New Rules Coming for Uber, Lyft

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New rules for Lyft and Uber are on the way as the Memphis City Council began formalizing them Tuesday but taxi companies protested that the rules did not go far enough to level the playing field.

Uber and Lyft began operating here in April. They hit a snag in June when when the Memphis International Airport told them that, without permits, drivers would not be allowed to pick up or drop off passengers. The city permits office sent cease and desist orders to Uber and Lyft in July. But they continued to operate as they began negations with the permits office and city leaders on new regulations.

Council member Kemp Conrad brought an ordinance to the council Tuesday that would levy registration fees on the companies and the cars, require drivers to carry insurance, and require the companies to conduct background checks on their drivers.

But Ham Smythe IV, CEO of Premiere Transportation Services, told council members Tuesday that the companies are attempting an “end run” around the traditional rules and agencies (like the Memphis Transportation Commission) that govern the rest of the transportation industry in Memphis.

“They have set up shop without trying to comply with city ordinances; they choose to willfully disregard that,” Smythe said during Tuesday morning’s meeting of the council’s public works, transportation, and general services committee. "When they city sent them a letter to cease and desist, they continued to operate. I’m not sure why the city and this council put up with that.”

Smythe likened the companies’ operation here so far to someone selling liquor out of their home, saying the city would shut that operation down “in a red, hot minute.” He said Uber and Lyft are “billion-dollar companies” but are getting special treatment over homegrown companies like his.

“We’re not saying that these companies should not have an opportunity to do business here but they are skipping a lot of key provisions (of current laws that stand for taxis),” Smythe said.

Council member Harold Collins said the new rules should have been vetted by the lawyers and permits administrator of the Memphis Transportation Commission. He said his father raised 11 children driving a taxi for 51 years and said the council’s top priority in dealing with Uber and Lyft should be the safety of the citizens.

“It is incumbent on us as the fiduciary stakeholders of the city to maintain some responsibleness for those who carry out the service,” Collins said.

C. Barry Ward, a partner in the Memphis law firm Ballin, Ballin & Fishman, said he represents Lyft in the matter. He reminded council members of President John F. Kennedy’s charge to put a man on the moon and that he said we are defined by our challenges.

“I challenge the city of Memphis to come into this new situation and overcome the recession of (2008) and this is a means to do that,” Ward said.

Council member Reid Hedgepeth answered Ward in plain terms.

“I would like for you to hear loudly the comments about one company having a disadvantage over another,” Hedgepeth said. “We like competitiveness in this city, but we don’t want to kill the taxi industry in this city by bringing in someone else at a much lower rate.”

Conrad and Aubrey Howard, the permit administrator for the Memphis Transportation Commission, said the ordinance was changed Monday to ensure that Uber, Lyft, and companies like them will be regulated by the transportation commission.

This appeased Collins on the matter but he said he still wants to hear from Memphis Mayor A C Wharton’s administration on the issue.

The council will have to approve the new regulations in three readings over the next six weeks. Conrad said he will continue to facilitate the conversation on the rules between the Uber, Lyft, and the taxi companies.

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