Legislature(2017 - 2018)CAPITOL 106
03/18/2017 12:30 PM House LABOR & COMMERCE
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| Audio | Topic |
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| Start | |
| HB132 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 132 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
March 18, 2017
12:32 p.m.
MEMBERS PRESENT
Representative Sam Kito, Chair
Representative Adam Wool, Vice Chair
Representative Andy Josephson
Representative Louise Stutes
Representative Chris Birch
Representative Gary Knopp
Representative Colleen Sullivan-Leonard
MEMBERS ABSENT
Representative Mike Chenault (alternate)
Representative Bryce Edgmon (alternate)
COMMITTEE CALENDAR
HOUSE BILL NO. 132
"An Act relating to transportation network companies and
transportation network company drivers."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 132
SHORT TITLE: TRANSPORTATION NETWORK COMPANIES
SPONSOR(s): REPRESENTATIVE(s) WOOL
02/15/17 (H) READ THE FIRST TIME - REFERRALS
02/15/17 (H) TRA, L&C
02/23/17 (H) TRA AT 1:30 PM BARNES 124
02/23/17 (H) <Bill Hearing Canceled>
02/28/17 (H) TRA AT 1:30 PM BARNES 124
02/28/17 (H) Heard & Held
02/28/17 (H) MINUTE(TRA)
03/02/17 (H) TRA AT 1:30 PM BARNES 124
03/02/17 (H) Heard & Held
03/02/17 (H) MINUTE(TRA)
03/06/17 (H) L&C AT 3:15 PM BARNES 124
03/06/17 (H) Scheduled but Not Heard
03/07/17 (H) TRA AT 1:30 PM BARNES 124
03/07/17 (H) Moved CSHB 132(TRA) Out of Committee
03/07/17 (H) MINUTE(TRA)
03/08/17 (H) TRA RPT CS(TRA) 1DP 4NR 2AM
03/08/17 (H) DP: WOOL
03/08/17 (H) NR: SULLIVAN-LEONARD, NEUMAN, DRUMMOND,
STUTES
03/08/17 (H) AM: CLAMAN, KOPP
03/10/17 (H) L&C AT 3:15 PM BARNES 124
03/10/17 (H) Heard & Held
03/10/17 (H) MINUTE(L&C)
03/17/17 (H) L&C AT 3:15 PM CAPITOL 106
03/17/17 (H) Heard & Held
03/17/17 (H) MINUTE(L&C)
03/18/17 (H) L&C AT 12:30 AM CAPITOL 106
WITNESS REGISTER
SAM MOORE
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
ERICA SIMPSON
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
ZAC BOLES, Owner
Southeast Alaska Sourdough Cab
Ketchikan, Alaska
POSITION STATEMENT: During the hearing of HB 132, discussed
local control.
ROSS BIELING
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
testimony.
BARBARA HUFF TUCKNESS
Executive Director/Legislative Liaison
Teamsters Local 959
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
concern.
SUZIE SMITH
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
opposition to the legislation.
RAFAEL BARBOSA
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
opposition to the legislation.
GEORGE RENDON
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, testified.
PAT FALON
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
concern for the legislation.
AGNES KALLMAN
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, testified as
an Anchorage taxi cab driver.
JAMES HARRIS, Owner
Juneau Taxi
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
opposition to the legislation.
KATHIE WASSERMAN, Executive Director
Alaska Municipal League
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
opposition to the legislation.
TOR WALLAN
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
DENNIS HARRIS, Owner
Custom Juneau Tours
Juneau, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for local control.
LINDA DURR
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
MITCHELL MATTHEWS, Representative
Uber Technologies
Seattle, Washington
POSITION STATEMENT: During the hearing of HB 132, offered
testimony and answered questions.
STEVE WACKOWSKI
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
SHAVONNA RIVERS
Seattle, Washington
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
MARICE BROWN
Seattle, Washington
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
ADELE TARIL
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
JEREMY PRICE, Alaska State Director
Americans for Prosperity
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
LEILANI INMAN
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
support for the legislation.
ANNABEL CHANG, Director of Public Policy
Lyft
San Francisco, California
POSITION STATEMENT: During the hearing of HB 132, offered
testimony and answered questions.
JIM BRENAN, Attorney
Anchorage Taxi Cab Permit Owners Association (ATCPOA)
Anchorage, Alaska
POSITION STATEMENT: During the hearing of HB 132, offered
opposition to the legislation.
ACTION NARRATIVE
12:32:26 PM
CHAIR SAM KITO called the House Labor and Commerce Standing
Committee meeting back to order at 12:32 p.m. (recessed from
3/17/17). Representatives Kito, Knopp, Sullivan-Leonard,
Stutes, Josephson, Wool, and Birch were present at the call back
to order.
HB 132-TRANSPORTATION NETWORK COMPANIES
12:32:35 PM
CHAIR KITO announced that the only order of business would be
HOUSE BILL NO. 132, "An Act relating to transportation network
companies and transportation network company drivers."
12:34:47 PM
SAM MOORE advised that he has lived in Alaska for a few years,
is representing himself, and he was born legally blind and has
never legally operated a motor vehicle. Earlier this week,
while walking to an Anchorage Community Council meeting along a
poorly maintained state road, he said he came to the conclusion
that he needed to attend this meeting in person to speak in
favor of this piece of legislation. He related that he
considered the price of an airplane ticket as a prudent
investment in his potential safety and overall quality of life
because transportation network companies (TNCs) help friction in
the marketplace by making it easier to match potential riders
with potential drivers. The TNCs also provide economic
opportunities for both parties by making basic human transport
easier while freeing up what would otherwise be idle capital
assets, and yet many of the concerns of these companies revolve
around the "quote/unquote fairness of competition." Taxi
companies around the country have enjoyed government-protected
monopolies for decades, thereby shunning innovation and customer
service in the process. He stated that the typical last-ditch
argument of unnecessary government protectionism is always
public safety, and he asked, in the name of public safety to
"please protect me, the consumer" from these unnecessary
barriers to competition. He asked the committee to protect him
from the Anchorage taxi cartels, and the assembly that protects
them, and to protect the Juneau residents from an unreasonable
supply ceiling, and the City and Borough of Juneau Assembly that
keeps it firmly in place. Mr. Moore then asked the committee to
empower Alaskans to find economic safety and the opportunities
TNCs create, and to not protect him from the marketplace. He
related that he has found himself waiting an hour for a taxi cab
just trying to get groceries to his home, and that he lives his
life constrained by a bus schedule and the whims of a
dysfunctional taxi system which is an affront to his
independence and freedom as an Alaskan and human being. He
urged the committee to pass HB 132 out of committee with the
statewide regulatory framework that protects him from the
meddling of taxi cartels and locally elected assemblies.
