Transportation networking companies like Uber and Lyft have been operating in Austin, Dallas, and San Antonio for months now, even though they’re currently illegal in those cities. (Houston voted to approve an ordinance that allowed the companies to operate in August.) Drivers providing rides through the service are subject to tickets and potentially having their cars impounded, resulting in a curious grey market where enforcement is very limited—though sting operations have busted at least a few Lyft drivers. Cities are thus pressured to either approve the services or accept a degree of lawlessness.
This all came to a head in Austin this week, when a city ordinance—which passed through city council on first reading last week—was expected to be approved on Thursday night, the day before the Austin City Limits Festival, of which Uber is a sponsor.
Every ACL wristband purchased comes with a $30 credit for the Uber service, and Uber sent out confident press releases on Thursday afternoon boasting about “the fun stuff” the company has planned for the festival. Opponents of the service—whose arguments range from “it’s unfair to cab drivers who must pay for licenses” to “there are massive potential liabilities when people without commercial insurance policies start offering rides for money” to “these companies exploit their drivers“—saw the fact that Uber was an ACL sponsor and that the final vote was coming the day before the festival began, and assumed that the fix was in.
Austin is rushing an operating agreement this week to legalize Uber & Lyft b/c of upcoming ACL music festival, of which Uber is a sponsor.
— Scott Kilpatrick λ☭ (@skilpat) September 29, 2014
Surprisingly, though, both the cocky press releases and the conspiracy theories proved to be less prescient than it appeared on Thursday morning. Austin City Council opted to kick the transportation networking company (TNC) can down the road:
Ahead of Thursday’s City Council meeting, ride-sharing companies like Uber and Lyft made their voices heard with a big rally.
But the final vote on the ordinance to make them legal got pushed back.
Council member Chris Riley who drafted the ordinance wanted to pass it on an emergency basis but there were many concerns from some of the other council members, especially Laura Morrison.
“One of the big issues though is that we have taxis and we’ve been regulating the heck out of them for years. And so how is it that we can fairly embrace this new technology with TNC’s but at the same time equalize things so that the taxi drivers are sort of released too and have somewhat of a level playing field,” Morrison said.
The council ended up passing the ordinance 6 to 1 on the second reading. Morrison voted against it.
The legal team will make changes regarding issues like insurance and price gouging and the council is expected to look at it again on the 16th for the third reading.
Ultimately, of course, that October 16th vote will probably pass, if Thursday’s vote went 6-1 in favor of the TNCs. But given the confidence that Uber has expressed in sponsoring a festival that it can’t legally service, and offering discounted rides that can get their drivers arrested, it’s hard not to view the fact that the ordinance failed to pass immediately as anything but a defeat for the company.
TNCs are ultimately going to be a part of the future of transportation in this country, much like Airbnb and similar services are part of the future of travel, or even how Bittorrent and filesharing are part of the future of digital media. The Internet likes providing things on a peer-to-peer basis, and finding a way to make that legal is in everyone’s best interest. In Austin, though, the city seems content to get there at its own pace.
