Alabama to get share of $148M Uber settlement over massive data breach
Alabama will get about $2 million of the $148 million Uber is paying to settle a data breach that the ridesharing company attempted to keep hidden, officials said. Attorney General Steve Marshall on Friday announced Alabama participated in a nationwide settlement with Uber that compels the company to comply with data breach notification laws and to make substantial improvements to its data security measures. All 50 states and the District of Columbia joined the settlement with the California-based ride-sharing company, Uber Technologies Inc., to resolve issues arising from a 2016 data breach involving personal information of Uber drivers that the company failed to report for one year. Because Alabama did not have a data breach notification law in effect at the time of the violations, the State’s participation in this case was based upon the fact that Uber’s conduct violated Alabama’s Deceptive Trade Practices Act. “This situation underscores how important Alabama’s new data breach notification law is for our consumers,” said Marshall. “People have the right to know if their personal information is stolen or compromised in a data breach so that they may exercise vigilance and take any actions possible to protect themselves. Until this year, Alabama was one of only two states without a data breach notification law, and I am pleased we were successful in passing legislation to correct that omission.” Uber learned in November 2016 that hackers had gained access to some personal information that Uber maintains about its drivers, including driver’s license information pertaining to approximately 600,000 drivers nationwide. Uber tracked down the hackers and obtained assurances that the hackers deleted the information even though some of that information, namely the driver’s license numbers for Uber drivers, triggered many state laws requiring them to notify those affected, Uber failed to report the breach in a timely manner, waiting until November 2017 to report it. In addition to the financial payment to the states, the settlement requires Uber to strengthen its corporate governance and data security practices to help prevent a similar occurrence in the future. The settlement — the nation’s the largest data breach settlement to date — requires Uber to: Comply with all state data breach and consumer protection laws regarding the protection of consumers’ personal information and notifying them in the event of a data breach concerning that information; Take precautions to protect any user data Uber stores on third-party platforms outside of Uber; Use strong password policies for its employees to gain access to the Uber network; Develop and implement a strong overall data security policy for all data that Uber collects about its users, including assessing potential risks to the security of the data and implementing any additional security measures beyond what Uber is doing to protect the data; Hire an outside qualified party to assess Uber’s data security efforts on a regular basis and draft a report with any recommended security improvements, which Uber will then implement; and Develop and implement a corporate integrity program to ensure that Uber employees can bring any ethics concerns they have about any other Uber employees to the company, and that it will be heard.
Uber prepares statewide launch ahead of July 4th
After years of pushback, ridesharing finally became a statewide reality in March when Gov. Kay Ivey signed a bill making Alabama the 45th state in the nation to welcome comprehensive ridesharing. Now, just a few months later, the law is about to go into effect and the global ridesharing juggernaut Uber is expanding to every county in the Yellowhammer State on Sunday, July 1 allowing access to rides at the tap of a button to new communities ahead of July 4th celebrations. Uber + MADD In anticipation of the upcoming holiday, Uber is joining forces with Mothers Against Drunk Driving (MADD) to help raise awareness about the dangers of impaired driving and remind those drinking over the holiday to make safe choices. While many enjoy cookouts and family vacations, the summer holiday is among the ‘100 deadliest days on the road,’ which fall between Memorial Day and Labor Day weekends. According to the National Highway Traffic Safety Administration, “drinking and driving continues to be the leading cause of death on our roads, with more than 10,000 lives lost across the country each year and nearly 300 alcohol-impaired driving fatalities in Alabama in 2016.” Which is why Uber and MADD are speaking up ahead of the summer holiady. “Uber is committed to helping make drinking and driving a thing of the past by connecting people to reliable rides at the push of a button – and now those rides won’t stop at city limits,” said Uber Southeast General Manager Kasra Moshkani. “As Uber launches throughout Alabama and brings service to new communities, we are proud to partner with MADD to encourage those celebrating during the July 4th holiday to make smart choices. We thank Governor Kay Ivey for her leadership paving the way for residents and visitors across Alabama to have the access to convenient rides and flexible work opportunities they deserve.” “There is never an excuse to drink and drive, and Uber’s expansion throughout Alabama will make it easier than ever to get a safe ride home,” added Pamela Morton, MADD Alabama State Director. “We are proud to team up with Uber to make progress on our goal of getting to zero – zero deaths, zero injuries, zero families impacted by impaired driving. Whether it’s with a designated driver, a bus, or an Uber trip, if you’re drinking this July 4th, leave your keys at home and take a ride on the safe side.” Uber is hiring Uber also offers people new opportunities to work—on their own terms. With this expansion, Uber will connect drivers in all areas of Alabama who are looking to serve their communities with new opportunities. Individuals interested in driving on the Uber platform can sign up on the Uber website.