12:37:44 PM
ERICA SIMPSON said she is a life-long Alaskan, resident of
Juneau, and is testifying on her own behalf. She offered
support for HB 132 as she is a proponent of ridesharing and
transportation network applications, and uses Uber and Lyft
almost daily whenever traveling out-of-town due to its
convenience, affordability, and efficiency. She related that
the majority of Uber and Lyft drivers are normal people looking
for ways to live comfortably and fill a need in a place where
there is a demand. Alaska, and in particular Juneau, is one of
the most expensive places in the country to live and she asked
the committee to not withhold an opportunity from anyone who
could benefit from a supplemental income. Opportunities in
Alaska have not been on the rise nor has its population. Alaska
is behind the times and there has not been a "smidge of
anything" that drives people to want to move here and try to
make a life here in quite some time. As an advocate of this
bill, people working seasonally have advised her that if this
bill passes at least they might be able to pay their rent next
winter rather than leaving town because they want to live and
spend time and money in Juneau. She stressed that,
specifically, the taxi companies in Juneau have irrelevant
arguments because economic impact statements and transportation
studies show that taxis suffer slightly from the addition of
rideshare applications in only the "on-demand service," as their
scheduled rides and street hails stay the same overall. In
Juneau, taxis make a large percentage of their income giving
tours in the summer so the impact on Juneau cabs would be so
insignificant it is not worth consideration. Approximately 50
percent more people would utilize rideshare applications on top
of those who already use taxis would mean an increase of patrons
to local businesses and restaurants because ridership increases
overall. Taxi companies will be able to increase their level of
customer service and everyone can have a ride when and where
they desire. She described it as a long overdue positive impact
on the business community and its citizens.
12:40:48 PM
ZAC BOLES, Owner, Southeast Alaska Sourdough Cab, expressed that
his argument against HB 132 is not that TNCs cannot come in and
do business because everyone wants to promote economic growth.
Except, he offered, Uber was caught with a software system
called "Greyball" which is built into the app to detect police
officers, regulators, and city officials that are against Uber,
its regulations, or its business practices. The New York Times
"has done many articles on it and other companies -- other
municipalities and states have started digging into this and
creating investigations to find out how this program has been
used." He explained that Greyball reviews information on a
person's phone and if it believes the person is "quote/unquote,
out to get Uber" or is a regulator or police officer, it stores
that information in Uber's system and a portion of the app sends
them a fake car or if there are close cars in a person's area,
it cancels the ride. Articles have stated that "they geofence
certain municipal places" like police stations, capitol
buildings, and public offices where it believes these people are
"messing with them to catch them in the act." He related that
it is important to know that currently, Portland has an
"investigation going 30 days," the San Francisco District
Attorney's Office "is in this, looking at it in their own home
town." Albany, New York is investigating as Uber is trying to
move out of New York City and move into upper state New York.
The State of New York has similar legislation as HB 132 and the
legislature has pulled it off the table until the end result of
this investigation in order to determine whether Greyball
software had been used in New York City and, he offered, Boston
is fighting this with an ongoing investigation. He explained
that Greyball has also been used in other places around the
world, such as Australia, China, and South Korea, therefore, it
is important to have local regulations on this situation.
12:44:33 PM
REPRESENTATIVE STUTES asked what the purpose of Greyball is.
MR. BOLES explained that the software detects regulators. He
said, "When they're picking up flags, taking phone calls, it's
so that the governments or municipalities or states that don't
want them because they don't believe in their business service."
Uber can blackball those people to stop them from catching Uber
doing anything illegal. The intent is to defraud regulators, he
explained.
12:45:13 PM
REPRESENTATIVE BIRCH asked, as a taxi cab owner, what sort of
discretion is permitted when deciding whether to pick up a fare.
MR. BOLES responded that he does reserved the right to decide
not to pick up a fare, but within the Ketchikan Municipal Code
there must be a valid and legitimate reason. The code also
requires that Ketchikan operators deal with a telephone call
customer first before picking up flags and cell phone calls.
REPRESENTATIVE BIRCH inquired as to whether the discretion is
left up to the taxi cab driver or the dispatcher.
MR. BOLES replied that the control is left up to the drivers,
and in the event a female driver believes a male customer has
been too aggressive with her, she has the right to pass off the
ride. In those situations, he said, the dispatcher sends the
next available car in line so the customer still receives
service.
12:47:06 PM
REPRESENTATIVE BIRCH asked whether there is a record of those
events.
MR. BOLES answered that his company does not keep those records,
it is all based upon driver discretion.
12:47:19 PM
REPRESENTATIVE JOSEPHSON referred to Greyballing, and opined
that this is not "some black helicopter theory" in that Uber has
acknowledged it was using this software.
MR. BOLES agreed, and he said it was used in Las Vegas as far
back as 2014.
12:47:56 PM
REPRESENTATIVE WOOL confirmed that The New York Times article
read that Greyballing did occur in cities exercising local
municipal control. He explained that HB 132 is statewide
legislation and it is for all transportation network companies
(TNCs). He asked whether Mr. Boles pays the insurance in his
taxi business, or the individual drivers.
MR. BOLES answered that his drivers are subcontractors on a
leased car system, and part of the lease money the drivers pay
him on their flat rate, pays the insurance.
REPRESENTATIVE WOOL surmised that the insurance policy is under
the company's name and not the individual driver's name.
MR. BOLES agreed, and he said the drivers submit a driving
record and are then added to that policy.
REPRESENTATIVE WOOL surmised that when leasing a car on a flat
rate, if the driver does not make enough money on a particular
night to cover the lease, he still has to pay it and would incur
a net loss for his shift.
MR. BOLES said that Representative Wool was potentially correct.
REPRESENTATIVE WOOL asked whether his company provides as
follows: guaranteed minimum wage, workers' compensation,
overtime pay, sick time, or vacation time.
MR. BOLES responded, "No."
12:49:29 PM
REPRESENTATIVE KNOPP asked whether the reason for the complaints
about taxi cab business is that when a person needs a taxi cab,
that Mr. Boles's company is not large enough to provide the
services during the busy time of year so people wait longer than
they would like, and are not able to book a taxi cab ride on
their smart phones.
