Stop playing favorites with transportation companies

Kenneth Reynolds

When it comes to the debate about how to regulate ride-sharing companies or Transportation Network Companies (TNC) like Uber and Lyft, we can’t fail to address how Michigan’s outdated laws effect state’s transportation industry as a whole.

TNC’s have condemned and refused to comply with existing state passenger transportation regulation and local transportation ordinances, but the TNC legislation that passed the House in 2015 used this same “antiquated” regulatory design.

The House legislation provides TNCs a competitive market advantage by prohibiting local regulation, excluding them from the Michigan Commercial vehicle code, and prohibiting taxis and limousines from being licensed under this same legislation. This leaves the taxis and limousines to be regulated under an antiquated and restrictive market design even though they compete for the same customers and provide essentially the same service.

Whether someone is riding in a luxury sedan, stretch limousine, taxicab or an Uber or Lyft vehicle, every one of these vehicles is providing for-hire passenger transportation. These vehicles are being driven by someone who is acting as a chauffeur, and oftentimes they’re competing for the same customer base. Therefore, it only makes sense that Michigan’s laws should be applied equally to all players in the passenger transportation market.

Detroit is a perfect example of Michigan’s broken regulatory structure. Taxi and limousines are subject to city regulation and heavy police enforcement based on rules that were written more than 75 years ago. These laws have not been updated in over 22 years — well before Uber or Lyft were around.

While taxis and limousines in Detroit have been forced to live under outdated regulations, in 2014 the city of Detroit provided TNCs Uber and Lyft with operating agreements that suspend local regulation and police enforcement and instead allow them to be self-regulated and have unrestricted market access. In the two years since Uber and Lyft were given their wish to be self-regulated, Detroit’s taxis and limo industry has been forced to compete for passengers under heavily enforced regulations.

An “antiquated” regulatory system affects all for-hire transportation providers, not just TNCs. Michigan needs to update its laws and ordinances to catch up to the shared economy movement. The solution, however, cannot benefit one or two companies over others. Legislation is needed that will level the playing field for all for-hire transportation provides and create equal rules and regulations that provide open access to all markets and is not restricted by local municipalities.

Michigan’s existing transportation companies are not trying to stop innovation or prevent new companies from entering the market. If anything, the increased competition is forcing all players in the market to step up their game and improve their customer experiences. That’s a good thing for everyone and should continue to be encouraged.

Those who have been in the transportation business long before TNCs came to this state simply want fair and equitable laws that provide equal market access and apply to all for-hire transportation providers.

Kenneth Reynolds is president of the Metro Detroit Cab Drivers Association.