Kay Ivey signs ridesharing bill allowing Uber, Lyft statewide
Governor Kay Ivey on Thursday — alongside Mountain Brook-Republican State Rep. David Faulkner and Greensboro-Democrat state Senator Bobby Singleton, Ride for Alabama coalition members and local rideshare drivers — signed Alabama’s rideshare legislation into law during a bill signing ceremony at the State Capitol. Alabama is the 45th state in the nation to welcome comprehensive ridesharing, allowing companies like Lyft and Uber to operate statewide. “Today, we are paving the way for ridesharing throughout all of Alabama, regardless of location or proximity to major metropolitan areas,” Ivey said. “I am proud to have supported this bill throughout the legislative process and commend the hard work of Representative Faulkner and Senator Singleton for sponsoring the bill and Ride for Alabama coalition members for their strong support throughout the legislative process.” “When I first spoke at the Ride For Alabama coalition launch in January, I stated that one of my primary responsibilities in the Alabama House is to ensure that all Alabama residents have access to safe, reliable and efficient methods of transportation,” added Faulkner. “The legislation that I and Senator Singleton carried, and that Governor Ivey signed today, does just that.” Previously, ridesharing companies were allowed to operate only in select, approved cities in Alabama. By enacting statewide legislation, suburban and rural communities will now have access to the many benefits the rideshare industry provides, including enhanced driver earning opportunities. “Rural parts of our state will now have access to these innovative transportation methods, and more Alabama residents will have the opportunity to earn additional income,” said Singleton. “With Governor Ivey giving her signature to this legislation, Alabama’s economy will move forward, public safety will increase and Alabama residents will experience greater quality of life.” Uber and Lyft both thanked Ivey for her support of the legislation. “We want to thank the Governor for her support of this law. Lyft is providing tens of thousands of Alabamians earning opportunities and transportation options that did not exist a few short years ago,” said Scott Coriell, communications manager for Lyft. “We’re excited to expand those benefits to more individuals and families around the state in the coming months.” “With this statewide framework for ridesharing, more Alabamians will benefit from access to safe rides and flexible work opportunities through Uber – and current customers will benefit from an even more reliable experience,” said Uber General Manager, Kasra Moshkani. “We thank Governor Ivey, Representative Faulkner, and Senator Singleton for their leadership and look forward to expanding throughout Alabama.” Throughout the legislative process, the bill was supported publicly by the Ride for Alabama coalition, comprised of multiple Chambers of Commerce and third-party entities, such as the Alabama Hospitality and Restaurant Association, Birmingham Urban League, Decatur-Morgan County Chamber of Commerce, the National Association of Women Law Enforcement Executives, the Alabama Black Chamber of Commerce, and the Alabama Association for the Deaf, among others. The law will take effect July 1.
