Okaloosa County BOCC — August 18, 2015 — Ground Transportation Policy for Transportation Network Companies — agenda request

BOARD OF COUNTY COMMISSIONERS AGENDA REQUEST DATE: August 18, 2015 TO: Honorable Chairman and Members of the Board FROM: Sunil Harman SUBJECT: Ground Transportation Policy for Transportation Network Companies DEPARTMENT: Airport BCC DISTRICT: 2 STATEMENT OF ISSUE: On May 19, 2015 the BCC voted unanimously to direct staff to identify options for allowing Transportation Network Companies (TNC), such as Uber and Lyft, the opportunity to operate pre-arranged for-hire services from Destin-Fort Walton Beach Airport (VPS). BACKGROUND: A TNC is defined as an organization, whether a corporation, partnership, sole proprietor, or other form that provides transportation services for compensation using an online enabled application (app) or technology platform to connect customers, in this case airport patrons and passengers departing the terminal with drivers using their personal vehicles as for- hire vehicles. It is important to recognize that TNCs as a technology based disruption model present a challenging and still evolving business model for airport ground transportation services; as they have presented regulatory, revenue, liability risk and safety challenges to airports. The accommodation of TNCs insisting that they are just using technology to connect customers with drivers (who are also viewed by TNCs as customers who decide when they work and who they will accept and refuse service to) have prompted sponsors of airports to negotiate permitting and revenue requirements on a customized TNC company by company basis. While it is widely acknowledged among US airports that the continued proliferation of TNCs is here to stay, with new companies emerging in the future, including adoption of TNC type applications by existing taxi and transport services, who will need to adapt to stay viable, it is recommended that the Board base any policy it adopts on the regulatory constraints that airport operates under to ensure the security and safety of its customers. Issues relating to the operation of TNCs at airports have a number of challenges throughout the county concerning airport ground transportation access. Many airports have established regulations imposing permitting and licensing restrictions on the transportation of passengers. These regulations have been adopted to ensure security from existential terrorist threats, protection of the airport’s arriving passengers safety and security, mitigation of the liability risk that would otherwise be assumed by the airport and its operator, assurance of ADA compliance and finally compliance with FAA grant assurances that require airports to operate as self- sustaining enterprises in an economically non-discriminatory manner. There are only a few airports that are similar in size to VPS that have entered into agreements with Uber and are as follows: Sarasota Bradenton International Airport has a one-year agreement and is paid a fee of $2.50 per pick-up. The vehicles are not allowed to pick passengers up at the curb and are required to park in pre-arranged locations. Uber has combined single limit commercial auto liability insurance for the drivers with limits not less than $1 million per incident for damages and injuries to drivers and passengers. Either party can terminate  the agreement by giving not less than 30 days written notice. Savannah-Hilton Head International Airport has a one-year agreement and requires insurance amounts of $1 million for liability and $1 million for auto and a fee payment basis of $4 per pick up or $1,000 per month, whichever is greater. Either party can terminate the agreement by giving not less than 30 days written notice. At both airports, the ride sharing companies pay higher fees and have higher insurance requirements than t