OFFICE OF THE CITY COUNCIL

 

CHERYL L. BROWN                                                                                                         117 WEST DUVAL STREET, SUITE 425

            DIRECTOR                                                                                                                                                                                 4TH FLOOR, CITY HALL

   OFFICE (904) 630-1452                                                                                                                                                          JACKSONVILLE, FLORIDA  32202

     FAX (904) 630-2906                                                                                                                                                                                                              

  E-MAIL: CLBROWN@coj.net

 

 

JOINT RULES/TEU VEHICLES FOR HIRE SUBCOMMITTEE MINUTES

 

September 23, 2013

1:30 p.m.

 

City Council Conference Room A

Suite 425, City Hall

117 West Duval Street

 

Attendance: 

Rules - Council Members Doyle Carter, Bill Bishop and Richard Clark

TEU – Council Members Jim Love, Reggie Brown and Stephen Joost

 

Also: Council Members Matt Schellenberg and Lori Boyer; Paige Johnston – Office of General Counsel; Jeff Clements – Council Research Division; Marilyn Allen – Legislative Services Division

 

See attached sign-in sheet for additional attendees

 

Chairman Carter called the meeting to order at 1:35 p.m. and all attendees identified themselves for the record.  Council Member Joost make introductory remarks explaining his rationale for introducing Ordinance 2013-554 which would change two vehicle-for-hire regulations related to limousines (minimum 30 minute wait from reservation to pick-up and minimum one hour charge) that would have the effect of allowing the Uber ride scheduling cellphone app to be used in Jacksonville.  He described it as a mobile app that will connect existing limousine companies with interested passengers more easily and quickly than is currently the case.  Marty Fiorentino representing Uber said that the app provides many conveniences and safeguards for the customer, including the ability to track the vehicle as it approaches the pickup location, identification of the driver by name and photograph, an estimated fare in advance, and an instant feedback mechanism after the ride is completed.

 

Mike Sobel of East Coast Transportation posed questions about Uber’s contact mechanisms, particularly in the event of a problem (is there a phone number available 24/7 that reaches a live operator); about whether the rider is actually contracting with Uber or with the company that ultimately provides the car and driver; about Uber’s screening of driver credentials periodically throughout their term of service; and about whether the company has a mechanism for tracking whether a driver is still under contract with and covered by the insurance of a local limousine company before each assignment.

 

The joint subcommittee discussed Uber’s business model, which Council Member Boyer likened to Orbitz or Expedia – third-party booking companies that connect travelers with pre-existing travel providers.  The committee noted the obvious difference between buying an airline ticket through a broker and ending up on an FAA-certified and inspected aircraft operated by a major airline and booking a ride in a limousine which may be provided by an unmarked car and a driver that are not as readily identifiable as being regulated, inspected and insured as is the case with the airlines.  In response to questions, representatives of Uber stated that dispatch of cars is done via an Uber-provided cellphone based on a combination of vehicle proximity to pick-up site and the drivers’ Uber ratings (higher rated drivers get first priority for dispatch), and that Uber is paid by getting a percentage of the fare.

 

Michelle Riddle of Northern Florida Transportation Group (Gator City Taxi, Yellow Cab, Go Airport Shuttle and Carey Limousine) explained that her company pays almost $500,000 per year for exclusivity rights to service Jacksonville International Airport with taxis, limousines and airport shuttles.  She is concerned that if third party brokers are able to dispatch cars to the airport on-demand and essentially provide taxi service, then there’s no value to the exclusivity rights and little sense in paying for that right. The exclusivity right is valuable to the airport in that it allows the airport to establish and enforce minimum service standards for vehicles, drivers, and passenger treatment which ensures that airport users have a pleasant, problem-free experience with ground transportation and therefore a good opinion of JIA. Her companies and drivers working at the airport are heavily regulated by both JIA and by the federal Transportation Security Administration (TSA) with required background checks, fingerprinting, badges, etc.

 

Council Member Clark questioned why the City would want to change the current vehicle-for-hire system that was hammered out in negotiations among the current providers and seems to be operating well for the benefit of a new company that will not have a physical presence in the city. Council Member Schellenberg was stated his understanding that transportation booked through Uber would be a higher priced service and therefore would not be a competitive threat to existing taxi and shuttle services.  Justin Kintz representing Uber stated that the company practices dynamic pricing – prices fluctuate with market demand.  He stated that when the company entered the Seattle market a longitudinal study was done that found no impact on taxi revenues at the same time that limousine revenues increased by 200%.

 

In response to a question from Council Member Boyer, Mr. Kintz stated that Uber contracts with limousine companies, not with individual drivers. There was discussion about how often Uber checks the credentials of the drivers it dispatches and whether the company would be aware if a driver working for one of the limousine companies quit or was fired from a company but continued to answer Uber calls using a private vehicle.  Michelle Riddle explained the four scenarios under which North Florida Transportation Group hires its drivers: 1) a driver works directly for the company as an employee; 2) the driver owns the vehicle and pays the company a dispatch fee to get a share of calls; 3) the company owns the vehicle and leases it to the driver on a daily basis; or 4) the company owns the vehicle and leases it to the driver on a longer-term basis.

 

Tim Albrecht of Timothy’s Town Cars asked the committee to look at what this new service model would do to cab driver employment and income.  Several representatives of limousine companies had reservations about whether signing on with Uber would impair their ability to service their existing non-Uber clientele.  If an Uber customer calls for a ride at the same time as one of the limousine company’s regular customers calls and there is only one vehicle available, who is the company going to dispatch to?  Who has priority? In response to a question from Ms. Riddle about why Uber is not yet established in any other Florida cities, Mr. Kintz stated that some Florida cities have very intense vehicle-for-hire regulatory environments that take time to work through, and entrenched providers fight hard to maintain the status quo.

 

Council Members Bishop and Carter said that it appeared to them that the Uber dispatch app sounds like it ought to work if all the parties could get together and work out the details, and that it could be a win/win situation for all the companies involved.  Council Member Joost offered to schedule a meeting to get all the interested parties together to talk out the issues.

 

There being no further business, the agenda meeting was adjourned at 2:47 p.m.

 

 

Jeff Clements, Council Research Division (904) 630-1404

 

 

Posted 9.24.13

5:00 p.m.