If you live in Chicago and use taxis there is a good chance you have heard about Uber, Side Car and Lift. If you think that these car services are a good deal and cheaper than a cab, you may want to think again! The price may be right but the real problem is the drivers may not have proper training or similar licenses to those of taxi or limo driver. Over a year ago, Uber was sued by the taxi and livery companies in Chicago. According to the press release, Uber was accused of violating the Chicago and Illinois laws designed to protect public safety, provide consumer protection and promote fair practices.
The taxi industry, which has labeled companies like Uber as a rogue app, has lobbied City Hall for help. The Department of Business Affairs and Consumer Protection proposed a rule that would have banned livery vehicles from using devices such as smartphones to calculate fares based on distance; if passed it would have shut Uber and its competitors down. The proposal is on hold pending the outcome of the federal lawsuit.
What makes Uber interesting is that it is a venture capital startup transportation network company, based in San Francisco and valued at 4 billion dollars. Many of these new tech companies are known in revolutionary terms as the SHARING ECONOMY! The company’s app is a marketed as a match-maker in various cities and countries. Cars are reserved by sending a text message or by using a mobile app.
The City is working to fill the regulatory vacuum that has given ride-sharing companies an unfair advantage over taxicabs, while providing no safeguards or protections for consumers. A 20-page ordinance is being introduced in a City Council meeting that would license ride-sharing companies as “transportation network providers” and require them to pay an annual $25,000 fee, plus $25 per driver.
UberX, Lyft, SideCar and other ride-sharing companies that allow drivers to offer rides in their personal vehicles to passengers who order them on their smartphones also would be required to pay the city’s $3.50 a day per vehicle ground transportation tax, the same tax already imposed on cabs. To guarantee passenger safety, the ordinance would require licensed ride-sharing companies to properly train drivers as well administering drug tests to their drivers, conducting regular criminal background checks and make sure that their ride-sharing vehicles pass an annual 21-point inspection.
Ride-sharing companies also would be required to secure “general liability” and “commercial auto liability” insurance with limits no less than $1 million per occurrence that would apply whenever the driver has their smartphone on and is trolling for fares. With all of its new regulations, the ordinance still preserves the distinction between ride-sharing vehicles and cabs.