Popular private-driver service Uber runs into friction with local regulators

Published Aug. 29, 2012

TAMPA — While Republican National Convention delegates decry excess governmental regulation, a case study is unfolding outside: a dispute between Hillsborough County regulators and a techie taxi startup in town for the convention.

Uber, a popular private-driver service based in San Francisco, recently unveiled its Tampa operation, offering its signature GPS-tracked sedans with text-message updates, hailed via smartphone app.

What the company can't offer? Low prices. Hillsborough County regulations set Uber's minimum fare at $50, three times as pricey as the service's minimum fare in New York City, London, Paris or practically anywhere else.

Uber fans and urbanites took to Twitter to decry the cost as a deal-breaker.

But the company redirected rage to the county's unbending rules for local limo drivers, which set drivers' minimum fares much higher to separate them from cabs. Uber contracts with local drivers, installing hardware, giving them business and taking a cut of the fare.

Hillsborough's rule was pushed by the local limousine industry, which argued higher minimum fares helped net its drivers more money, County Public Transportation Commission Chief Inspector Mario Tamargo said.

"You know all the hell we caught from the cab drivers not getting any work," Tamargo said. As for local limo drivers, they're "fine with it. They like it that way."

Uber's drivers, who will cover Charlotte for the Democratic National Convention for a $20 minimum fare, will likely see business dry up due to the rules, said Rachel Holt, the general manager of Uber's D.C. operation. Customers, she said, will lose out as well.

"Any time you have a minimum fare, there's one group of constituents who's going to lose, and that's consumers," Holt said. "There is an important role for regulations, and that's protecting the public … not blocking competition."

Holt said she met twice with the commission, which wouldn't budge. Uber's website, in explaining its attempts to reduce the fare, says, "Tampa regulators weren't interested."

Uber will close its local "pop-up shop" after the convention, and its future here is uncertain. Holt said the startup's "disappointing and frustrating experience" with county regulators had dissuaded the company from coming back.

"We're not going to go into a place," Holt said, "where we don't think we can do everything we can for consumers and drivers."

Drew Harwell can be reached at (727) 893-8252 or