Rep. Edwards introduces bill to regulate transportation network companies, such as Uber
STATE HOUSE — With the astonishing growth of transportation network companies, such as Uber and Lyft, House Majority Whip John G. Edwards wants to make sure it’s a smooth road ahead.
Representative Edwards (D-Dist. 70, Tiverton, Portsmouth) has introduced legislation (2016-H 8044) that would create a comprehensive regulatory scheme for companies that use software application services to connect passengers to transportation providers.
“There’s no question that these ride-sharing companies are meeting a definite need in the marketplace, and I applaud their efforts and ingenuity.” said Representative Edwards. “I just want to make certain that they abide by regulatory rules and regulations just like everybody else. Competition is great; an unfair advantage over traditional taxi services is not.”
The three issues of utmost importance to Representative Edwards — that the companies comply with strict insurance regulations, that drivers submit to background checks, and that the company pays taxes like everybody else — are all addressed in the legislation.
Use of ridesharing networks has grown tremendously. Lyft and Uber, along with others such as SideCar, Get Taxi, Hailo, leCab and Taxi Mobility, offer a convenient, low-cost way to get around. Appealing to users is their simplicity. The networks consist of a smartphone app and willing drivers.
Appealing to passengers is the convenience of catching a ride with one of these services. After downloading the free app onto a smartphone and entering your credit card information, all you do to summon a ride is enter your location.
Critics claim they have an unfair advantage over taxis by not having to play by the same set of rules, regulations and licensing requirements. Transportation networks are quick to differentiate themselves from taxicabs. They don’t hire drivers or purchase vehicles; they merely facilitate transactions between individuals.
At the forefront of the Edwards bill is the requirement that the companies register their vehicles and provide necessary insurance information to the Division of Public Utilities and Carriers, along with obtaining a permit. Each permit, which would come with an application fee of $15,000, would allow for the use of 100 vehicle identification devices. There would be an annual charge of $150 for every vehicle over 100.
The bill also requires drivers — including traditional taxicab drivers — to undergo a national criminal records check. Also, all transportation network companies would be subject to the same taxation as traditional taxicabs, including sales and use tax.
“This legislation evens the playing field by making sure that these new companies pay their fair share in taxes just like everybody else,” said Representative Edwards. “It also ensures public safety by spelling out insurance regulations and requiring criminal records checks. These background checks are required in many other professions. They should also be a requirement for those who are responsible for the lives of their customers.”
The legislation also provides that customers must be told in advance how much the fare would be, along with the method used for calculating the fare. It would also require that the website provide a picture of the driver and the license plate number. The bill would outlaw cash payments, or the accepting of fares beyond those that are scheduled through the app.
Rhode Island would join several other states that have enacted regulatory legislation on the growing industry. In 2014, Colorado enacted the first-in-the-nation regulatory framework for transportation network companies. It gives the Public Utilities Commission the power to revoke and suspend a transportation network’s permit as the result of a violation, but it prohibits the commission from assessing a penalty against a driver. The law also directs the Division of Insurance to examine whether the levels of insurance coverage required are appropriate.
“According to many of these companies, they already conform to the regulatory requirements, but there are still a lot of questions regarding insurance,” explained Representative Edwards. “This legislation would spell out the insurance requirements of vehicles in a transportation network company, ensuring financial responsibility and giving passengers peace of mind.”
The legislation, which is cosponsored by Representatives Joseph S. Almeida (D-Dist. 12, Providence), Arthur J. Corvese (D-Dist. 55, North Providence), Christopher R. Blazejewski (D-Dist. 2, Providence) and Grace Diaz (D-Dist. 11, Providence), has been referred to the House Committee on Corporations.
For more information, contact:
Daniel Trafford, Publicist
State House Room 20
Providence, RI 02903