Ride-haring Rodeo

Austin has Uber problems, too: Referendum could decide ride-sharing future in capital city

Austin has Uber problems, too; vote could decide ride-sharing future

If Prop 1 fails, Uber and Lyft have threatened to pull out of Austin. Uber/Facebook

Editor's Note: Houston is not the only Texas city having issues with ride-sharing services. In Austin voters will soon go to the polls to have their say.

We bet you've heard about this little tiff between ride-sharing companies and the City of Austin, considering all the radio ads, yard signs, and petitioners bombarding Austinites to vote for or against Proposition 1.

Despite all of the information floating around, it's difficult to get a handle on what Prop 1 means for Austin. To clear things up, here's a rundown of the issue — and how it may affect you.

Some background
The relationship between the City of Austin and Transportation Network Companies (TNCs) like Uber and Lyft has always been tumultuous. When the two companies rose to prominence three years ago, both began operating within city limits without a green light from Austin City Council. In fact, TNCs weren't legal in Austin until late 2014, and issues like background checks were discussed then as well.

What the argument is about
In December, city council passed an ordinance on TNCs, which included new payment requirements, vehicle identifiers, designated pick-up and drop-off areas, and fingerprint-based background checks for drivers, the last of which has become the centerpiece of the argument. The city believes that the new ordinance, which regulates TNCs in a similar way to taxi companies, provides more safety for TNC users and the city overall.

However, Uber and Lyft — who do conduct background checks but without fingerprinting — believe these new requirements are unnecessary and would hurt business. In response to the ordinance, Uber and Lyft backed Ride-sharing Works for Austin, a political action committee that rounded up enough signatures on a petition to put the issue to vote — this time by the people of Austin.

This is where Prop 1 comes in
Prop 1 is a referendum to the original ordinance put forth by the city council on TNCs. In short, Prop 1 is the way that Uber and Lyft prefer to be regulated.

A vote for Prop 1 means that TNCs will continue to manage their own background checks through third-party companies — no fingerprinting necessary. TNC drivers will not have to put something on their vehicle to identify themselves and can continue to pick up and drop off customers anywhere. As part of the proposition, TNCs will give 1 percent of their revenue back to the city.

A vote against Prop 1 will uphold the original ordinance. Fingerprint-based background checks will become a requirement for TNC drivers over time and would be handled by the city, but not necessarily funded by taxpayers. TNC drivers will also have to put something on their vehicle to identify themselves as a driver and will not be able to pick and drop off customers in travel lanes. Additionally, TNCs will have to choose between three different payment structures to give back to the city, one of which is the 1 percent rule that Uber and Lyft favor.

A look at some of the potential outcomes
If Prop 1 passes, then things will go on as they do now, and the city and many Austinites will still have concerns about safety surrounding background checks and blocking travel lanes.

If Prop 1 fails, Uber and Lyft have threatened to pull out of Austin (and that's not an empty threat). The departure of the two biggest TNCs in town could affect Austinites in a variety of ways, specifically during closing time — both sides agree that TNCs serve as a convenient alternative to drunk driving, creating a safer Austin driving environment because of it.

If Uber and Lyft follow through with their threat, taxi companies and startups like Get Me will take their place until both sides come to an agreement.

What you can do
It's in your hands now. Early voting in Austin has already begun — election day is Saturday, May 7.


If you'd like to explore the issue more, KUT hosted a debate between the political action committees from both sides of the argument.