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Messages from the President

Paving the Way for Expanded Car Service

By: Anna Tanski | January 16, 2017


While recovering from foot surgery last fall I gained a deeper appreciation for the passenger seat thanks to the kindness of co-workers, colleagues and family who shuttled me between doctor appointments, business meetings and running errands. It's humbling to impose on others while trying to spread the burden of "Driving Miss Daisy" from point A to point B. I nicknamed co-worker Bob Gustafson "Uber Bob" because I relied heavily on his generous door to door service. Ironically, it was during this same timeframe Duluth City Councilor Noah Hobbs reached out to discuss the proposed ordinance allowing Transportation Network Companies (TNC) such as Uber and Lyft to operate in Duluth.

TNC's connect paying passengers with drivers who utilize their personal vehicles for this service. All parties connect through a website or mobile app with the entire transaction conducted electronically from booking to payment. The platform uses location services to pinpoint the pick up and drop off points, which calculates the fare to the passenger who approves it. Payment is then processed, typically by credit card, and the passenger receives a driver profile including name, vehicle description and real-time tracking.

Ride sharing is available in more than 500 cities and has been operating in the Twin Cities since 2014. With more than two thirds of Duluth's visitor base originating from that market, there is an expectation this service is available in our community. However, just as the city grappled with regulating home sharing versus traditional lodging, Duluth is facing a similar issue with TNC's versus traditional taxi service.

Taxi companies vary in the size of operation, but own their vehicle fleet and operate under an existing ordinance which requires inspections, insurance and permitting. Drivers are actual employees of the company. Unlike major metropolitan cities where cabs are hailed, in Duluth companies are typically called for pick up which can result in longer wait times than the TNC's electronic method.

TNC's also enforce "surge" rates during high demand periods such as rush hour, bar close and around major sporting events and concerts. Taxi's currently do not have this same flexibility in rate structure. TNC's require vehicles to be less than 10 years old, which is not mandatory for taxi's. These are several key issues which need to be addressed in the ordinance to create a fair and equitable policy.

Personally, I've had positive and less than stellar experiences using both modes of transportation. From the experienced cabbie who knew my route by heart to a TNC driver who got a bit turned around after relying on the navigation system's suggested route. Immaculate vehicles maintained with pride and smelly junkers ready to fall apart after the next pothole. Pros and cons equally present themselves.

There’s a reason the shared economy is classified as a disruptor, because it tends to shake up traditional business models and impact existing business. On the flip side, it provides new employment opportunities offering flexible hours for seniors looking to supplement retirement, college students working around class schedules or additional income for those trying to make ends meet.

Ultimately, it’s the consumer who wins when new competition enters the market. There’s room for TNC’s and taxi service to co-exist in Duluth, and hopefully the outcome will result in higher standards for customer service, better vehicles on the road while providing a much needed service to visitors and residents alike. I highly recommend Uber Bob!