The San Francisco-based company that uses a smart phone app to connect people who need a ride with nearby drivers that use their own cars began operating in Richmond on Wednesday.
Its first day of business in Richmond coincided with an announcement from the governor’s office of a temporary agreement that will allow Uber and rival ridesharing company Lyft to operate legally in Virginia.
The companies had been ordered to halt operations in the state in June over questions of how to regulate them. Uber argued at the time that the state’s regulations were outdated.
On Wednesday evening Uber held an event to register and hand out phones to drivers at the Holiday Inn at 2000 Staples Mill Road. Another phone and registration session is scheduled for tonight at the Courtyard Richmond on West Broad Street.
The company plans to launch in Richmond with a handful of drivers, but would not give a specific number. Rides will be free during the first two weeks of Uber’s Richmond operations.
Lyft, a similar service also based in San Francisco, said Wednesday it had not made any plans to begin operating in Richmond.
Using the Uber app, a would-be passenger can look up drivers nearby and request the one of their choice. Drivers use their own vehicles and carry an Uber-issued phone. Pricing depends upon geographic location, demand and supply.
In Richmond, there is a $1.50 base fare, plus $1.50 per mile and 20 cents per minute for an Uber ride.
Uber then takes a 20 percent cut of the fare.
Company reps at Wednesday’s meeting said Uber operates in 162 cities and about 50 countries. While it began operations in Hampton Roads earlier this year, its journey to Richmond wasn’t so smooth.
In April, the Virginia DMV fined Uber $26,000 for operating in Hampton Roads without the proper authority from the state. In June, the DMV sent Uber and Lyft cease and desist letters for their continued operations there.
Both Uber and Lyft ignored the letters and kept operating in Virginia.
The agreement announced by the state on Wednesday “will help ensure the safety of passengers, bring the companies into compliance with Virginia law, provide transparency into their operations, and promote a level playing field for transportation providers,” the governor’s office said in its release.
“In order for Virginia to remain economically competitive, it is important that we welcome innovative companies like Uber and Lyft and provide them with the resources they need to safely and effectively operate in the Commonwealth,” Gov. Terry McAuliffe said in a statement.
As part of the agreement, the companies each received transportation brokers licenses and temporary operating authority from the DMV.
They must meet a set of regulations to promote passenger safety, have appropriate insurance and comply with Virginia laws.
The companies agreed to run background checks of drivers, including criminal and driving histories.
Drivers must have a valid driver’s license and must be 21 or older. Their vehicles must be four-door, carry no more than seven passengers at time and must have a valid registration and inspection.
The companies and the state also agreed on checks on rate transparency and documentation. And drivers are not allowed to accept street hails.
As part of the agreement announced Wednesday, both companies have paid the DMV fines.
Uber competes most directly with traditional taxi services.
John Canova, the operations manager at Veterans Cab Association, said it would not be fair for Uber to operate in Richmond because the company wouldn’t have to comply with the same set of regulations as taxis.
Richmond taxi ride prices are set by the city at $2.50 for a base fare and $2.50 per mile, Canova said.
Canova said taxis in Richmond are inspected every year, and cab permits have a $56 annual fee.