With Gov. Chris Christie’s signing of legislation outlining a regulatory framework for ridesharing services such as Uber and Lyft, New Jersey became the 36th state to legalize and regulate transportation network companies, whose explosive growth has revolutionized the for-hire transportation industry previously dominated by taxicabs and limousines.

While arguably late to the party, given the three-year fight leading up to this point, the move is nonetheless commendable and should serve as an encouragement to the 14 remaining states still dragging their heels on technological innovation—chief among them, New Jersey’s neighbor, New York, which still lacks a statewide regulatory ridesharing framework.

Also notable is that the state enacted a companion bill to eliminate the 7 percent sales tax on limousine companies. Often lost in the recent dramatic clashes between the cab industry and ridesharing companies is the simple fact that the best thing for consumers is to focus on more competitive services and less onerous regulations across the board, which getting rid of the limo tax helps to do. Unfortunately, this approach too often has been cast aside in favor of attempts to pull ridesharing companies into the cab and limo industries’ self-dug regulatory holes.

Among the contentious elements of the New Jersey legislative fight were efforts to force Uber to fingerprint prospective drivers, a burdensome requirement that has represented one of the cab industry’s favorite regulatory weapons with which to hamstring its ridesharing competitors, including in the ongoing debate in New York.

Proponents of fingerprinting requirements single out various specific criminal incidents involving ridesharing drivers, pointing at these rare but dramatic cases as clear evidence of the need for a fingerprinting requirement to be added on top of other licensing requirements and ridesharing companies’ already extensive in-house background checks. However, the logic favoring fingerprinting is spurious.

For one, the databases used to check fingerprints are often outdated and have raised serious questions about racial bias. Importantly, these databases record arrests, not convictions, and thus serve as an inaccurate gauge of whether someone has actually committed a crime.

As Uber CEO Travis Kalanick has noted, “Imagine a country where people might get arrested who shouldn’t get arrested. Imagine if that country were the U.S. We have systems in place where, if you’re arrested, you literally can’t get work, even if you’re found to be innocent. And it’s unjust.” It’s a salient point in the United States, where estimates indicate the number of Americans with some type of police record could be greater than one in three.

Furthermore, the proponents espousing a concern for public safety by way of fingerprinting ridesharing drivers rarely seem to highlight similar high-profile criminal investigations involving cab drivers, such as the New Jersey cab driver accused in November of beating a man to death. Or instances in New York of cab drivers accused of hate crimes or reckless driving.

Of the tens of thousands of cab, ridesharing, and limousine drivers operating in states like New Jersey, it is simply statistically unavoidable that occasional misconduct will arise. The preoccupation with fingerprinting has little to do with public safety, as evidenced by these and other failures of the heralded system high-minded cab representatives would thrust on others, and more to do with political gamesmanship.

New Jersey, for its part, ultimately saw through the specious arguments. On the heels of a federal judge throwing out a lawsuit filed by multiple Newark-based cab and limo companies that had alleged an unfair disparity in the way ridesharing companies and other for-hire transportation companies were regulated, the legislature rightly decided to do away with fingerprinting requirements. In pushing through the measure, legislators and the governor scored a victory for New Jerseyans, who rely on ridesharing both for transportation options and for the jobs the industry creates—an instructive lesson to the state’s more lethargic neighbor, where the same debate continues unsettled.


Image by f11photo