Ridesharing gets the green light in Alabama
Ridesharing companies like Uber and Lyft got a final green light to operate statewide from the Alabama Senate on Tuesday. The body passed the House-originated version of the ridesharing bill by a vote of 27-0, which will send the legislation to Gov. Kay Ivey‘s desk to sign it into law. The legislation would create a consistent regulatory framework for ridesharing companies across the state and eliminate the haphazard, confusing patchwork of differing municipal laws and regulations. Instead, ridesharing companies would be placed under the control of the Alabama Public Service Commission (PSC), and single permit issued by the PSC would then allow the companies to operate statewide. Ivey announced her support of the legislation last month. “To embrace the future, Alabama must accommodate modern transportation demands. The ability to request an on-demand ride is no longer considered a perk of being in a big city, it is an expectation no matter where one lives or work,” Ivey said at a press conference. “Having consistent rules statewide for ridesharing is the sensible way to give Alabamians access to safe, consistent and efficient transportation options.” Following its passage, Uber spokeswoman Evangeline George issued a statement thanking Ivey and the bill’s sponsors for their leadership in helping pass the legislation. “In passing one clear set of rules for ridesharing, the Alabama Legislature stood with students who need safe rides home late at night, seniors who need rides to their doctors, and commuters who need rides to work,” George said. “We thank Governor Ivey, Representative Faulkner, and Senator Singleton for their leadership and look forward to expanding access to Uber’s safe rides and flexible work opportunities throughout the state.” Lyft spokesman Scott Coriell issued a statement of support as well. “Ridesharing services like Lyft are providing tens of thousands of Alabamians earning opportunities and transportation options that did not exist a few short years ago,” said Coriell. “We’re excited that the legislature has acted to expand these benefits to more individuals around the state, and we look forward to working with the Governor to get this bill over the finish line.” Alabama is one of only six states that lacks statewide ridesharing regulations. Once signed by Ivey, the legislation will allow Alabamians from not only the larger cities, but also suburban and rural communities across the state to take advantage of all benefits the ridesharing industry produces.
Ala. Senate gives ridesharing companies a green light to operate statewide
Ridesharing companies like Uber and Lyft got a green light to operate statewide from the Alabama Senate on Thursday. The body passed SB143, which would create a consistent regulatory framework for ridesharing companies across the state and eliminate the haphazard, confusing patchwork of differing municipal laws and regulations. Instead, ridesharing companies would be placed under the control of the Alabama Public Service Commission (PSC), and single permit issued by the PSC would then allow the companies to operate statewide. The bill, sponsored by Greensboro-Democrat state Senator Bobby Singleton received bipartisan support and passed the chamber unanimously. Alabama is one of only six states that lacks statewide ridesharing regulations. If passed, the bill would allow Alabamians from not only the larger cities, but also suburban and rural communities across the state to take advantage of all benefits the ridesharing industry produces.rural communities across the state. “This is a perfect example of a bipartisan bill that works for all Alabamians,” Senate Majority Leader Greg Reed said. “Installing this regulatory framework is going to provide folks all over the state another choice in transportation, ensure safe operation for both drivers and riders, and pave the way for more jobs in the state.” Because of a lack of statewide regulations, ridesharing companies like Uber and Lyft operate in only fifteen of the larger cities in Alabama: Auburn, Birmingham, Daphne, Gardendale, Gulf Shores, Homewood, Hoover, Huntsville, Mobile, Montgomery, Mountain Brook, Pelham, Tuscaloosa, Trussville and Vestavia Hills. “This is important to the state of Alabama because ride-sharing is the new trend across the United States. If we pass this legislation, we will be the 45th state in the U.S.,” Singleton remarked. “It’s important for us as a state to keep up with trends. This will allow citizens in the state of Alabama to be employed and it will allow people who don’t have transportation to be able to move around in their cities.” Uber’s public affairs manager Nick Juliano praised Alabama lawmakers for passing the bill. “The Alabama Senate took the first major step today in making sure that people in every corner of our state have access to reliable, affordable transportation,” Juliano said. “By expanding ridesharing services to all of Alabama, this legislation will create thousands of new jobs. We are grateful to members of the Senate for their support of this pro-growth initiative that will make Alabama the 45th state in the nation to adopt a statewide ridesharing law.” SB143 now moves to the House of Representatives for consideration.
