UPDATE

Date Updated: March 6, 2015

The Broward County Commission published an Agenda for the March 10, 2015 Commission Meeting that includes a Motion to Request to Set for Public Hearing a proposed ordinance concerning Transportation Network Companies.

The purpose of the public hearing is to consider enactment of the proposed ordinance.

ORIGINAL PUBLICATION

Florida is a travel mecca. From all around the globe, people flock to our warm shores, our inland hiking trails and our famous and infamous cities for entertainment, food, sightseeing and relaxation.

With so many things to do at places spread far and wide, getting around here in Broward County, is causing a stir.

Traditionally, residents and visitors alike, if not driving their own vehicles, would call a cab for short hops to the airport or hire a limousine for spectacular nights out on the town. Taxis, limos and buses are staples of our tourism economy, and usually the best option for getting around our urban sprawl. The regulated industry thrives here.

But newcomers Uber and Lyft — two companies with software applications that pair passengers with drivers and vehicles – have upset the apple cart.

The charge from local industry, County officials and law enforcement is that Lyft and Uber are operating transportation companies without proper Certificates, Permits and Registrations. Drivers from both Uber and Lyft are subject to driver history and criminal background checks and the cars used to transport passengers with Lyft are inspected by other Lyft drivers. New Lyft drivers must pass a competency ride with a seasoned Lyft driver who makes sure the driver complies with road regulations.

With both Lyft and Uber, Passengers (“Riders”) provide their telephone number and credit card information prior to requesting a ride and pay a rate set by the company. At the end of the ride, drivers and riders are able to rate each other so there is application-wide feedback.

What Could Be Wrong with This?

If you’re a municipality that regulates the transportation-for-hire industry in a place where Tourism is the backbone of your economy or a business owner operating by those regulations… Everything.

Here in South Florida, the transportation industry caters not only to residents but to visitors from around the country and around the world. Our airplanes, busses, taxi cabs, limousines and passenger vans carry thousands of people each day. In Broward County, like most municipalities around the country, vehicles-for-hire, their drivers and the companies they work for are regulated. And if you, as a driver carrying passengers for money, have not subjected yourself to those regulations through compliance, you are operating illegally.

Part II Chapter 22-1/2 of the Broward County Code of Ordinances entitled, “Motor Carriers” provides the structure County Administrators, Law Enforcement, Chauffeurs and Transportation Companies refer to in order to understand what is, and what is not, legal.

Broward County is not unique in its regulation of ground transportation for hire. Most counties in Florida have some administrative code and ordinance in place to evaluate, permit, collect fees and provide for enforcement of taxis and transport vans. But Uber, Lyft and their sub-contracted drivers are not abiding by the Ordinances.

In a bold move to ensure “transportation network companies” can operate freely in Florida, a few legislators sought to remove the authority of any Florida County to regulate the ground transportation for hire industry. Last March, HB1389 (officially, “Limousines for Hire”, unofficially, “The Uber Bill”) was introduced in the Florida legislature. With language in place to make the State of Florida the regulating body, the Bill died in the second reading last session.

How to Comply with the Broward County Ordinance

A cursory reading of the Ordinance makes clear that drivers for hire need a Chauffeur’s Registration. The process, at this point, is easy and not too costly. Obtain and submit a Complete Florida Driver History ($16), pass a 25 question Chauffeur Registration exam and pass a Criminal History Background Check ($64) and the privilege to drive professionally is yours.

From here, it becomes more complicated, more expensive and less likely the average person will don a chauffeur’s hat and begin using their own vehicle to earn a living.

When you want to drive a taxi cab or luxury sedan, a Certificate of Pubic Convenience and Necessity is required. Stretch limousines and transport vans with 9+ passenger seats are exempt from this requirement but that doesn’t mean a person can just jump in their stretch limo and go. This is particularly true for Uber and Lyft drivers who operate in a taxi-like environment.

By regulation, Broward County places a limit on the number of Certificates of Public Convenience and Necessity it will issue based on the type of transportation service offered, the type of vehicle used and the size of the county population.

The Commission has determined that it shall be in the public interest to, at no time, authorize more than one (1) taxicab vehicle, singly or in combination, per each two thousand (2,000) inhabitants of Broward County nor to authorize more than one (1) luxury sedan per each four thousand five hundred (4,500) inhabitants of Broward County… (Sec. 22½–3. — Certificates of public convenience and necessity; application.)

