Several competing of ride-hail bills that would regulate for-hire transportation companies like Uber and Lyft will take center stage at the Massachusetts State House Tuesday.
The Joint Committee on Financial Services will discuss the four bills. One bill, sponsored by Gov. Charlie Baker, has Uber’s support. Another bill, proposed by Sen. Linda Dorcena Forry and Rep. Michael Moran, has the backing of the taxi industry, which has waged a virulent campaign in favor of regulating for-hire companies.
Uber and Lyft have stated their support for some form of legislation, if only to bring some clarity to how they can operate. Uber often points out that more than 20 states have already adopted what it considers “sensible’’ regulations—meaning, rules the company finds manageable.
Taxi operators have argued that Uber and Lyft are fundamentally transportation providers. They say the lack of regulation on those companies has put cabs at a competitive disadvantage. Cab owners have also complained that the value of their medallions—the municipal licenses to operate a taxi—have shrunk precipitously in the same timeframe.
Here’s what you need to know about how these bills might affect the biggest transportation apps in Boston.
The Baker bill
Gov. Charlie Baker has signaled support for letting Uber, Lyft, and similar services continue operating with limited new regulation.
His bill would task the Department of Public Utilities with regulating the transportation network companies.
The companies would pay a tax to the department to help cover the costs of regulating them. The bill would also require drivers with these services to put some sort of a decal or marker on their cars to show who they work for, which has become common in other areas where ride-hailing applications are regulated. All drivers would need to be 21 or older.
The companies would be required to conduct background checks on all prospective drivers, something Uber and Lyft already do. The legislation would add a new state background check for prospective drivers, but it would not require that it be a fingerprint-based check.
Uber and Lyft have resisted fingerprint-based checks, in part because they believe the process takes too long and clogs the pipeline of new drivers. Uber spokesman Taylor Bennett said the company also opposes fingerprint checks because they can include matches for people who were arrested for a crime, but not convicted.
The bill would also require that drivers be covered by a minimum $1 million insurance liability policy while a ride is in progress. It would be okay for the companies, as opposed to the drivers, to carry the policy—as Uber and Lyft currently do.
The taxi industry has fought against Baker’s proposal, advocating for regulations that would put tighter restrictions on the companies.
The Forry-Moran bill
The competing bill differs sharply from Baker’s proposal in several ways.
Drivers would be required to submit their fingerprints for a background check. The bill does not explicitly say drivers—rather than their companies—would need to carry commercial insurance. But it implies they would, by requiring that all vehicles be covered by commercial insurance and that drivers keep their companies aware of any changes to their insurance.
The bill would also prohibit drivers from operating at the airport, require that all cars used by drivers be less than five years old, and put restrictions on “surge pricing,’’ the Uber and Lyft practice of increasing fare prices because rider demand outweighs driver supply. Surge pricing has been a point of criticism for many Uber and Lyft users (and a point of celebration for drivers, who see it as an opportunity to make additional money).
Uber has led the outcry against the Forry-Moran bill, arguing that some of the components would stifle its ability to operate.
Shortly after debuting the legislation, Forry and Moran wrote an opinion piece in The Boston Globe arguing that their goal is to increase passenger safety.
What else is on the table?
A third bill, from Rep. William Smitty Pignatelli, would require a permitting fee of $5,000 per company. It would require that companies conduct their own background checks and would not require a separate state-run check. The bill would allow for drivers to be as young as 19. Like the Baker proposal, it would allow the companies to cover commercial insurance while a ride is in progress. Bennett, the Uber spokesman, said the company also considers this proposal “a smart approach.’’
Another bill, from Sen. James Timilty, deals exclusively with insurance. It would be similar to the Baker and Pignatelli proposals in that regard, but it would also require either transportation network companies or their drivers to maintain further insurance for when drivers have an app on but is not yet engaged in a ride.
How will this whole thing advance?
Both sides have appealed to their constituencies in advance of the hearing. Uber has circled a petition online against the Forry-Moran bill, a tactic the company has often used to fight regulatory efforts it considers burdensome. The company has also brought on former Boston Police Commissioner Ed Davis as a consultant to “work with the company to ensure it complies with any regulations the state imposes,’’ according to The Boston Herald.
Cabbies, meanwhile, held a meeting in late August to build support for the Forry-Moran bill and “rally troops for [the] hearing on the 15th,’’ according to Massachusetts Regional Taxi Advocacy Group spokesman Stephen Regan. Both sides have also put plenty of money into lobbying on Beacon Hill this year.
Sen. James Eldridge, who co-chairs the committee that will hold the Sept. 15 hearing, says the issue is a “top priority,’’ and that he feels there is some “urgency’’ to reach a resolution. The hearing is just one step in the legislative process. If and when legislators ultimately vote on a final bill, it may not cover everything. Other issues that have dogged the ride-hail companies and remain unaddressed in all the bills—including the brewing dispute over whether Uber and Lyft drivers should be considered contractors or employees—promise to linger as transportation network companies continue to grow.
Anti-Uber protests in France: