Questions and concerns remain as City Council moves to regulate ridesharing services, further regulate taxis

Uber, Lyft and taxis
Iowa City officials disagree with companies like Uber regarding what rules should be applied to ridesharing services. — illustration by Jared Jewell

Iowa City officials are updating their taxicab regulations, and the new rules could shut industry newcomers out of the market.

The Iowa City Council voted at its Feb. 9 meeting to change the rules governing local taxis, a move spurred in part by the emergence of app-based ride-sharing services like Uber and Lyft. Those companies have been successful in larger markets and are now aiming to enter mid-size communities like Iowa City.

Indeed, the council voted 7-0 to amend its existing taxi ordinance to allow for the regulation of shared ride services like Uber and Lyft. The updated ordinance also requires that the city issue ID cards to taxi drivers; eliminates the exception for taxi companies to dispatch from a location other than their office between midnight and 6 a.m.; requires taxi companies to adopt a color scheme; and calls upon the city to revise the definition of “destination rates.”

Though the concept of web-based ridesharing isn’t new, Uber and other companies have started doing it on a larger scale, using smartphone apps to arrange rides from independent drivers.

With the popularity of the new technology, a handful of horror stories have come to light across the country: According to news reports, a Chicago woman sued Uber last year after she said one of the drivers in their network made sexual advances and then groped her when she refused; another Uber driver in California struck and killed a child, though he apparently wasn’t on an Uber assignment when it happened, giving rise to questions over the company’s liability; and an operator for Lyft, a similar network service, allegedly punched a California bystander who was trying to take a picture of the driver’s shoddy parking job.

The companies usually respond to incidents by suspending the alleged bad drivers and releasing statements about their commitment to safety. Last spring, Uber went a step further and started charging network riders a $1 “Safe Rides Fee” on each ride. All those dollars apparently help cover the cost of background checks and screenings, as well as the “future development of safety features in this app, and more.”

“From the beginning, we’ve always been committed to connecting you with the safest rides on the road. … The whole Uber team is committed to continue innovating, refining and working diligently to ensure Uber is always the safest experience on the road,” the company wrote on its blog when it announced the “Safe Rides Fee.”

It’s not as though traditional cab companies have squeaky-clean records, either. The dangers of taxis earned attention here in Iowa City last year when a local woman said she was sexually assaulted by a cab driver.

Investigators found companies didn’t have sufficient records of who was driving their vehicles. An arrest was eventually made, but Iowa City Police Chief Sam Hargadine wrote in a city memo that his staff spent more than 200 hours tracking down possible drivers, “allowing the suspect to elude police and potentially continue to commit such crimes.”

“The ability to gather accurate information in an efficient manner is important in bringing criminal investigations to a timely conclusion,” Hargadine wrote. “In addition to identifying suspects and determining applicable charges, suspects and companies can also be cleared of involvement much sooner when useful information is available.”

Late last year, in response to the assaults, city staff proposed new taxicab regulations aimed at both reigning in existing companies and preparing for the arrival of services like Uber and Lyft. Administrators laid out five goals for their regulations: Police need to be able to track drivers; consumers must be able to identify taxis; the vehicles need to be safe; the operators need to be good drivers; and the fares must be fair.

The city differentiates “metered,” or traditional taxicabs, from “network”  taxicabs, like Uber and Lyft, but says the same rules should apply to each, “with limited exceptions.” Regulators say efforts like Iowa City’s are an honest try to protect consumers, but critics say the rules are a barrier that protects existing taxi companies.


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Before the council approved the new rules this month, Uber representatives argued to the city that the company has “unprecedented accountability and transparency,” and that rather than being a risk, Uber is a boon to communities—an entrepreneurship opportunity for drivers and an easy and accessible service for riders. Uber also says that it has led to fewer drunk drivers on the road: The company’s metrics show drunken driving arrests decreased by more than 10 percent in at least one city where the service is in place.

Uber officials say their model is different from traditional taxis, so the rules should be different. Instead of a uniform code for metered and network taxis, Uber has suggested that Iowa City establish a separate—and less strict—permitting scheme for its drivers, instead of trying to “squeeze ride-sharing” into taxi regulations.

But for now, the new regulations are taking hold, a relief for established cab companies who have encouraged the city to hold newcomers like Uber to the same standards.

“A taxicab company that dispatches via web-based technology nevertheless conducts taxicab business; whether or not a company uses this technology or not, passengers are still being driven from Point A to Point B for profit,” Yellow Cab manager Roger Bradley told council members in a letter in December. “We would like to see the proposed ordinance ensure that all taxicab companies and drivers are subjected to the same requirement to ensure safe and responsible service for all companies involved.”

This article was originally published in Little Village issue 171

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