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May 22 2017

State of Texas Trumps Austin over Uber, Lyft Regulations

by Patrice Lee Onwuka

Major events like music-film-and-tech-polooza SXSW may finally get the transportation options needed to service the hundreds of thousands of visitors to Austin thanks to Texas lawmakers.

Sitting on the desk of Governor Greg Abbott is a bill to ensure that ride-hailing apps like Uber and Lyft can operate freely throughout the Lone Star state – including in Austin. Last week, state Senate approved a measure passed by the House to create statewide regulations which will pre-empt municipal regulations.

The bill established a state-wide regulatory framework for transportation network companies and says municipalities can’t charge taxes, set rates, or impose other requirements. Addressing some concerns about access for the handicapped, there are specific requirements against drivers discriminating against those individuals or companies trying to charge them more for their rides. However, the bill does lift fingerprint requirements for drivers although criminal background checks are still in place.

This is a big win for choice and competition for riders, and could alleviate some issues that drivers experience if they transport riders across municipalities.

Some 40 states currently have statewide bills and last week, Alaska, Louisiana, and New York advanced statewide regulations as well.

Not surprisingly, city officials don’t like the statewide bill:

“There is definitely a national, coordinated push from the industry to enact regulations for this type of transportation at the state rather than city level," said Lara Cottingham, deputy assistant director of administration and regulatory affairs for Houston, which opposed the state bill because it could supersede city regulations. 

Austin Mayor Steve Adler has been a vocal opponent and said:

“I’m disappointed that the legislature chose to nullify the bedrock principles of self-governance and limited government by imposing regulations on our city over the objection of Austin voters,” Mayor Steve Adler said in a statement after the Senate’s vote. “Our city should be proud of how we filled the gap created when Uber and Lyft left, and we now must hope that they return ready to compete in a way that reflects Austin’s values.”

Austin, which drew national attention for its contentious fight with ride-hailing companies, is particularly troublesome though. As we’ve reported, the city passed heavy requirements that drove away Uber and Lyft. Smaller startups emerged to fill the vacancy on the roads – an example of the free market filling a need. However, when the annual major event SXSW occurred this year, the apps just couldn’t perform and meet demands - stranding tens of thousands of event goers. I can attest as one such stranded passenger.

Uber and Lyft have both said they plan to get back on the road in Austin as soon as the bill goes into effect which could be as soon as the ink dries on the governor’s signature this week.


Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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