New law to clarify Uber/Lyft ordinance

A bill aimed at addressing concerns about the newly created ordinance regulating ride-hailing services such as Uber and Lyft along with traditional taxi companies will become law without Mayor Kirk Caldwell’s signature.

As a way to strengthen an ordinance approved in August, Councilwoman Ann Kobayashi introduced Bill 55, which was approved by the City Council on an 9-0 vote on Dec. 1.

It makes clear that Uber/Lyft drivers, like cab operators, have to be certified, and it places responsibility for certification on transportation operators and not the city. It also includes certification rules for the companies.

The original ordinance, which also became law without Caldwell’s signature, puts taxi and ride-hailing operators under the same set of regulations, defining all as “private transportation companies and drivers.”

Caldwell’s main objection when he didn’t sign in August was that the Jan. 15 start date would not give the Department of Customer Services enough time to put enforcement rules in place.

The original law arose from two separate concerns: outcry by traditional cabbies that Uber and Lyft operators did not have to operate under the same rules, and a growing public perception that all private transportation drivers needed to pass more extensive background checks.

Caldwell’s memo informing the Council that he wouldn’t be signing Bill 55 on Friday said that while he supports the intent and purpose, “I remain troubled by certain aspects, especially those that do not go far enough to protect the safety of the general public.”

Additionally, “there are legal concerns that make it more likely that the bill may be subjected to unnecessary legal challenges that may result in the payment by the city’s taxpayers of costly attorneys’ fees incurred by plaintiffs who prevail in those lawsuits.”

The old law, for taxis only, requires criminal background checks locally only and to go back two years. Under the ordinance passed in August and slated to take effect next month, all the drivers are supposed to submit third-party, nationwide background checks that are to go back seven years.

All drivers will need to have Hawaii-issued driver’s licenses, a provision that raised objections from Uber and Lyft because many of their drivers are military members or dependents with out-of-state licenses.

In his letter Friday, Caldwell raised two additional concerns with the amendments in Bill 55.

First, it limits the authority of the customer services director to ensure compliance and enforce its provision to only a single inspection through a sampling of records in a given year. “In light of the fluctuating number of reported drivers by the private transportation companies in their public testimony, limiting the director to a single annual audit of a private transportation company’s records may jeopardize the safety and welfare of its ridership and the general public,” he said.

Second, Caldwell said, he objects to changing the law so that private transportation companies are not required to recertify drivers on a periodic basis and only conduct criminal background checks every two years. The companies should be required to recertify their drivers at least every two years to ensure they hold valid driver’s licenses, maintain valid auto insurance policies, ensure they are mentally and physically fit, and submit their traffic violations bureau certified abstracts, the mayor said.

A third bill that seeks to shape the ordinance is currently moving through the Council. Caldwell said he’s asked his staff to work with the Council to amend the law further.