Michigan lawmakers debate how to regulate car services
Lansing — Competing legislation in the Michigan House and Senate would take different approaches to regulating services like Uber and Lyft that allow people to request rides using apps on their smartphones.
The two Republican-sponsored packages have ignited a debate over how much local control is appropriate for creating and enforcing certain regulations.
A mix of local and state regulations governs limo and taxi services. A House package would create separate regulations for ride-hailing services, to be handled by the Michigan Department of Transportation. Local governments would be prohibited from setting their own regulations or fees.
The Senate package would put ride-hailing services under state limo and taxi laws while leaving some control with local governments, who say they support the expansion of ride-hailing services but need to set regulations that fit their communities’ needs.
Representatives from Uber and Lyft have lobbied heavily in favor of the House package, which they say would ensure “higher safety but lower barriers to entry” than if their services were regulated under limo and taxi laws.
Mike White, general manager for Uber in Michigan, said putting ride-hailing services under limo and taxi regulations would “prevent part-time drivers from having it be worth their while to go through all those barriers.”
“You’d be left with only individuals who are willing to do this on a full-time basis,” he said. He argued that part of what makes ride-hailing services beneficial is that it creates a market for part-time drivers who can help provide more service during peak demand times.
But the House package faces pressure from local governments and the state’s airports to remove the prohibition on local regulations.
Representatives from the Wayne County Airport Authority, Capital Region Airport Authority and Gerald R. Ford International Airport told a House committee they want to see ride-hailing services operate in the state with options for local regulations. The airport representatives said they need to charge car services reasonable fees to meet certain federal guidelines.
Local government associations also voiced concerns about not being able to impose their own regulations.
John LaMacchia, a legislative associate with the Michigan Municipal League, said the group supports the expansion of ride-hailing services in the state, but local governments are in the best position to determine where local regulations might be warranted.
LaMacchia said cities have different needs when it comes to regulating ride-hailing services, so having flexibility is crucial.
That local flexibility is part of what Republican Sen. Rick Jones of Grand Ledge aims to allow with his package. He said his primary focus is on making sure regulations protect passengers with proper insurance.
“We’d be happy to sit down and come to a compromise,” he said, but proper insurance will have to be part of that.
The Senate Regulatory Reform Committee has approved Jones’ plan, and the House package could be voted out of committee this month.
House Commerce and Trade Committee Chairman Rep. Joseph Graves, a Linden Republican, has said he wants to see statewide regulations for ride-hailing services so they won’t face a patchwork of local laws that could inhibit expansion.
Graves also pushed back on suggestions from the Michigan Department of Transportation, which is advocating for putting all limos, taxis and ride-hailing services under one set of reformed regulations.
Sharon Edgar, administrator of the Office of Passenger Transportation at MDOT, told the House Commerce and Trade committee that the department has pursued reforms to laws regulating car services for several years.
“A single set of rules levels the playing field,” Edgar said.
Graves said that process has already taken too long, and he wants a structure in place sooner rather than later to allow ride-hailing to expand.
“I don’t want Michigan to be the dinosaur state,” he said.