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Originally published January 30, 2014 at 10:23 PM | Page modified January 31, 2014 at 12:59 AM

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City panel shrinks options in rideshare pilot plan

A Seattle City Council committee is one meeting away from approving a pilot program that would drastically change the way UberX, Lyft and Sidecar do business.


Seattle Times staff reporter

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After a nearly yearlong debate over how to fairly and safely regulate so-called “rideshare” companies, a Seattle City Council committee Thursday, before a room full of unhappy drivers, narrowed down the options it will vote on next month.

Whether they work with taxi, for-hire, or rideshare companies — now legally referred to as transportation network companies (TNCs) — almost no one in the standing-room-only City Council Chamber Thursday afternoon agreed with the terms of a two-year pilot program the committee will likely approve at its next meeting Feb. 14.

Potential caps on the number of drivers for TNCs proved to be one of the most contentious issues. Councilmembers Sally Clark, Bruce Harrell and Mike O’Brien agreed that they liked the idea of issuing 300 newly created permits to TNC drivers, who could then work with whatever company they choose. Drivers with TNC permits would not be allowed to drive more than 16 hours a week — a problem for people who have begun depending on the job as a primary or essential source of income over the past year.

Sarah Cresswell, of Seattle, spoke of how driving for Lyft has kept her and her 6-year-old daughter off welfare and said she would likely not be able to drive after the regulations are in place.

“There’s no way any of the companies would be able to survive with the existing limitations proposed,” Cresswell said.

Lyft, UberX and Sidecar have never disclosed to media or the city exactly how many drivers they have working across King County, but they have said there are hundreds.

A recommendation O’Brien introduced at the meeting would require TNCs to contract only with drivers who had TNC permits or licensed for-hire drivers with access to a licensed taxi or for-hire vehicle.

No one voiced much opposition to the committee’s efforts to close insurance gaps every Lyft, Sidecar and UberX is driving with now, though. Recent accidents involving TNC drivers — including a recent one in which an UberX driver struck and killed a child in San Francisco — prompted the committee to support much tighter TNC insurance requirements than California approved last year.

At present, each company requires its drivers to have personal car insurance. But insurance experts from the Property Casualty Insurers Association of America told council members that they are not aware of any personal car-insurance policy that would cover accidents that happen while a commercial service is being provided by the insured vehicle.

The proposed pilot program would force TNCs to cover drivers with excess liability coverage as soon as drivers are live on the company’s smartphone app. That would help prevent some of the liability confusion that has followed accidents such as the one in San Francisco, which killed 6-year-old Sofia Liu and injured her mother and 5-year-old brother.

Uber, the parent company of UberX, claimed that the driver in that accident “was not providing services on the Uber system during the time of the accident,” that he had no passengers in his car. But, according to a lawsuit filed against Uber and the driver Monday, the driver was actively using UberX’s app at the time of the 8 p.m. accident on New Year’s Eve.

Because the driver may have been between ride requests, the driver may not be eligible for any liability coverage from either his personal insurance or Uber, leaving the injured family uncertain about who will be responsible for compensating them.

TNC representatives previously have told the city of Seattle that they don’t want to cover drivers unless they are immediately engaged in commercial activity, because drivers could take advantage of their company’s liability coverage while not seeking fares.

“All it takes is a couple of minutes to game the system,” explained Tony Kilduff, a council staff member leading research of potential TNC regulations. “But that may just be the cost of doing business.”

Alexa Vaughn: 206-464-2515 or avaughn@seattletimes.com. On Twitter @AlexaVaughn.



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