City ponders new rules, or not, for Uber, taxis

yorkregion.com
Nov. 26, 2015
By Amanda Persico

Markham taxi drivers are turning to the city create a level playing field for the regulated and licensed cabs.

On Monday, city staff made a presentation on the implications of Uber and how the new transportation network company fits into the city’s bylaws.

Uber, which operates in more than 300 cities around the world, is a ridesharing app that connects passengers with drivers and offers a flat-rate fee with the ability to pay via mobile device.

“We’re the good kids. We’ve paid our dues,” Markham taxi driver Mansoor Iqbal said during this week’s general committee. “Why are we being punished?”

The city’s current bylaw does not include provisions for Uber, where users can hail a cab through a mobile app.

The city does, however, regulate the base cab fare as well as license cab drivers and charge an annual renew fee.

Taxi drivers are losing about 40 per cent of their business to Uber during the week and about 80 per cent during high volume times, such as weekend nights, Iqbal said.

“On weekends, (Uber drivers) come out and business dries up,” Iqbal said. “If they come here unchallenged then they will come over and over again. The city needs to discourage this activity.”

Uber argues it is not a taxi company.

Instead, it is a new business model distinct from the taxi service, said Uber communications lead Xavier Van Chau in an email.

But to call Uber a rideshare company undermines the taxi industry, argued Spiros Bastas, general manager of Royal Taxi.

“Ridesharing is if you go to work and someone tags along,” he said. “If you drive from Point A to Point B and collect a fare, that is a taxi company.”

Many taxi companies in Markham have mobile apps that offer the ease of ordering a cab as Uber, Bastas said.

“It’s not a technology issue, because we have that technology already,” he said. “The No. 1 reason is the price.”

Another issue raised was the cost of commercial insurance for a taxi driver, which is from $6,000 to $7,000 a year, compared to the average personal insurance of about $1,200 a year.

Personal auto insurance does not cover cars used as a taxi.

If a licence taxi driver’s insurance is cancelled or is not in good standing, the insurance company notifies the city’s bylaw department. That does not extend to private or Uber drivers.

The insurance industry is currently looking at a middle ground between personal and commercial insurance policies to include rideshare programs, said city clerk Kimberley Kitteringham.

It is unknown how many Uber drivers or rides take place in Markham. Toronto sees about 17,000 Uber trips a day and there are 15,000 to 20,000 new Uber users a day.

City staff recommended taking a GTA-wide approach to Uber.

Meanwhile, Competition Bureau declared Thursday the only way to level the playing field between Uber operations and taxi cabs is to remove stifling regulations at the municipal level.

According to the Bureau, Canadians spent about $1.2 billion on taxi and limo services last year.

The bureau called on municipalities and provinces to relax restrictions, rather than try to impose old restrictions on newcomers to the taxi game.

And when regulations are needed, they should be limited to items such as passenger and driver safety.

The Bureau also recommended taxi companies follow in Uber's footsteps with lower base fares and peak-time pricing.

“Why did Uber appear? Because the industry is over regulated,” said Councillor Colin Campbell. “Uber is the next Microsoft. It’s not going away. We can make our own rules, then Richmond Hill make their own rules, then Vaughan. That will create havoc.”

Councillor Don Hamilton called for the city to do away with taxi regulations and allow the industry to regulate itself.

“Why are we involved?” he said. “Why not open it up, get rid of the taxi regulations and let everyone use Uber or something like it. There’s a level playing field.”

City staff are working with other GTA municipalities to come up with a standardized approach, that could see a provincewide taxi license, similar to marriage licenses issued by municipalities.

Another possibility could be reducing the city’s license and renewal fees as well as reducing the city’s pre-set base fare.

Uber provides an opportunity for to look at the city’s regulatory framework, Kitteringham said.

“We’re at a crossroads with a number of industries,” she said.

“We have to be careful not to go down the rabbit hole and say this is an enforcement issue,” she said. “This is a complex policy issue.”

“We believe the right path forward is to develop common sense regulations,” said Van Chau of Uber.

City staff plan to bring back a report outlining bylaw amendments to include Uber, base fare and license fee structure and the establishment of a taxi and limo advisory committee in the new year.