Salt Lake City leaders are deciding whether to make room for embattled peer-to-peer car-sharing service Lyft. Lyft is one of a handful of new online companies that connect drivers through a smart-phone app to passengers in cities all over the globe.
Salt Lake City resident Darin Berntson first used a car-sharing app like Lyft, called Uber when he was traveling in Boston. He likes that the experience is a bit more personal than a taxi cab.
“It was actually less money than using cabs and when you’re in a cab, especially back in Boston, you know, you kind of feel like you’re in a cop car,” Berntson says. “You’re in the backseat, you’re completely walled off, windows, and you’ve got hardly any room whatsoever.”
Berntson and I are in downtown Salt Lake City where he’s demonstrating how Lyft works. He opens the iPhone app, taps “Request Lyft”. And in the next couple of minutes, three cars appear on the screen. Berntson says drivers and passengers are protected by a two-way rating system.
“If I’ve been a good passenger they’ll give me a five-star rating,” Berntson says. “If they’re a good driver I’ll do the same thing, anywhere from one to five stars. But if there’s ever a mismatch, let’s say the driver had some drunk belligerent guy or something like that, he could mark him down to like a whatever rating and he’ll never see that passenger again.”
Moments later, a black Audi approaches the curb. The driver gives Berntson and me a “fist-bump” as we duck inside. He’s a hip, tattooed musician named Mike Crowder, who is eager to chat.
“It’s been mostly business people like in a suit or going to work or something like that, or a college kid that needs a ride to Jimmy Johns,” Crowder says. “That was my last ride.”
Crowder, who works just a few hours a week tells me, he’s surprised to learn Salt Lake City is pushing back on his fun new part-time job.
“I know that Lyft typically battles with cities when they get into them and I know some cities they’ve won the battle, and some cities they’ve lost the battle,” Crowder says. “So I don’t know how Salt Lake is going to go. But I hope it stays. It’s great.
I ask him if he feels comfortable driving.
“Yeah,” Crowder says. “Until I get someone telling me I can’t do it.”
Crowder drops us off at the local Dunkin Donuts. No cash is exchanged because Lyft already has Berntson’s credit card on file. Once the payment is submitted, Crowder will get 80 percent of the fare.
Salt Lake City requires all, for-hire ground transportation like taxicabs and limousines to go through a rigorous licensing process. Lyft provides its own background checks, liability insurance up to $1 million and vehicle inspections. But under current city guidelines Lyft drivers are breaking the law. Salt Lake City officials have started issuing drivers citations with fines ranging from five to $75 hundred dollars. One driver told KUER, he’d been issued up to four warning citations that amounts to about $26,000 in potential fines.
Although the company declined to do a taped interview, Katie Dally, a spokesperson for Lyft told KUER its model does not fall into existing ground transportation regulations because drivers use their own vehicles and only drive a few hours per week. Dally added the company will cover the cost of citations and even legal fees drivers might accumulate. It’s unclear whether they’ve kept their promise.
Ken Olsen is President of Ute Cab Company in Salt Lake City. He’s upset that Lyft isn’t paying the same fees and following the same regulations that traditional taxi companies are subject to. Olsen says he’s waiting for the city to clamp down on the company. But his patience is wearing thin.
“They can do what several other cities are doing,” Olsen says. “The cities are going after these companies. There are some cities that have actually started impounding the vehicles. Some cities have put out a stop and desist order out on these companies. Our city is basically doing nothing.”
“We’re almost past that at this point,” says David Everitt, Salt Lake City Mayor Ralph Becker’s chief of staff. “We’re looking at how to make this happen. “We want to accommodate it. We want to welcome it. Again, we want to make sure we’re doing so in a way that accounts for basic life safety concerns and establishes a regulatory regime that’s fair.”
Because Lyft has yet to reach out to Salt Lake City officials, Everitt says the city will focus on working with drivers.
“Well I think we’ll look at a way to get people licensed as ground-transportation providers but does so in a very unburden some way,” he says.
In San Francisco, where Lyft is based, taxi drivers are suing the California Public Utilities Commission for permitting the company to operate. And in St. Louis Lyft is in the midst of a court battle with the Metropolitan Taxi Commission.
At the same time, Lyft enthusiasts like Darin Berntson are petitioning local governments across the country to step aside and promote innovation, rather than hamper it.
Car-sharing services like Lyft are just a fragment of a much larger economic movement that’s gaining ground—individuals sharing assets, whether they be cars, vacation homes or time and energy—for a fee.
Berntson, who owns an internet marketing company, says he gets excited about technologies that shake up the status quo.
“At the end of the day these guys are just providing software,” Berntson says. “They are not the cab company, they are just the software piece that links me to you or me to a driver, I guess, and allows that driver to go out and make a little bit of money.”
Simply put, Berntson says, the cities and taxi cab companies are just going to have to get over it.