WBEZ | Sidecar http://www.wbez.org/tags/sidecar Latest from WBEZ Chicago Public Radio en Chicago moves on taxi reforms to leave more money in cabbies' pockets http://www.wbez.org/news/chicago-moves-taxi-reforms-leave-more-money-cabbies-pockets-110877 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Cabs.png" alt="" /><p><p>The city of Chicago is moving on a set of reforms to help cabbies take home more money, a partial salve after a months-long fight over legalizing competing rideshare services left many taxi drivers feeling bruised. While many hail the step as a sign that city officials are finally working to redress cab drivers&rsquo; complaints, some say the changes don&rsquo;t go far enough.</p><p>&ldquo;What we wanted to do is improve overall their experience here in the city, and make it more lucrative for them as cab drivers,&rdquo; said Maria Guerra Lapacek, Commissioner of Chicago&rsquo;s Department of Business Affairs and Consumer Protection.</p><p>Guerra Lapacek said her department crafted the proposals after working with representatives from Cab Drivers United/AFSCME Local 31 and other driver advocacy groups. Some of them will be included in an ordinance to be introduced at City Council&rsquo;s meeting next week. Others will be implemented through rule changes by the BACP.</p><p>The most significant change would reduce how much taxi owners may charge to lease their fuel-efficient cabs after the vehicles&rsquo; first year on the road.</p><p>&ldquo;The garages are able to recoup their investment after a year of having these vehicles in circulation,&rdquo; explained Guerra Lapacek, &ldquo;so the idea was to reduce the lease rate cap for the second year, and that way give relief back to the cab driver.&rdquo;</p><p>Guerra Lapacek said this idea resulted from the surprising finding in a recent <a href="http://www.wbez.org/study-chicago-cabbies-earn-average-12hour-110726">city-commissioned study</a>, which found that cab drivers spend about 40 percent of their gross income on their vehicle leases. Ultimately, the reform could affect leases for an estimated 3,700 of the city&rsquo;s nearly 7,000 cabs.</p><p>Leases would also be reduced for drivers whose vehicles generate a separate revenue stream from advertising displays. The reforms would require cab companies to credit leases in these cases.</p><p>&ldquo;There are over 2000 owner-operators in the City of Chicago. They don&rsquo;t pay a lease,&rdquo; said Peter Enger, a cab driver and Secretary of the United Taxidrivers Community Council. &ldquo;This will not help them in the slightest.&rdquo;</p><p>Enger said he&rsquo;s delighted that city officials appear to be considering the difficulties cab drivers have faced since a previous set of reforms took effect in 2012. Those reforms raised the lease rates for cabs, without a commensurate increase in taxi fare rates. Many cab drivers say that has resulted in longer working hours to earn the same income.</p><p>Cab drivers who own and drive their own taxis affirm Enger&rsquo;s fear that a new round of reform will still leave them in the dust.</p><p>&ldquo;The only way is to get a fare increase that we did not get for almost ten years, to offset the cost of living and all of that stuff,&rdquo; said Ahmed Ammar, who owns and drives his own taxi. &ldquo;Everything went up.&rdquo;</p><p>While some cab drivers, particularly those aligned with UTCC&rsquo;s union, push for a taxi fare increase, others worry it could adversely affect demand. Representatives from another union, Cab Drivers United, say raising fares is lower on their priority list.</p><p>&ldquo;Our focus first and foremost has been moving forward on these changes that will both put money in drivers&rsquo; pockets, and keep the cab companies competitive with the (rideshare) companies,&rdquo; said Tracy Abman, an organizer with AFSCME Local 31.</p><p>Guerra Lapacek said her department will not consider a fare increase at this juncture because she worries it could turn customers away from the taxi industry. Rideshare companies&rsquo; prices routinely undercut taxi fares.</p><p>The proposals also include city-backed smartphone applications to allow passengers to electronically hail taxis, as they do with popular services such as Uber and Hailo.</p><p>&ldquo;We think this is an excellent reform that&rsquo;s going to bring the cab industry into more innovation and really help them access those customers,&rdquo; said Guerra Lapacek. She said the city will put out a request for proposals, and will require all taxis to be on at least one of the city-backed apps.</p><p>Additionally, the reforms would reduce the fee that taxi drivers pay on credit card transactions, from 5 percent to 3 percent; lower the maximum penalties for taxi offenses from $1,000 to $400; and <a href="http://www.cityofchicago.org/content/dam/city/depts/bacp/publicvehicleinfo/publicchauffer/chauffeurtrainingtaskforcefinalrecommendations.pdf">streamline</a>&nbsp;the required driver training process.</p><p>The city will also create a task force to review <a href="http://www.wbez.org/series/curious-city/how-often-are-cabs-pulled-over-and-what-109734">the enforcement process of taxi rules</a> at the Administrative Hearings Court, which many taxi drivers disparagingly refer to as a &ldquo;kangaroo court.&rdquo;</p><p>&ldquo;I think it&rsquo;s significant that the City is listening to drivers that are organized, listen to them, hearing their concerns, addressing some of their concerns and agreeing to continue to work together with drivers to make their lives better and make sure the industry remains viable,&rdquo; said Abman.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her </em><a href="https://twitter.com/oyousef"><em>@oyousef</em></a><em> and </em><a href="https://twitter.com/WBEZoutloud"><em>@WBEZoutloud</em></a><em>.</em></p></p> Tue, 30 Sep 2014 18:03:00 -0500 http://www.wbez.org/news/chicago-moves-taxi-reforms-leave-more-money-cabbies-pockets-110877 Rideshare vs. Taxicabs: The inside story http://www.wbez.org/news/rideshare-vs-taxicabs-inside-story-110296 <p><p>The best taxi drivers get to know hotel doormen.</p><p>&ldquo;How you been, John? Everything good?!&rdquo; shouted Saied Sarvinehbaghi out his window as he pulled to the front of the Hilton cab line on a recent morning. &ldquo;You want me to stay here or back up? Stay here? OK. Airport would be nice, John,&rdquo; Sarvinehbaghi chuckled.</p><p>A ride from the Loop to O&rsquo;Hare could bring in more than $40 for a single fare. Chicago&rsquo;s airports are one of the few places left in the city where taxicabs still rule the road. But elsewhere, the competition for fares is growing fiercer by the day.</p><p>Chicago <a href="https://soundcloud.com/morningshiftwbez/rideshare-ordinance-passes-1?in=morningshiftwbez/sets/morning-shift-week-of-may-26">recently passed rules</a> to legalize ridesharing services, which let people use their personal cars to take paying passengers around. The debate over ridesharing has mostly centered on how the service differs from traditional taxis. So WBEZ spent a day with a cabbie, and a night with a rideshare driver to find out for ourselves.