I-70 Coalition works to change legislature around ride-sharing to decrease traffic and pollution
FRISCO — On Dec. 16, 2019, TreadShare, an app meant to provide a method of carpooling to the ski slopes from Denver, launched. The idea behind the app is for carpoolers to share the cost of gas and mileage, incentivizing the drivers to bring additional passengers and the passengers to get a cheap ride up to the mountains. Shortly following the launch, TreadShare received a “cease and desist” letter from the Colorado Public Utilities Commission. This caused TreadShare to shut down operations and another similar app, Gondola, not to launch.
While both companies attempted to be sure that their apps did not fall under a transportation network company designation by making the apps a cost sharing method rather than profit-making, the apps were designated transportation network companies under Colorado Revised Statutes 40-10.1-602, which reads:
“’Contract carrier’ means every person, other than a common carrier or a motor carrier of passengers under part 3 of this article, who, by special contract, directly or indirectly affords a means of passenger transportation over any public highway of this state; except that the term does not include a transportation network company, as defined in section 40-10.1-602(3), or a transportation network company driver, as defined in section 40-10.1-602(4).”
This law defining a transportation network company effectively puts these carpooling apps into the same category as Uber and Lyft, meaning they would have to follow the same expensive licensing procedures, which are not feasible for such apps that prioritize cost savings.
On Jan. 16, TreadShare sent out an email explaining why the app is on standby.
“Our partner, the I-70 Coalition, is engaging with key state legislators on our behalf to explain the issue and look for opportunities to change the regulations so that TreadShare can quickly get back online,” Erwin Germain and his partner, Justin Kurtz, wrote in an email.
The I-70 Coalition wrote a letter to Colorado legislators on Jan. 13 asking for a change to the law in order to allow carpooling apps like TreadShare and Gondola to operate and help alleviate some of the traffic on Interstate 70.
“We want to know if they see a legislative fix or are interested in helping us find a change to that law that would allow I-70 carpool apps to be viable,” Margaret Bowes, I-70 Coalition executive director said. “We don’t know exactly what that fix might be so that’s the question we’ve posed to our legislators.”
Bowes explained that likely the best way to go about this would be to amend the definition of ride-sharing to distinguish carpooling from a taxi-style service like Lyft and Uber.
“The two companies that had planned to launch this winter said their business model does not support having to meet the licensing fees to meet the law,” Bowes said, “It’s cost-prohibitive for them. They are not focused on profit as much as cost sharing, and the fees and regulations required for transportation businesses … it’s just not going to be viable for them to pay the licensing fees and be able to operate.”
The letter from the I-70 Coalition written to Colorado legislators explains further why the current law won’t work for carpooling companies and why I-70 needs these types of ride-share services.
“The annual $111,250 TNC license fee and the extensive regulations such as background and medical checks for drivers is prohibitive and not viable for these cost-sharing ride-share platforms that have the primary goals of congestion and carbon emission reduction,” Ryan Hyland, chair of the I-70 Coalition wrote in the letter. “Carpooling is one of a handful of strategies that can really ‘move the needle’ on reducing I-70 congestion. This reduction of vehicles traveling the I-70 mountain corridor would also result in significant reduction in carbon emissions.”
Bowes said that under the current law, a carpooling service would have to be completely free to use in order for it to not be considered a transportation network company. Bowes and the makers of Gondola and TreadShare believe making the service free to use would not incentivize people to share their cars when going up to the mountains.
Jordan Eskenazi, co-founder of Gondola, reported that they have received positive feedback from Speaker of the Colorado House of Representatives KC Becker and are hopeful the legislators will look into the issue.
“It’s nice to see that the senators have jumped on it so quick,” Eskenazi said. “It’s nice to see the resorts and everyone get behind these pieces of software that are trying to solve their problem.”
As a Boulder- and Broomfield-based company, Eskenazi and his team know the struggles of I-70 ski traffic.
“We understood the problem,” Eskenazi said, explaining how he and his partner, Adam Cotner, decided to work together on Gondola. “Adam and I were working at a previous company. I had this idea in my mind for three or four years, I was just pitching it to him around the water cooler.”
It just so happened that Cotner was building a related algorithm in his free time. Eskenazi said that as co-founders, Cotner is the partner that works well with software while Eskenazi takes over the marketing and business side. With 10 years in the tech industry, the duo wants to make the experience quick and user-friendly, making it possible to set up a carpool ride within 60 seconds of downloading. Meanwhile, Germain is drawing on his experience using a similar service in the French and Swiss Alps for TreadShare.
“We are making improvements to the app, we want to prepare,” Germain said in reference to the current standstill.
While the companies are currently waiting for a potential law change, they are both in the early stages of finding a way to utilize the narrow exceptions to companies being classified as a transportation network company listed by the law. One of these exceptions involves the ride-share service to be offered through an employer as an employer-paid program. Eskenazi said they are looking into ways to make ride-sharing an HR benefit-type program.
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