Legislative session weekly wrap-up: Budget introduction, Medicaid work reqs, ridesharing on the move
Alabama lawmakers faced cold weather and icy roads this week as they made their way to the State House where they managed to move a handful of bills in both chambers. The Legislature has now used four of its available 30 meeting days for the 2018 Regular Session, and only 26 meeting days remain. Here are the highlights out of Montgomery this week: In the Governor’s office: Some Medicaid recipients in Alabama may be required to work. As part of her General Fund Budget proposal, Ivey instructed Alabama’s Medicaid Commissioner Stephanie Azar to develop a policy for implementing a work requirement for Medicaid receivers. All work requirements would only be applicable to “able-bodied” adults, with exemptions being made for the elderly, people with disabilities, and children. Ivey’s current plan would also require copay increases for Medicaid recipients. Her goal is to “increase efficiency and decrease costs related to Medicaid, all in an effort to be good stewards of taxpayer dollars.” Alabama’s jobless rate holds steady at record 3.5 percent low. Ivey announced on Friday that 2,093,063 people were counted as employed in December, the most ever recorded. Alabama’s preliminary, seasonally adjusted December unemployment rate is 3.5%, maintaining last month’s record rate. The new figures also indicate the Yellowhammer State is ahead of the national employment average as the U.S. jobless rate is holding at 4.1 percent. Senate news: Tripp Pittman introduces Kay Ivey’s General Fund budget. SB178, otherwise known as the proposed budget, appropriates funds for functions of government, debt service, and capital outlay for fiscal year ending September 30, 2019. According to the Governor’s office, it does so “sensibly” and “funds state government with prudence and care.” Bill to remove marriage licenses passes. The Alabama Senate approved a bill on Wednesday to remove marriage licenses and begin a new process under which probate judges would accept affidavits from couples as an official record of marriage. Under the legislation, the requirement of a ceremony to honor the marriage would be erased. The cost would be the same as the current cost of marriage licenses in the state. Bill introduced to increase penalties for human trafficking. Introduced on Tuesday, the bill would enhance the criminal penalties for obstructing the enforcement of the human trafficking laws in Alabama. Ridesharing bill on the move. The bill, which passed the Senate Tourism and Marketing Committee on Thursday, would create a ridesharing network across the state for companies and place it under the control of the Alabama Public Service Commission (PSC). A single permit issued by the PSC would then allow the companies to operate statewide under uniform regulations rather than requiring each municipality to file for their own permits and regulations. House news: Legislation proposed to scrap partisan primaries. One Alabama lawmaker wants to scrap partisan primaries in favor of open elections that would send the two top vote-getters, regardless of party affiliation, on to the general election, thus eliminating the need for run-off elections. Of special note: State Representative George Bandy dies at 72. Longtime Alabama lawmaker, State Representative George Bandy Sr. died early Tuesday morning in a Macon, Ga., hospital, according to Alabama House spokesman Clay Redden.
