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August 13, 2015

Uber ride service operates in a gray area in most locations

While recently updating Gloucester City’s limousine and taxi ordinances, Councilman Pat Keating discussed regulating Uber, the popular ride service.

In the end, no direct action was taken, but that leaves Uber operating in a gray area within the city – a position the service is in throughout much of the country.

Jack Lipsett, the small city’s administrator, said the main transportation concern in the Camden County town is residents hailing cabs to buy drugs in nearby Camden, where Keating oversees the public works department – but the mere discussion of regulating Uber set off a heated pro/con debate online.

  • Ridesharing is the generic name for services that use smart phone apps and GPS to hail a ride, such as Uber and Lyft, the largest companies, though there are other smaller outfits and regional services, such as SideCar, Carma and others.
  • Uber offers various levels of service, such as UberX, everyday sedans, the least expensive option, to UberBlack, commercially registered and insured SUVs or luxury sedans. There is even a higher-end UberLUX, but just in Los Angeles so far.
  • Prices for rides are pegged to the vehicles’ age and luxury. Uber also charges a premium for transport at certain time of the day, so-called surge pricing.
  • A company known as Luxe just this week launched a valet parking application in Philadelphia to capture those who want to drive, but hate the hassle of parking.

George Berglund, the city’s former police chief, said in an online discussion “he saw a need to regulate this type of business, as there have been numerous individuals who have had a serious criminal record.”

“Uber, in concept, is a good idea, however there have been many incidents across the country where Uber drivers have been involved in criminal activity. There is a need to ensure that they are licensed so that we know who we are dealing with. It is almost like an underground car service, with no regulation,” wrote the former chief.

In a follow-up phone conversation, Berglund, who has used Uber while on vacation and called it “a pleasant experience,” said not having drivers licensed by Gloucester City and not driving marked and numbered cars makes the work of law enforcement harder.

He also said as a matter of fairness, Uber drivers should be subject to the same scrutiny and fees as cabbies working in the city.

“I’d still like to see an ordinance” regulating Uber, said the former chief. “They are like a cab company, not carpooling.”

The prospect of regulating ridesharing rattled Gloucester City resident Gus Orr, who relies on Uber for work and leisure because he’s found it less expensive, more responsive and more punctual than cabs.

He also likes paying Uber fares only by credit card, not feeling compelled to tip and following a clear GPS route to a destination.

“Gloucester City doesn’t even enforce parking laws. How would they enforce regulating Uber?” asked Orr, who plans to continue using the service – despite any attempts at regulation.

Competition from ridesharing has sparked cabbie protests from Paris to Cambridge, Massachusetts.

There have been numerous attempts to rein in or outright ban the service, which is based on arranging rides using smartphone technology.

“I’d still like to see an ordinance” regulating Uber, said George Berglund, Gloucester City's former police chief. “They are like a cab company, not carpooling.” But others disagree. (Jeff Chiu / AP)

Five-year-old Uber, valued at more than $40 billion and perhaps as much as $50 billion, has waged a largely successful campaign to remain unregulated by asserting that drivers have their backgrounds thoroughly checked, drivers are well-insured and drivers work as independent contractors, not employees of the company.

Mostly, Uber’s arguments have worked, though legal and political challenges pop up almost daily.

For instance, in New York City, the mayor late last month abandoned a plan to cap the number of rideshare drivers – now estimated at more than 26,000, as opposed to just 13,437 taxis – when it became clear the effort wasn't popular with most people.

Philadelphia has attempted to wage war on Uber, with stings conducted by the Parking Authority. The city allows UberBLACK service – the equivalent of a limo in Uber-speak – but bans UberX, which is more like cab service.

Martin O'Rourke, a spokesman for the Philadelphia Parking Authority, said last week that 68 rideshare cars for Uber X and Lyft, a similar service, have been seized, with the impoundments upheld in each of the 15 cases that have worked their way through court system.

Despite the PPA, Uber said in April it has provided more than a million rides in and around Philadelphia.

In New Jersey, state Sen. Joe Pennacchio, the assistant Republican leader, has called for regulation of ride services with an eye toward leveling competition between traditional cabs and services such as Uber, a topic the legislature may take up this fall.

“It’s a work-in-progress, but it could be a model for the rest of the country,” said the senator.

Meanwhile, he’s called on Uber to stop operating in New Jersey, a plea the company has ignored.

“Uber offers more than 7,500 New Jerseyans the ability to earn a living, putting us on par with the top 26 job creators in New Jersey,” said Uber spokeswoman Alix Angfall.

“By the end of this year, Uber will have an economic impact on par with the top 11 job providers in the state,” she added.

One of those UberX drivers is Thomas Watson, 75, a former cabbie for 27 years.

He said the background check done by Uber is more thorough than the review done by PPA.

Setting his own hours is the chief advantage, especially since he uses the payments as a supplement, “closing the gap between needs and wants.” Aware of that sentiment among seniors, Uber is actively courting older drivers such as Watson, partnering with AARP to recruit drivers.

“It’s a service whose time has come,” said Watson.

But he added he wouldn’t mind a tip now and then.