</p><p><span style="font-size: 21.81818199157715px;">The taxicab driver</span></p><p>Sarvinehbaghi started driving 35 years ago, soon after he came to the U.S. from Iran for college. At the time, he thought he&rsquo;d only be driving cabs for a couple of years. As a passenger climbs into the backseat and directs him to O&rsquo;Hare, Sarvinehbaghi reflects on why he&rsquo;s stayed so long in the industry.</p><p>&ldquo;This job is good to me because it&rsquo;s exciting, because it&rsquo;s not a boring job,&rdquo; Sarvinehbaghi said. &ldquo;It&rsquo;s a very addictive job, actually. You get addicted to this job. If you get addicted, it&rsquo;s hard to let go.&rdquo;</p><p>Sarvinehbaghi is not your typical cabbie &ndash; he owns his medallion, which is a city license for a cab. He&rsquo;s had it for about 15 years.</p><p>&ldquo;I didn&rsquo;t buy it,&rdquo; he explained. &ldquo;We had a great mayor called Harold Washington, and he&rsquo;s the one who started giving medallions out instead of selling them, so I was one of guys who won it (in a lottery).&rdquo;</p><p>Most taxi drivers don&rsquo;t own medallions, and in recent years, they&rsquo;ve gotten harder to buy. At times, medallions have sold for as much as $360 thousand. The majority of cabbies lease their cars, with the medallions attached, for $400 to $700 a week.</p><p>Sarvinehbaghi is glad he doesn&rsquo;t pay a lease, but he said he still has expenses. According to city rules, he has to buy a new car every four years and pay for expensive taxi insurance. Despite all that he says he got by just fine until the road recently became more crowded with rideshare drivers.</p><p><span style="font-size: 21.81818199157715px;">The rideshare driver</span></p><p>At about the same time Saied usually ends his shift on a Saturday evening, Dan Burgess is driving into the city from his home in Downers Grove. Burgess, who introduces himself to passengers as &ldquo;Trivia Dan,&rdquo; has done this most weekends for the past year. He drives for ridesharing services UberX, Lyft and Sidecar.</p><p>&ldquo;I like meeting people,&rdquo; he explained. &ldquo;I love the city and the pulse of the metropolis, and I enjoy driving people around and getting paid for it and having a good time. And I thought it would be a fun way to expose people to me and my trivia company and ask them trivia questions on the rides.&rdquo;</p><p>Burgess receives ride requests through his smartphone. Almost as soon as his first carload of Lyft passengers &ndash; three young women going out for a dinner in Lakeview &ndash; squeeze into his back seat, he peppers them with trivia questions.</p><p>&ldquo;Well, if you guys want to play trivia, I&rsquo;ve got trivia questions ready&hellip;&rdquo;</p><p>As Burgess ferries passengers around the city in his 2005 silver Hyundai hatchback, the same scene repeats itself all night.</p><p>When asked, passengers said they prefer ridesharing to cabs because of the convenience. They use their smartphones to summon cars without ever going outside, and there&rsquo;s no hassle with cash or credit cards &ndash; the apps take care of the payment. When the ladies arrive at their destination, they just hop out.</p><p>&ldquo;Alright, so, I just got a text already saying that was &lsquo;50% Prime Time,&rsquo;&rdquo; Burgess said as the passengers exited. &ldquo;Lyft has a promotion going on tonight, so I got time-and-a-half on that.&rdquo;</p><p>Lyft and Uber frequently raise their rates at times of peak demand, or simply to entice drivers to use their app rather than the competition&rsquo;s. Cabs, by contrast, can&rsquo;t change the meter rate.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Ridealongs%202.jpg" style="height: 415px; width: 620px;" title="Dan Burgess, a.k.a. “Trivia Dan,” drives in from the suburbs nearly every weekend to do ridesharing. He uses it as an opportunity to promote his trivia business, and says he shouldn’t be subject to the same rules as cab drivers. (WBEZ/Odette Yousef)" /></p><p><span style="font-size: 21.81818199157715px;">Different rules of the road</span></p><p>After roughly six hours with both Burgess and Sarvinehbaghi, it was clear that the essence of what they do is the same: they drive people places for money. So should they follow the same rules? Dan said &lsquo;no.&rsquo;</p><p>&ldquo;This is a casual experience,&rdquo; he said. &ldquo;I might go a month without giving a ride. Nobody has a cab that sits for a month without being used. So why should I fall under the same strict rules as a real cab when I might only give five or ten hours a week, or sometimes even five or ten hours a month?&rdquo;</p><p>&ldquo;There&rsquo;s rules and regulation,&rdquo; counters Sarvinehbaghi. &ldquo;It says if you want to transport people in the City of Chicago, you have to be registered, you have to have a medallion, you have to pay the fees and taxes, and have some kind of chauffeurs license, so they know who you are.&rdquo;</p><p>Sarvinehbaghi said to get his chauffeurs license, he had to take a class; pass an English exam, a physical, an eye test, and a background check; and have a clean driving record. Uber, Lyft and Sidecar say they perform background and driving record checks, too. But several <a href="http://articles.chicagotribune.com/2014-02-14/news/ct-rideshare-background-checks-met-20140214_1_background-checks-ride-sharing-drivers">news outlets</a> have <a href="http://www.nbcchicago.com/investigations/Ride-Service-May-Pose-Risk-to-Passengers-256639641.html">reported cases</a> of rideshare drivers with criminal histories.</p><p>&ldquo;It&rsquo;s about protecting the consumer in Chicago. People&rsquo;s life is in our hand,&rdquo; Sarvinehbaghi said. &ldquo;I used to work night shift on the weekends, you won&rsquo;t believe how many drunk people I take home, they pass out in the back seat. Young girls, older guys with Rolex (watches), girls with short skirt and practically no clothes on, and I take them where they want to go and I call their parents down and take them.&rdquo;</p><p>But Burgess said ridesharing services weed out bad drivers faster than the city does, because the apps require passengers to rate their drivers after each ride.</p><p>&ldquo;It&rsquo;s actually more safe because of the rating system,&rdquo; argued Burgess. &ldquo;If there&rsquo;s a problem, you can call support and report a driver, saying I was driving erratically or dangerously or I was under the influence or something. Lyft would turn off my account immediately.&rdquo;</p><p><span style="font-size: 21.81818199157715px;">The cost of doing business</span></p><p>The other big difference between Sarvinehbaghi and Burgess involved their expenses. WIth frustration, Sarvinehbaghi pointed out that his 2014 Toyota RAV4 was only four months old. He bought it with a five-year payment plan, but the city will only allow it to be used as a cab for four years. He said that means in the fifth year, he&rsquo;ll have to continue paying for it, but he won&rsquo;t be able to use it as a taxi. In fact, he&rsquo;d have to buy another new car to use as a cab,saddling him with two monthly car payments.</p><p>&ldquo;This car, $33,000, I paid it. I&rsquo;m paying the car payment,&rdquo; he said. &ldquo;I&rsquo;m paying almost $600 a month (for) insurance...stickers, fees, taxes, gas &ndash; you add all this up, it&rsquo;s costing me money to keep this medallion. You know, I work so hard, paying all these fees, and [rideshare drivers] come and do it without paying any fees or anything.