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Thursday, April 9, 2015

City Council passes ridesharing ordinance, but Uber and Lyft representatives still dissatisfied

Posted By on Thu, Apr 9, 2015 at 4:50 PM

click to enlarge Supporters of Uber and Lyft flooded the City Council chambers at City Hall today. - JEANIE RIESS
  • JEANIE RIESS
  • Supporters of Uber and Lyft flooded the City Council chambers at City Hall today.

Today, after months of debate and reconfiguring, the New Orleans City Council passed a ridesharing ordinance that would allow digitally-based transportation companies to start giving rides in the city. The vote was 4-2, with Councilmembers Nadine Ramsey and James Gray opposed. Council President Stacy Head was absent.

But both Uber and Lyft, ridesharing businesses that have been instrumental in getting the legislation off the ground, told Gambit they likely would be unable to operate due to 85 amendments made to the ordinance. 

Both Uber and Lyft are particularly dissatisfied with amendment 85, a provision that would prevent transportation network companies or TNCs (the newly minted, digitally-based, for hire companies the ordinance creates) from interfering with passenger or driver litigation. That amendment gives local passengers the right to litigate here in New Orleans as opposed to traveling out of state to litigate binding arbitration.

"The eleventh-hour changes make it very difficult to operate in the market," Michael Masserman, Lyft's director of government relations, told Gambit. "Not just for Lyft and Uber but for anyone in the ridesharing industry. There's potentially overly burdensome litigation costs and insurance measures that have been legislated ahead of or before the private sector." 

Tom Hayes, Uber's local general manager, said he would not be able to assess whether the San Francisco tech company would be able to operate here until his team had a chance to evaluate the amendment. But in public comments made to the council, Trevor Theunissen, Uber's public policy manager for the Southeast, said the company would not be able to operate as long as the amendment passed.

"There's a strong and enduring public policy decision that's been repeatedly affirmed by the Supreme Court to encourage arbitration of dispute," Theunissen said during the meeting. "Uber, like many companies — including some here like the [New Orleans] Pelicans, the [New Orleans] Saints, the Superdome — many companies are relying on this national view to require arbitration of disputes."

As passed, the ordinance says that no special license would be required for drivers for TNCs, though traditional cab drivers require a special chauffeur's license. A TNC driver would need to pass a background check, but would not be required to complete a fingerprint check — both of which are required of cabdrivers. TNC vehicles also would not need commercial license plates, though the city requires taxis to have them.

Insurance would be handled via a compromised insurance model bill, complete with two periods of liability coverage. Period one would cover the driver when a for-hire app is turned on but before he or she has matched with a rider. Period two would take effect from the time a driver is matched with a passenger to the completion of that ride.

TNC vehicles would not be allowed to sit at cab stands, be hailed by passengers on the street or accept cash — a rule that Jason Coleman, who owns Coleman Cabs, warned the council Uber and Lyft frequently flout in other cities.

click to enlarge John Virga shows his support for Uber. - JEANIE RIESS
  • JEANIE RIESS
  • John Virga shows his support for Uber.

The council chambers were packed with a myriad of pink, black, green and light blue t-shirt clad supporters of Uber, Lyft, the taxicab lobby and the anti-smoking lobby, which was waiting for the council's next order of business. The debate roared on between the two sides, with the same major players who have made their voices heard over since the ridesharing issue was first taken up last February.

In his closing remarks, just before the vote, District D Councilmember Jared Brossett said he considered the lack of dissatisfaction on both sides a good sign.

"The fact that it's not 100 percent of what either side prefers is a sign that we have struck the right balance," he said. 


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