No limits on rideshare drivers in new agreement announced by Seattle mayor

Uber and other rideshare services have scored a big win in Seattle under an agreement announced Monday by Seattle Mayor Ed Murray that should end over a year of contention over the popular upstarts.

Under the deal between the growing industry, taxi companies and city officials, rideshare services like uberX, Lyft and Sidecar will be allowed to operate without any limits on the number of drivers on the road at any give time.

An ordinance passed in March by the City Council had set a maximum of 150 drivers per company on the road at any time, drawing fierce opposition from the industry and supporters.

“I believe Seattle once again will lead the nation in showing how what appears to be conflicting interests can actually come together,” Murray said at a news conference announcing the agreement. “We have deregulated a highly regulated monopoly, allowing taxis and for-hires to become far more competitive than they are in the current situation. We are recognizing that a technology exists that is rapidly changing the marketplace.”

Under the terms of the agreement, which still needs approval by the Seattle City Council, rideshare or “Transportation Network Companies” and their drivers would be licensed and required to meet insurance requirements.

To address concerns of the taxi industry, the city would issue 200 new taxi licenses over the next four years. Taxi companies and drivers would be allowed to use app-based dispatch services, technology they were prohibited from using previously. And taxi and for-hire licenses would transition to a property right similar to a medallion in other cities.

The deal also allows for-hire drivers to have hailing rights for the first time, increasing their ability to compete.

Under the agreement, an accessibility fund would be created through a $0.10 per ride surcharge for drivers and owners to offset higher trip and vehicle costs for disabled riders who require accessibility services.

“The taxi industry is pleased that we can now compete and will soon offer mobile app technology. We will soon be the only service that the public can get with smart phone, phone, taxi stand and traditional hail without discrimination,” said Amin Shifow, wheelchair-accessible taxi operator.

The negotiations followed threats by the rideshare industry – which claimed limits on the number of drivers would drive the popular, app-based companies out of business – to bring the issue to voters this fall.

“Uber is committed to providing the safest and most convenient rides in Seattle while also offering consumer choice for riders and economic opportunity for drivers. Today’s announcement recognizes that the innovation economy is critical to Seattle’s future and we thank Mayor Murray for his leadership in reaching a compromise that benefits both riders and drivers,” said Brooke Steger, General Manager, Uber Seattle, in a statement.

“Seattle is a city that supports innovation and understands the transformative potential of technology. This is a city that is embracing ridesharing, and that’s why Lyft intends to be here for the long haul helping to facilitate a new era of transportation choices for Seattle residents. This agreement is a step in the right direction, and we look forward to working with the City Council to get it enacted into law,” said Katie Kincaid, an executive with Lyft.

Not everyone is happy with the agreement. GreenCab Taxi General Manager Chris Van Dyk, who’s listed as a plaintiff in a lawsuit against the City, told Geekwire in advance of the announcement that there would be a major problem with ending the cap on the TNCs.

“The experience in Seattle in years past, in San Francisco and in Ireland now, is that if you have unlimited entry, if you have no limit on the number of taxi and for-hire vehicles, operators simply cannot make a living wage, and the industry goes to hell in a handbasket, and in a relatively short time,” Van Dyk told GeekWire. “The economics of the industry are counter-intuitive, because of the low threshold of entry. Apps do not change this.”