Unregulated Austin: Movement Explodes After Uber & Lyft Leave

AUSTIN – A major Austin bar owner said Monday his sales are taking a dive. They dropped 20-percent this past weekend alone.

Bob Woody and several of his fellow bar owners blame the loss of well-known ride-hailing apps Uber and Lyft for their business decline.

"For us not to have it is to go back in time," Woody said. "To have had it and now not have it--really difficult."

Woody is also concerned by what he described as thousands of people searching for a ride home after the bars closed.

"[It’s] putting customers at risk," he said. "They are making bad decisions, too, because they are intoxicated."

Not Enough Cabs

The City of Austin has issued just over 900 taxi permits. Fares are set by the city, and there is no incentive available to encourage drivers to work late-night shifts when demand peaks.

"It is the same issue we have always had, which is we have never had officially enough taxis to service the city," James Means III of Austin Cab Company said.

Means fired a driver Monday after a passenger posted video of the driver physically removing him from his taxi early Saturday morning. The passenger, who’s asked to remain anonymous, said he could not get in touch with taxi company management until Monday morning.

Means saw the video Sunday on social media.

"It was about 20 hours after the incident" Means said. "I went ahead and took action to correct the issue. I pulled the driver from the car because I felt it was necessary based on what I saw."

Means fired the driver Monday with the support of Austin Transportation Department.

"If people would like to file a complaint against taxi companies, they can call 512-974-1551," spokeswoman Marissa Monroy said in a statement. "People may also file a complaint online, email groundtransportation@austintexas.gov, or visit the City’s Ground Transportation Division in person during normal business hours at 1111 Rio Grande Street."

Underground Movement

The departure of Uber and Lyft from the city limits of Austin prompted an underground movement to grow to more than 14,000 members in just a week.

The online community that connects drivers and riders concerns tech entrepreneur Joshua Baer, who founded Capital Factory.

"We went from having at least a system in place where drivers were screened and vetted--and they were being monitored all the time, and you could give feedback and report problem--to now a black market solution that's really taken over the city," Baer said.

The City of Austin said Arcade City, as it is known, is legal as long as drivers do not charge beyond the federal reimbursement rate of $0.54 per mile.

"Companies and individuals providing transportation service and charging more than the federal reimbursement rate without appropriate documentation are illegal in the City of Austin," Monroy said. "We highly encourage users to look for services that fully vet their drivers and have mechanisms in place to ensure the safety of both the riders and the drivers."

Monroy said the city will enforce city transportation code, but Baer questions if the city can regain control.

"I just don't see any way that we are going to see a solution here in Austin comparable to what we had last week in less than a year," Baer said.

Driver Fair

The city is trying to get drivers scheduled to be fingerprinted, so Austin's new ride-hailing apps can meet the new rules.

Companies currently operating within the city were required to have 25 percent of drivers cleared through fingerprint-based background checks by May 1. However, the city said it is not enforcing that benchmark.

Driver Onboarding Fair
ACC Highland
6101 Airport Blvd., Room 2211
Tuesday, Wednesday and Thursday 10 a.m. to 7 p.m.

The event will not feature on-site fingerprinting services. Drivers must pay $39.95 to a city-approved vendor to undergo the fingerprint-based screening. All ride-hailing apps must have 50 percent of drivers approved with fingerprint-based background checks by August 1. Learn more about the fingerprint fair by clicking here.

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