&rdquo;</p><p>After expenses, Sarvinehbaghi made roughly $11 an hour during the shift I observed.</p><p>Burgess has it easier. He uses his nine-year old car, which he paid off long ago. Unlike Sarvinehbaghi he is not required to pay for commercial liability insurance. Burgess just needs to cover gas, and pay Uber 15 percent of his earnings.</p><p>During my night shift with Burgess he made about $14 an hour after expenses.</p><p>He acknowledged that rideshare vehicles have been hard on independent medallion owners.</p><p>&ldquo;I really feel bad for some independent cab owner who spent $300,000 on a medallion, yeah, I feel sorry for that guy,&rdquo; he said. &ldquo;That&rsquo;s unfortunate, he made that investment. But it&rsquo;s a new day, and people like getting around this way more than that way.&rdquo;</p><p>Indeed, ride sharing&rsquo;s growing popularity is one reason Chicago&rsquo;s city council decided to legalize the service. Illinois may soon <a href="https://soundcloud.com/morningshiftwbez/rideshare-legislation-passes">follow suit</a> statewide. Sarvinehbaghi said he had planned to pay his sons&rsquo; college tuitions by selling his medallion, but now it&rsquo;s likely to lose much of its value.</p><p>Still, he said if the state allows ridesharing, he may sell his cab and try it, too.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Thu, 05 Jun 2014 15:21:00 -0500 http://www.wbez.org/news/rideshare-vs-taxicabs-inside-story-110296 Illinois Senate passes ride sharing rules http://www.wbez.org/news/illinois-senate-passes-ride-sharing-rules-110191 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/1Lyft (AP Photo - Jeff Chiu).jpg" alt="" /><p><p>Illinois senators have passed rules for the new, growing industry of &ldquo;ride sharing&rdquo; services, and they appear to be the strictest statewide regulations in the country so far. The package of regulations are contained in a <a href="http://www.wbez.org/news/illinois-house-moves-rein-ridesharing-110011">House bill</a> and a trailer amendment bill, the latter of which will have to go back to the House before both arrive on Gov. Pat Quinn&rsquo;s desk for signing. The rules were largely championed by a coalition of Chicago cab companies, who claim their business has suffered as a result of the proliferation of ride sharing activity.</p><p>&ldquo;We&rsquo;re not trying to stop technology, and everyone that uses it,&rdquo; said Sen. Tony Munoz (D-Chicago), sponsor of HB4075 and its amendment trailer bill HB5331. &ldquo;The only thing we want to do is make it safer, regulate it fairly for everyone in the industry.&rdquo;</p><p>The rules would apply most immediately to services UberX, Lyft and Sidecar, which facilitate ride sharing primarily in the City of Chicago. The three California-based companies provide smartphone app technologies that allow people to use their personal vehicles for hire, much like taxis. So far, they have operated illegally, but a groundswell of consumer support and a fear of alienating technology companies has prompted local and state governments to consider ways to bring them into a regulatory framework.</p><p>Under the bills, commercial ride sharing companies would be required to carry primary commercial liability insurance equal to taxis, with a combined single limit per accident of $350,000. More critically, it eliminates <a href="http://www.wbez.org/news/state-legislators-probe-rideshare-insurance-109857">concerns raised by several insurance associations in the state</a> over when that insurance policy would apply. Under the rules, the policies would be effective from the moment a ride share driver logs into the app to accept rides, until logging off. Previously, companies disputed whether their insurance policies should apply, or should apply at such a high level, during times that a driver may be logged onto their app, but not yet en route to or conducting a fare.</p><p>All ride share drivers would also have to carry distinctive registration plates and stickers on their vehicles.</p><p>More frequent drivers would be subject to additional rules, similar to taxi drivers. Those who offer ride sharing services more than 36 hours every two weeks, on average, would have to get public chauffeurs&nbsp; licenses, subjecting them to the same criminal background checks and drug testing as taxi drivers. The rules would allow a four-week grace period, during which these drivers may still offer ride shares while an application for a public chauffeur&rsquo;s license is pending.</p><p>Chicago drivers who average at least 36 hours every two weeks would also have to comply with the city&rsquo;s rules for taxis regarding the age of their vehicles. Currently, this means their cars could be no more than four years old, in most cases. These cars would also be subject to government safety inspections.</p><p>Despite fierce rivalry among ride share companies, they were united in their opposition to the Senate legislation.</p><p>&ldquo;The bill will prohibit insured and background-checked Lyft drivers with cars more than four years old, immediately eliminating 70% of Chicago&#39;s Lyft drivers,&rdquo; read an e-mail from Lyft. &ldquo;This will disproportionately affect low income drivers in the Lyft community who have come to rely on ridesharing as an important way to earn extra money to make ends meet.&rdquo;</p><p>&ldquo;Today&rsquo;s vote in the senate will hurt consumers and limit transportation options across the state,&rdquo; wrote Uber Midwest Regional Director Andrew MacDonald, in an e-mailed statement. Uber is the company behind UberX, the ride sharing platform.&nbsp; &ldquo;We will continue to work with state and city officials to ensure uberX has a permanent home in Illinois for consumers to benefit from competition and much needed transportation options,&rdquo; he continued.</p><p>&ldquo;I think it regulates too far, and I think it sends a message that innovation will be kneecapped in Illinois if you compete against a powerful monopoly,&rdquo; said Sen. Matt Murphy (R-Palatine), during the debate preceding the floor vote. &ldquo;That&rsquo;s not the kind of message we want to send right now.&rdquo;</p><p>The Senate rules still allow local municipalities authority to regulate fare structures for ride sharing services. In Chicago, aldermen are <a href="http://www.wbez.org/news/city-moves-regulate-rideshare-companies-109639">considering an ordinance</a> that gives the city authority to cap so-called &ldquo;surge pricing&rdquo; among some of the ride sharing services. The concept allows them to charge passengers more than the usual amount during times of peak demand.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Fri, 16 May 2014 07:58:00 -0500 http://www.wbez.org/news/illinois-senate-passes-ride-sharing-rules-110191 Secret recording shows Uber's efforts to poach Chicago cabbies http://www.wbez.org/news/secret-recording-shows-ubers-efforts-poach-chicago-cabbies-110072 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/AP81700915726.jpg" alt="" /><p><p>For years, Chicago has struggled to recruit enough taxi drivers for the city. New competition from ridesharing companies is making that even harder. As the city looks to regulate those companies, it also seems to have abandoned its past policy of ensuring a robust corps of cabbies. Now, a secret audio recording reveals a newly aggressive push by the industry to persuade cabbies to become rideshare drivers.