MR. BOLES responded that taxi cabs offer valuable services and
many taxi cab companies have apps to book fares, and people
could call and have cars available as needed, but he could not
speak for other companies. He pointed out that there are three
taxi cab companies in Ketchikan with 22 taxi cab permits between
all three companies, and wait time is no longer than ten minutes
except in an extreme circumstance due to weather. He began
keeping track of rides at the beginning of the middle of the
second quarter of last year in Ketchikan, and he offered that
"we've operated over 75,000 cab rides" in a 38-mile long town
from end to end.
12:51:26 PM
REPRESENTATIVE KNOPP commented that because his drivers contract
to pay him $100 per day per car, for instance, and they may lose
money at the end of the day that he would think the drivers
would be eager to take a fare.
MR. BOLES said Representative Knopp was absolutely correct,
drivers are aggressive in getting to rides, but not in a harmful
manner. The drivers work hard, he described, and they want to
work that car, make a living, and it is in the best interest of
the taxi cab "game" to get to the customer. He said they are
like one big happy family between taxi cab operators and
drivers.
12:52:09 PM
REPRESENTATIVE KNOPP commented that he was unfamiliar with
Juneau's economy, and asked whether it has a public transport
system, and whether his company is compensated for public
transit.
MR. BOLES related that he was unsure as to Juneau, but Ketchikan
does have public transit, and taxi cab operators are not
subsidized in any manner by public transit.
12:52:45 PM
REPRESENTATIVE JOSEPHSON asked what amount of money a Ketchikan
driver would personally invest in the business, assuming they
operated a leased car.
MR. BOLES advised that the only investment a taxi cab driver
must make in order to jump into a cab and lease a vehicle is the
cost of their license, $80 as a rule, and having some money on
hand to make change and a square credit card reader. Mr. Boles
advised that according to the lease agreement, from the money
the driver pays him, he pays insurance, vehicle maintenance,
upkeep, stickers, and advertising.
REPRESENTATIVE JOSEPHSON asked the amount of money one of his
drivers might gross in one year because they have to pay their
own taxes through a Form 1099.
MR. BOLES said that it was difficult to guess because newer
drivers will make a little less until they are established and
people start to call them and build up "personal calls." He
related that he has an 84-year old female driver that has been
driving for 40 years, is extremely popular and does very well.
This driver can clear, after lease, anywhere between $150-$250
per shift seasonally, and that the days driving during the week
make a difference. A driver can make a comfortable living in
Ketchikan because they receive approximately $3.30 per mile,
which stimulates the economy to help pay the lease, rent,
personal vehicles, groceries, and so forth.
12:55:32 PM
REPRESENTATIVE JOSEPHSON referred to the ostensible similarity
in status and asked how he distinguishes between his independent
contractors and the fact that no workers' compensation is paid
for them relative to these Uber drivers. Representative
Josephson further asked whether there was a separation in his
mind.
MR. BOLES stated there is a separation because taxi cab drivers
sign lease agreements stating they are separate, wherein the
drivers deal with all of the money and then pay their expenses,
and the choice is fully upon the driver how they handle their
expenses. The difference in how taxi cab drivers and Uber and
Lyft drivers operate is that the money goes through the
companies first and then comes back to the driver. When
discussing the issue of who handles the money, he noted that it
almost seems like an employer/employee relationship on for TNCs
because all of the money is funneled through the company before
coming back to the driver, almost in the sense of a paycheck
with their commission being removed.
12:57:55 PM
ROSS BIELING said he represents himself with no affiliation to a
third party. He pointed out that the IRS has a 20-question test
as to whether or not [TNCs] or taxi cab companies are
independent contractors or employees, and the state should not
insert itself in that decision-making process. He suggested
looking into standards requiring that the vehicles are entirely
checked over annually. He described that it should be an open
free-market enterprise even though the taxi cab companies do not
want competition, and the committee should rely on his testimony
for clearer guidance.
1:00:05 PM
BARBARA HUFF TUCKNESS, Executive Director/Legislative Liaison,
Teamsters Local 959, said she represents Teamsters Local 959,
and wants to make it clear that she is not testifying against
TNCs coming into the state because her concern is with the
drivers. There are over 400,000 drivers in this country
involved in lawsuits and she suggested that the legislators take
a close look at what is being contemplated in this legislation.
Local 959 believes that HB 132 should provide a special carveout
for existing worker classification law for transportation
network companies (TNCs) as the bill would instead impose
minimum requirements in order for TNCs to treat their drivers as
independent contractors. If passed, it would create an unfair
double-standard for classifying transportation workers. This
union represents transportation workers in this state who have
been using technological devices for years, for example, UPS
drivers. Under this bill TNCs drivers will be exempted from
existing state law for worker classification and would instead
be classified as independent contractors. In the event only the
minimal requirements are met, the TNC would not set the driver's
hours, prohibit drivers from using other TNC networks, limit the
driver's territory, or restrict the drivers' activities, and the
company and driver must agree to this in writing. Essentially,
she said, this bill establishes a new bright line for a
definition. She opined that an Uber driver's testimony
yesterday, disclosed that drivers all want to be independent
contractors because their hours are their only flexibility, and
the companies control everything else. She advised the
committee that a lawsuit was settled yesterday with $24 million
going to thousands of Lyft drivers. She said that the union is
asking the committee to take the time and make an effort to
protect not only these drivers, but other drivers who aren't
represented. Alaska is different and does not operate like
everybody else in the Lower-48.
1:03:40 PM
SUZIE SMITH said she is a taxi cab operator in Anchorage and
opposes the legislation because the state should not involved
with the regulation of transportation needs, but rather leave it
with the municipalities, and that TNCs should receive no special
treatment. Cities have rules and regulations to ensure safety
and consumer protection, yet this bill will create unfair
competition and subject the state to equal protection claims.
Special laws cannot be enacted for businesses that do the same
thing as a taxi cab company even though TNCs will claim they are
nothing more than a technology network company. Technology
Network Companies (TNCs) say they are different from a taxi cab
company except when it comes to their damage. For example, she
said, they are now seeking to get their driver recognized as a
self-employed operator, now they want to say their drivers do
the same thing as a taxi driver so they can avoid basic business
laws, such as workers' compensation. The TNCs hold the money
and issue payment to the driver, and are responsible for
evaluating drivers' performance and firing at will if the
drivers do not hold up to their standards, she said, "it sounds
like employer/employee status." This bill originally had a
fiscal note of $280,000 attached to it, so somewhere the
lobbyists must have been quite persuasive. The original fiscal
note, she opined, was underestimated - Anchorage transportation
budget has a yearly budget of nearly one-half million dollars to
regulate taxis, for hire [vehicles], and limousines. She asked
how the state plans to regulate TNC vehicles statewide with no
fiscal note attached, "for the benefit of an out of state
company where 25 percent of every ride leaves the state with no
financial benefit to our state?" She offered concern that under
HB 132, "they will be just running amuck" with basically no
oversight.
