No break for taxi drivers: New deal helps companies, not cabbies

Photo of pink mustache car by Quinn Dombrowski, photo of taxi by Jeffrey Zeldman, both Creative Commons license.

The Minneapolis city council’s new regulations for Lyft, Uber, and the city’s cab companies offer legalization for the transnational, multimillion-dollar Uber and Lyft “Transportation Network Companies,” some breaks to the city’s taxi companies, and next to nothing for hard-working taxi drivers.

Lyft and Uber are the new generation of taxi-like or maybe taxi-lite transport. You call them via a cell phone app, and pay by credit card. They compete with regular taxi companies, which have a lot of regulation. Their drivers use their own cars and the cell phone app.

Lyft and Uber operated illegally for a year in Minneapolis. As far as I know, they are still operating illegally in St. Paul, as well as in other cities around the country. Now they are “legal” in Minneapolis, as the city council just authorized them to operate.

In exchange for not raising a big stink about the Uber/Lyft licensing, the cab companies got some changes in regulations. Now taxi companies can hire drivers with Wisconsin licenses, for example. They also got permission to operate without a physical office.

Taxi companies still have to comply with a lot more regulations than the new companies. For example, taxi companies are legally required to operate 24/7, and to take fares to all areas of the city. Not so for Uber and Lyft. Taxi fares are set by the city and are the same at all hours of day and night. Again — not so for Uber and Lyft, which can (and do) raise the fares at busy times and cut them when lots of their drivers are working. That’s just the beginning — if you want to do an exhaustive analysis, see the regulations passed by the city council here and here.

Driving cab is one of the most dangerous jobs around. According to a Pioneer Press article, drivers are “60 times more likely than other workers in the United States to be murdered on the job, the National Institute for Occupational Safety and Health reports.” The same article explains:

“Why is cab driving so dangerous? Drivers work alone. They have a lot of cash, which makes them robbery targets. They work at night, and they’re often in high-crime areas, said Chaumont Menendez, the [NIOSH] epidemiologist.”

Lyft and Uber drivers avoid that risk — no cash, and every passenger has to be registered, with a credit card and cell phone on file before they get a ride.

Uber and Lyft also get a break on city license fees, and a number of other regulations.

For taxi drivers, competition for prime-time passengers and prime locations increases. Taxi drivers also must pay for classes and pass tests to be licensed, pay annual city driver license fees, and pay vehicle rental fees to the taxi companies if they don’t own their cabs.

As former cab driver, taxi company executive and current “Cab College” teacher Jim Morgan explained, when I interviewed him for an earlier TC Daily Planet article:

“Today you could actually lose money if you have a bad night. Today if I was going to drive a cab for 12 hours, I might pay $65 for the lease. I have to bring in $65 for the lease, plus I have to bring in gas money to pay for the gas. Round it off  — maybe $100 a night total for the lease and gas. I’d have to bring in $100 before I make a buck as a driver. If I only bring in $75, I have to pay for the night — I actually would lose money.”

And low-income passengers? Using Uber or Lyft requires having a smart phone and a credit card and prior registration, all of which will cut out lots of lower-income folks.

The city regulations still require taxi drivers to take all passengers, in all locations. The regulations don’t require the new “Transportation Network Companies” to operate in all areas of the city or at all hours. The city ordinance says Uber and Lyft have to report how many fares they pick up in each zip code, but — the ordinance also says the information won’t be made public.