Contents tagged with PTC
The inefficiency of the premium private car service industry stunned Alan Stapleton soon after he arrived in Minneapolis for a June 2012 wedding.
The process, says Stapleton, was agony. He made at least seven phone calls, wasted two hours, and, with no method to price shop a simple hotel trip, he was still stuck at the airport. A retired federal government official-turned-entrepreneur, Stapleton decided to do something about it. Says Stapleton: “It struck me that this could be a lot better than it was.”
Stapleton says he spent the plane ride back home, to Baltimore, drawing up ideas “on the proverbial napkin” of how he could improve the private car service industry. The result is RideCommand, an Annapolis, Md.-based mobile app car service firm that made its nationwide debut in Tampa in mid-October.
The Tampa area will be the laboratory for RideCommand’s patent-pending technology that utilizes a reverse bid system, where companies compete for a customer’s business. “I have a model where the consumer is in charge,” says Stapleton, assistant director of the U.S Government Accountability Office at the peak of his Beltway career. “It puts you in charge of your own fleet.”
The RideCommand app and website allows users to virtually make a ride request. That request goes out to car services registered in the RideCommand system. RideCommand, so far, has agreements with about 30 Tampa-area local licensed luxury car services. Most of those are one- or two-vehicle services. Traditional metered taxi companies aren’t part of the RideCommand network.
The companies in the RideCommand system bid on the customer in a reverse auction format where prices go down, not up. The passenger, finally, gets to select the winner among all the bidders. RideCommand takes a commission, up to 12% of the fare, from the firm that wins a bid.
The rationale for the reverse-bid strategy, Stapleton says, is simple: A company with a vehicle on the way back to base without passengers would rather get a low bid, and some revenue, than sit empty. At least that’s what Stapleton hopes will happen. “We don’t know how it will work,” Stapleton says. “It’s never been done before.”
Other challenges loom for RideCommand. The firm, for one, must prove a sustainable need exists for the service that can be duplicated in other markets. “For some people it’s too much technology,” says Stapleton, who invested about $250,000 of his own money into the business.
Another hurdle is regulation. That comes mainly from the Hillsborough County Public Transportation Commission, which maintains a $50 minimum fare for all premium car rides, no matter the distance. A premium car is basically a vehicle without meters. The Hillsborough PTC regulates all vehicles for hire, from taxis to tow trucks.
The $50 rule can sink RideCommand if customers balk at the minimum fee. One way RideCommand navigated the rule is a partnership with Tampa-based Cab Plus, which combines luxury sedans with a metered pay system, says owner and CEO Brook Negusei. Cab Plus, the biggest company RideCommand works with, has about 35 vehicles.
So RideCommand users can book a ride on Cab Plus sans the $50 minimum. “We are a luxury cab service,” Negusei says. “We charge a little more than a taxi, but less than a limo.”
The $50 rule nonetheless drove another car service app, San Francisco-based Uber, out of town during the Republican National Convention in August 2012. Uber departed when it deemed the $50 fee unworkable.
Stapleton is confident he can avoid that result. He hopes success in Tampa will catapult the firm to success in other markets, including Miami, Orlando, Baltimore and Philadelphia. “Tampa is a nice place to crawl before you walk,” says Stapleton, “and a nice place to walk before you run.”
The Hillsborough County Public Transportation Commission is on a possible road to extinction.
That could happen under new legislation proposed by State Rep. Jamie Grant, R-Tampa, and State Sen. Jeff Brandes, R-St. Petersburg. The legislators filed a bill Oct. 30 that would put the existence of the PTC up for local referendum. The Hillsborough legislative delegation would have to approve the bill first. Then it would go to Tallahassee, where both chambers and the governor would vote on it. If it passes there, local voters could decide the PTC’s future.
The Florida Legislature created the PTC in 1976. Many large cities have similar commissions, designed to ensure safety in a vehicle for hire.
But in many of those cities, and now in Tampa, transportation commissions have become magnets for anti-competition criticism. The Arlington, Va.-based Institute for Justice, for example, sued the Hillsborough PTC earlier this year, a case that remains active. The institute contends the commission’s $50 minimum fare rule for non-metered vehicles is an example of “burdensome regulations and restrictions not common in other places.”
The PTC has also faced criticism on other fronts. A previous executive director left under controversy over being paid when he was out sick. And former Hillsborough County Commissioner Kevin White was imprisoned for a bribery scandal that partially involved the PTC and a towing service.
Here in Hillsborough County, we watch our County Commissioners espouse their proposals for economic development. They have tied transportation to economic development and have doled out our tax dollars to bring the big box Bass Pro Shop Sporting Goods store to Hillsborough. They are now proposing subsidies, tax breaks, tax credits to large companies who want to bring their businesses and jobs to Hillsborough like Amazon.
But what about new, innovative companies who also want to bring their business to Hillsborough County but burdensome regulations are keeping them out? We know what happened last year to Uber during the RNC convention. The Tampa Bay Times wrote last year:
While Republican National Convention delegates decry excess governmental regulation, a case study is unfolding outside: a dispute between Hillsborough County regulators and a techie taxi startup in town for the convention.What the company can't offer? Low prices. Hillsborough County regulations set Uber's minimum fare at $50, three times as pricey as the service's minimum fare in New York City, London, Paris or practically anywhere else.
At the Eye, we agree with what Rachel Holt, general manager for Uber's DC operations said,
"There is an important role for regulations, and that's protecting the public … not blocking competition."
Well, Uber left town during the RNC, run out by the heavy handed anti-competitive regulations of the Hillsborough County Public Transportation Commission, and headed to Charlotte for the DNC.
Also recall the entrepreneurial company Hop Tampa who was providing free golf cart shuttle services downtown. Hop Tampa free shuttle cart downtown shutdown.
