clock menu more-arrow no yes

Filed under:

Ride-hailing showdown vote scheduled for Friday

Uber and Lyft drivers have rallied in opposition to any attempts by the city to regulate the ride-hailing services. | Fran Spielman/Sun-Times

Uber and Lyft have threatened to abandon the lucrative Chicago market if aldermen forge ahead with a plan to license ride-hailing drivers to improve public safety and level the playing field with taxicabs.

It looks like that threat could be put to the test.

The chairman of the City Council’s Transportation Committee has called a meeting for Friday to forge ahead with the licensing plan, in spite of a big-bucks advertising campaign against it bankrolled by the ride-sharing giants.

By blanketing the airwaves and purchasing full-page newspaper ads, Uber and Lyft apparently had hoped to persuade Ald. Anthony Beale (9th) to back off. It didn’t work.

“They’re crying wolf every day. They’ve operated under scare tactics across the country. If they choose to leave because we are trying to make sure consumers are protected, then God bless `em. I’m pretty sure that, within 24 hours, there’ll be somebody in the system to ready to replace `em,” Beale said Tuesday.

Mayor Rahm Emanuel’s communications director Adam Collins responded to Beale’s bold claim by saying, “We are continuing to work with the Alderman towards a compromise plan that would ensure people throughout Chicago have a variety of safe, reliable transportation options to choose from.”

Emanuel, whose brother Ari is an Uber investor, has been lobbying hard to kill Beale’s licensing ordinance on grounds that it will kill the “transportation choices” that riders demand.

The Illinois Transportation Trade Association, representing the struggling taxicab industry, is fighting equally hard to push the ordinance over the goal line. The group and its political action committee have contributed more than $35,000 in recent months to Beale and other aldermen.

Friday’s Transportation Committee vote could provide a test on who has the political muscle on an ordinance co-signed by two-thirds of Chicago’s 50 aldermen.

“I believe I have the votes. We’ll see what happens in committee. Then, we’ll bring it to the full [Council] floor on the 22nd. The votes are standing very firm and solid behind making sure consumers are protected,” Beale said.

Beale’s ordinance would require Uber and Lyft drivers to get restricted chauffeur’s licenses after a one-day class, be fingerprinted by a city-approved vendor and get their vehicles inspected by City Hall.

A minimum of 5 percent of the total fleet of both companies would have to be accessible to customers with disabilities. No ride-hailing vehicle more than 6 years old could remain on the streets.

Lyft and Uber, whose drivers owe the city $15 million in unpaid parking tickets, red-light and speed camera fines and water bills, would also be required to immediately settle those debts to renew their operating licenses.

Already, 10,000 Uber and Lyft drivers have been “de-activated” after failing to comply with a May 23 deadline to settle their debts.

During a marathon committee hearing last month, Uber and Lyft played the race card and threatened to abandon the Chicago market to avoid licensing.

“If this ordinance were to pass, ride-sharing as we know it would no longer exist in Chicago,” Uber’s Chicago general manager Marco McCottry said on that day.

Joseph Okpaku, Lyft’s vice president of government relations, said it’s a “distinct possibility” that the company would pull up stakes.

Okpaku argued that Lyft drivers — 80 percent of whom drive less than 15 hours-a-week — would not be willing to jump through the regulatory hoops to get a restricted chauffeurs license. That includes: paying a $115 fee; passing a one-day course and undergoing a fingerprint-based background check.

“We cannot operate under a regulatory framework like this. If you can’t get part-time casual drivers on board, the model fails. . . . If you shut off the critical mass of drivers, the whole system starts to crumble,” Okpaku said.

On Tuesday, Beale argued once again that a $68 billion industry can afford to absorb the nominal cost of licensing.

He also threw cold water on the claim that Uber and Lyft are responsible for providing 92 percent of rides to and from under-served Chicago neighborhoods and that, without them, passengers will be left high and dry.

“They’re saying nobody’s serving the South and West Sides, which is not true. An African-American cab owner on the King Drive has given data that she provides 6,800 rides-a-month to the South and West Sides. So, they’re saying these things, but they’re not giving us the data to back it up,” Beale said.

“Because they have so much money, they’ve been able to craft the message and get people to believe what they’re saying, instead of what’s accurate and what’s the truth,” he added.

In an emailed statement, Uber spokeswoman Brooke Anderson said: “It’s unclear why Chairman Beale would be arguing with the City of Chicago’s own data. The trip numbers released by the City show that ridesharing companies provided 10 times the rides to and from underserved neighborhoods over the last six months alone. Our own records validate those facts, showing 42% of Uber’s rides in the city start or end on the south and west sides.”

Uber and Lyft have further maintained that ride-sharing has provided jobs for thousands of African-Americans and that a background check based on FBI fingerprinting would discriminate against minorities who are “far more likely to have an interaction with the criminal justice system,” often for minor, nonviolent offenses where the charges are dropped but the record has not yet been expunged.

Beale doesn’t buy that argument either. That’s even though former U.S. Attorney General Eric Holder wrote him a letter making that same argument. Holder works for a law firm has advised Uber in California.

“We’ve streamlined the process by saying they can get their chauffeurs license in a day,” he said.

“I don’t understand why anyone would not want to be finger-printed and background-checked when public safety is first and foremost. We have to make sure that people [driving] the public are who they say they are.”