</p><p>WBEZ obtained the recording from a cab driver who attended a February information session at Uber offices in Chicago. The session was specifically to recruit taxi drivers to the company&rsquo;s popular ridesharing platform, called uberX.&nbsp; In it, an Uber representative pitches a room full of cabbies on the idea of dropping their cabs.</p><p>&ldquo;As Uber grows &ndash; this is why we&rsquo;re here today, is to teach you guys about the option that I think, quite frankly, is a little bit better for you guys in terms of your life and the cost,&rdquo; he told them.</p><p>UberX drivers get fewer fares than taxi drivers, but the company representative played up the advantages of switching from cab-driving to rideshare-driving. First, cab drivers wouldn&rsquo;t have to pay a weekly lease to use their vehicle anymore, because they&rsquo;d be able to use their personal cars. Taxi leases run anywhere from $400 to $700 a week.</p><p>Second, drivers could cash in on &ldquo;surge pricing&rdquo; &ndash; that&rsquo;s a term Uber uses for times of peak demand. The company hikes its fares during rush hour and when the weather&rsquo;s bad, sometimes charging up to seven times their normal rates. The representative told cab drivers in that session that if they got one taste of surge fares, they&rsquo;d want more.</p><p>&ldquo;It seems difficult to not drive a taxi in rush hour when you guys are taking a fare to the Loop &ndash; but just try uberX,&rdquo; he urged them, &ldquo;and you&rsquo;ll see that it might take a couple minutes longer to get that fare, but that fare will be at an increased rate.&rdquo;</p><p>WBEZ spoke with several taxi companies that say they are losing drivers to ridesharing. The question is, are fewer taxis good for the city?</p><p>The mayor&rsquo;s office wouldn&rsquo;t comment. Oddly, neither would the city&rsquo;s department of Business Affairs and Consumer Protection, which regulates the taxi industry. A spokeswoman said they don&rsquo;t care about driver numbers.</p><p>But they certainly did before. Last year, the department head was very vocal about a shortage of cab drivers.</p><p>&ldquo;We&rsquo;ve seen it dropping down over the past five or six years,&rdquo; said former Commissioner Rosemary Krimbel, at a Taxi Driver Recruitment Fair that the city co-hosted at Olive Harvey College last year. Krimbel said the city was short 2,000 cab drivers. She called that a problem, and said it was the city&rsquo;s job to fix it.</p><p>&ldquo;I think there&rsquo;s a solution,&rdquo; she said, &ldquo;And I hope to increase the number of drivers and support them.&rdquo;</p><p>But now the city says it has no role in keeping enough taxis on the road. Some say that&rsquo;s not a wise position for the city to take.</p><p>&ldquo;I definitely think it&rsquo;s very important for the tourism industry to have outstanding taxi service,&rdquo; said Charles Goeldner, a professor emeritus of tourism and marketing at the University of Colorado. Goeldner literally wrote the textbook on tourism, called &ldquo;Tourism: Principles, Practices, Philosophies.&rdquo;</p><p>Goeldner said cities that are serious about tourism actively support their taxi industries. He says taxi drivers are ambassadors for the places where they drive. They offer visitors knowledge and predictability.</p><p>&ldquo;There has to be a trust element,&rdquo; he said, &ldquo;and the taxi industry has always been regulated and licensed and has to meet certain requirements for cities.&rdquo;</p><p>Uber claims it holds its ridesharing drivers to high safety standards. It also talks a lot about promoting consumer choice in transportation. But if cab drivers heed Uber&rsquo;s call and switch to ridesharing &ndash; making rush hour commutes more expensive than ever &ndash; isn&rsquo;t that bad for consumers?</p><p>&ldquo;The goal is not to surge at rush hour,&rdquo; said Andrew MacDonald, Uber&rsquo;s Midwest Regional Director. &ldquo;But the pitch to drivers is &lsquo;Hey, right now we are undersupplied at rush hour, and so the opportunity is good to be on the Uber system.&rsquo;&rdquo;</p><p>MacDonald said as more people, cabbies or not, sign up to drive for uberX, prices won&rsquo;t surge as much. That might push some cab drivers back into the taxi industry.<br />But for now, it might be harder than ever to get a taxi in the Loop during rush hour.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Thu, 24 Apr 2014 17:38:00 -0500 http://www.wbez.org/news/secret-recording-shows-ubers-efforts-poach-chicago-cabbies-110072 Illinois House moves to rein in ridesharing http://www.wbez.org/news/illinois-house-moves-rein-ridesharing-110011 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Rideshare-legislation.jpg" alt="" /><p><p>Illinois lawmakers took a step Thursday toward imposing rules on popular ridesharing services that have come under particular scrutiny in the City of Chicago. Despite receiving thousands of e-mailed petitions overnight from supporters of Lyft and Sidecar urging them to vote against <a href="http://www.google.com/url?q=http%3A%2F%2Fwww.ilga.gov%2Flegislation%2Ffulltext.asp%3FDocName%3D09800HB4075ham003%26GA%3D98%26SessionId%3D85%26DocTypeId%3DHB%26LegID%3D77989%26DocNum%3D4075%26GAID%3D12%26Session%3D&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNHJkILW6HuQSYOmvH2W08D1X1kv7w">House Bill 4075</a>, House legislators voted overwhelmingly (<a href="http://www.google.com/url?q=http%3A%2F%2Filga.gov%2Flegislation%2Fvotehistory%2F98%2Fhouse%2F09800HB4075_04102014_024000T.pdf&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGoWEKnNfNCts1Fl2_xQZJgosffqw">80-26</a>) in favor of regulations.</p><p>Uber, Lyft and Sidecar started offering smartphone apps in the Chicago area in the last two years, aimed at helping regular people use their personal vehicles for hire. The House bill, backed by representatives of Chicago&rsquo;s taxi industry, originally took a broad, restrictive approach, requiring those drivers to comply with many of the same rules as taxi drivers on issues of licensing and safety checks. The bill that ultimately passed was touted by its sponsor, Michael Zalewski (D-23), as a &ldquo;compromise bill,&rdquo; combining input from both the taxi industry and Uber.</p><p>&ldquo;Nothing in this bill is going to shut down these apps,&rdquo; Zalewski said, minutes before the roll call. &ldquo;We want them to thrive, we want them to do well. However, it&rsquo;s our duty to protect our constituents.&rdquo;</p><p>State lawmakers have, in recent weeks, raised red flags over <a href="http://www.google.com/url?q=http%3A%2F%2Fwww.wbez.org%2Fnews%2Fstate-legislators-probe-rideshare-insurance-109857&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGo3KvYNiEAn8hJorLnRP8GtOztGg">insurance concerns</a> with ridesharing services, as well as the propriety of entrusting background checks and drug testing of drivers to the private companies. The bill that House members passed imposes different requirements based on how much time drivers spend behind the wheel for the services.