Ocean City Eyes Ordinance Change Ahead Of Uber’s Possible Market Entry

Ocean City Eyes Ordinance Change Ahead Of Uber’s Possible Market Entry

OCEAN CITY – Local officials dove Monday morning further into how to go about regulating the car service Uber in Ocean City, despite the company’s claim of having no immediate plans in coming to the resort.

Last month the Ocean City Police Commission discussed if and when the car service Uber comes to Ocean City how the town would regulate the company in order to comply with existing taxi laws. The discussion was paired with a presentation of other proposed tweaks to the town of Ocean City’s taxi ordinance titled “Vehicles for Hire.”

Uber, a smart-phone enabled car service, has hit the streets in over 200 cities nationwide as close to Ocean City as Annapolis and Baltimore and in 54 countries. A smart-phone app links a passenger to an Uber driver. The app provides many user-friendly features including fare estimations, paperless transactions and the option to share a fare but since the company’s inception in 2009, Uber has met resistance from local, state and national governments usually backed by a frustrated taxi industry.

City Solicitor Guy Ayres explained to the commission last month, Uber, which has gone unregulated for years, has been dealing with the Maryland Public Service Commission (PSC) in becoming regulated due to frustrations that arose among the Baltimore taxi industry once Uber came to the city.

On Feb. 26, the PSC made an agreement with Uber. The deal applies to Uber’s Maryland subsidiary Drinnen LLC, which is now considered as a common carrier in the state requiring the company to apply for a motor-carrier permit and supply the PSC with a list of its drivers’ names.

According to the PSC, the drivers must have commission-issued operating permits and fully insured commission-inspected vehicles, as well as file a schedule of its times, rates and charges with the commission that include maximum and minimum rates and surge pricing. Those schedules will be posted online.

Also, Senate Bill 868, sponsored by Sen. Bill Ferguson, is before the General Assembly addressing Uber on a state-wide level. It would “authorize the establishment of transportation network services in the State; authorize an individual to submit an application for registration as a transportation network operator; require a transportation network company to conduct, or have a third party conduct, a specified criminal history records check using a specified database and obtain and review a driving record check for each applicant before approving an application.” A public hearing is scheduled on March 24 at 1 p.m.

Following last month’s meeting, Uber representative Kaitlin Durkosh reported to The Dispatch the company currently does not have any immediate plans to expand to Ocean City.

However, on Monday the Police Commission furthered discussion regarding the potential of Uber coming to Ocean City.

Slight modifications to the town’s taxi ordinance are currently in City Solicitor Guy Ayres office to receive formal language changes and will be brought before the Mayor and City Council for approval at an upcoming regular meeting.

“I will have something prepared in the next couple of weeks because we want to incorporate Uber and its operations in it,” City Solicitor Guy Ayres said. “My understanding is the taxi industry is opposed to the Senate Bill as worded because it does not impose upon this type of service [Uber] the state regulations and everything else taxis have to go through, so it does not create a level playing field.”

According to Ayres, despite Uber’s claims in having no immediate plans to conduct business in Ocean City, it’s advertising for independent drivers in town. Sponsored Facebook posts have been seen on local citizen’s newsfeeds in recent months.

Commission Chair Councilman Doug Cymek added Uber has claimed the advertisement is to investigate whether there are interested drivers in this area.

It became clear among the commission members that there is a need to address Uber on a local level in case Uber does bring business to Ocean City prior to a state-wide regulation being passed.

“There is a lot of public support for Uber, and we have all talked about utilizing it and how it can be a good service but at the same time they need to comply with our ordinance to follow the same rules and regulations as the taxis to create a level playing field. If the state supersedes that in the future so be it but Ocean City needs to step in front it by creating an ordinance,” Mayor Rick Meehan said.

Councilman Dennis Dare pointed out many aspects of Uber’s business model counteracts with Ocean City’s taxi ordinance.

There are a total of 175 taxicab medallions in Ocean City — up to 85 percent issued to fleet holders and up to 15 percent issued to independent holders. Currently all medallions are owned by holders and fleets, and are sold between them. Most recently a medallion sold for over $7,000.

The ordinance requires medallion holders to have their vehicles inspected annually, operate by meter, proof of insurance, hold a business license, and drivers must obtain a permit, as well as are subject to background checks and drug tests.

“To make Uber the same as taxis then you might as well not allow Uber because it is not their business model,” Dare said.

Uber’s business model doesn’t make its vehicles any less of a vehicle for hire, Ayres responded.

Meehan asserted Ocean City at least needs to establish what business category Uber would fall under in order to regulate the service locally.

In the end, the commission was in consensus to have Ayres move forward with the changes to the ordinance as initially proposed incorporating Uber into the law. The discussion will continue when the ordinance comes before the full Mayor and City Council in its first and second reading prior to passage.