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Austin transportation director recommends deregulation of the city's taxi industry

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Flickr/Stanley Wood

The head of the Austin, Texas Transportation Department believes the city's taxi industry should be deregulated, putting traditional cabs on an equal regulatory footing with upstart ride-hailing services like Uber and Lyft, reports The Statesman.

Austin Transportation Director Robert Spillar, in a memo sent to the Austin City Council, says the city should eliminate taxi franchise agreements and have cab companies obtain an "operating authority" like Uber and Lyft do. The deregulation proposal would allow for a "truly competitive marketplace" instead of a "system of managed competition," writes Spillar. It would probably also involve the elimination of the medallion-type setup that Austin uses to limit how many taxis can operate in the city.

The memo comes after a proposal to remove Austin's regulations — including one that requires Uber and Lyft drivers to be fingerprinted for background checks — on ride-hailing companies was defeated and the two companies promptly suspended their operations in the city.

would create a "truly competitive marketplace"

It's fascinating that Austin is thinking of lifting regulations on taxicabs to allow them to compete with Uber and Lyft more directly. At the same time, the two ride-hailing companies have ceased operations in Austin because of regulations they feel are too onerous. Both Lyft and Uber have aggressively resisted additional regulations that would implement limits on fares and the number of drivers in numerous markets, while taxi operators have generally argued that, because market restrictions do apply to cabs, the market isn't a level playing field.

Spillar has created a working group of taxi and limousine company representatives, as well as members of Austin's taxi drivers union, in order to get them on board with his proposal. If all goes well, Spillar says it could go in front of Austin's City Council as soon as August. The whole point may be moot, however, if Lyft and Uber keep refusing to operate in Austin.