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Old, new clash as Portland ponders regulating Uber

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Old, new clash as Portland ponders regulating Uber

PORTLAND — An official at Uber, the ride-share service launched in Portland in October, expressed wariness on Sunday about the city's possible regulation of the business.

"We are eager to sit down with the city and answer any questions," Billy Guernier, the company's general manager of regional expansion, said in a telephone interview. "Taking old models and applying them to new solutions just makes it worse for everybody."

Uber Transportation Services, the digitally based service established in San Francisco in 2010, is not covered by the taxi and livery service regulations in Chapter 30 of the city code, acting City Manager Sheila Hill-Christian said in a Dec. 10 memo to the City Council Transportation, Sustainability and Energy Committee.

The committee, with Councilor David Marshall as chairman, met Dec. 17 and directed city Corporation Counsel Danielle West-Chuhta to examine options for regulating Uber and any other transportation network service.

"We are primarily concerned with the safety of the public," Marshall said Dec. 18, adding the company insurance requirements and driver background checks concerned him most.

On Dec. 19, city spokeswoman Jessica Grondin said West-Chuhta hopes to have a draft ordinance ready for the committee's February 2015 meeting.

Since 2010, Uber has expanded into about 260 cities in 53 countries, Guernier said. Its premise is simple: Members use a smart-phone app to request a ride, and a nearby driver responds. The app provides the passenger with information about the driver, the car, it's location and when it will arrive.

Uber rates – $1.75 for the pick up and $2 per mile – undercut maximum taxi fares of $1.90 for pick up and 30 cents for each additional tenth of a mile. Those rates are set by the city code, where a minimum $5 fee for a Jetport pick up is also mandated.

Uber also charges 23 cents per minute for rides, with a minimum $5 fare and $5 cancellation fee. City cab drivers can charge a waiting fee of 40 cents per minute  at "express direction of the passenger after a trip has begun," or if a driver waits more than five minutes for a passenger.

Uber's billing is digital, no cash is exchanged, and passengers are asked to rate the ride and driver.

Guernier declined to disclose how many drivers Uber has in the Portland area, but said it offers flexible schedules that allow drivers to work as many or as few hours as they wish. Drivers keep 80 percent of their fares.

Craig Cobbett, owner of 207 Taxi on Presumpscot Street, spoke at the committee hearing and then elaborated Dec. 18 about why Uber should follow the same rules that apply to his company.

"I have no problem with Uber as a company, I think competition is great," Cobbett said. "I like playing by the rules."

What particularly troubles Cobbett and Marshall is that Uber has so far been allowed to skirt city and state regulations regarding liability insurance, background checks for drivers, and licensing fees.

The Uber website notes participating drivers must have a $1 million insurance policy to cover driver liability and coverage against uninsured or under-insured drivers. Guernier said Uber also carries policies to cover passengers.

Cobbett said insuring drivers and passengers for 15 cabs in service costs more than $70,000 annually, and the company carries its own liability policy. Licenses for cabs cost $300 annually, and drivers also pay $121 annually for licenses and background checks performed by the city.

Included in the committee packet for the hearing were copies of ordinances and operating agreements from Colorado; Tulsa, Oklahoma; Spokane, Washington, and Baton Rouge, Louisiana, that were enacted to cover Uber and similar companies while setting up local licensing fees.

Guernier said regulations in Baton Rouge; Austin, Texas, and Washington, D.C., recognize the unique nature of the business. He said an ordinance passed Oct. 16 by the Austin City Council spells out insurance requirements for drivers, which offenses can disqualify a driver from working for a transportation network service, and requires city approval of which company performs the background checks on drivers.

"They have taken a measured approach," Guernier said.

But Uber background checks have been questioned in the wake of charges brought against Uber drivers for reckless driving and sexual assault, including a recent case in Cambridge, Massachusetts, on Dec. 6, according to Middlesex County District Attorney Marian Ryan and Cambridge Police Commissioner Robert Haas.

In a Dec. 17 press release, Ryan said Alejandro Done, 46, of Boston, was charged with rape, assault to rape, kidnapping, and two counts of assault and battery. The release said Done worked for Uber.

“We allege that this defendant picked up a young woman, presenting himself as the driver for a ride-sharing service, and then drove her to a secluded location where he beat and sexually assaulted her,” Ryan said.

Marshall and Cobbett said the city should oversee the background checks, while Guernier countered the company's stringent process will be strengthened.

"I would say we are very confident in our background-check process," Guernier said.

According to the Uber website, the research performed by a third-party company include multiple sources checking a minimum of seven years of background for potential drivers. Drivers are not finger-printed; Guernier said finger prints may not be wholly reliable because of the length of time it takes some agencies to update databases.

"We actually send people out to the county courthouses," Guernier said of the depth of background searches that also include Social Security numbers.

Committee members received one emailed complaint from High Street resident Gordon Smith, alleging an unidentified Uber driver illegally solicited a fare from him on Commercial Street and became "belligerent" when Smith declined the ride.

Cobbett noted taxi drivers are banned from soliciting rides.

Guernier said Uber drivers are not allowed to seek passengers who have not requested rides.

"There is no concept of street hailing with Uber," he said. "If we ever get a complaint, we will act on it."

David Harry can be reached at 781-3661 ext. 110 or dharry@theforecaster.net. Follow him on Twitter: @DavidHarry8.