Citations seem to be part of doing business, and breaking into a new market, for the app-based ride-sharing companies Uber and Lyft. They're finding out that elbowing their way into Houston's livery space for the past month doesn't come cheap. (Remember, Lyft is the one with the pink mustache on the grill, and Uber is the other one.)
Neither organization is allowed to operate like it wants to in this city, just yet. There's this little thing called Chapter 46 and an amendment to for-hire requirements that's working its way through city council. An Uber spokesperson tells us that they're looking to eliminate a 30-minute wait requirement, as well as a minimum fair requirement for catching rides. Right now, both services operate without charging riders. But that might not really be the case according to testimony heard in city hall.
The issue came up at yesterday's council meeting and Mayor Annise Parker said that undercover Houston police sting operations have resulted in 26 citations for Uber and Lyft drivers. They were likely, misdemeanor violations for operating an illegal taxi.
The mayor's remark was in reply to testimony from Duane Kamins, a partner, along with his brothers in Houston's second largest cab company, Houston Transportation Services. He's also a lawyer and filed an affidavit with the state revealing his findings during his own undercover operation where he was charged some dollars for trips to the pharmacy and thereabouts.
"We clearly have two rogue operators in the city of houston today, uber and lyft who are operating in clear violation of Chapeter 46 of the [city] code," he said.
In his affidavit, which you can view below, Kamins describes getting charged $4.70 for a short trip from an Uber driver with the handle Abdessamad. He also details a $13 trip with Lyft driver Ballagio. And later, a $12 trip with a Lyft driver named Sebastian whom he knocks for relying too much on his GPS to get around.
Kamins, who obviously has a major stake in not wanting to add more competition to the local cabbie game, asked the council to take action against the companies. His beef is that someone is getting compensated for provided commercial transportation services on city streets.
Basically, while the driver may not have asked for cash directly, that's not how these services are meant to work anyway, in the end nobody is really driving around wasting gas for free.
"I think the entities that are in violation of the ordinance are Uber and Lyft themselves," Kamins said. "They are the companies that presentrd the app for the customers to use. My credit card is on file with Uber and with Lyft, and not with the driver. My credit card was charged by the companies, the companies keep the funds for themselves then distribute a certain percentage to the drivers. At least that's my understanding," he said.
A spokesperson for Lyft, Katie Dally, explained how driver compensation works: "Lyft credits new users' accounts with free rides when they sign up with Lyft through our Pioneer Program - so users are not paying for rides, and drivers are compensated based on time and distance with those credits."
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She also said, via email, that a Lyft driver was cited by an undercover cop who asked for a ride, and that the company was "covering the cost of the citation and any necessary legal assistance."
Another taxi study is expected to be presented to the city council next week.