</p><p>Those who average fewer than eighteen hours per week would largely remain under the oversight of the private companies. But drivers who average more than eighteen hours per week would be subjected to many of the same rules and oversight as taxi drivers in Illinois. The bill would require them to obtain public chauffeur licenses, commercial registration plates for their vehicles, and fulfill inspection and age requirements set by the city or local government in which they operate.</p><p>Zalewski told WBEZ that Uber&rsquo;s lobbyist in Springfield, attorney Michael Kasper, supported the idea of bifurcating drivers into different regulatory categories depending on how much time they work. &ldquo;I can only negotiate with who Uber tells me to negotiate with,&rdquo; he said, &ldquo;and their representatives were willing to negotiate on this point.&rdquo;</p><p>But almost immediately after the bill passed, Uber denied that it was consulted in the crafting of the bill. &ldquo;Uber has not signed off on a proposal that bifurcates drivers,&rdquo; said Andrew MacDonald, Regional General Manager of Uber Midwest. Lyft issued a similar statement: &ldquo;Bifurcating drivers into two groups was not a compromise and we did not support this model in conversations with the bill sponsors.&rdquo;</p><p>&ldquo;That&rsquo;s an outright lie,&rdquo; said Pat Corrigan, a Principal at Yellow Group and representative of the Illinois Transportation Trade Association, which includes nearly all of Chicago&rsquo;s taxi companies. &ldquo;We talked to Uber representatives, including Michael Kasper, their lobbyist, over the weekend in an attempt to understand how we could satisfy their wishes.&rdquo; Kasper did not respond to an e-mail by posting time.</p><p>MacDonald argued that the bill will force drivers to choose whether they want to be full-time or part-time, and that it would make it difficult for the company to respond to fluctuations in demand.</p><p>&ldquo;Why are we putting in a threshold? Does it benefit consumers? Does it benefit drivers? No. It protects the taxi industry,&rdquo; he said. MacDonald said he did not know immediately what portion of the company&rsquo;s drivers in Chicago drive more than eighteen hours per week. He added that a more reasonable restriction would simply limit rideshare drivers to 12 hours per day, a rule that Chicago taxi drivers must follow.</p><p>Chicago officials, however, have been crafting similar changes to a city ordinance on ridesharing. According to Michael Negron, Chief of Policy for the Mayor&rsquo;s Office, a new proposal divides rideshare companies into two classes: those whose drivers average more than 20 hours a week, versus companies whose drivers average less. Companies with higher averages would have to ensure their drivers have public chauffeurs licenses and submit to background checks and drug tests done by the city.</p><p>Unlike the state legislation, the city will consider company-wide averages rather than individual driver averages. &ldquo;If we have to go and individually determine how much each driver is driving, that&rsquo;s a harder-to-enforce system, there&rsquo;s more opportunity for gaming, etc.,&rdquo; explained Negron.</p><p>The bill will go to the Illinois Senate after a two-week recess.&nbsp;</p><p><em><span id="docs-internal-guid-c1722b30-50d1-5e4e-753a-9f789cd52716">Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her </span><a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Fri, 11 Apr 2014 07:40:00 -0500 http://www.wbez.org/news/illinois-house-moves-rein-ridesharing-110011 Shadowy lobbyists influence rideshare debate http://www.wbez.org/news/shadowy-lobbyists-influence-rideshare-debate-109770 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Rideshare lawsuit_0.jpg" alt="" /><p><p>The fight over the future of ridesharing in Chicago is increasingly being waged through shadowy lobbyists. This has some aldermen concerned about how that could influence the current regulatory debate.</p><p>At a hearing at City Council&rsquo;s Joint Committee on Transportation and Finance on Monday, some noted that the lobbying activity on the issue appeared different from the usual at City Hall. They said they were disturbed by the apparent emergence of advocates for ride-sharing companies like Uber, Lyft and Sidecar, who have not identified their interests upfront.</p><p>&ldquo;I&rsquo;m concerned with the amount of lobbyists on this that we won&rsquo;t hear from today,&rdquo; said Ald. Bob Fioretti (2nd), after noting that he had been handed an unmarked packet of information on his way into the hearing, with no information about its source. &ldquo;I&rsquo;d like to see all the lobbyists come up and forward on who we&rsquo;re dealing with and what&rsquo;s happening in this controversy here.&rdquo;</p><p>Ridesharing services offer smartphone apps to connect people with cars to people who need rides. Drivers do not have public chauffeur licenses, and they use their personal vehicles. Lately, several cities in the country, including Chicago, have been considering whether, and how, to regulate these services to ensure public safety.</p><p>Earlier this month, city officials offered <a href="http://www.wbez.org/news/city-moves-regulate-rideshare-companies-109639" target="_blank">competing proposals</a> on rules for ridesharing. Almost immediately, media outlets (including WBEZ) began receiving phone calls and emails about the issue from a public relations firm that did not immediately identify its ties to the ridesharing industry.</p><p>A Chicago-based communications firm called Resolute Consulting has offered to connect reporters with community-based organizations in neighborhoods such as Little Village, Belmont-Cragin and Pilsen, who support ridesharing services. It did not initially disclose that its client is Uber, one of the technology companies behind a ridesharing app.</p><p>The consulting firm similarly publicized a press conference led by Alderman Joe Moreno (1st) just minutes before Monday&rsquo;s committee hearing on ridesharing rules. Moreno was joined by drivers and passengers of ridesharing services to voice support of &ldquo;reasonable regulations&rdquo; for the technologies.</p><p>&ldquo;Today is, I think, the difference between the Flintstones and the Jetsons,&rdquo; said Moreno. &ldquo;And we&rsquo;re here today to support the Jetsons.&rdquo;</p><p>Moreno said regulating ridesharing services under taxi rules, as proposed in a resolution by Aldermen Anthony Beale (9th) and Ed Burke (14th), would stifle innovation in Chicago. Other supporters at the press conference said they feel safe using ridesharing services, and that driving for these services helps them supplement low incomes.</p><p>They denied that a company had lobbied them to be at the press conference, with Moreno adding that riders, drivers and the industry are organizing on their own around the issue. But reporters were handed unlabeled, white folders containing reports about Uber, copies of letters written to the city on behalf of Uber, and other information highlighting troubles within the city&rsquo;s taxi industry. Resolute Consulting&rsquo;s name is nowhere cited in the packet, though a listed contact&rsquo;s name and number are associated with the company.