All of these certificates have been acquired. There are no more available.

The only way to obtain one of these certificates is to buy or lease one from a current certificate holder or win the county’s lottery.

If any were available from Broward County, you would pay $1,000 each. If you choose to enter the lottery when the county decides to hold one, the lottery entry fee is $400. And, if you want to lease a Certificate, the county will collect $250 on top of whatever lease payment you negotiate with the current Certificate holder.

Permit for this, Permit for That… Permit for Everything

Permits are issued

per vehicle

based on the vehicle you operate (taxicab, luxury sedan, luxury limo or transport van)

for picking up people at Port Everglades

for picking up people at Fort Lauderdale Hollywood International Airport

The grip on the free market is tightened by these permit fees.

Since there are no freely available Certificates of Public Convenience and Necessity, Luxury Sedan or Taxicab permits are off the table. Therefore, the only permit available to a legally operating Lyft or Uber driver (and I say that loosely as neither company employs drivers), is a Luxury Limousine and 9+ Transport Van permit.

How Much is the Luxury Limo / Transport Van Permit?

The basic permit per vehicle is $300. If you want to pick up passengers, on a pre-arranged basis only (meaning, you cannot sit at the Port or Airport and wait for someone to hail your vehicle), there are additional fees.

The airport fee per vehicle is $150.

Pick-up at Port Everglades is a bit more complicated. The money you’ll spend for the privilege of picking up at the Port begins with a $200 Initial Processing Fee.

This “meta fee,” (my phrase) is imposed by Broward County for Port pick-ups and is, in my opinion, a fee for the convenience of paying another fee: the $250 Annual Port Business Fee.

At this point, the subsequently required per vehicle Port Everglades Decal fee of $15 pales in comparison.

The lack of availability of the necessary Certificates of Public Convenience and Necessity required to operate a taxi cab or luxury sedan service coupled with the per vehicle fees associated with operating a stretch limo or passenger van at the Port and the Airport create a protected market for taxis and luxury sedans regardless of what the Customer wants.

And we aren’t done with the fees to be paid to operate in this space. But first…

What about The Tourists and Law Enforcement?

County officials might look at these fees differently when one considers the importance of cruise passengers to our county tourism receipts. We can’t have just anybody in any kind of vehicle picking Visitors up from the Port or our International Airport — even if those Visitors request a ride from Lyft or Uber, see their Driver’s photo and have access to their Driver’s ratings from other Riders.

The County Ordinance says that’s not legal without meeting certain requirements first.

Another point to bear in mind is this: the County must be able to enforce its Ordinance which, arguably, is designed to protect the Consumer.

Law enforcement personnel must be available to protect Consumers by enforcing Chapter 22–1/2. Then, with this enforcement in place, the legal redress to the Consumer that Chapter 22–1/2 provides is accessible through the Courts.

Does limiting the number of Certificates makes enforcement easier?

If you are sitting at the Port, waiting to pick someone up, your place in the pecking order is visible: you’ll have the appropriate decals on your car, limo or transport van and, in the case of taxi cabs, an additional tell-tale hat.

It won’t take an army of police officers to identify bad actors. Conversely, vehicles without the appropriate markers are more easily identified.

That the County promulgates these laws and their associated fees provides grounds for legal redress of grievances both to wronged passengers, innocent by-standers and insurance companies — in an orderly arena: the Courts. In plain English, consumers, insurance companies and other victims can use the courts to recover damages instead of some form of vigilante justice that doesn’t follow due process.

Some may argue for no regulation at all. Certainly if we had no regulation, no laws would be broken. But this does not mean we would have no wrong-doing, no injustice or no victims.

I’ll Bet Other Cab Companies Love this Regulatory Barrier

Taxi Cab Companies and Luxury Sedan Permit holders surely look at these barriers to entry in a more favorable light. Afterall, no one wants a higher capacity vehicle muscling in on throngs of their Customers.

But they’re paying their fees and complying with the Ordinance. So, it is easy to understand why people like John Camillo, of Yellow Cab are so upset with Uber and Lyft.

