The NCSL Blog


By Douglas Shinkle

Uber and Lyft, the twin titans of ride-sharing have dramatically disrupted the transportation industry while providing millions of on-demand rides for Americans.

Ride-sharing app on phoneUber for example, says its services now cover 75 percent of the United States’ population. Last year was a red-hot time for legislative activity concerning these services, which are typically referred to as transportation network companies (TNCs).

At least 28 states—Arizona, Arkansas, California, Colorado, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine, Maryland, Minnesota, Montana, Nebraska, Nevada, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, Washington and Wisconsin—as well as D.C., have established some sort of regulatory framework for TNCs. Delaware has a memorandum of understanding between its Department of Transportation and Uber. New Hampshire and Rhode Island have convened official legislative study committees.

Laws in Louisiana, Minnesota, Texas and Washington focus solely on insurance requirements for TNCs and their drivers. Insurance proved to be one of the most-debated issues in statehouses, with discussion focusing on appropriate levels of insurance coverage for TNCs and drivers respectively during specific three specific time periods of service: Period 1, when the app is on and a driver is ready to, but has not yet been matched with a rider; Period 2, when the driver has been matched with a customer but has not yet picked them up and Period 3, when the passenger is riding in the vehicle.

A compromise between the TNCs and the insurance industry led to the development of model insurance language for future state TNC laws based on appropriate levels of insurance for these respective periods.

Idaho and Oklahoma are examples of states that largely adopted the compromise language. The model language and many state TNC laws also encourages or mandates a disclosure be provided by the TNC to TNC drivers on what is and is not usually covered under their personal policy. There is also hope that the insurance industry will develop new innovative insurance products for TNC drivers.    

NCSL's Doug Shinkle offers a short overview on shared transportation options such as Uber, Lyft and car2go and the policy issues they pose for state lawmakers in the video on this page.

Other issues that were commonly addressed in 2015 legislation include: requiring criminal and driving background checks for drivers; standards and timeline for vehicle safety inspections; record-keeping for drivers and vehicles; communication of estimated fares and the final receipt to a customer; operation at airports and restricting the hailing of a TNC from the street and other requirements.

Notable 2015 provisions included Maryland, Nevada and South Carolina enabling the collection of an additional fee per TNC trip. Maryland, for example, allowed a locality to impose a fee not exceeding 25 cents per trip. Montgomery County has taken advantage of this provision to create a fund to help finance the creation of transportation services for eligible senior citizens and people of limited income.

A few states added extra provisions with an eye toward ensuring safety. Colorado, Nebraska and Virginia restricted the number of hours a TNC driver can provide service: no more than 12 consecutive hours in Colorado, no more than 12 hours during a 24 hour period for Nebraska and no more than 13 hours in a 24 hour period in Virginia. North Dakota required TNCs to provide the state Department of Transportation with the number of accidents and traffic violations that were reported to the TNC during the passenger on-board stage.

The 2016 legislative season has already been full of TNC debate at statehouses. A large number of states are debating bills to create a new regulatory framework or further refine their existing laws.  At least 20 states—Alaska, Arizona, California, Florida, Georgia, Hawaii, Illinois, Iowa, Massachusetts, Michigan, Mississippi, Missouri, New Hampshire, New Jersey, New Mexico, New York, Pennsylvania, South Dakota, Vermont and West Virginia—are considering TNC bills in 2016. 

Most 2016 legislation thus far focuses on creating or refining the legal standards and processes for TNC operation in the state, similar to 2015. However, there are some emerging issues that legislatures seem ripe to discuss include accessibility for people with disabilities; data-sharing of information between TNCs, localities and states and employee/employer relationships and designation.

Notable 2016 legislation includes a pending California bill that would enable contractors such as TNC drivers to collectively organize and bargain. Illinois is debating a bill that would give TNC drivers a $1,000 tax credit to purchase or repair an automobile.

Douglas Shinkle is NCSL’s Transportation Program Director and uses his own car, Uber, Lyft, his bike and his feet to get around.

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About the NCSL Blog

This blog offers updates on the National Conference of State Legislatures' research and training, the latest on federalism and the state legislative institution, and posts about state legislators and legislative staff. The blog is edited by NCSL staff and written primarily by NCSL's experts on public policy and the state legislative institution.