Council puts limits on rideshare companies

Rideshare companies catch a break with Mayor Murray's new plan. Credit: Credit: Raido Kaldma

A limit on rideshare vehicles for at least the next year is part of Seattle’s City Council’s new set of taxi and rideshare regulations approved in a unanimous vote Monday.

Seattle has three rideshare companies operating within the city, and each will be limited to 150 vehicles on the road at any one time. That translates to a limit of 450 rideshare vehicles, which the app-based companies had maintained would be inadequate to meet consumer needs. Current estimates say there are more than 2,000 drivers working for the firms in Seattle. Council members also agreed to explore raising that cap in one year.

The council also told the city staff to begin identifying and mapping out how to tackle future issues around taxis, limousines and rideshare issues. “The industry is changing, and I expect you’ll all be eventually competing without caps,” Councilmember Bruce Harrell told the audience, mostly taxi and rideshare drivers, who packed council chambers for the vote.

Councilmember Tom Rasmussen, a critic of the limits, said of Monday’s taxi-rideshare vote: “This is not a perfect bill. But it’s better than what we have now. … This is a wake-up call to the city to how our transportation system is changing.”

The new taxi-rideshare law is an attempt to balance innovation in the evolving transportation picture, consumer protection and fair competition with the long-regulated taxi industry.

Uber ridershare’s Seattle manager Brooke Steger issued a sharp statement about the council action. “It’s astounding that that the city council has chosen to ignore the voices of nearly 30,000 constituents and move to put hundreds of drivers out of work,” Steger said. “This fight is not over, and as we explore our options, we urge Mayor Murray to reject the anti-competitive and arbitrary caps that will slingshot Seattle’s transportation ecosystem back into the Dark Ages.”

Samatar Guled, an immigrant from Somalia who has driven a Seattle cab for 15 years, criticized the new companies’ unwillingness to face regulations like the existing firms. “They’re still afraid to compete with us. We’re refugees who are barely surviving,” he said.

The new taxi-rideshare law is an attempt to balance how public transportation is evolving against not giving rideshare companies a free pass to the tougher rules followed by the taxi industry. The blossoming mobile-app rideshare industry has gained national scope, with three services now having footholds in Seattle — UberX, Lyft and Sidecar.

The new ordinance, which still needs Murray’s signature to go into law, strengthens the insurance requirements on rideshare drivers to become close — if not the same — to what taxi drivers need. The complexities between providing insurance in the two similar-but-separate industries led to haziness Monday on whether the requirements are exactly the same. Driver testing and vehicle checks for rideshare drivers have become the same. The council added an amendment to the bill that forbids one corporation from owning more than one ridesharing subsidiary in Seattle, something that taxi drivers had pointed to as a potential way to sidestep the 150-driver cap. “This is to make sure we don’t have an UberX, an UberY and an UberZ,” ‘said Councilmember Jean Godden.

Council members Rasmussen, Tim Burgess and Sally Bagshaw unsuccessfully tried to eliminate the cap on rideshare drivers. “It arbitrarily limits a popular service. … Let’s not cut supply when the demand is so high,” Rasmussen said. However, the majority of the council agreed with Councilmember Bruce Harrell’s argument that taxis have limits on the numbers of licenses as well as facing strict regulations — and rideshares companies should face the same requirements.

Councilmember Sally Clark was the council’s point person on this issue. She said the three rideshare companies started setting themselves up in Seattle before working out the details with the city government. She praised them for their innovations but pointedly criticized them on what had been seen by council members as slowness and reluctance to share detailed information that could have eased the shaping of the legislation.

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