We’re Not Done Paying Yet… Other Costs and Fees

Broward County also requires proof of commercial liability insurance which, down here in Worst Driverville, is not cheap. The following minimums are imposed by the county:

For taxis and luxury sedans: Certificate of auto liability insurance must indicate minimum limits of $125,000/$250,000/$50,000 For each vehicle, submit a certificate with the year, make and Vehicle Identification Number (VIN); for a fleet of vehicles, provide a schedule listing the vehicles with year, make and VIN. (Broward County Taxi Cab Permit Application and Requirements)

For luxury limousines and transport vans: Certificate of auto liability insurance must have a minimum limit of $500,000 CSL. For each vehicle, submit a certificate with the year, make and Vehicle Identification Number (VIN); for a fleet of vehicles, provide a schedule listing the vehicles with year, make and VIN. Port Everglades Business Permit only: certificate of general liability insurance must have a minimum limit of $500,000 per occurrence and list Broward County Board of County Commissioners as additional insured. (Broward County Luxury (Stretch) Limousine / Transport Van Permit Application)

Currently, Lyft provides commercial insurance whenever a driver is engaged in transporting a passenger through the Lyft application. I am unaware of Uber’s offering.

Broward County requires that the County be named on the insurance.

Whether you operate a taxi, luxury sedan, stretch limo or transport van, the insurance certificate must list, at a minimum, the Broward County Environmental Licensing and Building Permitting Division as a certificate holder.

I do not believe Lyft or Uber do this, which makes me question the enforceability of an insurance claim against either company.

Are their underwriters going to protect Broward County from financial liability when a victim sues the County for not protecting her?

But we still aren’t done forking out money and time to comply with Broward County’s Chapter 22–1/2.

If you have a business that operates in Broward County, with few exceptions, you owe the county an occupational license tax, now called a Broward County Business Tax Receipt on October 1 of each year.

Movers and Limo Services pay this fee based on their number of employees. Less than 5? Pay your $33 Broward County Business Tax Receipt and go get your required vehicle inspection.

I need a Vehicle Inspection?

All ground transportation vehicles used in passenger transportation-for-hire must pass Broward County’s inspection to receive a permit. The county does not sub-contract this service, so the fact that Lyft Drivers check out other Lyft Driver’s cars will not satisfy local government. But, the County Inspection is a less-than-one-day process if your car, limo or van is fit for service. And it makes sense, particularly when you are accepting compensation to put people, who trust you, in your vehicle.

But Uber and Lyft are Transportation Network Companies – Not Taxi Services

Uber and Lyft consider themselves “Transportation Network Companies.” While that label makes sense, I think they can both be described more accurately with pre-internet language.

Uber and Lyft are, plainly, Dispatchers with a slew of Customers who have raised their hand and said “YES!” to their service.

I’m not belittling the software or the folks who dreamed of connecting mobile passengers with mobile drivers and vehicles.

On the contrary, I think it is, and they are, brilliant for solving a distribution problem and an underutilization problem in the marketplace.

Even more brilliant is the recognition and traction both of these apps have outside of one very small pocket of the country.

And herein lies the problem local transportation businesses have with Lyft and Uber: these little shits have the market, they want 20% for it and they don’t have any vehicle skin or local skin in the game.

Download Our App Instead – We’re Legit!

It has been suggested, in the battle cry against Lyft and Uber, that people should just download the app that is available from one of the local cab companies to request a taxi.

Look, no one wants to download a local cab company app that can only be used in one place — even if that place is sunny, South Florida. I’m not going to do that. And neither will you.

I’d rather give up my location and info to an app that has more reach (Customers, Cars and Drivers), that I can use in more than one location and that lets me offer some feedback in a structured way. And therein lies the beauty of Uber and Lyft.

But They Are Breaking the Law!

I agree. We need to change the law.

Drivers with Uber and Lyft, are clearly providing transportation for hire and therefore are clearly subject to Chapter 22–1/2 here in Broward County. Each driver is operating, at a minimum, without government-inspected vehicles and without a Chauffeur’s Registration.

Oh, But this is not Transportation for Hire

There are some who will argue that passengers are not charged for transportation, that they simply make a “donation” for the transportation they receive. But that financial transaction walks like a duck and talks like a duck.

Hiding behind the clearly phony facade of “it’s just a donation; they’re not paying for transportation” does not hold water and makes you look, at best, naive for a variety of reasons.

The word “donation” still means “freely given,” and, “not required.” I doubt that I would take a person from Point A to Point B expecting to earn revenue but knowing I might or I might not receive a donation.

