A ride-hail vehicle is seen at San Francisco International Airport. (Mike Koozmin/2015 S.F. Examiner)

A ride-hail vehicle is seen at San Francisco International Airport. (Mike Koozmin/2015 S.F. Examiner)

State OKs regulations legalizing rental cars for Uber, Lyft

Gov. Jerry Brown legalized the use of rented vehicles as “personal vehicles” to drive for Uber and Lyft with a stroke of a pen in September, and now the framework for that law is in place.

With little protest and even less discussion, California regulators on Thursday approved regulations legalizing rented and leased Uber and Lyft cars by redefining them as “personal vehicles.”

SEE RELATED: Uber offered self-driving rides to state lawmakers days before illegal SF launch

That means drivers can now legally rent to drive for Uber and Lyft, instead of using the cars they own, potentially saving drivers the cost of upkeep of their vehicles.

And, as ride-hail companies have said, this may encourage more people to affordably drive for the platforms.

SEE RELATED: SF blasts Uber, Lyft for downtown traffic congestion

Thursday’s vote by the California Public Utilities Commission, which oversees ride-hails like Lyft and Uber, was heavily debated for most of the year until the matter was essentially sidestepped by Assemblymember Mike Gatto, D-Los Angeles, who wrote the bill on personal vehicles that was approved this year.

The new law and subsequent CPUC regulations may usher a new local industry of rental services which will allow Uber and Lyft drivers to no longer use their own vehicles to drive on the digital platforms.

Hansu Kim, owner of San Francisco’s Flywheel Taxi service, was frustrated by the decision.

“When Uber and Lyft got their foot in the door they put themselves out as ‘ridesharing.’ No one doesn’t support real sharing of vehicles,” he said.

But now, he said, “it’s gone from someone’s personal car you were supposedly sharing, to someone renting a car to use for commercial purposes.”

Attorneys for Rasier-CA LLC, a subsidiary of Uber, argued in regulatory filings that the CPUC was making the right choice to define rental cars as personal vehicles.

“There is no legitimate public policy justification for prohibiting [ride-hails] from contracting with rental and leasing agencies,” Uber attorneys wrote.

Though legally it may seem the CPUC’s hands were tied due to the passage of state law on the matter, some taxi drivers still hoped they could sway the commission before its vote, and spoke at its regular meeting Thursday.

The will of the commission “to interpret and adopt this absurd new definition of a personal vehicle is outrageous,” said Marcelo Fonseca, a Yellow Cab Co-Op taxi driver, who was not speaking on behalf of the taxi company.

Fonseca voiced disagreement with the commission’s decision to not accept recommendations from the San Francisco Municipal Transportation Agency, which filed arguments to the CPUC earlier this month recommending the CPUC conduct an environmental impact review of the new personal vehicle regulations.

“The commission’s prior and current rulemaking process clearly has had a significant environmental impact,” SFMTA wrote, and said the estimated 45,000 Uber and Lyft drivers operating in San Francisco have led to congestion of city streets.

Uber’s attorneys pushed back against that claim, writing in its filings, “SFMTA conveniently ignores the introduction of the uberPOOL product, which has been shown to increase mobility without introducing congestion.”

In CPUC Commissioner Liane Randolph’s recommendation, which was approved Thursday, the CPUC declined all of the SFMTA’s recommendations.

The CPUC’s regulation defines a personal vehicle now as one owned, rented for a time less than 30 days, leased, or otherwise authorized for use by a participating driver, which is not a limousine or taxicab.

Hyrecar, Breeze, Enterprise, General Motors and others all offer some form of car rental or leasing service to prospective Uber or Lyft drivers.
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