Uber tries to sink Vt. bill about insurance, background checks

MONTPELIER - In the final weeks of the legislative session, Vermont senators are considering a surprise proposal to regulate ride-sharing technology companies such as Uber and Lyft.

Lyft rushed to hire lobbyists this week to respond to the bill, which was approved by Sen. Dick Sears, D-Bennington, and his Senate Judiciary Committee on April 14. Uber has spent weeks fighting the proposal, and some lawmakers are skeptical.

The proposal would require Uber and Lyft to triple their current total insurance coverage for personal injuries when drivers are between rides. The bill would also impose new background check requirements and an annual licensing process with the state Department of Motor Vehicles.

"I live in Montpelier, I want to ride to Burlington, but the guy that’s going to give me the ride lives in Vergennes," said Sen. Ann Cummings, D-Washington, chairwoman of the Senate Finance Committee. "Who’s regulating it?”

If passed, the state regulations would supersede all conflicting local laws about transportation network companies — except Burlington's vehicle for hire ordinance, which could remain in place for up to five years.

Burlington Mayor Miro Weinberger said he was confused about how the new state requirements would apply to Uber drivers who cross Burlington city limits. Would they be required to meet Burlington's insurance requirements, or the higher requirements imposed by the state?

"This has become a very significant part of how transportation works in Burlington and in Chittenden County," Weinberger told the Senate Judiciary Committee on April 11, "and any change that disrupts that would disrupt a lot of travelers and would disrupt a lot of people who are earning their living through this."

A lobbyist representing Uber, Christopher Rice, raised similar arguments during committee discussion. Rice said Vermont could choose statewide regulation or local regulation — but not both.

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Uber spokeswoman Carlie Waibel said the Senate proposal could adversely impact Uber drivers.

"We oppose the Senate’s efforts to pass onerous regulations that could have significant impact on people’s ability to earn money with Uber, ultimately stifling growth and improved transportation," Waibel said in a statement.

The bill passed out of the House of Representatives as a short piece of legislation that would codify the amounts of insurance that Uber and Lyft already offer. The Senate Judiciary Committee added pages of new requirements.

Attorney Chris Maley, who represents clients who are injured due to negligence, said the insurance requirements were not high enough.

Maley urged the committee to require more insurance for the time period when drivers are logged into the Uber or Lyft app but have not yet accepted a passenger. Each company currently provides coverage up to $50,000 per person for injury or death, or up to a total of $100,000. The committee agreed to propose new coverage requirements of $100,000 per person and $300,000 total.

“If you look at Uber’s history, they’re pushing back every step of the way," said Maley, who spoke on behalf of the Vermont Association of Justice. "They initially had no coverage, and there was a girl who was killed in a crosswalk, and they said, 'OK, graciously we will provide this $50K.' And it’s going to take states like Vermont to say, 'Wait a minute, that’s not enough. Do more.'"

In addition to the insurance requirements, the bill would also require the companies to pay a $500 annual fee to register with the Department of Motor Vehicles. They would have to commit to an accessibility policy, a nondiscrimination policy and a no-tolerance policy for drug and alcohol use. The companies would be required to conduct annual background checks on drivers through a national database as well as the Vermont Crime Information Center.

Sears, the committee chairman, pushed for the background check provisions after reading a Boston Globe report about Uber and Lyft drivers who failed expanded background checks.

The Senate Judiciary Committee approved the regulatory package without issue — but the bill is already facing headwinds at the Senate Finance Committee, which discussed the proposal for about 10 minutes Wednesday afternoon.

"Right now there’s no regulation except in a couple of places," said Sen. Ginny Lyons, D-Chittenden. "So I call up for a cab and I get some guy who comes and is three sheets to the wind. We want to avoid that."

Sen. Dustin Degree, R-Franklin, suggested that other towns could follow Burlington's lead in adapting their taxi ordinances to include Uber and Lyft.

"What I would like to avoid, madam chair, is setting up parallel means of regulating companies simply because one of them uses an app and another one doesn't," Degree said.

Gov. Phil Scott, who has promised not to raise taxes or fees, said Tuesday that he would be open to considering the bill's $500 business registration fee. Scott has not disclosed a position on the overall bill.

Contact April McCullum at 802-660-1863 or amccullum@freepressmedia.com. Follow her on Twitter at @April_McCullum. 
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