HOUSTON, TEXAS (Oct. 31, 2014) – The R Street Institute expressed deep disappointment in the onerous regulations for transportation network companies set to go in effect in the City of Houston on Tuesday, Nov. 4. The new rules present an unnecessary bureaucracy that will cost taxpayers an estimated $600,000.

Among the many requirements are additional background checks of all drivers and an automotive check to be performed by one specific contracting facility. This is in addition to the background checks and automobile inspections already required by TNCs.

“Regulations, when properly written, set standards and requirements,” said Houston-based R Street Associate Fellow Steven Titch. “Building fire codes stipulate necessary fire suppression and alarm systems, but they don’t tell builders they must use one particular contractor or purchase one specific brand of fire extinguishers. All builders must do is show inspectors they have complied with the code.”

“The City of Houston’s demand that ride-sharing drivers use the state’s systems micromanages the compliance process while placing a substantial economic burden on taxpayers, due to administrative costs. TNCs have shown they can meet the law’s requirements for driver background checks without using the expensive and burdensome mechanisms the city is demanding,” he said.

TNCs currently require drivers nationwide to pass vigorous background and automotive checks, at no cost to taxpayers.

“While we’ve seen many cities recently adopt regulations that are more welcoming to TNC s, the exact opposite is happening in Houston,” said Andrew Moylan, senior fellow and executive director of R Street.  “Cities should encourage more job development, not enact new regulations that will cost the taxpayers money and hinder people trying to enter the workforce on a full-time or part-time basis. It would be unfortunate to see ride-sharing companies cease operations in Houston because of onerous rules that do not make anyone safer than the status quo.”