An executive from the ridesharing company Uber explained the company’s business model to the legislature’s Transportation Committee last week.
Lawmakers are struggling with Uber’s new social business model and trying to figure out how much regulation is necessary.
Uber has been servicing Connecticut since April 2014. The company launched in Fairfield and New Haven counties and has since expanded its operation to Hartford and New London, according to Nicole Benincasa, a policy and regulatory associate for Uber.
One month following Uber’s launch in Connecticut, 15 state cab and livery companies filed suit against Uber and Lyft, another ridesharing company, to block them from doing business in the state. The taxi companies contend the ridesharing companies’ services skirt state and federal regulations of the industry.
Uber is an app-based transportation network that allows a person to request a ride with his or her phone. Drivers use their own cars to pick up people and drive them to their destinations.
The Connecticut taxi industry, which is highly regulated, has been trying to delay Uber’s integration to the industry due to its absence of regulation and potential impact on the market, as well as passenger safety.
According to the New Haven Register, the lead plaintiff in the case is Greenwich Taxi. The company’s manager, Anthony Boskello, said Uber and Lyft pose a “very serious threat” to safety.
In a written statement, Boskello said, “Because they are not regulated as we are, their cars are not properly inspected regularly to ensure they are maintained in safe operating condition. Their drivers have very little training, if any, do not possess the certification and driver’s licenses ours must have, nor are they subject to the rigorous criminal background checks we perform on our drivers.”
The committee asked the Department of Transportation to evaluate how Uber would affect the transportation industry, according to Rep. Antonio Guerrera, co-chairman of the Transportation Committee. The evaluation, which was done in conjunction with Central Connecticut State University, will be completed before the end of the month.
“If there’s a product out there that gets a person from Point A to Point B, I think it’s our obligation as legislators to hear about it,” Guerrera said.
Speaking to the committee, Benincasa provided a thorough review of Uber’s policies. Committee members were concerned about background checks for drivers, public safety, and insurance coverage for passengers.
“We provide rigorous background screening for our partner drivers,” Benincasa said.
Uber contracts with an independent firm that performs multilayered checks, screening drivers through the National Sex Offender Registry, Social Security, and Department of Motor Vehicle records, Benincasa said.
Benincasa also gave an overview of the difference between rideshare and livery services, highlighting that rideshares are for personal and local use compared to commercial cab services, which travel about 70,000 miles per vehicle annually.
William Scalzi, president and founder of Metro Taxi, the largest full-service taxi company in Connecticut, questioned the need for new regulations for “rideshare” companies like Uber. “Why would we make new regulations for a company that does a fraction of the business that the taxi industry does?” Scalzi asked.
Scalzi also suggested that the driver vetting process of companies such as Uber is “not even close to what it should be.” Taxi companies such as Metro Taxi include fingerprinting through FBI databases in their background checks, which Scalzi said are more effective than Social Security checks because it actually ensures the identity of the person.
Rep. Sean Scanlon, D-Branford, noted that “there is a level of expectation from the public that government does have strong oversight over things like transportation.” Scanlon cited the Metro-North train crash in Valhalla, New York, that killed six people as an example of the level of expectations.
“New and separate regulatory structures have been adopted in 24 out of the 275 jurisdictions where Uber operates across the country,” said Benincasa. She told the committee that Uber is “not afraid of reasonable regulation.”
In a recent release from ConnPIRG and Frontier Group, Hartford was ranked 61st among 70 major American cities for high-tech transportation options. “Technological advances are giving people new and convenient ways to get around more freely without having to own a car, but Hartford has yet to take advantage of many options,” Sean Doyle, ConnPIRG organizer, said.
Benincasa said Uber has plans to expand statewide.
“We hope Connecticut will be as receptive as other jurisdictions have been. We have a growing team that only needs to get bigger,” she said.