Ride-sharing service seeks OK for non-limo rides as Philadelphia impounds cars, issues fines

AutoAssociated Press

The ride-sharing service Uber X has entered the Philadelphia market, running up against the same kind of opposition from regulators it has faced in cities around the country.

The Philadelphia Parking Authority, which regulates taxi service, has accused Uber X of operating a "hack" taxi service with unlicensed, unregulated drivers. The agency has impounded 15 vehicles and slapped each driver with a $1,000 fine since the service started recently.

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Uber has muscled its way onto taxicabs' turf, sparking controversy in cities such as Washington, D.C., Chicago and Miami as regulators try to decide how, or if, the company should operate and the taxi industry seeks to protect drivers' livelihoods.

"Uber has no license to be here. They're operating as hack cabs," parking authority director Vincent Fenerty said Wednesday. "If the Legislature changed the law, where people could ride-share, and set the proper guidelines ... the PPA would abide by (that)."

The state's Public Utility Commission was expected to vote Thursday on Uber X's application to operate in other parts of Pennsylvania on a two-year "experimental" license. The designation is meant to address new ride-sharing platforms hosted by Uber, Lyft and others.

Uber spokesman Taylor Bennett called Uber a technology company, not a transportation company.

"The rules and regulations out there, they were built decades ago," Bennett said. "We've been trying to craft new regulations that actually apply to this business model, that welcome more choice into the city, and give people opportunities to start their own companies."

Riders use Uber's smartphone app to seek out independent drivers using their own cars. Uber does not own the vehicles or employ the drivers, but instead "partners" with them, and takes 20 percent of their earnings.

The company started about four years ago in San Francisco and now operates in 230 cities worldwide, Bennett said.

The Uber X service started in Philadelphia in recent weeks despite failed talks to win approval from Fenerty's agency. Uber has been paying the drivers' fines, Bennett said.

"Uber Black" and "Uber SUV" drivers have been operating legally with limousine licenses for about two years in Philadelphia, Pittsburgh and elsewhere.

"The cars I've been in have been immaculately clean," said Philadelphia lawyer Richard J. Fuschino Jr. "It was cheaper, and cleaner and nicer."

The statewide Uber X application has attracted fervent opposition from the state's taxi industry and others. Administrative law judges reviewing the file for the PUC recommend that the board reject the experimental license, citing safety and insurance concerns.

Uber X "has failed to propose adequate insurance, education and training for (its) drivers, its passengers and the general public, and it leaves unanswered several crucial insurance-related issues," law judges Mary D. Long and Jeffrey A. Watson wrote in a lengthy opinion.

Uber insists that its drivers go through thorough background checks, and that it offers passengers $1 million insurance coverage per ride.

The company's fluid pricing plan is another source of concern, and occasional ire. Prices surge at peak times, such as during snowstorm or outside an NFL arena after a game — occasionally leaving riders on the hook for hundreds of dollars for even short rides.

Bennett said that is an "incentive for more drivers to get out and meet that demand. That brings prices down to normal levels. It's purely supply and demand."