KC adopts regulations that Uber says will keep it from operating in the city

The UberX ride-booking service said Thursday that new regulations would end its ability to operate in Kansas City.

The company’s statement came after the City Council voted unanimously to approve new rules for these types of high-tech transportation companies.

The regulations are aimed at protecting public safety while accommodating services that use a smartphone app to link passengers with part-time drivers in their own vehicles.

But Uber said the city’s rules, reached after nine months of debate and negotiations, were still unacceptable.

“We’re very disappointed with the city’s decision,” Uber representative Brooke Anderson said in an emailed statement Thursday night. “By trying to squeeze ridesharing into antiquated regulations, the City Council has effectively eliminated a safe and reliable transportation option, making Kansas City one of the few cities left in the nation without Uber.”

But just prior to the council’s vote in favor of the regulations, Mayor Sly James unleashed a diatribe against Uber, scoffing at its complaints that the regulations are too burdensome.

“The idea that we are kicking Uber out, that is so much garbage,” James told a crowd of dozens of Uber drivers. “We have bent over backwards. We have something that they can and should accept.”

James said the city has tried for months to negotiate in good faith with Uber, but he argued the company essentially wanted no regulations. He said that was unacceptable for a city government that has to ensure the drivers and their vehicles don’t put the public at risk.

Andy Hung, Uber’s general manager in Kansas City, rushed down the stairs right after the vote and was not available for comment. But he has said in the past that Uber’s business model depends on many part-time drivers who may work only a few hours each week or on weekends. He said the city’s fees and other bureaucratic demands make it very difficult for that type of workforce, and that Uber takes its own steps to ensure the public is safe.

Uber says it is able to operate successfully in more than 30 cities with minimal regulations, including Austin, Texas; Washington, D.C.; Tulsa, Okla.; Minneapolis; and Chicago. But it has already pulled out of Boise, Idaho; Anchorage, Alaska; and San Antonio.

More than 50 Uber drivers rallied outside City Hall before Thursday’s meeting, and they apparently thought they could still persuade the council to reconsider. After the vote, stunned and disappointed Uber drivers left the meeting.

“I feel like my heart’s just been ripped out,” said Sam Farmer, a Northland resident who said he has been driving for the company for about a month.

Farmer said he has had health issues and hasn’t been able to work his regular job for several months, but Uber gave him the flexible hours and working conditions he desired. He was not sure about the future.

The Uber drivers might have a future with Lyft, which suspended Kansas City operations last October but had hoped to resume soon.

James said he thought Lyft was OK with the new regulations, but in a statement late Thursday, Lyft said simply, “We appreciate the work done by the mayor and City Council. … We are taking a hard look to determine whether or not we can operate in the city under these revised rules.”

The new city law requires adequate insurance and comprehensive background check information from both taxis and ride-booking services. It charges individual drivers $250 (down from $300 under the previous regulation), but if a parent company such as Uber will pay an annual fee of $40,000, that would drop the driver’s vehicle permit cost to $100.

But Uber has also chafed at other requirements that a driver obtain a business license ($12.50), a medical check and a chauffeur’s license. City officials said the chauffeur’s license is a state requirement.

Uber has said in the past that it has provided jobs for more than 500 drivers in Kansas City and has gotten rave reactions from passengers. Company officials said Kansas City was its fastest growing market in the region. Some passengers have testified at council meetings that these smartphone app companies provide a cheaper, more convenient service than traditional cab companies.

Tech-savvy professionals have been emailing the City Council in recent days, urging them to continue negotiating with Uber.

“If ultimately the regulations caused Uber to leave Kansas City, we believe that negative fallout could overshadow Kansas City’s growing reputation as an entrepreneurial, innovative tech hub,” the Technology Council of Greater Kansas City said in a letter to council members.

But James bristled at that notion Thursday.

“There is no thought to slow down the innovative, entrepreneurial spirit of this city, absolutely 100 percent not,” he said.

While the City Council was united Thursday in its vote, the public apparently remains confused and divided on the issue of these new ride-booking services.

A poll earlier this week by Remington Research Group in the Kansas City metro area shows 43 percent of residents believe Uber and Lyft should follow the same regulations as regular taxi companies, while 32 percent said they shouldn’t have to and 26 percent were undecided.

In addition, 39 percent of residents said governments should make concessions to ride-booking companies to help them continue operating in the area, while 32 percent said concessions should not be made and 29 percent were undecided.

This story was originally published April 9, 2015 at 7:19 PM with the headline "KC adopts regulations that Uber says will keep it from operating in the city."