A top official at the ride-sharing service Lyft and Sen. Bo Watson, R-Hixson, say Tennessee’s new law, which allows car-booking companies such as Lyft and Uber to operate statewide, has been applauded by both officials at Lyft and Sen. Bo Watson (R-Hixson), as a model for other states looking to adopt similar policies.
“We think this bill actually represents the model legislation for state legislatures regarding the ride-sharing or transportation networks across the nation,” said Joseph Okpaku, director of public policy for Lyft.
The bill, signed into law by Gov. Bill Haslam on May 20, incorporated a compromise that the majority of the insurance industry and the ride-sharing industry were able to strike back in March, Okpaku said. “And it was one of the first bills to encapsulate that compromise. But beyond that, we also think it provides an appropriate regulatory framework for this new and innovative sector.”
Watson, the primary Senate sponsor of the bill, recently spoke to lawmakers from other states about the Tennessee initiative at the National Conference of State Legislatures. “I hope it helps drive a new economy in terms of transportation,” said Watson. “This is really one that's kind of market-driven, which I think is amazing. It is representative of the new economy that we're all experiencing where business is done over a smart phone, business is done over a computer and government's trying to adapt to that. As is business, the taxi-cab industry, the limousine industry. I mean they've all kind of had to adapt to a changing landscape.”
The law supersedes ordinances on ride-sharing in cities such as Chattanooga and Nashville, leaving the companies largely self-regulating.
Traditional cab companies, however, take serious issue with the law as they see it allowing multibillion-dollar firms to enjoy laxer regulations than those imposed on their own operations. The new law appears to block traditional cab services from incorporating app-based hailing of cabs into their business models. It also sets up insurance requirements for the ride-sharing companies and resolves national disputes between the firms and even more powerful insurers and lenders over whose insurance coverage kicks in when.
The law also seeks to resolve criminal background check issues, requiring them to be done (which the companies say they already did). But it allows them to continue to use private contractors to conduct the background checks instead of state or local police agencies.
Ride-sharing companies, which had been fighting their battles to operate on a city-by-city basis across the country soon figured out the quickest route was going to state legislatures or regulators.
Tennessee has followed Georgia, which has had a similar law in effect for some time. At present, some 22 states have enacted some form of ride-sharing service regulations and/or laws.
