Smartphone-driven ride-sharing services operating in the city of Los Angeles slammed into a bureaucratic brick wall this week.
On Monday, the city's Department of Transportation sent cease and desist letters to Uber, Lyft, and Sidecar, three ride-sharing operators that have been running in Los Angeles for several months – in Uber's case more than a year.
And in case that didn't register, a brief chat with L.A.'s taxicab administrator reveals just how serious the city is.
Despite the increasing popularity of these services, which let someone hail a private car using an app on a smartphone, Tom Drischler's take is anyone operating an unregistered taxicab service is breaking the law. According to the letters sent by the department, drivers are subject to arrest and their cars may be impounded.
The problem, Drischler said, is one of safety.
"We cannot verify that these companies are properly insuring the drivers or that the cars have been inspected," he said. "In our mind that poses a risk. Our top priority is public safety and we can’t guarantee to the public these operations are running thorough criminal history background checks of the drivers."
Spokesmen for the three companies each insisted that their companies run thorough background checks on drivers and provide adequate insurance. All three have said they will continue to operate in the city despite the order.
The Uber L.A. Twitter account tweeted an old Steve Jobs quote in response to the city's letter.
The move to ban Lyft, Sidecar, and to a lesser extent, Uber (the company runs a black car service, and some of its vehicles are registered), comes as a bit of a surprise. Though the services faced fights with other municipalities, including Austin, Texas, New York and San Francisco, L.A. had been laissez faire about these services until now.
Drischler explained that the department has been monitoring the companies for some time, though it did not consider taking action until recently, when the services began ramping up operations. Uber has been in L.A. since March 2012, Lyft began operating locally in January, Sidecar in February.
When the companies came to town, Drischler said they had no formal discussions with the city about how to operate.
"They're the ones that came into L.A. without a permit. They need to approach us," he said. "But that’s not how they operate; they just go into business."
Though the three have faced pushback from other California municipalities in the past, each has received a waiver from the state Public Utility Commission, which regulates taxicab services. The agreements are intended to be provisional while the state figures out the specifics of regulating ride sharing services.
But Drischler said LADOT determined that even with the provisional agreements, these services still violate a section of the Municipal Code that prohibits non-permitted taxicab services from operating within the city.
Though Drischler insisted the decision did not come at the behest of the city's taxicab unions, they have been pushing against the ride-sharing companies for some time. Earlier today, taxi drivers organized a protest in downtown L.A., driving their cabs around city hall and honking their horns.
The issue is scheduled to be discussed in front of the city's Transportation Committee on Wednesday, though Drischler said it's largely informational rather than a matter of policy discussion.
For now, he said it will take a change in the state's laws to allow for the ride-sharing services to operate locally. In other words, no changes on a local level will bring Lyft, et al, back.
Drischler did say a ride originating outside the city of Los Angeles would not be subject to this ruling; a person getting picked up in Santa Monica need not worry about any action from the city.
Still to weigh-in on the ride-sharing controversy is the soon-to-be-inaugurated mayor. Eric Garcetti ran on a platform that heavily emphasized the city’s high tech culture, and received strong support from the region's burgeoning sector.
Many members of L.A.'s tech scene have already implored Garcetti to lift the city's ban on ride-sharing, and a petition to that effect is already circulating.
Garcetti, who is currently out of the country on vacation, was unavailable for comment.
For the DOT’s part, Drischler insisted that the move is by no-means anti-tech.
"Taxicab companies are extremely sophisticated when it comes to tech. All have GPS in their cars, many have phone apps and security cameras. So they’re no slouches in the tech department," Drischler said. "This isn't an anti-tech initiative. It’s strictly anti-illegal operations."
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