, you can buy a license plate good only in the state that you live in, so if you drive to a neighboring state, you’re breaking the law. Why not just get the plate that makes you legal to drive anywhere? Regulation by cities just creates barriers to entry into the taxi industry, leading to higher prices and worse service for the consumer.

  12. Joshua ben bullard says:

    No ,they don’t ,to date there are well over ,40,000 uber /lyft cars ,while taxi is 2400= 2000 owned by one have no free market choice to pay any driver direct .if you take uber driver or a taxi ,your mandated to pay one of 2 men 29% extra first.that’s not ” free market will”.that’s a monopoly and it cost you and your family a fortune over a natural lifetime.