City Council opens the door for Uber to operate legally in Edmonton

After a marathon meeting that lasted until nearly 10pm, Council eventually decided to look at new regulations that could make Uber legal while enforcing the existing bylaws in the meantime. The motion put forward by Councillor Knack also seeks additional data on the taxi industry and directs Administration to look at issuing additional taxi plates. “The world has evolved and people want choice,” he said.

Here’s the motion that Council passed unanimously this evening:

  1. That Administration work with the Transportation Network Companies and other stakeholders to provide a report, before the end of the third quarter, to include a draft bylaw that would establish public safety rules and regulations for the operation of Transportation Network Companies.
  2. That, in parallel with the work in part 1, Administration work with the Taxi Industry to provide a report, before the end of the third quarter, with a draft bylaw to amend the Vehicle for Hire Bylaw 14700 to provide for improved taxi service standards, and with recommendations for issuance of additional taxi plates.
  3. That, in the meantime, Administration request that UBER temporarily suspend operations in the Edmonton market and if they refuse, Administration take all steps necessary to apply for an injunction against UBER to prevent its unlawful operation in Edmonton until such time as UBER complies with the applicable City of Edmonton bylaws.
  4. That Administration work with the taxi brokers to obtain data from dispatch systems on number of taxis dispatched at given times, wait times for taxis, and other information relevant to allow for determination of appropriate customer service standards and expectations.

With bullet #1, the motion seeks to create rules that would allow companies like Uber to operate legally in Edmonton. With bullet #2, it seeks to address the shortcomings that currently exist in Edmonton’s taxi industry.

“I think this approach makes sense because it leaves the City’s options open,” said Mayor Don Iveson before the motion was voted on. He also reiterated the need to have more data in order to make better decisions in the future. The mayor said it makes sense to ask companies like Uber to abide by the regulations that are in place while the City works to align them with the market.

Uber is currently operating illegally in Edmonton. It launched its service back in December and the City declared that any Uber car caught operating would be considered a “bandit taxi” and face a $1,000 fine. Uber has argued consistently that its technology and business model are fundamentally different and are therefore not explicitly covered by provincial or municipal regulations. Sometimes called a ridesharing app, a more general term for Uber is transportation network company.

Yellow Cab
Photo by Dave Sutherland

The discussion centered around the Vehicle for Hire Bylaw 14700, which “regulates taxi brokers, drivers, and vehicles, but does not regulate passengers.” From the report:

“The number of allowable taxi plates within the city was frozen in 1995 to facilitate a financially viable taxi industry. The taxi rates are controlled by the City of Edmonton to ensure consumer price protection.”

Edmonton caps the number of taxi permits or plates at 1,319. It has increased the number of plates allowed a few times over the years, but the City recognizes there are still too few plates to meet demand. A report from 2007 suggests that Edmonton is 177 plates short. Council mentioned repeatedly that they have heard from constituents that there aren’t enough taxis and that wait times are too long.

At one point, Councillor Scott McKeen asked Edmonton Taxi Group president Phil Strong if the industry has been lobbying for more plates to be issued, but of course they haven’t been. “I wouldn’t know where to go,” he claimed. The issue is that by making more plates available, the value of each declines.

“Almost everybody agrees the status quo doesn’t work,” the mayor said.

There was quite a bit of discussion about the idea that the City create its own app for taxi services. The problem with that in my opinion is that what makes Uber attractive is that it works in hundreds of cities. That’s great for Edmontonians travelling elsewhere, and for visitors to our city too. A local-only app would not benefit from the economies of scale that Uber provides.

There was also a lot of discussion about driver’s licenses and insurance. Most of us have Class 5 licenses, but in order to transport passengers for profit, you need to carry a Class 4 license. You can learn more in the Commercial Drivers Guide PDF. On the topic of insurance, there was some confusion about whether or not Uber’s policy, which only kicks in if a driver’s personal insurance fails to cover an accident, was sufficient. It has not yet been tested in Canada.

Most of the speakers present at the meeting today were from the taxi industry, either drivers or representatives of the brokers. Uber’s sole representative was Chris Schafer, the Public Policy Manager for Uber in Canada. It was a packed house for most of the meeting.

The reports that the motion seeks will include a draft bylaw, so don’t expect them to return to Council until sometime in the fall. In the meantime you can try to take Uber, but know that they are operating illegally.