In 2009, Hop Tampa was shut down by the dubious Public Transportation Commission. The Tampa Bay Times article Plug pulled on free shuttle service by downtown Tampa's electric carts reported:
Hillsborough County transportation officials Wednesday slammed the brakes on electric cart operators providing shuttle services downtown.The Public Transportation Commission ruled that the companies run vehicles for hire, which means they need permits to stay in business.
And all it took was a call from a local taxi cab company as TBT went on to state:
The board made the decision after hearing from an attorney for Yellow Cab.
Creative Loafing also reported on the shutdown with Free rides short-circuited as Tampa kills green downtown shuttle service:
It is a classic Catch-22; electric vehicles operators downtown say they were told they didn't need permits because they didn't charge for their rides (they make their money from advertising on the vehicles, and the drivers get tips), and since the PTC tightly controls taxi permits, they likely wouldn't be able to get them anyway. But even though they don't charge fares and mostly provide rides that the for-pay taxis won't/don't give (short hops that aren't profitable), the PTC put them out of business after cabbies complained.
Apparently these private sector, entrepreneurial golf cart transportation services were being well received in downtown and south Tampa. They were free to riders because they used advertising on their vehicles. They provided a service for those short hop trips that taxi cabs do not want anyway. The taxi's want the longer haul trips, especially from the airport.
The question that needs answering is what is the purpose of the PTC? Hillsborough County is the only special district in Florida that regulates for-hire vehicles with such a commission. It regulates taxi cabs, limousine services, towing services and ambulance services. PTC regulations force for instance Tampa limo services to charge a minimum $50 charge to step your leg into a limo, even if you only want to go 10 miles down the road. PTC regulations are inhibiting ambulance service competition in the county. PTC regulations are driving out innovative, entrepreneurial businesses like Uber and Hop Tampa.
Now another innovative new company, RideCommand, is trying to pick up where Uber was forced out.
RideCommand - new phone apps
RideCommand App The Tampa Bay Times reports today Company offers luxury car rides via smartphone app: RideCommand lets customers use a mobile phone app to order a ride right away for a predetermined price or put future rides out to bid to get the lowest price possible. President and Founder Al Stapleton, who retired from the US GAO, developed the concept and stated this in the Times article: "We're giving consumers the power to choose," he said. "We think people can ride for less if they're in charge.""We feel like the market should determine the price, not the government," said Stapleton, who is funding the company himself.
Here at the Eye, where we support free markets, innovation, competition and entrepreneurs agrees, but the power and regulatory control of the PTC lurks as the Times article goes on to state: He (Stapleton) also hopes pressure from customers could eventually persuade the Hillsborough County Public Transportation Commission to reduce or eliminate the fare minimum — an effort that proved futile for Uber.
Every other county in the state has figured out how to ensure safety, provide choice and competition around these vehicle for hire transportation services. For example, if you want to start a new transportation service in Pinellas County you can easily go to the their website and obtain a Public Vehicle Certificate.
Last but not least is a reminder of the corruption and ethical issues associated with this commission. Former County Commissioner and PTC board member Kevin White went to prison for bribery and corruption charges associated with this board. Current Hillsborough County Commissioners who sit on this board, Victor Crist and Ken Hagan, receive campaign donations from the very companies they regulate. The smell of this Commission is so strong the Tampa Tribune recently weighed in with their Op-Ed, Dump public transportation commission.
Corruption, Cronyism and inhibitor of Competition are the 3 C's associated with the Public Transportation Commission. Perhaps while the County Commissioners are handing out our tax dollars to some large companies, they can reign in the PTC too.
America's free-market system is well and fine unless it hurts the bottom line of Hillsborough County's taxicab industry. That's the guiding ethos of the Public Transportation Commission, the agency that oversees for-hire vehicles in Hillsborough. The Legislature should disband the agency and hand its narrow task to county government.
The chauffeur service RideCommand is trying to bring a service to Hillsborough that a similar company tried to and failed because of a PTC rule that artificially limits competition for the benefit of the cab industry. As the Tampa Bay Times' Susan Thurston reported last week, RideCommand lets customers use a mobile phone app to order a ride right away, or to put future rides out to bid to get the lowest price. But premium car services, which operate limousines and high-end SUVs and sedans, are prohibited from soliciting walkup customers on the street. The PTC requires they charge a $50 minimum fare, even for short distances, which serves only to protect the taxis.
The PTC says it is trying to separate everyday taxi service from the luxury providers, but that makes no sense. The private car services are subject to the same regulatory oversight as the taxis — the same inspections to ensure the vehicles are safe, the same background checks on the drivers. The difference is that the taxicabs benefit from a publicly imposed price support that gives the taxicabs a $50 jump on any business. The rule was suggested by the industry (no shock there). And PTC staff oppose the mobile phone service on the ridiculous notion that it disenfranchises poor people who need a hired ride but lack a smartphone.
The price-fixing policy is wrong, bad for consumers and business and counterproductive in terms of what customers are looking for today when it comes to value and convenience. It also undermines the great need to get the taxicab operators to improve their levels of service. If clients want to hire RideCommand, they should be able to under the terms the company offers, not beholden to the arbitrary rules the PTC imposes that have nothing to do with safety.
The commission was created by a special legislative act, and its stand-alone authority to regulate for-hire vehicles in the county is the only one of its kind in the state. But the PTC does nothing special; dissolving the agency and moving its handful of staff under county government would be easy and make the operation more efficient and accountable. The inspections would go on, but the move would bring greater public scrutiny to a pricing and regulatory scheme that fosters an uneven playing field. The bill to disband the commission should be a priority of Hillsborough's delegation for next year's legislative session.