The Kentucky Transportation Cabinet recently issued regulations dealing with Transportation Network Companies, more commonly known as ride-sharing businesses, or by the names of the two most prominent firms, Uber and Lyft.
The services use smartphone apps to match riders with people driving their own cars. Customers' credit cards are billed automatically so no cash is exchanged. Usually both driver and customer can rate each other at the end of a ride.
This transportation business model isn't going away and it must be regulated. So, good for the cabinet for jumping into the fray. And good that the regs maintain a focus where it should be: on public safety, particularly for passengers.
The regulations — which went into force immediately — require the companies to register with the state, to conduct criminal background checks on drivers, and maintain appropriate insurance.
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They must also have a file for each driver showing records of annual auto safety inspections, current driver's license, insurance and complaints against the driver. An explanation must be filed if a driver turns down a ride, a measure that allows the cabinet to evaluate whether service is being provided equitably throughout a market.
Although the regs are in effect now, the network companies, the public and others will have the opportunity to comment on them and request a public hearing before a final version is adopted.
If Kentucky follows the national trend, taxi companies will likely assert that they are disadvantaged by the new services.
Public comment likely will address safety, a concern that has arisen nationally and internationally as clients and regulators have questioned the thoroughness of background checks and other company efforts to assure safety for passengers and other drivers.
During this process, the cabinet — and local communities that choose to regulate these services — must maintain focus on public good and safety and not on protecting an existing business model.
With proper oversight, this new approach to transportation could help lower costs for travelers by increasing competition, reduce the number of cars on the road and the number of people driving after they've had too much to drink.