1:06:39 PM
REPRESENTATIVE WOOL noted she was a taxi cab driver in Anchorage
and asked whether she was covered by workers' compensation
insurance.
MS. SMITH responded that she is a taxi cab operator in Anchorage
and said, "I run a permit, I do not drive," and her drivers do
not have workers' compensation insurance.
CHAIR KITO advised, for the record, that all members of the
committee have been present since the beginning of the hearing.
1:07:15 PM
RAFAEL BARBOSA said he has been a taxi cab owner/operator in
Anchorage for 33 years, and encouraged the committee to not
allow Uber into the state unless it was willing to follow the
rules. He expressed that TNCs come in with nothing but a bunch
of lies and once they are in, they do whatever they want and it
needs to be changed because it will put the people in Anchorage
"in a bad situation."
1:09:07 PM
GEORGE RENDON said he is a former owner of a taxi dispatch
company for the last 30 years and he is in favor of [taxi cab]
drivers and operators, and almost 80 percent of the drivers who
do not want Uber to come into this town. He said that he has
noticed crime growing in Anchorage and he knows what is going on
to increase crime in Anchorage. He said, "I think here to
represent most the drivers have (coughing) and (audio
difficulties) stop who is coming to this town." (Audio
difficulties) come to town and destroy the business so that
[taxi cab] drivers do not make enough money to support their
families and turn to welfare for help with food and rent. He
said it is upsetting to see how that business destroys over 500
families trying to make a living.
1:11:36 PM
PAT FALON said she represents herself, and commented that if
Uber comes back to Alaska, it should be required to follow the
same rules as other like-businesses with employees. Uber wants
its own rules and the ability to misclassify its drivers as
independent contractors and not pay workers' compensation
insurance or overtime. Uber misrepresents itself, she stated,
it is unfriendly to its employees, it requires drivers to drive
new vehicles and then cuts their income so the driver cannot
afford the payments on the vehicle and they must file for
bankruptcy in the process. Uber has the Koch Brothers and
Americans for Prosperity supporting this bill and she asked the
committee to slow this issue down and take a good look at Uber.
1:13:29 PM
AGNES KALLMAN said she represents herself and is an Anchorage
taxi cab driver. She disagreed that there is a monopoly and no
competition because many families, permit owners, and drivers
receive their income from this [industry]. She described that
she is an independent contractor and pays tens of thousands of
dollars for her lease each year to a local owner, which
stimulates the economy in Anchorage.
1:15:50 PM
JAMES HARRIS, Owner, Juneau Taxi, James Harris, Owner, commented
that this type of legislation is "being pushed" all over the
country with Uber and Lyft currently allowed in hundreds and
hundreds of cities with similar state legislation "which would
undercut all of the rules they already have." Subsequent to the
voters in Austin, Texas voting for stricter background checks
for Uber drivers, Uber left Austin, Texas. He related that,
"Now they are putting this same type of legislation through to
try to come back without those rules." He remarked that these
transportation network companies (TNCs) have spent millions upon
millions of dollars throughout the country for lobbyists to push
this type of legislation. He said there is not a monopoly in
Anchorage or Juneau, this [legislation] is TNCs pushing their
agenda to make taxi cab companies look bad, and surmised that
this legislation could "pass quite easily" except the holdup of
local regulation.
1:18:26 PM
KATHIE WASSERMAN, Executive Director, Alaska Municipal League,
advised that the Alaska Municipal League has no issue with TNCs
because it likes fair competition, although unfair competition
is not cared for especially when that unfair competition is
pushed by government. This issue is not about these specific
companies, this is about the legislature attempting to erode
local control. The Constitution of the State of Alaska, Article
X, provides for "maximum, local, self-government," and the
Alaska Municipal League is opposed to this legislation.
Currently, municipalities do regulate, except they do not simply
regulate the individual vehicles for taxi cabs, shuttles,
limousines, and buses, they regulate the system. For example,
she pointed out, when 10,000 people unload from cruise ships in
Ketchikan for one day, for instance, tour buses, taxi cabs,
pedi-cabs, limousines, and shuttle buses from the hotels are
available, and "you have to be able to regulate that system."
Except, she expressed, when 15-20 new cars suddenly show up from
some business of which the municipality is not allowed to deal
with, "the entire system goes up;" this [system] is for safety
and local municipalities need the ability to regulate. Unclear
in the bill, she related, is what regulation means and whether
it includes taxes because it appears that regulation includes
sales tax, and municipalities would not be able to charge a
sales tax to these companies. Yet, she remarked, these cars are
using city roads and streets and receive police protection, and
if the city cannot tax them, they would receive these services
for free and the cost "eventually goes onto other people."
1:21:19 PM
TOR WALLAN advised he was raised in Juneau, and is testifying as
a private citizen. He said he has spent a lot of time traveling
for work in various cruise ports with high demand for
transportation options and appreciates Uber and Lyft as a
transportation choice. In his experience in the cruise
industry, the more transportation options the better because
free enterprise and competition encourages all parties to
enhance their business model. He related that Seattle taxi cab
services offer their own app for services which has proven
beneficial to them, and they still flourish in locations where
ridesharing is an option. It is important, he said, to consider
that taxi cab services will continue to cater to specific
demographics that do not embrace new technology and find it more
comfortable to call or hail a taxi cab. He explained that his
support for this bill should not be interpreted as a position
against taxi cabs, he simply believes that new independent
businesses should be welcomed in this state rather than holding
them back. He advised that he has spoken with taxi cab drivers
who have transitioned into Lyft drivers and they are happier
because they can better manage their own schedule with flexible
hours, more money, and eliminated the money transaction factor,
which often caused issues for debate when they drove a taxi cab.
