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Transportation Network Companies (TNCS) – The Response of Regulators AIRPORT GROUND TRANSPORTATION ASSOCIATION. Phoenix, Arizona September 14 - 17, 2014. Professor Matthew W. Daus, Esq. IATR President. Professor Matthew W. Daus, Esq.

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Transportation Network Companies (TNCS) – The Response of Regulators AIRPORT GROUND TRANSPORTATION ASSOCIATION

Phoenix, Arizona

September 14 - 17, 2014

Professor Matthew W. Daus, Esq.

IATR President


Professor Matthew W. Daus, Esq.

  • Former Commissioner/Chair, NYC Taxi & Limousine Commission

  • President, International Association of Transportation Regulators

  • Distinguished Lecturer, US DOT Transportation Research Center

    City University of New York, The City College of NY (Region 2)

  • Partner & Chairman, Transportation Practice Group

    Windels Marx Lane & Mittendorf, LLP

    Contact: [email protected] or [email protected]

    156 West 56th Street | New York, NY 10019

    T. 212.237.1106 | F. 212.262.1215


Ttp tnc tnp
TTP,TNC,TNP…

  • No matter the term you use - it is safe to say that the advent of “booking technology” in the transportation space has disrupted the industry, and does not seem to be slowing down.

  • TRANSPORTATION TECHNOLOGY PROVIDERS

  • TRANSPORTATION NETWORK COMPANIES

  • TRANSPORTATION NETWORK PROVIDERS


What is a tnc
What is a TNC?

  • The CPUC defines TNCs as:

    an organization whether a company, partnership, sole proprietor, or other form, [operating in California] that provides transportation services for compensation using an online-enabled application (app) or platform to connect passengers with drivers using their personal vehicles.


What is a tnc coke anyone
What is a TNC?Coke Anyone? 


What is a tnc regulation light or zero regulation
What is a TNC?Regulation light or zero regulation?


Pink floyd or fraud
PINK FLOYD or FRAUD?

  • TNCs entered the market in 2011.

  • Members of the public, industry, and the regulatory community have reacted fiercely.


Litigation legislation
Litigation & Legislation

  • TNC related issues and business practices are being litigated around the country.

  • Local and state regulators have also introduced rulemaking proceedings and taken legislative action in an attempt to deal with the proliferation of TNCs.


Litigation legislation1
Litigation & Legislation

  • Recently, jurisdictions like Colorado, California, Seattle, Washington and the District of Columbia have made legislative efforts to further address TNCs.


New legislation regulations
New Legislation & Regulations

  • New TNC legislation and regulations vary from imposing light licensing requirements and self-reporting standards to none at all.

  • Primary issues:

    • Insurance coverage

    • Driver criminal background checks

    • Accessibility


Insurance
Insurance

California

  • Assembly Bill 2293 requires TNCs to provide commercial insurance once the driver activates the app. Primary policy must have at least $750K coverage; lower primary coverage in the “App On-to Match” timeframe to: $50K/$100K/$30K with excess coverage of $200K.

    Colorado Senate Bill 14-125

  • TNCs must maintain liability insurance providing a minimum of $1M coverage which applies all times a driver is logged onto the app.

  • Must disclose to passengers and drivers that personal policies may not provide coverage for these commercial transactions.


Insurance

Seattle TNC Agreement

  • TNCs must provide $100K/$300K/$25K liability coverage while drivers are active on the app and/or looking for hailing customers

  • Proposed amendment to require that TNC insurance be “exclusive” during all times a driver is active on the app was voted down in a 5-4 vote.

    DC Transportation Network Services Innovation Act of 2014

  • Maintain a commercial policy of at least $1M per incident for accidents which applies from the time a driver accepts a trip request until the completion of the trip.

  • Lower minimums when app is on, but no match made: $50K/$100K per accident/$25K for property damage (not primary).


Driver background checks
Driver Background Checks

California

  • TNC must conduct national criminal background checks on all of its driver-applicants using the applicant’s social security number.

  • One-year driving history from TNC drivers, and quarterly thereafter; TNCs must perform driver record checks through the DMV.

    Colorado

  • TNC drivers must pass a criminal background and driving history check.

  • Drivers will be required to obtain a criminal history check every five years while serving as a driver.


Driver background checks1
Driver Background Checks

Seattle

  • TNC drivers will undergo background checks but details have not yet been released.

    District of Columbia

  • TNC shall conduct, or have a third party conduct, a local and national criminal background and driving record check driver-applicants going back 7 years.


Accessibility
Accessibility

California

  • TNCs must endeavor to provide equal access to all consumers.

  • Public hearings scheduled in September and October to discuss how TNCs are serving the disabled community.

    Colorado

  • TNC “shall provide services to the public in a nondiscriminatory manner, regardless of…disability, or other potentially discriminatory factor that could prevent customers from accessing transportation.”

  • TNC cannot impose additional charges for providing services to persons with physical or mental disabilities.

  • If a ride with physical or mental disabilities requires the use of mobility equipment, a driver shall store the mobility equipment in the vehicle during a prearranged ride.


Accessibility1
Accessibility

Seattle

  • TNCs must impose a ten-cent per ride surcharge to go towards the City’s accessibility fund.

  • TNCs must provide passengers requesting accessibility service with contact information for an accessible taxi dispatch.

    District of Columbia

  • Proposed Bill does not address accessibility.


Iatr model regulations
IATR Model Regulations

In 2013, the IATR prepared model regulations to address transportation technology apps:

  • These regulations promote direct or indirect licensure.

  • The model regulations have either been adopted or introduced by regulators in rulemaking proceedings in Cambridge, MA; Austin, TX and others.

  • The model regulations are available at

    http://www.windelsmarx.com/resources/documents/IATR%20Model%20Regulations%20(10890808).pdf


New iatr model regulations for accessibility
New IATR Model Regulations for Accessibility

This year, the International Association of Transportation Regulators drafted Model Regulations for Taxi & For-Hire Vehicle Accessibility:

  • TNCs are to be held legally to the same exact standards as taxis & FHVs;

  • TNC's would be required to contribute funding to an "accessibility lockbox“;

  • Creates a funding mechanism by which municipalities would designate a single agency to manage the funding and dedicate it towards accessible transportation initiatives;

  • Additional funding would be provided by a per trip surcharge and cost savings from integration of taxis in paratransit.

    Model Rules available at: http://bit.ly/YH50xA


Litigation
Litigation

Over thirty lawsuits nationwide --

  • Personal injury litigation and insurance coverage issues;

  • Labor law violations and worker misclassification claims;

  • False advertising, unfair business practices & consumer protection claims;

  • Racketeering;

  • Antitrust violations;

  • Disability discrimination;

  • Government actions;

  • Constitutional challenges;

  • Environmental law violations.


Litigation1
Litigation

Regulators are suing illegal TNCs for violating FHV requirements:

  • City of St. Louis, MO. Metropolitan Taxicab Commission v. Lyft, Inc.

    • Preliminary injunction awarded.

  • City of Columbus, OH v. Uber Technologies, Inc.and Lyft, Inc.

    • Preliminary injunction denied but case ongoing.

  • The People of the State of New York, et al. v. Lyft

    • TRO awarded and Lyft forced to comply with NYC regulations.


Litigation2
Litigation

  • More information on TNC litigation across the country may be found in the report:

    “The Disruptive Transportation Technology Movement: A Litigation Primer & Roadmap”

    Available at www.windelsmarx.com




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