Vote put off on rules for ride-hailing companies like Uber

The City Council Budget Committee voted Wednesday to defer a bill that would require Uber, Lyft and other ride-hailing drivers to abide by the same rules as taxicab drivers.

“I believe we can reach some kind of balance,” Budget Chairwoman Ann Kobayashi said in requesting that the committee not take a vote on Bill 85 (2015) until its April 27 meeting.

Traditional taxi companies and their drivers want the same rules they are required to follow to apply to ride-hailing operators. Those requirements include the need to obtain taxicab drivers’ permits, carry liability insurance and go through extensive criminal background checks and medical clearances.

But ride-hailing operators, and their supporters, said that imposing the same regulations on them would shake up the companies’ business model and make it difficult for such operations to continue in Hawaii.

Brian Hughes, Uber Hawaii general manager, said the current language in the bill “would not allow us to operate.”

“The entire framework does not work for our business model,” Hughes said.

The Council and administration blame each other about the lack of progress on the issue.

Councilman Ron Menor voiced frustration when questioning city Customer Services Director Sheri Kajiwara. The administration earlier indicated it was willing to look into the issue further.

“What I am awaiting, from the administration, are your recommendations,” he said, about whether to include ride-hailing operations under the umbrella of taxi regulations or establish a new framework just for the fledgling industry.

Menor said he wants a time frame for such a recommendation “because we’ve been talking about this for a while now.”

But Kajiwara told Council members that the administration had no position on the bill because the decision is up to the Council. She said she had been planning to create a working group to study the issue in detail but was “denied” by Council members.

“Your decision today will allow us to move forward in whatever manner you feel is important,” she said.

Kobayashi said it was wrong for Kajiwara to suggest it was the Council’s fault that a working group had not yet been formed. “No one on this committee has denied you a working group,” she said. “And I don’t think we would.”

“My understanding was you were going to create a working group,” Councilman Trevor Ozawa said, adding that only the administration would have the resources to delve into the issue more deeply. “We need your help.”

Galen Onouye, an administrator with the Department of Customer Services, said he has been working since last year on a revamped set of guidelines for taxi regulations, but has not inserted ride-hailing companies into those guidelines — pending Council action on the bill.

“Whatever the Council puts forth, we will work within to make it work,” he said.

Onouye said there was also uncertainty over whether the Legislature was going to address the issue statewide. So far, that doesn’t appear likely to happen this session, except for possibly a measure that would require ride-hailing operators to carry the same insurance as cab drivers, he said.

Onouye said the debate over whether to include so-called transportation network companies, or TNCs, with taxis is occurring in state and municipal governments across the country. “Every single state is grappling with this issue,” he said. “There’s a lot of money involved in this legal battle. I have a feeling it’s going to go all the way up to the Supreme Court.”

Councilman Brandon Elefante said a separate set of rules needs to be created for TNCs. “I don’t believe that folding them into taxicabs is the appropriate way (to regulate them),” he said.