Just wrote a policy memo for class and wanted to share it with the group.
I’m optimistic that the Council will vote affirmatively for the TNC petition tomorrow and that the TNC’s will in turn sign the MOU’s.
However, I think some of the CM’s seem to not be convinced that TNC’s, even in their largely unregulated form, are a net positive for the City. I think the data and supporting studies show a clear link between increased TNC utilization and decrease alcohol-related deaths.
Please share as you see fit.
PDF with graphs: TNC use in Austin and the associated decrease in alcohol-related deaths
Text Only Below (see PDF for references and charts)
Executive Summary
Alcohol-related deaths have decreased in Austin despite overall automobile-related deaths increasing and reaching an all-time high in 2015. The downward trend in decreased alcohol-related deaths generally started after TNCs (transportation networking companies) entered the Austin market. A recent study looked at the correlation between the decrease in alcohol-related deaths and TNC entry, the study found strong causal evidence for this link. In the study, local markets with a low-cost TNC option showed a marked decrease in alcohol-related deaths with no associated drops seen in other comparable markets. Further, increased regulations have shown to lead to increased costs; increased costs lead to lower TNC use that will potentially negate drops in alcohol-related deaths.
The short history of TNCs in Austin
The Austin market has two primary TNC providers, Uber and Lyft. Uber entered the Austin market in June of 2014. TNC’s were initially considered an illegal operation because they provided taxi like services but had a completely radical business model.
City Council eventually legalized TNC’s in October of 2014 and TNC use has since skyrocketed. Since Uber’s arrival to Austin, “500,000 people have gone to [the] app and requested a ride,” as of November 23, 2015 . In December 2015, City Council voted to increase regulations on TNCs with measures that included increased requirements to fingerprint TNC drivers. The requirements would also apply to drivers that might only offer their services infrequently or for a small amount of time every week.
Both Uber and Lyft have said that they would have to exit the Austin market in response to the phasing in of fingerprint requirements over the next couple of months.
A public action committee (PAC), Ridesharing Works for Austin, has filed a valid citizen’s initiative petition to overturn the December 2015 legislation. On February 11th, City Council will vote to either enact the petition as written or put the matter to the electorate in a special election in May. The Mayor has proposed on the City Council Message Board a proposed course of action in which City Council would potentially vote affirmatively for the petition; the second part of the deal would have the TNC’s sign a special Memorandum of Understanding (MOU). The MOU would allow the TNC’s special drop off points in the City and at City-sponsored events in return for the TNC’s offering consumers the choice of a fingerprinted driver, among other things.
Drunk driving in Austin
Last year, more people died on Austin’s streets than ever before, 102 people . 55 of these deaths, the largest category, happened in automobiles while the other deaths included 30 pedestrians, 15 motorcyclists, and 2 cyclists. The dangerous trend has many contributing factors.
Despite these sad numbers, one facet has shown an improvement, DWI collisions trend downwards over the past 18 months despite overall deaths increasing . However, the data is not as clear-cut if we only consider the year timespan from November 2013 - November 2014 versus November 2014 - November 2015. However, DWI collisions have decreased by 88% when comparing the first 10 months of 2013, when no were TNC’s active in the Austin market, to the first 10 months of 2015, when TNC’s were active the entire time.
Low-Cost TNC options lead to lower drunk driving deaths
A recent study looked at the effect Uber’s entry into a market had on drunk driving collisions and deaths . This study analyzed data from 5 years and compared different cities in California. The researchers looked at when Uber’s low-cost service, Uber X (~20% - ~30% cheaper than taxi’s), entered each of those cities; whether or not Uber Black, the premium service (~20% - ~30% more than a taxi), was offered; and what effect this had on drunk driving in that market.
The study showed conclusively that “the entrance of Uber X results in a 3.6%–5.6% decrease in the rate of motor vehicle homicides per quarter in the state of California.” However, markets with only the premium TNC option did not see these results; this indicates that low ride price is a factor in decreasing the drunk driving deaths.
That these results took “upwards of 9-15 months” for the benefits to start to manifest is also an important finding in the study.
Increasing TNC regulations could dampen decreased DWI collisions
To the average consumer, a taxi offers the same result as a TNC ride, a pickup followed by a drop off at their desired location. TNC’s new business model has generally led to “shorter wait times, cheaper prices, and increased convenience” for consumers. Increased regulations cause increased taxi prices .
If it is harder to become a driver for a TNC due to new regulations, like requiring in-person fingerprinting, less drivers will offer to drive for a TNC or taxi company. A lower supply of drivers will mean higher prices for consumers and less TNC rides consumed. Decreased TNC use will hinder long-term effects of low-cost TNC use on drunken driving deaths and collisions.