1:23:37 PM
DENNIS HARRIS, Owner, Custom Juneau Tours, said that he drove a
taxi cab in Juneau for 10 years, is the process of obtaining a
limousine license, and favors local regulation. The insurance
levels in HB 132 are too low because he carries $1 million of
commercial coverage at a cost of $3,500 per year for a taxi cab,
and will cost $6,500 for a limousine he intends to purchase. He
advised that commercial insurance must be required for anyone
carrying passengers for hire, and must be set at a level higher
than stated in the legislation, and local municipalities must be
able to collect sales tax and permit fees. The permit fees at
the Juneau airport finance the operation of the taxi waiting
zone at the airport, paving, striping, and maintenance, which is
the same at the docks, wherein a permit fee is charged for
people picking up passengers, and the city collects a sales tax
from the drivers. He said that he averaged approximately
$70,000 per year on the meter, which meant the city collected
$3,500 per year off of his taxi cab when he was driving. In
Juneau, with approximately 60 taxi cabs on the street, the city
needs that money to help finance the operation of Juneau with
five cruise ships a day. He pointed out that with 60 taxi cabs
and all of the buses, [the system] will not work without local
regulation. Uber prices its fares at 40 percent of its costs
currently because it has $70 billion in venture capital and will
do that until it ruins the taxi cab business all over the
country. He remarked that after that, because it is not
regulated, Uber's fares will "go up just like they do when they
do the man pricing when it's busy."
1:27:17 PM
LINDA DURR advised she has been a resident of Alaska over 40-
years, is a retired "snowbird," and has experienced Uber and
Lyft ridesharing services when outside of Alaska. She offered
that from a consumer's point of view, previously it was
difficult to hire a cab in the residential areas of Clark
County, Nevada, and when Lyft entered the market it was an
absolute "Godsend" for disabled people and residents. She
described that it is more affordable for people to use on a
regular basis than a taxi cab, and expressed her support for the
legislation.
1:30:29 PM
MITCHELL MATTHEWS, Representative, Uber Technologies, advised he
represents Uber Technologies, and that 20,000 Alaskans
downloaded the Uber app in 2016, and over 60,000 individuals
opened the app looking to connect with a ride, be it tourist or
resident. The legislation provides the appropriate safeguards
for consumers, it creates a predictable, clear, and concise,
framework for TNC drivers and riders across the state. He
added that the bill also contains an insurance model adopted in
substantially the same form in over 40 states, of which has the
support of the largest property and casualty insurance trader in
the United States. This bill will enhance access to
transportation around rural communities when Uber connects with
underserved neighborhoods and residents, it will create new
small businesses and new income streams for families and
individuals, and it supports maximizing the network that drivers
can create in their communities with the statewide framework of
the bill. He explained that when evaluating drivers for their
eligibility to drive on the app, a thorough screening process on
each individual is completed by a third party, which is approved
by the National Association of Professional Background Check
Screeners, and it screens for convictions based on the social
security number, DMV driving records, and Uber does not allow
anyone on the National Sex Offender public website to drive. He
added that, if necessary, a screener will travel in person to a
courthouse in each individual borough, county, and municipality
to confirm that the information is correct. To drive with Uber,
he said that individuals must submit their full name, date of
birth, social security number, driver's license, registration,
proof of valid insurance, and proof of a valid bank account to
which this information is screened. With respect to the
classification of workers, he advised that seven states,
including Kansas, Nevada, and Massachusetts, made a statewide
determination that Uber drivers are independent contractors for
the purposes of unemployment compensation, and the bill assigns
a similar designation to TNC drivers that taxi cab drivers in
Alaska already have. The TNC driver controls their own hours,
what app they can use - there are no restrictions on using
competitors' apps and can have both apps open at the same time,
the type of vehicle they own and drive, the expenses of that
vehicles, maintain a business license, pay their taxes, and
choose how often they wish to be paid and where they drive. He
related that Uber looks forward to coming back to Alaska and
operating under this statewide framework.
1:33:41 PM
STEVE WACKOWSKI advised he is a life-long Alaskan and a combat
veteran fighting in Afghanistan. He related that services, such
as Uber and Lyft help active duty service members and veterans
in that recently Uber and Lyft announced hiring over 50,000
veterans. The TNCs offer incentives and discounts to active
military and veterans and make it easy to work for the TNCs, and
receive rides. Mr. Wackowski then offered a couple of personal
anecdotes. Uber and Lyft are the only outside employment many
active duty commanders will allow for their troops, and Alaska
has more veterans per capita than any other state in the United
States. He opined that not one single taxi cab permit holder in
Anchorage is a combat veteran, and he urged the committee to
allow for ridesharing in Alaska.
1:35:53 PM
REPRESENTATIVE STUTES asked whether he said that Uber and Lyft
hire veterans.
MR. WACKOWSKI responded that this summer Uber had a military
initiative and in July it announced that it had just hit the
50,000-person mark for active duty military and veterans.
1:36:25 PM
The committee took an at-ease from 1:36 p.m. to 1:40 p.m.
1:41:01 PM
SHAVONNA RIVERS advised she represents herself and offered
support for the legislation because she is an Uber and Lyft
driver in Seattle due to the freedom and flexibility. She said,
"With our current regulations" without the proper city licenses
it makes it difficult and those processes are not the same for
each city. For example, she must have a Seattle business
license to function and operate in Seattle and if she drives
outside of Seattle, she must have another city license. The
goal of HB 132 is to simplify the process so drivers can drive
in the local cities and counties without jumping through various
hurdles by being under the umbrella of the state.
1:43:14 PM
MARICE BROWN advised that after 20 plus years of working with a
non-profit organization he was let go due to organizational
restructuring. He began searching for work "and I faced a lot
of race discrimination" in the process which was frustrating and
discouraging but, he said, he is grateful to the TNCs because he
is able to provide for the needs of his family and keep working.
He said that "when we do the patchwork" and cross counties in
order to pick up and deliver in a certain county they must have
a license for that county.
1:45:57 PM
ADELE TARIL advised that she has owned assisted living homes in
Anchorage and HB 132 would be a benefit to Alaska's more
vulnerable population with the opportunity to review drivers'
histories. She said she has used Uber in many cities and "it
rocks," and would be a boost to the tourism industry and make
tourism safer in downtown Anchorage with tourists not driving in
unfamiliar territory, intoxicated, or stoned. The taxi cab
companies have had the opportunity to add the services the
public likes about Uber, but instead they do not want
competition. Uber is a "win-win," she said.
1:50:12 PM
JEREMY PRICE, Alaska State Director, Americans for Prosperity,
advised that dozens of young Alaskans asked Americans for
Prosperity to engage in this issue because after the last
legislative session, the previous chairman of the House Labor
and Commerce Standing Committee "refused to even hear the bill
in question" and these young people were frustrated with the
legislature. Americans for Prosperity decided to weigh in on
this issue for young folks and assist in the possibility of
allowing these ridesharing services into Alaska, and it is
trying to help Alaskan have a better future. While he
understands the local municipalities' position, he related that
in Alaska's small market differing local regulations would not
work because there is a limited population base and limited
customer base. When looking at Austin, Texas, local regulations
drove ridesharing businesses out of the city. In the event
there is an attempt to pull Section 7 out of the bill, he opined
that there is no purpose in passing the bill, and on behalf of
thousands of young people, he asked the committee to pass the
bill out as currently written.