And, please, stop saying “we are not a transportation company.”

To the extent that you hold out to the public the availability of transportation and you accept the money for that transportation, you are in the transportation business.

Finally, stop pissing people off and alienating decision-makers — putting any needed change at risk.

Should We Just Ignore Uber and Lyft?

No. There are good reasons for amending Broward County’s Ordinance and opening up the market. Chicago did it, although they’ve just made another protected class and rasied the barrier to entry for new players by requiring a $10,000 Licensure Fee.

Here in Broward County, the crux of the issue is that there is a barrier to entry into this industry due to the manner in which the Industry is regulated. Uber and Lyft have exposed those barriers.

These two platforms have also revealed the fact that there are a number of vehicles that Customers are comfortable riding in. In other words, we do not need to limit our transportation-for-hire operators to Luxury Sedans, Stretch Limousines and 9+ Passenger Transport Vans.

We should thank Uber and Lyft for uncovering this niche in the market.

Where Do We Go From Here? What Needs to Change?

First, the number of Certificates of Public Convenience and Necessity that are available from the county are zero. Without these, there is no new entry into the taxi or luxury sedan market. Fiefdoms develop. Service suffers. The only players who can enter the market are players with deep pockets. There should be no limit to the number of Certificates available or there should be no Certificates.

Let the market decide with its dollars who provides the best service.

Second, any 4+ door vehicle manufactured after 2010 that meets certain safety and fuel efficiency requirements should be allowed to participate in our tourism and transportation economy. We should not limit the free market to a Luxury Sedan list, a stretch limo or a 9+ Passenger Van. The Ford Transit Connect and Subaru Forrester are safe, fuel efficient vehicles that should be options for service with or with a Certificate of Public Necessity and Convenience.

Lyft and Uber have made clear the traveling public’s tolerance of and demand for other types of vehicles. Existing permit holders whose vehicles would not meet the 2010 or newer requirement should be grand-fathered in.

Third, get rid of the requirement for cab drivers to be on the job for a certificate-holder for 36 months or more before s/he can hold her own certificate. This creates an unfair barrier to entry for people who are clearly qualified, know the roads and want their own shot at The American Dream.

Fourth, re-vamp the 25 question Chauffeur Registration Exam and the accompanying Study Guide. Kudos to Broward County for making this an audio-visual test; we should keep this. However, a professional driver or Chauffeur here in our vacation wonderland should be intimately familiar with our county and be a competent, safe driver — even if they’re driving part-time. So, add rules of the road and signage questions. Add questions about cities and unincorporated areas of Broward County. Add more questions about the locations of attractions, parks, event venues and hotels throughout the county. Test to a higher standard and our Visitors and Residents will have better experiences in our county.

Fifth, lower the fees that allow pre-arranged Airport and Port Everglades pick-ups and make sure that Uber and Lyft Customers who request an Uber or Lyft driver are considered “pre-arranged.”

Sixth, if a Driver is fluent in English and a second language (and I mean fluent — not just a barely passing competency), reward that driver with lower fees. I realize we speak English in this country, but a Driver fluent in English and another language is an asset to our Guests and Residents from other countries.

Finally, if we are going to create a “Transportation Network Company” definition, we should not limit ourselves or our constrain our workforce to Lyft and Uber.

However, I do not believe we need this definition if we are willing to redefine “Taxi” and discard the Luxury Sedan definition and requirement. You might argue that we would have a “free-for-all” but I submit that Drivers will flock to Uber, Lyft and any other mobile Dispatching source that can safely provide Customers and Customers will flock to any mobile Dispatching source they trust.

Moving Forward with Uber and Lyft

The public good can be better served by opening the doors to better, more efficient competition. Uber and Lyft have identified inefficiencies in the marketplace on both sides of the supply chain.

There are under-utilized vehicles, under-utilized Drivers and Customers desiring to make safe, trusted use of both — all over the United States. Uber and Lyft bring all three together on their platforms that reduce inefficiencies and encourage good service.

As a primary vacation destination in the USA, we should embrace the changes needed to satisfy our Visitors and Residents who travel in hired vehicles. And we should provide greater opportunities for local Drivers and Business Owners to thrive, right here in Broward County.

To do that, our County Commission needs vision and our current regulations need revision.