D.C - PowerPoint Presentation

Slide1

 D.C. TAXICAB COMMISSIONpanel on industry

PRESENTATION TO Regional Taxicab Regulators Task Force:d.c. taxicab commission report on “RideSharing” March 26, 2014Jacques P. LernerGeneral Counsel(202) 645-6019Slide2

Service entered D.C. without approval (Spring 2013)Unlicensed public vehicles-for-hire operated by unlicensed drivers. D.C. Code: vehicles impounded and drivers arrested by MPDDCTC creates the Panel on Industry to study current issues in the industry and make non-binding recommendations (August)Emergency legislation allows “ridesharing” while the Panel concludes its work (September-December) Panel studies “ridesharing” businesses, meets with industry stakeholders, and drafts the reportReport issued (January 2014)Rulemaking process expected to begin (April)

A Brief History of “Ridesharing” in D.C.Slide3

“Marketing impels passengers to believe the only relevant difference between a trip by black car and a trip by a “ridesharing” vehicle is a higher payment for a more luxurious ride. But that is not true. [So-called] “[r]idesharing” vehicles are personal cars with non-commercial tags driven by untrained, amateur drivers; black cars and taxicabs are commercial vehicles operated by trained professionals.” Report at page 3.What is the Service?Slide4

Findings 1: The New Service is Not “Ridesharing” The word “ridesharing” is not fair and accurate and “legally has no place describing a service that falls within the authority of the Commission.” The Commission could not license

or regulate this activity if its self-styled name were accurate. The term “ridesharing” confuses the consumer and lends legitimacy to an otherwise unlawful activity.Other jurisdictions have not focused on this issue.Slide5

Define “ridesharing” as “an activity in which passengers are grouped for a non-commercial purpose, such as defraying costs, reducing road congestion, decreasing fuel use, protecting the environment, and increasing ridership, in which no person has a for-profit interest.”Definition is for the Commission’s regulations only.Define the new service as “a public vehicle-for-hire service that uses digital dispatch to connect passengers with non-professional drivers operating their own personal vehicles”. Report at page11.The proposed rules will use the term “private sedan”.

Recommendations 1:Establish an accurate nameSlide6

Findings 2:The Need for InsuranceThe No. 1 issue for regulation.Adequate liability coverage must be available to cover claims by passengers and members of the public injured when vehicles are involved in accidents.

Claims do not fall within the coverage of ordinary personal motor vehicle policies (consider pizza delivery).Existing “excess liability” policies provided by the businesses may not be adequate to ensure coverage. These policies pay at $1 “if” personal policy refuses to pay.No coverage for driver or vehicle.Terms of service are misleading and may be incompatible with insurance requirements.Slide7

Driver/owner must maintain personal insurance. Business must provide “umbrella policy”.Covered activities under the umbrella (increasing scope):Whenever a driver has a passenger in the vehicleWhenever a driver is signed into the app (not the same as a “shift”)Whenever a driver is providing service (e.g. cruising for street hails)Whenever a driver is signed up (i.e. 24/7 until the relationship ends) Terms and conditions must not disclaim liability.

Recommendations 2:Require Adequate Insurance At All TimesSlide8

Equipment – Private Vehicles: Enforcement issuesVehicles not commercially tagged (trade dress)Driver/owners – “Little or no training”: Safety issuesCriminal background and driving records “Zero tolerance” policies but no screeningPolicies against taking street hails but the apps allow it (cruising)No “shift” limitsLicensing:

Who decides which drivers and vehicles are on the road?Findings 3:Concerns re Non-Commercial Drivers & VehiclesSlide9

Licensing process (both the business and the Commission): Business pre-qualifies driver and vehicle, sends application to DCTC.DCTC completes the process, issues “light” license and vehicle decal.Pre-qualification by business:Third party screens driver for criminal backgroundThird party screens driver for drug useDriver signs “owner’s agreement” to obey regulations, maintain insurance, etc. (excludes leasing)Vehicle receives safety inspection.DCTC checks driving record at DMVApproved drivers receive basic training from the business. Recommendations 3:

Driver & Vehicle: LicensingSlide10

Business model is similar to black carsExisting rules:No street hails (may require changes to the app)100% digital dispatch100% digital paymentAdditional requirements:DCTC decal on vehicle (trade dress optional)“Light” license limits driver to part-timeDCTC commercial license allows full-timeRecommendations 3:Licensed Drivers &

Vehicles: Operating RulesSlide11

How business is organized: uberX vs. Lyft & SideCar.The business is not unlike a taxicab company paired with a single digital dispatch service.The business is the only meaningful source of insurance coverage.

Unprecedented role in licensing and operation.Findings 4:The Private Sedan BusinessSlide12

Business must establish its compliance with all requirements for drivers and vehicles.Most important issue is adequacy of insurance policy.The digital dispatch service (which may be a separate company) must be registered for approval of its app, to provide quarterly trip data, and submit the passenger surcharge. Recommendations 4:The Private Sedan Business: LicensingSlide13

The business would play a unique and untested role, requiring a high level of cooperation with the Commission. The business must:Maintain insurance coverage (if lost, operations must be immediately suspended). Maintain zero tolerance policy for drug and alcohol use.Maintain requirements for drivers (drug screening, training, etc.).Maintain an inventory with DCTC for enforcement purposes.The digital dispatch service must:Modify its app to prevent street “dispatches

” and hold “light” drivers to part-time.Collect passenger surcharge and make quarterly payments to the District.Provide quarterly trip data to assess patterns of service and reconcile surcharge. Recommendations 4:Licensed Businesses: Operating RulesSlide14

Private sedan service creates new challenges for preserving and enhancing fair competition.Taxicabs find it difficult to compete fairly, in part because many private sedans cruise and take street hails.Taxicabs are the main source for wheelchair-accessible public vehicle-for-hire transportation. A reduction in taxicabs means fewer options for wheelchair passengers.Findings

5:Effects on the Taxicab IndustrySlide15

Level the playing field between taxicabs and private sedans: Allow drivers with DCTC commercial licenses to operate private sedans full-time.Allow dispatched taxicabs to go “off-meter”, with rates set only by the dispatch service, like black cars and private sedans.Study measures to prevent private sedans from hindering current efforts to increase the availability of wheelchair-accessible vehicles.Recommendations 5:

Effects on Taxicab IndustrySlide16

Jacques P. LernerGeneral CounselMain: (202) 645-6018Direct Dial: (202) 645-6019Email: jacques.lerner@dc.govContact Information