An Uber user searches for a ride in Red Deer. (rdnewsNOW file photo)

By Josh Hall (Twitter: @Vancan19)

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Licensing costs could squeeze Uber drivers out of Red Deer

Jan 3, 2020 | 8:52 PM

Uber says it could be on its way out of Red Deer pending the outcome of an upcoming debate by city council.

The ridesharing company launched here in September 2017.

On Monday, council will deliberate a new fee structure applying to vehicles for hire, as part of a broader action to create a Vehicle for Hire Bylaw. This would amalgamate the current Taxi Bylaw and Limousine and Sedan Bylaw.

In a letter to council, Michael van Hemmen, Uber’s head of operations for western Canada, says key components of the City’s plan would prevent Uber from continuing operations in Red Deer.

“Uber would be pleased to be licensed by the City, and much of what staff is proposing is best practice across the country,” he admits. “(But) the operational burden of individually licensing hundreds of drivers and their vehicles when they may not complete a single trip is not sustainable for the ridesharing business model.”

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Driver-partners across North America, he points out, typically drive less than 10 hours per week, thus making costs more burdensome for drivers doesn’t make sense.

van Hemmen notes that in other Alberta cities such as Lethbridge, Airdrie and St. Albert, regulations are far less restrictive than what Red Deer is pondering. For example, where Airdrie and St. Albert require annual vehicle inspections, Red Deer could mandate two yearly.

Uber is already governed by provincial regulations across Alberta, with penalties for non-compliance maxing out at $50,000 per day, van Hemmen notes.

“A unified business licence forces companies to take ownership and accountability for driver and vehicle documentation,” he says. “Uber would obtain a license from the City and be required to collect, maintain, and make available driver and vehicle records. The City would maintain the authority to access records and restrict a driver’s ability to rideshare in the appropriate circumstances.”

Local Uber driver Travis Beebe wrote city council pointing out that Uber drivers don’t make a lot of money.

“We already do an annual mechanical inspection, which seems reasonable. Two a year is NOT reasonable,” he emphasizes. “Uber drivers are already faced with supplying police background checks along with a vulnerable sector search annually. If the City was concerned, they could reach out to Uber or the driver to see them.”

Beebe is also frustrated with the lack of consultation, saying many in the business that’s he’s spoken to had no idea this discussion was even on the table.

“It seems the local taxi industry had way more consultation than any other driver group,” he says. “I would NOT say that’s a good thing given that they want other services banned.”

In an agenda report prepared for council, City Inspections and Licensing Manager Erin Stuart isn’t recommending the unified licensing model.

In a list of pros, it’s noted that unified licensing may be simpler and come with reduced fees, but the cons include less regulations, which could result in lower public safety, among other things.

It’s also noted that feedback from the local taxi industry suggests opposition to unified licensing because it would decrease the reputation the industry has for vehicle and driver safety.

The public portion of Monday’s city council meeting is expected to start at about 3 p.m.