Not unlike curious cats, lawmakers often show inordinate interest in the newest and shiniest objects to pass their field of vision. In Pennsylvania, recently hailed as a center of autonomous vehicle innovation and home to ridesharing service Uber’s technology-testing center, state legislators must have picked up a glint from one of the test vehicle’s spinning sensor arrays.
Last week, a 10-member bipartisan group of state senators introduced legislation that would erect a series of constraints on the development of autonomous vehicles. They claim the bill would enhance safety. S.B. 1268 requires operators of autonomous vehicles to contract with the state, on pain of criminal prosecution, to test their vehicles. It would further require operators to demonstrate they hold $5 million in general liability insurance or self-insurance and also would require them to report all collisions, however minor, to the state.
On their face, these requirements are not onerous, particularly for firms as well-capitalized as Uber, Google or the world’s major carmakers. But that does not mean that they will not present problems. Just because a regulatory bar is intended to be low does not mean that it will not have a chilling effect on the development of technology. These legislators, who claim to not wish to stand athwart innovation, are doing exactly that – perhaps without realizing it.
The path along which innovations are made is rarely clear. Concrete examples of how S.B. 1268 could harm Pennsylvania stem from that fact. For instance, the heightened insurance requirement included in the bill currently is ambiguous about whether the $5 million liability insurance requirement is per-vehicle or per-driver. In either case, that level of coverage, the need for which has not been established, erects a barrier to entry for subsequent autonomous vehicle developers.
This legislation, in spite of its regulatory hurdles, will not prove insurmountable for firms and institutions with existing research efforts in Pennsylvania. What it will almost certainly do is guarantee that future autonomous-vehicle entrepreneurs will seek out more permissive environments from which to base their operations. S.B. 1268 will kill any semblance of garage-tinkering innovation within the state.
The cost of this unnecessary legislation is high, particularly since it is apparent that self-driving vehicles are already testing without causing any meaningful public impact. Absent the appearance of specific concerns capable of redress, there is no pressing need nor is there a great vacuum that must to be filled by legislative action. By default, this technology is already subject to civil restraints.
The more fundamental question here is about the appropriate role of state versus federal regulation. Of the 18 states that have thus far enacted legislation related to autonomous-vehicle technology, the standards to which operators are subject vary dramatically. Some states are better than others. It should speak volumes to Californians that Uber, headquartered in San Francisco and a creature of Silicon Valley, has opted to test its vehicles on the other side of the country to escape the legislative and regulatory strictures of the Golden State.
Of course, state-level regulatory balkanization is not necessarily a bad thing, provided that the subject of the regulation has an appropriate nexus with state-level governance. The benefits of federalism, local control and subsidiarity are well established. To date, the states have retained control of vehicle licensing and a smattering of other functions related to their constitutional police power. But broad standards for vehicle safety are determined by the federal government – and properly so.
The good news is that July is fast approaching. With the middle of summer will come new standards from the National Highway Traffic Safety Administration. Those guidelines will almost certainly be imperfect, but they will begin to correct the wholly predictable trend of legislators pawing at things that they do not understand.