Support grows for bipartisan, statewide ridesharing bill
Want to take an Uber in Alabama? Well you can, depending on where you live. Currently, ridesharing companies like Uber and Lyft operate in only 15 of the larger cities across the state —Auburn, Birmingham, Daphne, Gardendale, Gulf Shores, Homewood, Hoover, Huntsville, Mobile, Montgomery, Mountain Brook, Pelham, Tuscaloosa, Trussville and Vestavia Hills — but due to a lack of comprehensive, statewide regulations aren’t able to operate in all parts of the state. Which is what Mountain Brook-Republican State Rep. David Faulkner and Greensboro-Democratic State Sen. Bobby Singleton hope to remedy this legislative session. They’re soon introducing a bill that would create a ridesharing network across the state for companies like Uber and Lyft, and place it under the control of the Alabama Public Service Commission. On Thursday, the pair was joined by Gov. Kay Ivey on the steps of the State House where they discussed plans for the bipartisan, statewide ridesharing legislation. They were also joined by the “Ride for Alabama” coalition, formed by supporters of the bill. More than 30 local rideshare drivers were also in attendance. “To embrace the future, Alabama must accommodate modern transportation demands. The ability to request an on-demand ride is no longer considered a perk of being in a big city, it is an expectation no matter where one lives or work,” Ivey at the press conference. “Having consistent rules statewide for ridesharing is the sensible way to give Alabamians access to safe, consistent and efficient transportation options.” Alabama is one of only six states that lacks statewide ridesharing regulations. If passed, the bill would allow Alabamians from not only the larger cities, but also suburban and rural communities across the state to take advantage of all benefits the ridesharing industry produces. “Alabama has the opportunity to make the best decision for the state’s future with regard to a statewide ridesharing framework, as the passage of this bill would provide citizens from one corner to the other with the opportunity for safe and reliable transportation,” said Faulkner. “Ridesharing creates transportation options for those with low incomes, the elderly, and people with disabilities,” added Singleton. “By increasing overall transportation access for all of Alabama, we are also creating new economic opportunities for our state.” Ride for Alabama is made up of multiple Chambers of Commerce and third-party entities, such as Birmingham Urban League, Decatur-Morgan County Chamber of Commerce, the National Association of Women Law Enforcement Executives, the Alabama Black Chamber of Commerce, Young Alabama and the Alabama Association for the Deaf, Inc., among others. “Embracing innovative and forward-thinking technology platforms like Lyft and Uber will continue to move Alabama forward,” said Deon Gordon, Ride for Alabama coalition member and president, TechBirmingham. “The time has come for Alabama to become the 45th state to expand these vital transportation options to all.”
Uber to Alabama lawmakers: don’t adjourn without one set of ridesharing rules
With no ridesharing-friendly bills signed into law this year and just days left in the legislative session, Uber is making a final plea to state lawmakers to pass one clear set of rules that will bring ridesharing to the entire Yellowhammer State. In a blog post on Tuesday, Uber Alabama General Manager Luke Marklin urged Alabama lawmakers to follow in the footsteps of more than 40 other states across the country, and pass a statewide framework for ridesharing before adjourning this legislative session. “Alabama’s lawmakers should not leave town this week without sending a bill to Governor Ivey that brings Uber’s reliable rides and flexible work opportunities to everyone in the state with one clear set of rules,” said Marklin. “Forty-two states—and counting—have passed statewide ridesharing frameworks, and letting this session end without a law in Alabama will leave Alabama’s residents and tourists behind. If cities continue to have varying rules for ridesharing, it will hurt thousands of drivers’ ability to earn money and prevent people from a getting a ride when they need it most.” Currently ridesharing companies like Uber and Lyft can only operate in select cities throughout the state, and are governed by agreements with each individual city. Which is why, earlier this month, the state House of Representatives passed HB283, which endeavors to provide uniformity of laws governing transportation network companies by ensuring companies, drivers, and insurance requirements are governed solely by Alabama State Law. However, a last minute amendment that was added to the bill, is complicating its future. Instead of allowing the law to apply statewide, HB283 would now only apply to cities and unincorporated areas of the county that do not currently have ridesharing services, should it be signed into law. “A last-minute provision added to the legislation will continue Alabama’s patchwork of conflicting regulations and create more confusion for riders and drivers,” said Uber spokesperson Evangeline George. On Wednesday, the state Senate is expected to consider an alternative bill, which has the full support of Uber. SB271 creates one single set of rules for ridesharing that Uber believes “Alabama needs.” According to Uber, nearly 