Here’s Why A Florida Town Is Subsidizing Uber

Uber has revolutionized the transportation game, despite getting a lot of opposition from governments, both on the national and local levels.

Some government concerns are on point, as Uber is far from perfect:

  • Uber often uses questionable tactics to enter markets, where they’ll just begin operating until they’re shut down, at which point they’ll put their deep legal pockets into getting officially recognized
  • UberX is arguably not regulated enough, in terms of safety standards, driver screening, and insurance
  • It seems clear that Uber’s strategy in many markets is to artificially lower prices to the point that they’re driving taxi companies out of business, and then possibly raise prices significantly; at least that’s what it feels like, especially in markets where Uber is too cheap

Uber-Cost

Still, the taxi industry has done nothing to innovate for decades. When you look at the amount of dirty cars, bad service, “broken” credit card machines, etc., it’s hard to feel sorry for most cabbies.

But overall Uber has been met with opposition from governments. Look at how long it took Uber to be allowed in Las Vegas, and for Uber to be allowed to do airport pick-ups in Los Angeles.

That’s why I think it’s interesting to look at a city in Florida which is taking the opposite approach towards Uber, and is actually subsidizing them.

Altamonte Springs, a town of 42,000 people in Central Florida, is subsidizing Uber by up to $500,000 over the course of the next year, by paying 20-25% of the cost of any ride. Here’s what Curbed has to say about the first of its kind pilot program:

And the system set up to pay for rides—a unique municipal subsidy that covers 20% of any ride that begins and ends in the city, 25% if it begins or ends at the local light rail station—has already gotten others cities in the surrounding Seminole County interested in replicating it, even though it just started running yesterday.

“Seemed to us, if you can order a pizza using your cell phone, or transfer funds with you cell phone, you should be able to order a transit trip,” says Martz. “We were tired of waiting for Central Florida to move on transit, so we did.”

The city’s new program, which creates a geo-fence around the 9.4-square-mile town and lets app users within city limits receive subsidized rides—they just enter the promo code ALTAMONTE in the app—is part of a pioneering experiment in supporting multimodal transportation via ride sharing.

Basically the city has a local commuter rail connecting it to Orlando. The issue is that the city government couldn’t get approval for a bus system which would connect locals to the commuter rail. So instead they came up with another solution, of paying 20-25% of Uber rides for locals, in hopes of that making it easier to get to the commuter rail.

SunRail

Bottom line

Kudos to Altamonte Springs for their creative solution to local transit. At some point having an on demand ridesharing service seems more efficient than a bus service, especially in a smaller town where you don’t have the volume of people you might have in other cities.

While this won’t impact those of us in bigger cities, it’s at least nice to see some governments encouraging Uber, rather than working against them, or at best, acting indifferently towards them.

Comments

  1. They should do the same for California instead of building the stupid “high speed rail” just subsidize intra California flights would be much cheaper and earth quake proof than the rail system.

  2. How can you write nice things about Uber after acknowledging the first three points in this article? Is it now OK to support bullies if they have an app and deep enough pockets? Is it OK to support them because their competition doesn’t have clean hands? Two wrongs make a right?

    “I’ll do as I damn well please because I have money,” is an ugly, ugly way to look at the world.

  3. UF in Gainesville FL has also partnered with Uber in a pretty awesome way.

    From 10pm-3am Wed-Sat (when you’re in college, this is the “weekend”) UF students get 50% off Uber rides as long as the ride starts & ends within a defined map. The map essentially covers the campus and some immediately adjacent residential areas and the “downtown” bar/club/restaurant area of town.

    Pretty sweet deal for drunk undergrads.

  4. My hometown in NJ is also partnering with Uber to offer $5 rides from the train station to anywhere in town btw the hours of 8pm-3am. Ideally cutting down on the number of folks getting plastered in Manhattan, taking the train back to town then driving home.

    And from what I hear, people are using it. I cant imagine many, if any, were calling the local unreliable cab companies for the safe ride home.

    I get that uber may have some questionable business practices but nearly every time i’ve taken a local cab (whether its NYC or Chicago or a small town or a suburb) it’s been a rough experience.

  5. Keep in mind, Lucky, that the cabbies – for whom you feel little sorrow – are usually just the drivers for larger taxi cartels. The question is whether the cabbies’ new jobs with Uber will keep them afloat; and there is much evidence to suggest that it will not.

  6. @John What evidence is there to suggest that individual cabbies that switch to uber don’t do as well as driving for a taxi cartel?

  7. Using Uber in Asia is awesome. No communication problems, no cash, no “broken” or tampered meters.

  8. Typical Florida. “Can’t” get approval for an actual public utility, so let’s instead give government money to private companies.

  9. Sorry to get to this conversation two months late 🙂 However, I drive for Uber in Portland, OR, and question Lucky’s statement about safety standards, driver screening, and insurance. Uber has completed a criminal background check on me; they have my license, insurance card, photo, and vehicle registration. A million dollar liability insurance policy covers me while driving a rider to the destination. My Jetta TDI failed the first vehicle inspection because it needed new rear brakes (I knew this previous to the inspection and was comforted that the Uber sponsored garage found this and prevented me from using the car until the brakes were repaired). I also passed the required online training course for drivers. After providing over 350 rides, I am convinced by the overwhelming comments from riders that Uber is providing a safe, reliable, timely, and extremely convenient transportation service in our community. No, I don’t work for Uber 🙂 I’m a happily retired person who loves to drive a meet people!

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