May 5, 2015

Lyft says goodbye, Uber’s future unknown

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DSC_0083Ken is a self-proclaimed “night owl” who spends many weekends driving around the streets of Albuquerque waiting for someone who needs a ride. A realtor by day, he can make up to $700 in three days pulling double duty driving for Lyft and Uber, two ridesharing services currently operating in Albuquerque.

He usually starts his nights driving at 8:00 p.m. and calls it quits around 4:00 a.m. He asked not to reveal his last name out of concern that his personal insurance company would increase his rates for driving for a ridesharing company.

Last week Ken, along with other drivers who contract with Lyft, received an email from the company stating the service will no longer be available in Albuquerque.

Ken, who has been driving with Lyft for a month, said he is disappointed to see the service go, but the money he makes driving is purely supplemental.

“My day job is starting to pick up for the summer,” he said. “Even so, the extra money doesn’t hurt.”

What Ken is concerned about is the lack of reliable and safe transportation. He said he has talked to many riders who have waited hours for a cab, or even decided to drive drunk.

“I’ve had passengers tell me they used to drive drunk and they will probably do it again when Lyft is gone,” Ken said.

Lyft leaving

The email from Lyft to drivers specifically cited increased regulation in New Mexico as the reason for the company’s exit.

“State officials have moved forward with onerous ride sharing requirements that make it nearly impossible for drivers like you to thrive on a peer-to-peer platform,” the email stated.

In a statement, a Lyft spokeswoman confirmed to New Mexico Political Report that the company will halt operations in the area specifically because of increased regulation.

As New Mexico Political Report previously reported, the regulations would include drug tests for drivers as well as a mandatory car inspection by a licensed mechanic.

“While we appreciate the work done by the PRC, the new rules do not allow true ridesharing to operate in New Mexico. We are now forced to choose between supporting regulations that we know will make it exceedingly difficult for our peer-to-peer driver community to thrive, or taking a stand for the right long-term path forward. Because of this, we have made the difficult decision to pause operations in Albuquerque on May 14th.”

The notice came about a year after the service became available in the area. In that year, lawmakers and state officials questioned whether or not services like Uber and Lyft should have to comply with the same state regulations as cab companies.

Uber stopped service in both Auburn, Alabama and San Antonio, Texas earlier this year because of certain regulations in those cities.

For now, Uber hasn’t made any announcements about leaving the state, but in an email to New Mexico Political Report an Uber spokesman said any regulations in New Mexico need to be reasonable.

“Ridesharing has changed the way New Mexicans connect to the people and places they love in Albuquerque, Santa Fe and Las Cruces. Over 40 jurisdictions across the United States have already responded by developing common sense regulations that recognize the unique nature of ridesharing. It is now time for the PRC to do the same and pass reasonable regulation that protects jobs and preserves the ability of New Mexicans to access safe, reliable rides.

Some say regulations are too much

In May 2014, the Albuquerque Journal reported the New Mexico Public Regulation Commission tried to stop the company from operating until it complied with state regulations. The commission didn’t immediately make a decision and Lyft continued to operate with minimal state oversight.

Supporters of less restrictions for ridesharing services have said companies like Lyft and Uber allow riders to safely travel affordably and easily.

During the 2015 legislative session, Rep. Monica Youngblood, R-Albuquerque, sponsored a bill that would have added some regulations, but was also aimed at allowing ridesharing services to continue to operate.

The legislation passed the House by a wide margin but never received a vote in the Senate.

Youngblood told New Mexico Political Report she sees the move by the PRC as detrimental to TNCs.

“I think it’s terrible, the state has been so unfriendly to the industry but I can’t say I am surprised at their decision to leave,” Youngblood said.

She added that it could prove harmful to drivers who are using the service as a main source of income.

“Hopefully, there is demand enough with Uber that they can make the switch but I would say the uncertainty of the future for TNC’s (transportation network companies) may put those veterans, single moms, single dads, retirees, college students in a dire situation and many other entrepreneurs out of business,” Youngblood said.

On Monday, a local subsidiary of Uber filed a motion with the PRC asking for a reconsideration of the new regulations. Hinter-NM, LLC proposed that any regulations on TNCs should be separate from those of taxi companies.

Others want more oversight

Critics of how Lyft and Uber operate have argued that there needs to be more oversight for safety and accountability. In a letter to the PRC last week, New Mexico Attorney General Hector Balderas urged commissioners to require more drug and alcohol testing for TNC drivers.

According to Karen Montoya, the commission’s chair, the letter was delivered to the commission just as they were making those changes.

Not so, said Commissioner Valerie Espinoza. She said the commission did not do enough to address Balderas’ concerns and that drug testing is a matter of public safety.

“Drug and alcohol testing is non-negotiable,” Espinoza said in a phone interview. “I won’t stand by to watch morals change.”

Espinoza said she could not talk in detail about Uber and their request as it is now a pending case, but said she would not fight for a company that is not in compliance with the regulations.

“If our rules and laws are too tough, it’s ok by me if they operate in another state,” Espinoza said.

Espinoza said she was “the lone wolf” when the PRC voted on what kind of regulations should be applied to TNCs, but pointed to other states where Uber and Lyft have left. She said the fact that other places are tightening rules, “tells you I’m not the only one who sees it this way.”

The PRC has not added the reconsideration motion to the agenda of its Wednesday meeting, but Espinoza is confident it will be discussed later this week.

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