2,000 Uber riders and driver-partners in Alabama have written their representatives and senators about why Uber is important to them and should be available throughout the state. “I am an Uber driver with over 2,000 rides under my belt, and I can tell you that the majority of my riders state how much they love Uber,” said Tonja, an Uber drive-partner from Mobile. “The convenience of being there to pick them up within minutes, the cost of a ride, and friendly drivers are a godsend to them. Uber has lowered the number of DUI arrests in this country and abroad. It has given drivers the freedom to work on a schedule that best suits their lifestyle, which has opened up an entrepreneurship that helps families and individuals everywhere.” Leaders from across the state are echoing Ubers pleas to legislators, urging them to pass a statewide framework for ridesharing in Alabama this session: Dr. John R. Drew, Senior Vice Chancellor, Troy University: “While Alabama’s large cities have passed ridesharing regulations, it will be impossible for the service to come to small cities like Troy without a statewide law. Continuing Alabama’s patchwork of conflicting regulations will only foster confusion and hamper our ability to get the rides we deserve. We need one set of ridesharing rules to ensure Troy University students can count on Uber for rides to and from Montgomery, Auburn, and anywhere else in the state they choose to visit.” Eufaula Mayor Jack B. Tibbs Jr.: “In Eufaula, providing for the safety and security of the citizens of our community is a top priority. Ridesharing has proven to have a significant impact on public safety in communities across our country, which is why I urge you to pass one clear set of rules for ridesharing in Alabama that would allow companies like Uber to operate statewide.” William J. Canary, President and CEO, Business Council of Alabama: “Alabama is building a reputation around the globe for being open and welcoming to technological innovation and entrepreneurialism exampled by the influx of high-tech jobs to regions across our state. HB 283 will help Alabama to continue moving in this direction and is a commonsense approach that benefits consumers, businesses, the entrepreneurs who work with TNCs, and local governments.” J.T. Griffin, Chief Government Affairs Officers at Mothers Against Drunk Driving: “MADD knows that Alabama is currently considering legislation, HB 283, which would provide for a consistent, clear regulatory mechanism that would allow rideshare companies to operate statewide. Rideshare has the ability to help provide new alternatives to take drunk drivers off the road and help protect our communities. MADD would urge you to consider the lifesaving potential of rideshare technology as you consider this legislation.” Joy Harris, President of the National Federation of the Blind’s Alabama Chapter: “As President of the National Federation of the Blind of Alabama, I support the passage of HB 283, which would permit ridesharing services to operate throughout the state with appropriate regulation. We strongly support the expansion of these services throughout the state. Provision of ridesharing in underserved areas would explode the number of transportation options available to blind residents. It would allow the blind to independently order their own transportation and free anyone who was reluctant to provide it from that task.”
Uber announces support for ‘unified framework’ for Alabama ride-sharing
Uber announced Thursday it is supporting a bill moving through the Alabama Legislature that would create a statewide framework for ride-sharing. “Every day in Alabama, thousands of people depend on Uber for affordable transportation options and flexible work opportunities,” said Uber Alabama General Manager Luke Marklin. “With a statewide framework, even more Alabamians will benefit from a convenient ride at the tap of a button — and current riders and drivers will count on an even more reliable experience.” HB 283, sponsored by Rep. David Faulkner, would require ride-sharing company drivers to go through a thorough background check before they can start working and would legislate some consumer protection provisions, such as requiring estimated fares to be disclosed before a ride and requiring detailed receipts be sent electronically, two practices Uber already employs. The bill would also allow Alabama municipalities to opt out of having ride-sharing companies operate within their jurisdiction. “It’s time for Alabama to bring certainty to consumers with a statewide ride-sharing framework,” Faulkner said. “Access to new technologies and affordable rides should not be limited to those who live in the biggest cities, and this bill will give all of our residents the transportation options they deserve. The current patchwork of inconsistent regulations is unsustainable, which is why Alabama should not go another year without passing uniform ride-sharing laws.” The bill also has the support of Mothers Against Drunk Driving, with the group’s Chief Government Affairs Officer J.T. Griffin telling Alabama Lawmakers in a letter that services such as Uber have “the ability to help provide new alternatives to take drunk drivers off the road and help protect our communities.” HB 283 was filed by the Jefferson County Republican Feb. 21 and has been referred to the House Committee on Commerce and Small Business.
