PUC grants emergency applications for ride-share companies to operate

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HARRISBURG — A unanimous vote by the Pennsylvania Public Utility Commission board on Thursday granted emergency temporary authority for ride-sharing companies Lyft and Uber to operate in Allegheny County.

But the board also voted unanimously to uphold cease-and-desist orders filed July 1 against both companies.

And conditions of the 60-day temporary order require “proper insurance paperwork and a rate structure with the commission” in order for the cease-and-desist orders to be dissolved.

To comply with the emergency temporary authority, the ride-sharing companies' insurance policies must provide primary coverage when drivers are conducting ride-sharing business, and policies must meet PUC standards.

Lyft and Uber drivers have to notify their insurance providers that they will be driving for a ride-sharing company, and vehicles have to comply with PUC safety standards: not more than 100,000 miles on the odometer and not more than 8 years old. Criminal history checks have to be conducted on all drivers, who must be 21 or older and hold a valid license. PUC placards must be prominently displayed on vehicles.

“I want to emphasize that under today’s decisions, the applicants shall not engage in their experimental ride sharing network services until they comply with the terms and conditions of our orders,” vice chairman John Coleman said. Providing such “unauthorized service” may subject both companies to further penalty under the PUC code, Mr. Coleman said, “and the rates charged for unauthorized service may be subject to refund.”

Neither company has been deterred by the cease-and-desist orders handed down before the July Fourth holiday weekend. Despite proposed fines of $1,000 per day and citations and fines against individual drivers, the companies have continued to operate.

PUC chairman Robert Powelson said after the meeting that Thursday’s decision to grant the emergency applications was akin to giving both companies a “do-over.” Both companies have formal applications to begin experimental service in Pennsylvania that are pending, but both were filed in April, weeks after the companies began doing business in Pittsburgh.

“You never get that second chance to make a first impression,” Mr. Powelson said. “If I were them, I would work hard over the next 60 days to make sure they had all the boxes checked on the list of conditions we gave them.”

Mr. Powelson remarked at the meeting it was the first time he could recall an issue where all five commissioners made statements for the record.

“These proposals, while temporary in nature, foster the ability for Allegheny County residents to avail themselves of regulated transportation service that uses modern technology to serve traveling customers in that county,” said Commissioner Pamela Witmer, in a joint statement with Mr. Powelson. “As evidenced by our action today, the commission strives to ensure that its current regulatory structure is not a barrier to technological advances and desirable changes in the transportation industry.”

Complete PG coverage: All you need to know about Lyft, Uber and ride sharing in Pittsburgh

Lyft spokeswoman Paige Thelen said the decision marked a “significant step” toward ride-sharing companies’ future in Pittsburgh.

“With this decision, the PUC has recognized that regulations can and should be modernized to allow innovative industries to thrive while maintaining the highest level of public safety,” Ms. Thelen said. “We applaud the PUC for these efforts as an important first step in ensuring the people of Pittsburgh have transportation options.”

Uber spokesperson Taylor Bennett said in an email the decision by the PUC showed it was listening to Pittsburgh consumers.

“As the commission confirmed, the people of Pittsburgh have been heard loud and clear and will continue to have access to the safest ride on the road and the ability to take advantage of the opportunity and flexibility Uber provides," the email read.

After the meeting, Mr. Powelson said since ride sharing became an issue in Pittsburgh, the PUC had received hundreds of complaints about the state of existing transportation services.

“This has been a real eye-opener for me,” he said. “People are really frustrated about what they see as an inadequacy and a lack of taxicab service in the Pittsburgh area.”

He urged people who have bad experiences with taxi companies to file formal complaints.

“If we had a bigger docket of formal complaints, our enforcement guys would have been out en masse” citing taxi companies, he said.

State Sen. Wayne Fontana, D-Brookline, said the only issue he remembers producing more letters from constituents than ride sharing was when the Penguins were threatening to leave Pittsburgh in 2007.

He estimated he heard from some 700 constituents expressing their support for Lyft and Uber in Pittsburgh. “It was overwhelming,” he said.

Mr. Fontana said he doesn't think enough consumers are aware of how to complain about bad taxi service to the PUC, and that it might be worth looking at deregulating the complaint process, or at least putting it in the hands of a local authority.

“People don’t know who to complain to,” Mr. Fontana said. “Until this happened, I don’t know if people had a clue who the PUC was, or how to reach them.”

Mr. Fontana, who has introduced legislation to regulate Lyft and Uber as transportation network companies in Pennsylvania, said he worked closely with PUC officials to grant temporary licenses so the companies can continue operating until the Legislature is back in session in September.

Still unresolved are the criminal and civil citations against 32 Lyft and Uber drivers, issued by the PUC’s bureau of investigation and enforcement. Thursday’s decision does not address whether those charges would be modified or dropped, and Mr. Powelson would say only that they were “still pending.”

​Pittsburgh Mayor Bill Peduto, who has been a vocal supporter of ride-share companies in the city, thanked the PUC for its decision.

“This unanimous vote underscores Pittsburgh’s leadership in supporting 21st-century transportation options, and I will keep working with the PUC and others in Harrisburg to allow for them permanently,” the mayor said in a statement.

Gov. Tom Corbett praised the PUC’s decision, which he said supports “innovative thinking” for Allegheny County.

“I look forward to working with the General Assembly in the fall to ensure these innovative companies can continue to operate throughout Pennsylvania,” the governor said in a statement.

Owen McEvoy, Mr. Corbett’s spokesman, would not speculate about whether the governor might support changes to the PUC complaint process.

“But the governor, growing up in Pittsburgh, is aware there are problems” with transportation options, Mr. McEvoy said. “There is a reason these companies [Lyft and Uber] are popular, because of the innovation and convenience they bring to a major metropolitan area.”

The commission will continue its consideration of the companies’ formal applications for permanent authority to operate, which are pending before the administrative law judges’ office.

In addition, the PUC announced Thursday that the commissioners will hold a hearing Aug. 28 “to examine issues in the state’s transportation industry, including adequacy of driver integrity regulations, vehicle safety regulations and current insurance requirements.”

Kim Lyons:klyons@post-gazette.comor412-263-1241. Twitter: @SocialKimly​ First Published July 24, 2014 12:00 AM

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