1:52:14 PM
LEILANI INMAN said she has traveled across the country and
cannot believe Alaska does not have ridesharing. She described
that taxi cab services are overpriced, not safe, the drivers
drive recklessly, and it takes too long to receive any sort of
service to get through on their telephone line. She said that
many people have expressed the need for Uber in Alaska, Alaska's
public transportation is due for an improvement and this is one
step closer to achieving that goal.
1:54:46 PM
CHAIR KITO, after ascertaining no one wished to testify, closed
public testimony on HB 132, with the caveat that public
testimony could be reopened if necessary.
1:55:23 PM
REPRESENTATIVE STUTES asked whether Uber or Lyft transport the
mentally disabled or the physically handicapped, and if so,
whether they accept vouchers.
1:55:52 PM
MR. MATTHEWS responded that some jurisdictions in the United
States have partnership with Uber where it can provide first and
last mile opportunities for transit agencies, and that can
segway into transporting individuals who may require some form
of extra assistance. Uber has a relationship in Portland,
Oregon where it has Uber Assist, which provides enhanced
services for individuals. The app is also tailored in a manner
for drivers who are hearing impaired or deaf with enhanced
capabilities to support those individuals driving on the app to
have an income.
1:56:42 PM
REPRESENTATIVE STUTES asked whether when someone calls for Uber
Assist, the driver's private vehicle has a lift or whether it is
something Uber and the driver work together to create.
MR. MATTHEWS responded that within the metropolitan area of
Seattle, and the Seattle-Tacoma International Airport, Uber has
a partnership with Yellow Cab and it provides the service for
individuals requiring a wheelchair accessible vehicle, and Uber
pays a fee on every trip.
1:57:36 PM
ANNABEL CHANG, Director of Public Policy, Lyft, responded to the
question regarding non-emergency medical transit or people with
potential mental handicaps, and said that Lyft provides tens of
thousands of non-emergency transit rides every single week, has
a partnership with the National Federation for the Blind. The
Lyft app also has voice over capabilities so visually impaired
individuals can actually use their voice on the Lyft app. Lyft
also partners with hospitals and senior living centers which,
she described, is one of Lyft's greatest and largest
partnerships in is with Brookdale Senior Living Centers across
the country. The Lyft app is available for senior citizens and
those who do not have access to a smart phone can order their
rides through a desktop or laptop computer web portal page, she
explained.
1:58:58 PM
REPRESENTATIVE STUTES asked whether some of the Lyft drivers
have their own vans equipped for a wheelchair, or whether there
is a relationship Lyft built with another company, such as Uber
and Yellow Cab.
MS. CHANG answered that there are multiple types of partnerships
in place. In the event an individual notates on their
application that they require special needs beyond the regular
lift, Lyft will potentially partner up with transportation
providers within the community, and Lyft has some partnerships
where a set ride fee is sent into a fund, she explained.
REPRESENTATIVE STUTES asked whether any of Lyft's partnership
for any of those types of services are with the local taxi cab
companies.
MS. CHANG answered yes, and she said that in some markets that
is the case.
2:00:33 PM
REPRESENTATIVE BIRCH referred to recent testimony regarding the
collection of sales tax in Alaska, wherein there are multiple
jurisdictions and there is local sales tax in some communities
and not in other communities. He asked how Lyft deals with that
circumstance, whether it is an issue, and how it goes about the
sales tax collection.
MS. CHANG replied that Lyft is looking at the language being
crafted addressing that issue at the municipal level in Alaska.
At this time, she offered, there is no precedent for a municipal
sales tax collection on the TNC platform in the nation, but Lyft
is open to discussions.
REPRESENTATIVE BIRCH asked whether Lyft must pay a sales tax on
a ride in Seattle or San Francisco.
MS. CHANG replied, "No, we do not."
2:02:03 PM
REPRESENTATIVE BIRCH asked her perspective on the suitability of
the background checks including fingerprints.
MS. CHANG responded that Lyft currently does not operate in any
market of peer-to-peer ridesharing models with a fingerprint
requirement. Lyft's current third-party background checks
provider is Sterling Talent Solutions, a national background
check provider for several companies including financial
services and health services. As a former prosecutor, she said,
she is aware that the most accurate information is located at
the country courthouse level, and Lyft has court runners to
cross-check those records.
2:03:52 PM
REPRESENTATIVE KNOPP referred to the independent contractor
status, and asked what defines the independent contractor,
whether vehicles must be registered to the driver and license,
and whether insurance must be in the owner's name. He asked
whether drivers have the ability, as independent contractors, to
hire drivers.
MS. CHANG opined that the question was regarding the current
structuring and the relationship behind the driver and the
vehicle. She explained that in all states the driver is
registered to drive that vehicle, although, there are instances
where the owner is not necessarily the driver. For example, she
explained, the title of the car is under Joe Smith and his wife
elects to be a Lyft driver, if she is listed on the insurance,
and has the capability of driving that vehicle, she can also be
a driver on Joe Smith's car as long as she meets the state's
background and driving record check.
2:05:20 PM
REPRESENTATIVE KNOPP surmised that an Uber owner/operator driver
could hire as many drivers as he chose as long as they were
included on his insurance policy.
MS. CHANG opined that the question was if someone was
potentially operating a mini-fleet on the Lyft platform, and
answered that it could potentially be possible, but under
different state regulations there could be limitations. Lyft
does have a partnership with General Motors and Hertz Holdings
where people could rent a vehicle if they did not have a
qualifying vehicle under state law. She advised that in order
to drive on this platform, they are technically the owner of the
vehicle during that rental period and are listed as an owner of
that vehicle.
REPRESENTATIVE KNOPP said that, theoretically, a taxi cab
company could be using the Lyft app and be Lyft drivers under
the mini-fleet as long as they are using the Lyft platform.
MS. CHANG advised that Lyft does not have taxi cabs on the Lyft
platform at this time, and opined that that is not available
anywhere in the United States.
MR. MATTHEWS interjected that the Uber app in some cities does
have taxi cabs as an option on the Uber platform, and there are
vehicles operated by the owner/operator involved individuals who
may lease that vehicle from an owner.
2:07:17 PM
REPRESENTATIVE KNOPP noted that the committee has predominantly
heard from Uber as "the push that is behind the legislation,"
but he surmised there are numerous TNC out there. He asked
whether providing the exemptions the companies are requesting is
necessary for all TNC platforms from doing business in Alaska,
even if Uber chooses not to.