Will Lochamy: An Uber success?
Can you believe we’ve made it? I mean, it’s a miracle that we’re still here! Think about it … Y2K, quicksand, Zima, the Mayan calendar, and even Uber. We’ve survived, folks! Chicken Little’s whole “acorn story” was more convincing than Birmingham City Councilor Kim Rafferty’s anti-Uber charade. While supposedly only representing the community, she appeared on a national propaganda video produced by the Taxi, Limousine, and Paratransit Association. Speaking about Uber, Henny Penny… I mean Rafferty, said, “Just because you need a ride, doesn’t mean you have to be abused or taken advantage of.” It get’s better. She actually said, “We continue to stand before a millennial groundswell that is manipulated and tantalized by shiny, newfangled app gadgetry, convenience, and self-service with no concept of public service and no care for public safety. Social media may be pretty, but it will not serve you well when the battery goes dead.” I’m assuming she thinks we should stop driving cars as well, because, you know … they might run out of gas. Thank goodness our batteries haven’t died. We’ve now been using Uber for over seven months in Birmingham. That’s right; the scary, unregulated, bogey man-driven, rideshare service that everyone warned us about. Close your eyes, because here is what people have experienced: People from 45 different countries have used Uber in Birmingham. “Since Uber came along, I’ve personally witnessed a complete transformation in the landscape of transportation in Birmingham. Where there are STILL no cabs, we now have Uber. Our customers now have a reliable, affordable, safe option to get around when they make the choice to not drive,” said Cliff Atkins, owner of 41st Street Pub and Rowe’s Avondale. “Uber is a valuable service and safety enhancement to our citizens. There is no other way to see it unless you’re serving some other end.” Birmingham City Councilor Sheila Tyson said, “We haven’t had any complaints. If they had complaints, trust me, they would blow our phones up.” “There are no longer lengthy wait times. Also, an added bonus has been the paper trail Uber leaves. Knowing exactly when you rode, who drove you, and the route you took home is extremely helpful to our customers,” said Joseph Hoskin, general manager of Innisfree Irish Pub. The average wait time for an Uber in Birmingham is four minutes. “The first six months (with Uber) have been all we had envisioned: creation of jobs, decreased incidents of DUI, and satisfied out-of-town visitors who have more reliable transportation to and from the Birmingham airport. It’s an all-around success story for our city,” said Hoover City Councilor John Lyda. It took Birmingham 18 long months to get past the red tape. I don’t want to think about the negative things that might have happened during that time without ridesharing. The proof is in the pudding. I stood before an Alabama State House in 2015 that didn’t know what Uber was. There’s no excuse now. Drinking and driving, reliable transportation, and outdated thinking isn’t a just a Birmingham thing. It’s time to take this out of the local municipalities’ hands and pass statewide legislation. Oh, and thanks to the drivers. You guys and gals have been on your best behavior. Let’s keep it that way. We’d hate for one of you to mess it up for the rest of us. Will Lochamy is co-host of the radio show, “Oh Brother Radio” on Birmingham Mountain Radio (107.3FM).
