It is no secret that taxis and ride-hail companies (Uber, Lyft) are in need of a more even playing field. California’s taxi industry is regulated tightly by local municipalities, generally cities. Ride-hail, also called TNCs (Transportation Network Companies), are regulated relatively laxly by the state Public Utilities Commission (PUC). But proposed state legislation that would theoretically put the taxi industry on a more even footing is ruffling some feathers, especially in southern California, where the city of Los Angeles this week voted to formally oppose the legislation.
Assemblymember Evan Low (D-Silicon Valley) is the author of A.B. 650, called the Taxicab Transportation Services Act. The bill is working its way through the legislative process, currently awaiting approval of the Senate Rules Committee, and expected to be voted on by the Senate soon. If approved by the Senate, the bill will then have to go to the Assembly where it would need to be approved before Wednesday.
A.B. 650 would remove local control of taxis, shifting responsibility to the PUC.
Theoretically the bill would apply to the entire taxi industry statewide, but there is a carve out so it does not apply to San Francisco. San Francisco’s taxis operate on a medallion system, which serves as a sort of retirement benefit, so upending that system could constitute a “taking.” City of L.A. taxis operate under a franchise system, which does not feature a similar retirement benefit for drivers.
One big issue in Los Angeles’ opposition to A.B. 650 is the city’s bottom line. The city currently charges a fee of $30 per month per taxicab, totaling $360 per year. Under A.B. 650, cities’ or counties’ taxi permit fees may not exceed $50 per year per taxicab. L.A. uses the current funding stream to enforce restrictions against taxi’s other competition: “bandit” or unlicensed cabs. Bandit cabs are not subject to consumer protections including approved fare structures and disabled access.
L.A. City Department of Transportation (LADOT) General Manager Seleta Reynolds is critical of A.B. 650 because the city would lose the ability of ensuring taxis serve Los Angeles’s transportation, labor, equity, and environmental goals. Reynolds stated,
Local control matters because of what’s coming next–our ability to regulate an increasingly autonomous fleet of rides for hire. For the present, we lose the ability to require lifeline services for people with disabilities, equitable service to every neighborhood in the city, and a green taxi fleet. For the future, we lose the ability to encourage ridesharing through pricing and to prohibit things like empty taxis circling the street. Read more…