State leaders begin to study Uber, Lyft in hearing

–Steven Senne / AP

Supporters of Uber, draped in blue T-shirts, Lyft, in pink, and the taxi industry, in yellow, packed a State House auditorium Tuesday. They sat for hours in a colorful hearing, exchanging applause and boos throughout testimony about bills that could have a major impact on how smartphone-enabled ride-hailing services are regulated.

The conflict between cab services and the newer companies, which allow for car owners to arrange rides and take payment through apps, has stewed on the streets of Greater Boston (and elsewhere across the world) for more than two years. Many of the arguments throughout that time period—whether Uber and Lyft are technology or transportation companies, how driver backgrounds should be checked and insurance regulated, the extent to which the new companies have decimated taxi owners’ business—were echoed in the wide-ranging, 10-hour hearing of the legislature’s Joint Committee on Financial Services.

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Two of four proposed ride-hail bills featured most prominently Tuesday. One bill, from Gov. Charlie Baker, has the support of the ride-hailing companies. Another, from Sen. Linda Dorcena Forry and Rep. Michael Moran, has the strong endorsement of the taxi lobby. (You can read about the differences between the bills here.)

Baker’s bill would put Uber and Lyft under the oversight of the Department of Public Utilities, require drivers to put some sort of external marker on their cars, require the companies to cover the costs of regulation, and require that the companies maintain $1 million in insurance while rides are in progress. It would also institute a statewide background check system, but one that taxi advocates think does not go far enough. Angela O’Connor, who chairs the Department of Public Utilities, said the bill “strikes a balance’’ between allowing for new technology and providing public safety.

Forry and Moran’s bill, by contrast, would require Uber and Lyft drivers to protect their own vehicles with commercial insurance, to hold livery license plates, and to have their fingerprints taken for background checks. Uber and Lyft have resisted these ideas in the past, arguing they would stifle drivers’ abilities to get on the system. The insurance, they argue, would be too expensive and that fingerprint-based background checks too cumbersome. The companies have instead insisted the background checks they currently run work well enough.

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Forry and Moran said that Uber and Lyft are not just technology companies, but that they exist to provide transportation. As such, they said, they should play by the same rules as taxi companies.

“That is what you are. … These are loopholes that we are trying to close today,’’ Forry said.

The point was echoed by representatives of the taxi and livery industries throughout the day.

Uber’s East Coast General Manager Meghan Joyce said the Forry-Moran bill would put a regulatory burden on Uber’s drivers, rather than the companies the law would seek to regulate. Other provisions to the law include a requirement that all Uber and Lyft drivers’ cars not be more than five years old.

“If such a proposal were to become law, it would effectively ban ridesharing services from Massachusetts,’’ Joyce said in prepared remarks.

But Stephen Regan, who represents the Massachusetts Regional Taxi Advocacy Group, argued that if Uber is going to consider itself a technology company that facilitates rides between drivers and users, then that means the drivers themselves are breaking the law by not abiding by local and state livery laws.

Fingerprint-based background checks came up often throughout the day as a common point of inquiry among joint committee members. Boston Police Commissioner William Evans testified that he supports requiring Uber and Lyft use the checks. His predecessor, former Commissioner Ed Davis, who recently joined Uber as an advisor, testified on the company’s behalf, and said he felt the company’s existing background check process was sufficient.

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While Baker’s bill would not require a fingerprint background checks, it wouldn’t prevent individual cities and towns from requiring them, said Daniel Bennett, the secretary of the state Executive Office of Public Safety and Security.

The hearing may represent a crest for the issue in the Bay State, as it could ultimately result in legislation governing the popular but scrutinized ride-hailing apps. Sen. James Eldridge, who co-chairs the joint finance committee, said he is “hoping we can come up with legislation this session,’’ which would put Massachusetts on level footing with more than 20 other states that have already adopted rules for the newer services.

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