Onerous new ridesharing regulations are set to go into effect tomorrow in the City of Houston that will make services like Uber and Lyft more expensive for the average consumer and create additional costs for local taxpayers.
Among other things, the new rules will require drivers of transportation network companies (TNCs) to undergo additional background checks and vehicle inspections over and above those already demanded by TNCs. The cost of these bureaucratic measures, which the City forthrightly acknowledges “will be an added expense for the driver,” may well be passed along to the consumer in the form of higher prices.
And then there’s the cost to taxpayers.
According to a recent memo from the City of Houston’s Administration & Regulatory Affairs department, the cost to implement the city’s new regulations in the first year will run close to $600,000. Some of the major cost items include:
- Temporary employees: The department plans to hire “8 temporary employees to assist with processing applicants during the surge period. The cost of hiring the temporary employees is approximately $45,000.”
- New employees: The department “is adding four customer service personnel and six enforcement personnel to manage increased workload going forward. The cost of the additional personnel is approximately $530,000 per year.”
- Overtime: The department is planning to offer extended customer service hours for a short period. “The anticipated overtime costs associated with this effort total approximately $12,000.”
It’s unfortunate to see the City move forward with these costly and duplicative requirements, especially considering that residents there could lose access to Lyft altogether if they go into effect.