CITY HALL — Supporters of ride-sharing services got their day before a City Council committee Thursday and asked aldermen to come up with a fair regulation plan that supports innovation — as quickly as possible.
Dozens of riders and drivers for UberX, Lyft and Sidecar offered testimony to the License Committee, asking aldermen to act before the state passes an "onerous" bill that they said would hurt them.
The hearing basically gave the upstart services a chance to address criticism offered at a hearing last month that was dominated by conventional taxi firms, which argued that the companies should be as heavily regulated as the taxi industry.
Beth Kregor, director of the Institute for Justice Clinic on Entrepreneurship at the University of Chicago Law School, called on the city to "resist the pressure" to aid "old-fashioned businesses" with anti-competitive legislation. She asked aldermen to remain "open to innovation."
The companies also brushed off criticism that they don't serve certain parts of the city and ignore the disabled.
"I'm not afraid of being held up," said UberX driver James Evans. He pointed out all Uber transactions are done by credit card, adding, "What have I got on me, $20?"
"We have made it our mission to provide as much access as possible in the city," Lyft spokeswoman Candice Taylor said. In fact, both ride-sharing drivers and riders testified that they went to places taxi drivers often decline to go — which is against city regulations.
"I'd argue there is no violation of the law here," Taylor added. She said a bill that passed a state House committee this week would "undermine" the services in Chicago. The proposed statewide legislation, which would require all ride-share drivers to have a chauffeur's license and meet other taxi regulations, was "onerous" and "disappointing," she said.
The Illinois Transportation Trade Alliance, which sued the city over ride sharing, issued a statement in response to Thursday's hearing asking the city to impose "rigorous regulation of the ride-share industry to protect the safety of the public and create a level playing field for all transportation providers."
The group backed the state legislation, saying: "Our industry needs a reasonable set of statewide standards to protect people from harm and to allow companies to compete freely according to the same rules."
"I'm here to set the record straight," said ITTA spokeswoman Mara Georges, a former city attorney. "The ITTA welcomes competition."
Conventional taxi firms have also argued that the upstarts are underinsured. Taylor, Sidecar general counsel Elizabeth Stevens and Uber spokesman Corey Owens all testified they had $1 million policies to cover their drivers. Stevens, however, was grilled by Ald. Edward Burke (14th) over Sidecar's refusal thus far to honor a City Council subpoena to present details on its coverage.
"I'm not trying to hide anything," Stevens said, adding that she would deliver the details under seal to protect information from competitors.
Stanley Hollenbeck, the former director of the City Council Legislative Reference Bureau, cut both ways in support of ride sharing. He said one UberX driver, operating under "surge pricing" during a rush period, hiked the rate 420 percent on a ride to $75.
"It was a shock to me," Hollenbeck said. But he said it was his own fault for not figuring the fourfold increase, and he defended other services.
"I don't think that it's the cabdrivers' fault that they're grumpy and mean and nasty," Hollenbeck added, blaming the stiff regulations taxi drivers operate under.
"It's definitely a disruptive innovation to our transportation," he added, but asked the council to protect it, while perhaps setting a limit on surge-pricing fare hikes.
James Johnson, who said he represented the "reform wing" of the Greater Chicago Taxi Association, spoke in favor of the upstart services and asked the council to act ahead of the General Assembly.
"We would urge the state legislature to leave this issue to Chicago," Johnson said, calling it "fundamentally local."
Ald. Emma Mitts (37th), chairman of the License Committee, said the hearing served to add information as Mayor Rahm Emanuel prepares to present a new ordinance proposal next month for consideration at the May City Council meeting. The mayor has previously proposed creating a "Transportation Network Provider" license separate from what taxis operate under, but Mitts said that was being amended.
The mayor signaled he was trying to accommodate both sides.
"The city has introduced an ordinance that would fill the regulatory vacuum for ride share under current state law and city ordinances by establishing a balanced set of requirements to protect consumers, keep riders safe and allow these companies to continue to meet growing customer demand," said mayoral spokesman Bill McCaffrey. "If this vacuum is filled through an amendment to state law, the city will revise its ordinance accordingly. Since it was introduced, we have received feedback from aldermen and stakeholders, and are taking this into account as we revise our ordinance."