CA Regulatory Officials Lay Out Proposed New Rules For Ridesharing Companies

The California Public Utilities Commission has weighed in on how to regulate smartphone-enabled rideshare services with a proposed decision released this afternoon.

The proposal aims to ensure public safety for drivers and users of transportation network companies, which the CPUC defines as a company or organization that provides transportation services using an online-enabled platform to connect passengers with drivers who are using their own vehicles.

As part of the recommendations, companies, such as Lyft, Uber and Sidecar, would have to be licensed by the CPUC, run background checks on drivers, have a driver-training program, and have a more stringent insurance policy.

The CPUC would require a $1 million per-incident coverage policy for rideshare vehicles and drivers during a trip with passengers.

There would also be a zero-tolerance drug and alcohol policy.

The CPUC, which regulates passenger carriers, had an administrative law judge compile the report on rideshare companies.

In December, the commission tasked the judge with gathering information to “evaluate the safety of ridesharing businesses that utilize the Internet, social media, and location services to arrange transportation of passengers over public highways for compensation,” according to CPUC documents.

Various local agencies, companies and organizations submitted comments to the CPUC before the proposal was released, including various rideshare companies, taxi companies, taxi advocacy groups, the San Francisco International Airport Commission and the California Highway Patrol.

The CHP wrote in a letter to the judge in March that the rideshare companies cannot be left unregulated because it “increases the potential for operation of unsafe vehicles, unqualified drivers and uninsured transportation providers.”

In another document, airport officials had contended that the term “rideshare” for these companies was misleading and asked for the CPUC to not allow the drivers to take passengers to and from the airport, citing passenger safety and security concerns.

As defined by the CPUC, a rideshare involves a driver transporting passengers to a destination, usually work-related, without profiting from the ride.

The airport said drivers and companies profit from the “ridesharing” system.

In June, Sidecar company officials submitted a letter that outlined what they called “the potential benefits of ridesharing.”

In the letter, officials wrote, “New dynamic ridesharing platforms are now innovating in ways that have the unique potential to overcome traditional barriers and unlock the true potential of rideshare—if regulatory models keep in step.”

The letter continued, “These platforms are not designed or intended to displace public transportation, corporate vanpooling, taxis or limousines services, but rather to complement multi-modal transportation networks.”

In the letter, the company asked the commission to implement a “new framework” that encourages “innovative transportation technologies, business forms and sharing models.”

The proposed decision is open to public comment for the next 30 days before the commission has its first opportunity to vote on the recommendations on Sept. 5.

Sasha Lekach, Bay City News

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