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PUC Hearing Focuses on Uber and Lyft – Pa. Needs Legislation

Posted on Aug 29, 2014

The Pittsburgh Business Times covered an important hearing at the Pa PUC on regulating ridesharing services such as Uber and Lyft.  I was proud to represent the Pennsylvania Association for Justice (PAJ) in advocating to make sure that safety and adequate insurance is protecting the consumer before the company can operate.  Otherwise, a person seriously injured in a Pa car accident involving an Uber or Lyft driver may not be able to recover from an insurance company.

Below is a link to the article by Justine Coyne and the full article as well below.

Scott Cooper of the Pennsylvania Association for Justice said legislation that has been introduced in support of ride-share services in Pennsylvania is promising, but the problem is there are only nine legislative days left in this session.

“It’s hard to get a bridge named after someone through legislation in nine days, it isn’t likely something this controversial will pass in time,” he said, testifying at a hearing Thursday held by the Pennsylvania Public Utility Commission in Harrisburg to determine what changes, if any, need to be made to its transportation regulations.

But what’s more important than passing legislation quickly is to make sure the state gets ride-sharing regulations right, he said.

State Sen. Wayne Fontana, D-Allegheny County, introduced legislation in July that will allow ride-sharing services like Uber Technologies Inc. and Lyft Inc. to operate legally in the state, and address concerns that have been raised about ride-sharing.

Testifying Thursday, Fontana, who worked with the PUC to craft the legislation, said he has received hundreds of emails from constituents voicing support for ride-share services.

Katie Kincaid, government relations manager for Lyft, said since coming to the Pittsburgh market, the need and demand for the startup’s services has been clear.

Too often she said Lyft’s services are viewed as an alternative to taxi service, when in reality it’s meant to be an alternative to vehicle ownership.

Nick Zabriski, public policy associate for Uber, said ride-shares services have also been shown to decrease DUI rates after introduction in a new market.

“There are societal benefits from DUI reduction to overall environmental benefits, and I commend you for putting that out in the public discussion,” PUC Chairman Robert Powelson said.

But some voiced reservations.

Rep. Anthony DeLuca, D-Allegheny County, who sits on the State House Insurance Committee, said he supports ride-share service, but only if the operators meet “certain necessary and common sense insurance requirements.” Without the proper insurance, he said the public could be at risk.

One of the most debated issues is what should be done in terms of insuring personal vehicles that are serving a commercial use.

Samuel Marshall, president of the Insurance Federation of Pennsylvania, said there has been an ongoing learning curve.

Both Uber and Lyft carry a $1 million insurance policy for operators while they have a passenger in the vehicle, but he said it’s important to thoroughly examine the policies as well as driver contracts to ensure there are no clauses that will circumvent that policy and shift it to the driver’s personal coverage.

“It is important to get it right so that everyone sees what the provisions are going tone and make sure the rating is accurate,” Cooper said.

The source of coverage, amount and process for submitting a claim must be clear, Marshall said.

“The success of this new transportation will greatly depend on how safe it is,” Deluca said.

Ray Middleman, an attorney representing the Yellow Cab Co. of Pittsburgh Inc., said one of the greatest concerns regarding public safety and welfare is whether vehicles used for ride-share services are checked for mechanical soundness regularly.

Both Lyft and Uber rely on annual state inspections of personal vehicles to determine mechanical soundness in addition to relying on rider feedback to bring up any additional issues.

Much of Thursday’s discussion also centered around what can be done to create a level playing field between taxi companies and ride-share startups.

Joshua Freedman, CEO of Pittsburgh-based CabbyGo, said allowing Lyft and Uber to operate as they are is unfair to those carriers that play within the rules of the law.

“It’s sending a message to carriers that if you have money and come to the state of Pennsylvania, you can can influence the politics,” Freedman said.

When Freedman started his service, which connect riders with PUC-certified drivers, he said he was careful to make sure it fell within the commission’s regulations.

PUC Commission member James Cawley said one of his largest concerns is the use of non-professional drivers.

“It gives me some pause that these people may be good drivers and know their way around Pittsburgh, but they also may be bad drivers that don’t know their way around Pittsburgh,” he said. “But frankly that could be true of taxi drivers as well.”

And while it will likely take more than nine days to hammer out the issues, there’s a general sense that ride-sharing, in some capacity, is here to stay.

Rep. Erin Molchany, D-Mount Washington, said other states are adapting to accommodate new transportation models and if Pennsylvania does not, it risks falling behind.

“We are a growing city, we are amazingly progressive, and I think it would be embarrassing if we step back and say we are not going to accept this innovation,” she said.