Lawmakers debate allowing Uber and Lyft statewide

(AP Photo/Ted S. Warren)
(AP File Photo/Ted S. Warren)

AUSTIN (KXAN) — The debate over whether ride-hailing services like Uber and Lyft can operate statewide took place at the Capitol on Thursday. Lawmakers grilled Uber executives about safety concerns at a House committee hearing.

Rep. Chris Paddie’s, R-Marshall, proposed bill would regulate companies that specifically use a smartphone app to link passengers to drivers, like Uber and Lyft. More than 60 people, made up of lobbyists, drivers, passengers, public safety officials and insurance agents, signed up to testify.

The Associated Press reports Uber and Lyft spent up to $1 million on lobbyists compared to the taxi industry which was about half of that, according to the Texas Ethics Commission.

Paddie said his proposal would require the companies to pay an annual registration fee of $115,000 and they would have to get a state permit every two years. It would cover the costs to implement the plan statewide. Paddie’s proposed bill would also mirror laws eight other states have adopted, which requires companies to have $1 million commercial insurance for drivers.

Another part of the bill would require companies to run drivers through a background check, something both Uber and Lyft said they currently do.

During the hearing, some lawmakers on the panel pushed for fingerprints instead, an idea Uber and Lyft disagree with.

“If we have to comply with a fingerprint mandate, it typically adds many weeks to getting a driver on the road and making money,” said Sally Kay, Uber’s head of U.S. State Affairs.

Matthew Assolin, vice president of a chauffeur business that operates in Houston and Austin, said both cities require his drivers to be fingerprinted, which he said “is crucial” to passengers’ public safety.

Sherman Republican Rep. Larry Phililps queried Kay over a recent incident involving a Houston Uber driver who was arrested after a passenger alleged she’d been sexually assaulted. The driver was later found to have had a 10-year-old federal conviction and hadn’t received a permit from the city, which requires fingerprinting.

Kay said Uber’s background check didn’t catch the driver’s criminal background because their checks only go back seven years.

“That’s not really good enough for me, to be honest,” Phillips said. “I think fingerprinting — all 10 prints — is something that you’re going to have to do.”

The fingerprinting requirement has been a sticking point for Uber and Lyft, which left San Antonio this month after the city adopted an ordinance that requires drivers be fingerprinted.

Kay said that only one of the 10 states whose legislatures have approved laws — Kansas — mandates fingerprinting. The bill is awaiting approval from Republican Gov. Sam Brownback, and as a result, Uber is “actively considering leaving that state.”

Paddie’s measure would trump any local ordinances, including those in Houston, San Antonio and Austin, which the ride-hailing companies strongly support.

San Antonio Republican Rep. Lyle Larson, one of the bill’s sponsors, said the Legislature may relinquish some control to local entities but supports the statewide law because “competition is healthy.”

Municipalities are less enthusiastic. Austin’s city council in October adopted an interim ordinance to allow the ride-hailing companies to operate in city limits.

Because of the ordinance, out-of-town drivers were allowed to drive for ride-hailing companies during the South by Southwest festival and took some 250,000 trips, Kay said.

City Councilwoman Kathie Tovo told the committee the legislation “very thoughtfully balances the various interests.” While it doesn’t require fingerprinting, the Austin rule permits the city to audit the companies’ records. One ride-hailing driver was removed from the system after a recent city audit found he had an outstanding warrant,” Tovo said.

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