Ride-sharing service Uber may soon be a legal operation in Anchorage. The Anchorage Assembly appears poised to pass an ordinance Tuesday night that will temporarily exempt Uber from local taxi codes and direct the city and Uber to enter into an as-yet-unwritten memorandum of understanding.
That is, if the Assembly can get through what is expected to be a long period of public comment on the ride-sharing service and other controversial issues like proposed changes to towing regulations. If the ordinance is passed, Uber -- currently under a judge's order to offer only free rides in Anchorage -- would be allowed to begin charging its local customers.
Uber's Anchorage rollout has been a bumpy one. After beginning operations Sept. 18 and briefly charging Anchorage customers -- for a period of about 16 hours -- Uber has been sent two cease-and-desist letters from the municipality, and a local judge issued a temporary restraining order that barred the company from charging for rides in Anchorage until city codes were changed.
The Anchorage transportation inspector's office and the municipal Department of Law believe Uber should be subject to the rules governing local taxicabs. Those rules cover everything from permit and license availability to driver background checks and vehicle maintenance requirements.
Uber has claimed that most taxi codes and rules are obsolete and do not fit its business model. Uber claims it is not a cab company but a technology service provider, offering riders and drivers a smartphone app that allows them to schedule rides between each other.
Drivers operate their own cars, and Uber takes 20 percent of all fares as a "technology fee."
The ordinance addressing Uber operations in Anchorage, proposed by Assembly members Dick Traini and Amy Demboski, would allow the company's drivers to pick up fares without having to comply with city transportation codes, but only for a limited time. It would not take effect until the memorandum of understanding has been approved by the city's law and transportation inspection departments, as well as the Assembly -- a process that could take weeks.
"It is not, like some in the taxi industry would have you believe, going to go into effect right after passage," Traini said.
Municipal Attorney Dennis Wheeler agreed, adding that negotiations about what, if any, restrictions might be placed on Uber during the trial period can't begin until after the Assembly passes Traini and Demboski's ordinance.
"It's pretty tough to negotiate when you don't know what those conditions may be," Wheeler said.
With local taxi permits selling for more than $100,000 in some cases, and fears from local permit owners of unfair, unregulated competition, Uber's plans have drawn the ire of Anchorage's cab and limousine companies.
It's a fight that has already played out in hundreds of cities across the U.S. and continues to be fought in places like Austin, Texas, Philadelphia and now in Anchorage. In almost every case, Uber eventually received permission, at least temporarily, to operate outside most city or state taxi regulations.
Assembly member Bill Evans, who chaired the ad hoc transportation committee looking into the Uber issue, has his own ordinance up for discussion on Tuesday. Evans' ordinance would lay out specific rules and regulations for Uber and all other ride-sharing services, also called Transportation Network Companies, although Evans said it would probably be tabled, pending the outcome of Traini and Demboski's ordinance.
Characterizing his support for the other ordinance as "tepid," Evans said that some of the claims being made by the cab industry about the effects of ride sharing on local transportation companies are overblown, though he expects the memorandum of understanding to include some assurances for cab companies.
Still, Evans said Uber should have a place in the Anchorage area -- especially in historically underserved areas like Eagle River and Girdwood.
"Something has to be done to start the process to allow organizations like Uber to operate," Evans said. "It's not the way I would have done it, but what's going to matter most is what happens after this, what's in the MOU."
But Traini, Wheeler and Evans agree on one important limitation of the ordinance: other ride-sharing services like Lyft and Sidecar that have yet to break into the Alaska market would need to sign their own memoranda of understanding with the city before they could begin Anchorage operations.