</p><p>Additionally, all the riders and drivers present at the press conference disclosed, upon being asked, that they were only affiliated with Uber, rather than other ridesharing companies. Afterward, a consultant for Resolute told WBEZ that Uber had put out a request to its members to organize on behalf of limiting city regulations. Alderman Moreno admitted that he had met with an Uber lobbyist, whose name, he said, he could not recall. But he maintained that his advocacy on the issue was motivated by concerns he had heard from constituents who use the service.</p><p>&ldquo;There are lobbyists on both sides of this issue,&rdquo; Moreno offered at the committee hearing, in response to Fioretti&rsquo;s suggestion that ridesharing companies have been surreptitious in their lobbying effort. &ldquo;It&rsquo;s not just lobbyists that are on the rideshare side,&rdquo; he added, &ldquo;There&rsquo;s lobbyists that we all know that are on the taxi side of this, as well.&rdquo;</p><p>Interests aligned with the taxi industry have also mounted their own public campaign. In recent weeks, public relations firm Edelman has reached out to the media on behalf of client Taxi Magic, which produces an alternative transportation app. Taxi Magic partners with nine metro area cab companies, including Yellow Cab and Checker. Yellow is among several plaintiffs who recently filed a <a href="http://www.wbez.org/news/cab-livery-companies-sue-city-over-rideshare-companies-109655" target="_blank">federal lawsuit</a> against the City of Chicago, demanding that the city regulate ridesharing apps as it does their industry.</p><p>The coalition of companies behind the lawsuit have also hired former Daley administration lawyer, and City Hall insider, Mara Georges to represent their interests to aldermen in this debate. At Monday&rsquo;s committee hearing, Georges started off testimony by offering evidence to bolster Aldermen Burke and Beale&rsquo;s resolution to treat ridesharing companies the same as taxis.</p><p>In 2014, city data show the industry has four registered lobbyists at City Hall. Among ridesharing companies, Uber has three and Lyft has one. A single lobbyist represents taxi drivers&rsquo; interests.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Tue, 25 Feb 2014 17:04:00 -0600 http://www.wbez.org/news/shadowy-lobbyists-influence-rideshare-debate-109770 Cab, livery companies sue city over rideshare companies http://www.wbez.org/news/cab-livery-companies-sue-city-over-rideshare-companies-109655 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Rideshare lawsuit.jpg" alt="" /><p><p>A group of mostly taxi and livery companies have filed suit against the City of Chicago, claiming that the city has tolerated, and even promoted, &ldquo;unlawful transportation providers&rdquo; to undermine their industries. Their case focuses on technology companies Uber, Lyft and Sidecar, which offer smartphone apps that allow people who need rides to find people with cars, for a fare. The suit claims that the city has denied the plaintiffs equal protection under the law, by forcing them to abide by rules and regulations that have not been applied to the technology companies.</p><p>At the heart of their complaint is the assertion that the companies, which call their services &ldquo;ridesharing,&rdquo; are de facto cab companies.</p><p>&ldquo;This isn&rsquo;t ridesharing,&rdquo; said Michael Shakman, an attorney representing the plaintiffs. &ldquo;They sell services 24/7 to the general public, they charge by time and distance, and they&rsquo;re an on-demand service. They&rsquo;re exactly a taxi service, not a rideshare.&rdquo;</p><p>At a press conference Thursday, Shakman accused the city of allowing a taxi &ldquo;caste&rdquo; system to emerge, whereby Uber, Lyft and Sidecar are allowed to focus only on passengers who have credit cards, smartphones, and live in high-income neighborhoods.</p><p>&ldquo;They are not available at all to the disabled or to people who pay with cash,&rdquo; Shakman said. &ldquo;This taxi &lsquo;caste&rsquo; system excludes large portions of the population on racial, economic and disability grounds, and it thereby violates the Illinois Civil Rights Act.&rdquo;</p><p>Also joining the lawsuit is Brad Saul, President of Chicago Disability Transit, a non-profit that provides paratransit options for people with special needs. Saul said on the occasions he attempted to get a car from ridesharing companies, they did not have any that were able to accommodate his wheelchair.</p><p>&ldquo;As a platform, we don&rsquo;t force drivers to use it a certain way,&rdquo; said John Zimmer, co-founder of Lyft, &ldquo;but as a broad platform there&rsquo;s drivers who do support that.&rdquo; Zimmer said in many of the 20 markets where Lyft now operates, there are people who drive wheelchair-accessible vehicles.</p><p>But while Saul and other plaintiffs argue that the companies should have to serve people in all neighborhoods, and with disabilities, the lawsuit also dwells heavily on the economic injury they say they are suffering. Lyft, Sidecar, and Uber&rsquo;s ridesharing service, called uberX, typically are cheaper than taxis, although when demand is high, they use a surge-pricing model that can lead to steeper charges.</p><p>Additionally, there is a relatively low cost of entry for their drivers. Cabbies must have city-issued medallions, currently priced at roughly $350,000 each, as well as mandated insurance, worker&rsquo;s compensation, and vehicles that are no more than four years old. Taxi and livery drivers are also required to attend school and be licensed as public chauffeurs, neither of which are necessary for rideshare drivers.</p><p>Representatives from Lyft and Uber dispute the underlying characterization of their service as a taxi service &mdash; and argue that&rsquo;s why they shouldn&rsquo;t be regulated as cab and livery vehicles.</p><p>&ldquo;A taxi can hail someone from the street, and when you have something like a street hail, it creates different dynamics and different safety requirements,&rdquo; said Zimmer. &ldquo;You don&rsquo;t have choice over the company, you don&rsquo;t have information on the driver, you haven&rsquo;t agreed to a terms of service, and you have a lot less information. And with a service like Lyft, you&rsquo;re choosing to use Lyft, you see information about the driver, about the car, and there&rsquo;s many more differences.&rdquo;</p><p>The lawsuit comes a day after lines of disagreement surfaced at City Hall. Mayor Rahm Emanuel&rsquo;s office <a href="http://www.wbez.org/news/city-moves-regulate-rideshare-companies-109639">introduced an ordinance to create regulations</a> for the industry, designating a new category of transportation called &ldquo;Transportation Network Providers.&rdquo; The proposal would allow the ridesharing services to continue many of their operations, but would require them to register annually with the city, maintain minimum standards of general commercial and commercial vehicle liability insurance, pay the city&rsquo;s Ground Transportation Tax, and have drivers&rsquo; cars inspected annually.</p><p>Plaintiffs in the lawsuit say the proposal falls short, and they don&rsquo;t like the idea of a separate set of rules.</p><p>&ldquo;It&rsquo;s bad public policy to create a second taxi system designed for the elite who happen to be fortunate enough to live in neighborhoods where taxi drivers are willing to take them,&rdquo; said Shakman.