MS. CHANG responded that HB 132 would be critical for Lyft's
ability to launch in Alaska.
2:08:32 PM
REPRESENTATIVE JOSEPHSON referred to Seattle's approach to
regulation which began in earnest in December 2015, which
resulted in litigation and disputes about the City of Seattle's
ability to regulate Uber. He asked whether Lyft had joined Uber
in any litigation in the City of Seattle.
MS. CHANG opined that the United States Chamber has filed
litigation, and Lyft is a member of the (indisc.) Chamber.
2:09:24 PM
REPRESENTATIVE STUTES asked whether Uber is operating in any
city whatsoever with any type of local controls.
MR. MATTHEWS responded that the City of Seattle, Washington was
the third city Uber launched in 2001, and its service has
continued to operate for the most part uninterrupted. Although,
he said, Uber is pursuing statewide regulations in consultations
with the City of Seattle and other cities in Washington to
enshrine a state framework recognizing the costs and
complexities of regulations.
REPRESENTATIVE STUTES surmised that from this point forward any
area Uber chooses to operate would not be under local control.
MR. MATTHEWS responded yes, and he said that in Washington, Uber
has been removing operations from cities with local control as
it works toward state regulations.
2:10:59 PM
REPRESENTATIVE JOSEPHSON surmised that in Uber's perspective,
there is no conceivable way, in the long term, to tolerate local
regulation of the TNC industry within that community.
MR. MATTHEWS answered that he would "err on answering that
absolute manner." He stated that as Uber works toward statewide
regulations with municipalities under his operational area in
Washington, Uber has erred on launching new locations that
request carveouts or nuanced regulations to support a facet of
city operation or city structure.
2:12:16 PM
REPRESENTATIVE JOSEPHSON asked whether Mr. Matthews was closer
to a "yes or no" to his question.
MR. MATTHEWS replied that it is all situational. He added that
in order for Uber to contemplate launching in Alaska, it would
require a statewide bill with a clear and concise framework.
2:12:59 PM
REPRESENTATIVE WOOL asked whether the money a person
"relinquishes" through their phone app then goes to Uber and
Uber then disperses it back to the driver.
MR. MATTHEWS explained that it is a cashless service in the
sense that a person puts a credit card or gift card on their
app, the payment is then reconciled through a credit card
company or another payment service, and the driver is paid. The
driver can request to be paid within that day, within a few
hours, weekly, or at a time the driver sees fit.
2:14:27 PM
MR. MATTHEWS, in response to Representative Wool's question,
confirmed that Uber makes the payment back to the driver at a
time period agreeable to both parties, or at the default seven-
days.
REPRESENTATIVE WOOL asked Ms. Chang the same question.
MS. CHANG responded that Lyft has a third-party payment
processor because it is all a cashless credit card transaction.
Essentially, she explained, once the ride has finished, the
passenger makes a determination on how much to tip on the app,
and the payment is completed. At that time, the payment
processor splits the fare, the driver retains 75 percent of the
fare and 100 percent of the tips. Similar to Lyft's
competitors, the driver selects the time period for payment to
their account, she said.
REPRESENTATIVE WOOL asked whether Lyft is primarily operating
only in states with statewide regulations, and whether the new
states Lyft picks up only have statewide regulations.
MS. CHANG responded that Lyft hopes to launch operations in
Alaska, and in order to launch it would need statewide
regulations. She offered that 39 states have comprehensive
statewide legislation and in the states with statewide
legislation, Lyft was able to launch in much smaller cities.
2:17:12 PM
CHAIR KITO reopened public testimony on HB 132.
2:17:26 PM
JIM BRENAN, Attorney, Anchorage Taxi Cab Permit Owners
Association (ATCPOA), advised he is an attorney representing the
Anchorage Taxi Cab Permit Owners Association (ATCPOA), and said
he has represented elements of the Anchorage taxi cab industry
for decades and is well experienced in governmental regulations
of passenger transportation. In Alaska, he offered, that type
of regulation has always been under local municipalities, never
under the state. He opined that the question has become "how
can we fit this into Uber's overall game plan nationwide,"
except there are a number of reasons why this industry should be
locally regulated. Alaska's cites are all different, their
transportation situations are different, and therefore the
regulations are different for taxi cabs as they should be for
TNCs. There is no reason TNCs should not be subject to local
regulations thereby allowing the regulator to make an effort to
be even-handed between the regulation of taxi cabs and other
forms of transportation. Originally, he pointed out, there was
a fiscal note, and now there is no fiscal note, which means this
amounts to no regulation because there is no way this can be
regulated on a statewide basis without additional expenses in
the way of state governmental employees. The City of Anchorage
alone has four full-time employees to regulate taxi cabs and
limousines, and he urged the committee to at least jettison the
section that preempts municipal regulation and leave this type
of regulation to Alaska's municipalities. He advised that the
Municipality of Anchorage Assembly has been wrangling with a
detailed and well thought out ordinance for regulation of TNCs
in Anchorage. This assembly, he commented, has experience in
dealing with the transportation of passengers for hire and it
should not be superseded by a blanket bare-bones regulatory
process with no enforcement mechanism. He reminded the
committee that there is no provision in this bill for a penalty
if the TNCs or its drivers do not comply. The discussion here,
he explained, is an enactment that would have no enforcement
capability to replace municipal regulations, which has
enforcement capability.
2:21:04 PM
CHAIR KITO, after ascertaining no one wished to testify, closed
public testimony on HB 132.
2:21:29 PM
REPRESENTATIVE JOSEPHSON asked whether Lyft, at its discretion,
changes the rate it charges passengers and therefore also the
rate it pays drivers, similar to Uber.
MS. CHANG responded that Lyft does engage in "prime time," a
dynamic pricing tool. For example, when a large concert ends
and the people leave the facility, in order for Lyft to have
enough supply to meet the demand, Lyft arranges its prices to
reflect that greater demand and incentivizes drivers to go to
that location and pick up rides. She described this as an
effective tool in making sure people arrive at their
destinations, and they are notified through the app if there is
a price change, and a person cannot request a ride or accept a
ride until they acknowledge there was a price change. The app
has a price estimator so it is always clear as to what the price
would likely be when the person is charged.
2:23:02 PM
REPRESENTATIVE WOOL asked whether other municipalities, other
than the City of Seattle, that Uber operates in that do not have
municipal regulations.
