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Gaming Guru

Richard N. Velotta

Nevada Transportation Authority deems lack of ride-hailing companies an 'emergency'

12 June 2015

Does the fact that transportation network companies don’t operate in Nevada represent a crisis requiring the drafting of emergency transportation regulations?

That was the question the Nevada Transportation Authority wrestled with for nearly three hours Thursday morning, ultimately determining that, yes, an emergency exists.

Commissioners voted 2-1 to petition Gov. Brian Sandoval for his approval to begin drafting regulations that could get Uber and Lyft on the road as early as July 1.

Sandoval must concur with the emergency designation before the authority, which oversees the regulation of limousines and buses in the state and taxis outside Clark County, can begin drafting them.

About 40 people jammed into the authority’s small hearing room on South Jones Boulevard in the latest confrontation between local transportation companies and e-hailing companies that use smartphone applications to request rides in private vehicles.

Representatives of the local transportation industry argued in testimony before the board that no emergency exists for the authority to rush through quickly drafted rules that would be in place until permanent regulations are in place.

“There is no emergency here,” said Kimberly Maxon-Rushton, a Las Vegas attorney who also serves as the executive director of the Limousine Operators Association.

She urged the board to move carefully and deliberately to guarantee that new entrants to the transportation industry be properly investigated and vetted for the safety of the riding public.

Authority officials estimated that on an expedited track, a conventional regulatory approval with workshops, meetings, public hearings and deliberations would take until around Oct. 1 to be completed.

Representatives from Uber and Lyft, two San Francisco-based ride-hailing companies poised to enter the Nevada market, said the emergency that exists is that people living in outlying Southern Nevada neighborhoods have trouble getting reliable taxi service on a consistent basis.

Reliable service is a common complaint in many neighborhoods and local taxi companies recently addressed that by staging more cabs at neighborhood casinos.

The “emergency” that swayed Chairman Andrew MacKay and Commissioner Keith Sakelhide was the deadline imposed by lawmakers in the legislation enabling transportation network companies.

The bill signed into law by Sandoval last week said “the authority must begin to accept applications for permits within 30 days after the effective date” of the law, May 29, and “the authority shall not issue a permit until July 1, 2015.”

Based on that timeline, MacKay and Sakelhide determined that the only way the board could establish an application process would be to do it through emergency regulations, which have shorter public notification parameters and can take effect a day after they’re posted if that’s done by 9 a.m.

Commissioner George Assad, the lone dissenting vote, had a different interpretation. He believes the authority could accept applications from the companies, but not license them until they’re thoroughly vetted, a process that could take months.

Industry leaders had other concerns and MacKay had to steer the conversation about the question to whether an emergency existed.

Officials feared that licensing applicants currently under review would be jumped by Uber and Lyft applicants because of the Legislature’s direction to get the companies on the road quickly.

There are continued concerns about there being two separate standards for taxi and limousine drivers and transportation network company drivers. Taxi and limo drivers are subject to FBI background checks and fingerprinting while Uber and Lyft conduct private background checks with no fingerprinting, but they check background further back in history than the taxi and limo drivers. Taxi and limo drivers get random drug tests; Uber and Lyft driver maintain “zero tolerance” standards, but no testing.

Industry officials also are concerned the Transportation Authority won’t be able to hire additional personnel fast enough to handle the anticipated flood of transportation network drivers. Uber officials claim they have 10,000 prospective drivers ready for licensing.

Industry leaders also want to know what the state’s policy will be on dynamic pricing, the “surge” system Uber uses to attract more drivers to turn on their apps and work. In other cities, it happens when ride demand is high and as a result, customers are charged more for their rides than standard rates.

The authority will now await word from the governor’s office about whether it should go ahead with emergency regulations. If he doesn’t concur, the board is expected to start the usual process for regulations next month.