Daniel Sutter: Unintended consequences of Uber
The disruption of established taxi markets by ridesharing services like Uber and Lyft is bringing financial ruin to some in the industry. The consequences raise complicated economic, political and ethical questions. Uber and Lyft are ridesharing services. People sign up to drive using their own cars and drive on their own schedules. Riders use an app to request a pickup. The companies facilitate sharing by generating a minimum threshold of initial trust. We teach children not to accept rides from strangers; Uber helps customers trust the stranger giving them a ride. Governments have regulated taxis for decades, requiring taxis to possess a medallion to operate legally. Limits on the number of taxis increase fares compared to unregulated competition, making customers pay extra for rides. But cab drivers do not typically benefit from the system. Why not? Regulation makes each fare somewhat higher than otherwise; let’s say that this totals an extra $20 over a typical shift. But the cabbie will not get to keep the $20 – the taxi company monitors rides and fares. The extra revenue collected day after day goes to the medallion owner, not the cab driver. Obtaining a medallion would seemingly allow the driver, not his employer, to keep the extra revenue. Taxi medallions can be bought and sold, and generally purchase is the only option, since cites rarely issue new medallions. But as Lee Corso says on ESPN’s “College Game Day,” “Not so fast!” Owners looking to sell a medallion know that the buyer will get to charge higher fares, and will accordingly charge more for the medallion. This process, known as rent capitalization, constitutes one of the more confusing results of economics. The price of medallions illustrates the extent to which cities restrict the number of taxis. The medallion, after all, is just a bureaucratic permission slip and doesn’t help transport riders. In New York, the price of medallions reached $1.2 million. Taxi regulation costs consumers enormously, and yet in a very real sense does not benefit the vast majority of cab drivers and companies. Most medallion owners today entered the business by purchasing medallions, and so profits from operating cabs merely pay back the cost of getting into the business. Economist Gordon Tullock called such a situation the Transitional Gains Trap. Ridesharing has driven fares down to the level that would have prevailed without regulation. The price of taxi medallions has fallen dramatically, by more than 25% in many cities. The city of Philadelphia recently sold some new permits for $80,000; they had hoped to sell them for nearly $500,000. Current medallion owners may not benefit much from regulation, but they certainly bear the losses from its disruption. Not surprisingly, taxi companies have battling tooth-and-nail, seeking regulations to hamstring ridesharing and suing the companies. This political opposition may, at least in some markets, limit realization of the potential gains from ridesharing. The situation also raises an ethical question. Is it fair for the current owners of taxi medallions to bear this loss? Many were hard-working cab drivers who saved and borrowed to buy a medallion, and now face financial ruin. They made business and life decisions based on expectations created by government policy over decades. Should cities make good the promise of regulation reflected in medallion purchase prices? On the other hand, taxi regulation represents an improper use of government’s regulatory power. Regulation was (and still is) defended as protecting consumers from unscrupulous or even criminal behavior on the part of taxi drivers. Government is not supposed to simply enrich one group of citizens (sellers) at the expense of another (customers). Haven’t taxi riders suffered enough? We make decisions based on the economic world around us today, and the world we expect to prevail tomorrow. Even costly and ineffective government programs shape our expectations and decisions. Consequently, ending wasteful government programs costs more than imagined. Gordon Tullock concluded that avoiding such messes altogether was the only good solution to the Transitional Gains Trap. Hopefully the difficult straits of many in the taxi industry today will encourage us say no to new ill-advised regulations governments propose this year. • • • Daniel Sutter is the Charles G. Koch Professor of Economics with the Manuel H. Johnson Center for Political Economy at Troy University and host of Econversations on TrojanVision.
At long last, Uber launches in Birmingham at 4 p.m.
Magic City residents have something to celebrate as 2015 draws to a close: Uber is at long last launching in Birmingham on Tuesday afternoon. After more than a year and a half of negotiating with the Birmingham City Council, the San Francisco-based ride-sharing company will officially start its service in the Birmingham metro area at 4 p.m., a little more than 48 hours before New Year’s Eve festivities commence. “Residents of Birmingham have been eager to get expanded access to safe, reliable transportation options and the economic opportunities that Uber brings to the community,” said Tom Maguire, general manager for Uber in Alabama. “We are thrilled to finally be able to start operating here, and I want to personally thank city officials for all their hard work and support to make this happen.” Organizing private rides for consumers using a mobile app, Uber launched in 2009 and went international in 2012. Until today, Birmingham was the largest city the U.S. without Uber available to to its residents and visitors. But Uber is no stranger to the Yellowhammer state; Mobile and Tuscaloosa already have Uber available in their cities. To use Uber, all a user needs to do is download the app, sign up and enter credit card information in order to pay for the rides. New to Uber? You can sign-up and your first ride is on us (up to $15).