MR. MATTHEWS advised that Uber has different arrangements with
different cities, for example, the City of Tacoma has
regulations differing from the City of Seattle and Bellingham.
He then listed the cities in Washington with and without
regulations.
2:24:09 PM
REPRESENTATIVE WOOL surmised that the City of Spokane does not
have regulations and Uber operates there; however, when
statewide legislation is passed, all cities and municipalities
in the State of Washington would be under the same statute.
MR. MATTHEWS advised that the City of Spokane is waiting until
statewide regulations are in place, and Uber has a Memorandum of
Understanding with the City of Spokane to clarify any questions
it had, but there are no adopted regulations.
2:24:51 PM
REPRESENTATIVE SULLIVAN-LEONARD commented that she understands
the Alaska Railroad and other tour industries do not pay sales
tax or attain business licenses in each individual city when
transporting people in and out of that specific area. She said
she wondered whether Alaska needs to have regulations on the
Uber and Lyft TNC market when they are providing a service
similar to the railroad and tour bus services. She asked Mr.
Matthew to compare that description to the taxi cab industry.
MR. MATTHEWS answered that he was unsure he understood the
question.
REPRESENTATIVE SULLIVAN-LEONARD noted that the challenge for her
is that if taxi cab drivers are required to have a business
license in all of the small different communities in the
Matanuska-Susitna Valley and Anchorage, it limits transportation
in a manner that possibly Uber and Lyft could provide. She
asked whether that was Mr. Matthews perception in other
communities.
MR. MATTHEWS replied that in rural states, such as Montana and
Idaho, Uber has been able to enter and provide services into
smaller cities and towns and smaller markets that have not
traditionally had a taxi cab type service. Yes, he related,
smaller communities are served better under statewide
regulations and are served more conveniently through TNC
systems.
2:27:58 PM
REPRESENTATIVE STUTES asked whether the reason Uber does not
operate in Port Townsend is because the city wants local
regulations.
MR. MATTHEWS answered that certain jurisdictions ask for carve-
outs or nuances in their regulations and Uber chooses not to
operate in those jurisdictions.
REPRESENTATIVE STUTES asked whether Mr. Matthews was aware of
the regulations Anchorage had required that caused Uber to turn
to the legislature for regulations.
2:29:30 PM
MR. MATTHEWS said he has an understanding of the regulation that
the City of Anchorage is considering at this time as to
transportation network companies (TNCs).
REPRESENTATIVE STUTES asked what the regulations were that
created some consternation for the TNCs that prompted Uber
coming to the legislature.
MR. MATTHEWS asked whether she was discussing the 2015
regulations or the current City of Anchorage conversations.
REPRESENTATIVE STUTES opined it would have been the 2015
regulations because that is when Uber chose to come to the state
looking for legislation.
MR. MATTHEWS answered that the 2015 regulations included:
cameras in vehicles, fingerprint background checks, individual
licensing, and any number of issues that Uber did not seek to
include because it was somewhat against the manner in which Uber
looks at its background check model and its verification
systems. Uber believes that fingerprint background checks are
somewhat discriminatory in nature and can leave no chance for
rehabilitation for individuals, and also, Uber believes its
third-party background checks are more suited for the team model
versus what was being requested by the City of Anchorage. He
offered that Uber does have digital records of rides including
GPS roads, and the City of Anchorage requested video cameras as
well, Uber does not believe that is necessary for the public's
safety.
2:31:55 PM
REPRESENTATIVE STUTES said she was confused by the comment that
Uber believes fingerprint checks were discriminatory in nature.
MR. MATTHEWS answered that fingerprint background checks use FBI
records and the FBI has indicated that the records lack of
information about the final outcome of cases. He pointed out
that FBI records are somewhat inconsistent because it relies on
each individual police department or agency to upload their
records into the FBI file. The federal government acknowledged
that the database was not fully complete and there was a
somewhat large margin of error due to human technicians and/or
the fact that there are missing records. Fingerprint background
checks can be discriminatory in the sense that when records are
incomplete and inaccurate, individuals are more likely to make
faulty decisions based off of those records. He pointed out
that communities of color are disproportionally impacted because
they are arrested at a higher rate in the United States, and
fingerprint background checks show arrest and convictions,
whereas the third-party background checks only look at
convictions. There are certain concerns about privacy in
government overreach in that the FBI is requested to (indisc.)
system from the Privacy Act, and that the retention of civil and
criminal fingerprints have been merged.
2:33:41 PM
MS. CHANG reiterated that she is a former prosecutor and a major
concern about the FBI database, which is fingerprint based, is
exactly what Mr. Matthews testified. In certain counties,
uploads are often paper based and voluntary, so depending on
whether certain counties are short staffed, et cetera, the
counties actually do not upload information to state's database
system and; therefore, the state does not then have the ability
to update, and send that update to the FBI database system. The
difference here, she said, with the TNC model is that it
actually goes directly to the primary source, the criminal
courthouse, for the most accurate information possible to be
certain individuals are not caught up in a false positive,
thereby, being fairer to the applicants.
2:35:00 PM
REPRESENTATIVE JOSEPHSON commented that Ms. Kathie Wasserman, a
representative of the Alaska Municipal League, testified that
one of the frustrations for cities was the inability to collect
a sales tax through the TNC system and Ms. Chang's response was
that "nowhere in the United States does that happen." He
referred to an article and said that "Airbnb agrees to collect
hotel taxes in another huge U.S. city, and that city is Los
Angles. And it says there are 200 other cities worldwide
including San Francisco." He referred to the burden put on
firemen, law enforcement, and roads, and said that it all sounds
pretty reasonable, and asked "Why should you get exempted from
that, and why could not there be a system to say you can't be
exempted from that?"
2:36:05 PM
MS. CHANG offered that to be clear, Airbnb is not regulated at
the state level in any region and are municipally regulated,
which is part of the reason they have entered into this model.
Essentially, she said, the current bill language read that there
is no permit fee, that this is part of the discussion here in a
way that "we can make sure that cities are made whole" and Lyft
looks forward to having that discussion.
2:36:48 PM
MR. MATTHEWS responded that in some jurisdictions,
transportation is a service exempt from municipal sales tax
(indisc.) designation on those municipalities. He related that
he heard from Representative Wool that they are working on
language for this particular situation and Uber is open to
conversations about sales taxes.
2:37:15 PM
REPRESENTATIVE WOOL responded that he is currently pursuing
language to accommodate local municipal sales tax in this
legislation.
[HB 132 was held over.]
2:38:06 PM
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee meeting was adjourned at
2:38 p.m.
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