Legality of Uber, Lyft in Ann Arbor still unresolved

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By Lara Moehlman, Daily Staff Reporter
Published January 29, 2015

Across Michigan, local governments have placed regulations on two prominent rideshare companies operating in the state, Uber and Lyft.

However, breaking from that trend, this past August the Ann Arbor City Council did not pass proposed regulations that would have placed significant restrictions on these rideshare services, requiring drivers to register with the city, provide proof of insurance and obtain a valid chauffeur’s license, among other regulations. No action has been taken on the issue since, leaving their status in Ann Arbor uncertain.

Councilmember Sabra Briere (D–Ward 1) voted against the proposed regulations. Briere said she opposed them because she believes that the Ann Arbor City Council has not yet figured out how to properly handle the operating models of companies like Uber and Lyft.

“Part of the reason we struggled with this is because the only model we have is an old model that doesn’t respond to modern technology,” Briere said.

Rather, she said the ordinance proposed in August treated rideshare services as if they were taxi services, instead of a separate entity.

“Trying to make (Uber) operate like a taxi would destroy it,” Briere said.

Though she acknowledged that Uber has received negative press, she said there are distinct benefits to having an accessible rideshare service that doesn’t require a reservation an hour in advance.

“All of the people I have spoken with who use Uber have felt comfortable and safe — which is not to suggest that every driver is perfectly vetted — I don’t know whether they are or aren’t,” she said. “It’s not to guarantee that every driver in every place that deals with Uber specifically is properly trained and has a properly safe vehicle, because I can’t guarantee those things either. I can only say that every rider with whom I’ve spoken to felt safe.”

Safety questions surrounding Uber’s operation is just one facet of the Uber controversy, which has emerged internationally as well.

In Ann Arbor, local taxi service owners and operators have raised financial concerns in addition to the safety concerns raised by members of the community and City Council.

Merlyn Wade, owner of Ann Arbor Cab, has been in the taxi business for almost 30 years. He submitted a five-page testimony to state legislators, outlining the flaws in a Michigan House of Representatives bill proposed in December. The bill called for statewide mandatory permits, insurance and screening for drivers for services such as Uber and Lyft.

Wade said, if passed, the bill would have allowed Uber to continue operating the same way it has been, without following regulations taxicabs have to follow.

“They would have been able to operate without a chauffeur’s license, without commercial insurance, without commercial plating,” he said.

He added that those rules are put in place to protect both the passenger and the driver in a taxi.

“They might seem archaic, but they’re there for a reason,” Wade said. “And the rules and the regulations that we have to follow out here are not excessive.”

Wade also noted the unfair advantage he sees in the Uber business model.

“I have a wife who’s terminally ill and I’ve got five children I’m trying to feed, and I follow the rules and I come out here, just like my drivers do, and these guys are allowed to come out here and operate illegally, and take food off the table of my family? How is that right?” Wade said.

“I don’t have a problem with Uber doing business. I have a problem with Uber not following the same rules everybody else follows,” he added.

John Etter, president of Blue Cab Company, expressed similar views. His cab company pays $5,000 to $10,000 per car a year.

“To have a competitor that doesn’t have to pay that? That doesn’t seem right,” Etter said.

Etter said he has seen business suffer as a result of Uber, especially with the student market on weekend nights.

In response to the new technology Uber on which operates, Etter said Blue Cab is working to develop an app of its own, which would allow customers to see where the cars are and keep their credit cards on file.

While taxi companies attribute a drop in customers due to Uber, Ann Arbor taxis themselves are not immune to safety concerns from the community. In 2013, the Ann Arbor News reported a Blue Cab taxi driver was arraigned for two misdemeanor assault and battery charges after a female customer reported he kissed her.