</p><p>At the same City Council meeting, Aldermen Anthony Beale (9th) and Edward Burke (14th) proposed a <a href="https://chicago.legistar.com/View.ashx?M=F&amp;ID=2902650&amp;GUID=AE467792-6BF2-425E-85C7-6C05D0CFBD3C">resolution </a>calling for the Police Superintendent and Commissioner of Business Affairs and Consumer Protection to immediately apply the existing taxicab rules to the ridesharing services.</p><p>&ldquo;We need to make sure that the consumers are protected,&rdquo; said Beale, &ldquo;and so we need to take the steps on shutting them down and then work towards a solution to make sure they&rsquo;re regulated.&rdquo;</p><p>The resolution is not binding, but will go to a joint committee on Transportation and Finance, of which Beale and Burke are chairs, respectively. As such, they may ask enforcement officials to offer testimony as to why the city has not applied its rules on taxicabs and livery to the ridesharing services.</p><p>Representatives of Uber and Lyft say they expect there will be regulation of their service, and that they are in favor of measures to promote safety. But they say the push by cab and livery companies to have them adhere to the same rules that they do will stifle technological innovation.</p><p>&ldquo;Hundreds of thousands of Chicagoans rely on uberX precisely because it is a faster, safer, and cheaper way of getting around their city,&rdquo; wrote Andrew MacDonald, Midwest Regional Manager for Uber, in an e-mail. &ldquo;After years of neglecting Chicago drivers and passengers alike, the taxi industry has resorted to name-calling and frivolous lawsuits. While they spend time in court, we&#39;ll be working with Mayor Emmanuel (sic) to design a forward-looking regulatory regime that creates economic opportunity, prioritizes safety, and ensures access to the best, cheapest rides ever available in the city.&rdquo;</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Thu, 06 Feb 2014 20:05:00 -0600 http://www.wbez.org/news/cab-livery-companies-sue-city-over-rideshare-companies-109655 City moves to regulate rideshare companies http://www.wbez.org/news/city-moves-regulate-rideshare-companies-109639 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Screen Shot 2014-02-05 at 10.02.40 AM.png" alt="" /><p><p>The days of Chicago&rsquo;s Wild West of ridesharing services may be numbered, if the city has its way. The Mayor&rsquo;s office introduced new rules at Wednesday&rsquo;s City Council meeting, aimed at bringing the technology companies into the regulatory fold. But the move is already angering some who say the city should use its existing regulations for taxicabs and livery vehicles, rather than create a new set of rules.</p><p>&ldquo;This is a new industry that&rsquo;s still in the early stages and we wanted to step in, create some requirements that provide for public safety and consumer protection, but do that without essentially regulating the industry out of existence,&rdquo; said Michael Negron, Chief of Policy to the Mayor.</p><p>The proposed ordinance creates a new category of commercial vehicle transportation, called &ldquo;Transportation Network Providers,&rdquo; meant for technology companies that connect people who need rides, to people who have cars. Currently, this would include companies like Lyft, Uber and Sidecar, which have operations in Chicago. Unlike taxi drivers, people offering rides with these services use their personal cars, which do not have to be registered with or inspected by the city. The drivers also do not have to undergo training or licensing as public chauffeurs.</p><p>&ldquo;Now that the industry&rsquo;s been up and running for a bit, we want to be able to step in and impose what we think are ultimately some common sense requirements,&rdquo; said Negron, &ldquo;that ensure that when people step into a rideshare vehicle they know that the driver has gotten a background check and the driver&rsquo;s been drug tested and that the vehicle has been inspected and that they&rsquo;re getting the fare disclosed to them.&rdquo;</p><p>The ordinance would require the companies to register with the city and pay an annual $25,000 licensing fee, as well as $25 per driver with their service. It would also subject the companies to the city&rsquo;s ground transportation tax &mdash; $3.50 per day, per vehicle, for each day that the vehicle is used in Chicago for ground transportation. Additionally, the vehicles would have to display signage or an emblem that identifies their ridesharing service, and would have to be inspected annually by the city.</p><p>But perhaps the most significant cost that the rules would require are general commercial liability insurance and commercial automobile liability insurance policies of $1 million per occurrence.</p><p>&ldquo;Uber&rsquo;s existing policy meets that requirement,&rdquo; said Andrew MacDonald, Regional Manager for Uber Midwest. &ldquo;The basic premise is our insurance policy, as designed with our carrier, does cover a driver on an Uber trip regardless of the personal insurance policy.&rdquo; The company, however, declined to share a copy of that policy with WBEZ.</p><p>Several drivers, some of whom asked not to be named because they still drive for&nbsp; UberX and Lyft, told WBEZ that they were offered little or no detailed information about the companies&rsquo; insurance policies when they went through their orientation sessions.</p><p>&ldquo;People asked about what to do if there were problems,&rdquo; one said, &ldquo;but the answer was always to call Lyft Support,&rdquo; a hotline that the service provides for its drivers. &ldquo;They verified my insurance,&rdquo; said another driver for UberX, &ldquo;but never explained anything about what would happen in the case of a very bad accident.&rdquo;</p><p>Lyft, too, claims to carry an insurance policy of $1 million per occurrence, but it is an &ldquo;excess policy&rdquo; that kicks in after the driver&rsquo;s personal insurance has been used. The proposed ordinance would no longer allow this.</p><p>&ldquo;For us, it&rsquo;s like we are completely on board with provisions that increase consumer safety,&rdquo; said MacDonald, referring to the idea of new regulations. &ldquo;But beyond safety issues, I think controls on pricing, overreach on information, limitations on where cars could operate &mdash; all of that stuff starts to be not about safety, but starts to be about protectionism, and doesn&rsquo;t benefit the consumer, and doesn&rsquo;t create jobs, so that&rsquo;s where I get really concerned,&rdquo; he said.</p><p>The ordinance proposes that drivers with the services may collect fares determined by distance or time, or that are predetermined, or that are suggested donations. It would no longer allow the companies to apply formulas that calculate fares as a combination of time and distance. It also does not address &ldquo;price-surging&rdquo; or &ldquo;prime time tipping&rdquo; &mdash; a practice where Uber and Lyft hikes their fares when demand is high.</p><p>&ldquo;This ordinance is simply enabling an illegal activity which is a cab-like activity to take place,&rdquo; said Pat Corrigan, owner of The Yellow Group LLC, which operates Yellow Cab in Chicago. &ldquo;So this is not something the cab industry can stand by and see.