The City of Cleveland Vs. The Professional Chauffeur Industry: How Will Consumers Be Affected

At the Cleveland Hopkins Airport there is a welcome center with the tag line "Going Places", but professional limousine companies are feeling less than welcome to operate in the city due to some proposed "New" regulations which unfairly target limousine companies. Recently, The State of Ohio passed legislation making Uber and other TNC's (Transportation Network Companies) exempt from the stringent taxi and livery laws that affect limousine companies, all for the low, low price of $5000. The State ruling eliminates local municipalities from passing legislation to regulate how they (TNC's) do business in the local community. Allowing TNC's to continue to operate without the costly compliance issues that "Professional Chauffeured Transportation Services" contend.

Unfortunately, with the upcoming Republican National Convention coming to Cleveland, the city has decided to attempt to move forward with Cleveland Codified Ordinance Chapter 443 in an attempt to extort local limousine companies who largely are abiding with strict State and Federal Transportation laws, to now add an additional layer of complexity and costs, just to operate legally in the City of Cleveland. Many local limousine operators are small business people who provide jobs, pay taxes, have aspirations of sending their kids to college, volunteering for local non-profits, etc., etc. The "Un-confirmed" proposed rules and guidelines, which the City refuses to provide the Limousine and Taxi Industry with, creates an environment within the City of Cleveland where the following scenarios might exist:

1. Increase the Number of "Gypsy Services"- Currently there are hundreds of "Black Cars" that operate throughout the City of Cleveland that are neither licensed as "Livery Vehicles" (A State Requirement for a vehicle that provides "For Hire" passenger transportation services in vehicles that accommodate under 9 occupants), nor do they maintain the State Minimum commercial livery insurance of $300, 000.00. Most consumers are unaware or naive in their assumptions that a chauffeur company "Has To Be Insured", right? Unfortunately, not all companies are created equally and many of these "Gypsy Services" have found that the costs of following regulations, commercially licensing, physicals, drug tests, U.S. Department of Transportation safety requirements, State Vendor Licenses, Sales Taxes and more, are not conducive to their survival. Ultimately, these operators lower the cost of providing services and increase the potential consumer exposure to safety risks and catastrophic losses. 
2. Increase the Regulatory Burden To Properly Operating Companies, Therefore Pricing Qualified Service Providers Outside Of The Consumer's Reasonable Budget- Initial estimates from Industry Consultants on the "Proposed" City of Cleveland Law, would increase the average limousine operator's legislative compliance costs approximately 30-35% per year. As I'm sure any business person would agree, an increase of that magnitude leaves a company with only two options: (1) pass the costs of compliance directly to the consumer and therefore pricing yourself out of the competitive market or (2) be non-compliant and therefore risk the costs of enforcement penalties and possible disruption of service to our most valued asset, the client. Many of the allegedly proposed mandates duplicate separately what our industry is required to do for the State, Federal Department of Transportation and our private commercial insurers. Plus the enactment of such strict regulation by Cleveland, would not prevent smaller local municipalities from enacting their own laws creating an environment where "Everyone Wants Their Fees" and essentially eliminating the ability for small business people to operate safely, legally and with the highest professional standards.

The main concern of the local limousine operators community is very simple: FAIR ENFORCEMENT!

Time and again the City of Cleveland has displayed its inability to enforce the rules they already have in place. For Instance, Cleveland Hopkins Airport requires each limousine company to register with the airport annually and pay over $500 for special passes. The airport continually does not enforce the need for companies to have permits and therefore most companies do not make the sizeable investment. Why? No one worries about the rule being enforced and there are no clear cut penalties for non-compliance. Why spend the money if there is no "Meaningful Benefit" to the customer or the company.

Cleveland's proposed law essentially will affect consumers in the following:

1. Increase the current costs of utilizing qualified, quality limousine and chauffeured transportation companies significantly.
2. Limit quality chauffeured services available. (If passed, many smaller companies will make the decision to sell or close their businesses due to compliance costs and some companies will refuse to transport passengers within city limits)
3. Increase the consumer's risk of using "Gypsy" services that do not comply with any Local, State or Federal laws and typically operate undetected.
4. Reduce available chauffeured transportation inventories significantly. (Less companies, less cars, higher demand, unreasonable increase in costs. Ever heard of Uber and their Surge policies in times of high demand? Welcome to our "Race to the Bottom")

In closing, the proposed legislation and lack of "Clearcut" enforcement and penalties, introduces the idea that The City of Cleveland wants to enact policy for a singular event The RNC2016, that will appear on paper as solid legislation with no intent to Enforce the Rules. This over-reaching legislation will essentially limit your access to quality transportation providers, reduce your access to budgetary options, increase your exposure to uninsured or underinsured providers and you will potentially have a greater risk of being exposed to completely unregulated operations. 

If you are a resident of the City of Cleveland, please call Council Member Martin Keane (Chair of the Transportation Committee) at 

Council Office: 216.664.4239
Ward Office: 216.941.9509

and express your dissatisfaction with the proposed Limousine Laws and your viewpoint of this legislation being nothing more than additional taxation.