&rdquo;</p><p>Corrigan and others from Chicago&rsquo;s cab and livery industries say they are prepared to file a federal lawsuit against the City of Chicago to compel the city to regulate ridesharing services the same way as their industries.</p><p>&ldquo;The public transportation system, which is the taxi system as you know it, has all these rules and regulations,&rdquo; he continued, &ldquo;including it can&rsquo;t charge more than the meter. UberX, Sidecar and Lyft, can charge basically anything they want.&rdquo;</p><p>Corrigan noted that cab companies must offer worker&rsquo;s compensation, use vehicles that are less than four years old, accept forms of payment other than credit card, and service all neighborhoods of the city &mdash; requirements that are not part of the proposed rules for ridesharing companies.</p><p>The arrival of ridesharing companies has certainly complicated the city&rsquo;s position. Under Mayor Rahm Emanuel, the city has touted itself as technology-friendly, and appears to have dropped early objections to Uber&rsquo;s taxi operations in the city. But at the same time, Chicago brings in tens of millions of dollars each year in taxes and fees from taxis &mdash; an industry whose value rests largely on maintaining the value of the medallions.</p><p>&ldquo;It&rsquo;s certainly not good for the medallion system,&rdquo; added Corrigan, &ldquo;because you have another system that&rsquo;s competing &mdash; a private system of transportation &mdash; for some of the people in the city that can afford it, competing against the public system.&rdquo;</p><p>Taxicab medallion owners and lenders have been nervously watching the growth of ridesharing in the city, worried that it may undermine the value of their investments. Medallions, which the city issues in limited number to license taxis, are valued at roughly $350,000 apiece.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="https://twitter.com/oyousef">@oyousef</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>.</em></p></p> Wed, 05 Feb 2014 09:55:00 -0600 http://www.wbez.org/news/city-moves-regulate-rideshare-companies-109639 Cabbies threaten to abandon Uber over changes http://www.wbez.org/news/cabbies-threaten-abandon-uber-over-changes-109625 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Uber changes.jpg" alt="" /><p><p>Once a darling of tech-savvy cab riders and taxi drivers looking for supplemental income, technology company Uber now faces mounting anger from some of those same drivers. The popular taxi-hailing service announced to cabbies via e-mail last week that, effective immediately, it was amending their contracts to include a $10 weekly charge for the data plan of the iPhones that the company issues them. The phones are currently mandatory for drivers that sign up with the service.</p><p>&ldquo;Connecting our partners with hundreds of riders each week does come with a cost,&rdquo; the email states. &ldquo;Since we launched in 2012, Uber has paid $10/week for the cost of data plan for every Chicago TAXI partner on our system, but at this time, this subsidy must end in order to encourage responsible iPhone use and prevent waste.&rdquo;</p><p>The message notes that the $10 deduction from drivers&rsquo; statements will begin this week, and that this policy has already been in effect since October for drivers in the company&rsquo;s livery service, UberBLACK.</p><p>&ldquo;I&rsquo;m going to return the phone,&rdquo; said Mohan Paudel, a Chicago cab driver who has used Uber for more than a year. Paudel and several other taxi drivers say that $10 per week is an unreasonably high charge in a business where the margins are already miniscule. Many are now thinking of dropping the service altogether, unhappy with the company&rsquo;s sudden, unilateral approach to changing the terms of their agreements.</p><p>&ldquo;I&rsquo;m definitely considering stopping working with Uber,&rdquo; said Peter Enger, a longtime Chicago taxi driver and Secretary for the United Taxi Drivers Community Council, a grassroots organization that works on labor issues in the industry.</p><p>&ldquo;I know a lot of cab drivers have gotten kind of fed up with their corporate practices. They&rsquo;re now no longer open for business, you cannot just go and consult with them except by appointment,&rdquo; he added. Enger and others complain that the company is difficult to reach with questions, and that often staff are discourteous when they respond to questions.</p><p>Andrew MacDonald, Uber&#39;s Midwest Regional General Manager, did not respond to questions from WBEZ about the change in policies, and did not follow up on a request for an interview.</p><p>But in the e-mail to taxi drivers, the company argues that the new charge for the data plan is reasonable because the service has allowed drivers to take home greater pay. &ldquo;We understand that every cent counts when it comes to your hard earned dollars that need to be spent on your food, housing, education, and your families,&rdquo; it states. &ldquo;Did you know that you earn as much as 7.5% more per Uber request compared to other fares paid via credit card?&rdquo;</p><p>&ldquo;But we&rsquo;re not making more money because we have to spend more time for the Uber customers,&rdquo; countered Paudel, &ldquo;because we have to go there and wait for two minutes, maybe sometimes ten minutes, and get the fare, which is&mdash; we&rsquo;re wasting a lot of time on that, too.&rdquo;</p><p>Other drivers agree that they typically have to wait longer when they arrive at a pickup location for customers that summon them through the Uber app. They also say they often waste time getting to Uber calls, only to have them cancelled at or before arrival. They say that Uber promises to pay them $5 for cancelled fares, but they rarely see that payment. Paudel says the new $10 charge, on top of these inconveniences, will add up to less weekly revenue than if he simply dropped Uber altogether.</p><p>The Uber notification also stated that drivers will be charged the weekly amount for the data plan regardless of whether they turn on the Uber device to take any calls in a week. Paudel said that&rsquo;s not fair if he decided to take a week off. He suggested that Uber instead increase the percentage that it takes from taxi drivers&rsquo; fares, currently 2.5 percent of the metered amount.</p><p>Still, it&rsquo;s not clear that taxi drivers abandoning the service would do much harm to the company. Since launching its taxi service in April 2012, the company also introduced its UberX ridesharing service, which matches passengers with non-taxi drivers. Many in the taxi industry fear that ridesharing services such as UberX, and competitors Lyft and Sidecar, directly threaten their business.</p><p>Last week, Uber announced that it was slashing its UberX fares&mdash;already lower than taxi meter rates&mdash;by 15 percent. The move follows accusations that the company engaged in price gouging on New Years Eve and in recent days with particularly inclement weather. UberX employs a surge pricing model when demand for rides peaks.</p><p><em>Odette Yousef is WBEZ&rsquo;s North Side Bureau reporter. Follow her <a href="http://twitter.com/oyousef" target="_blank">@oyousef</a> and <a href="http://twitter.com/WBEZoutloud" target="_blank">@WBEZoutloud</a>.</em></p></p> Mon, 03 Feb 2014 10:16:00 -0600 http://www.wbez.org/news/cabbies-threaten-abandon-uber-over-changes-109625