California's latest absurd regulatory debacle

I’ve long since run out of unique ways to describe the bizarre regulatory practices of the state of California, so we may as well just jump straight into this one. The topic at hand concerns a business called GoGo Grandparent. The company offers a service targeting both the elderly and the vision impaired. For those unwilling or unable to use a modern “smart” cellphone, they would summon an Uber for them. In exchange, they tacked on a charge of 27 cents per mile. While it’s a business and not a charitable organization, it’s still a pretty nice service for people without full access to modern tech, don’t you think?

Well, the state of California disagrees. They determined that GoGo Grandparent should be defined as “a for-hire transportation service” and, as such, needed a million dollars in liability insurance and would have to pay a huge fine for not being in compliance. The full story is at Reason.

California regulators are trying to crack down on a company that orders Ubers for the blind and elderly.

In February, the Consumer Protection and Enforcement Division (CPED) of the California Public Utilities Commission—the state body that regulates transportation network companies like Uber and Lyft—issued a citation to GoGo Grandparent for operating a for-hire transportation service without permission.

Regulators demanded that the company pay a $10,000 fine and obtain the necessary permit to run a transportation network company, which would involve getting $1 million liability insurance for its vehicles and handing over lists of its drivers to the state.

Defining GoGo Grandparent as a transportation service is beyond a stretch. They own no vehicles. They hire no drivers. They do not make any money for “transporting” any person or cargo. They receive requests via phone or online and then feed information to an app operated by another company. (Uber, which is also arguably not a “transportation company,” but that’s an argument for another day.)

Still, California defines such operations as a “person engaged in the transportation of persons by motor vehicle for compensation.” They then go on to define “engaged in” as meaning “involved in the activity.” This preposterous linguistic stretch would mean that virtually anyone could be defined as a transportation service.

Fortunately for GoGo, a judge ruled in August that the definition was bogus and they should not be classified in this fashion or forced to pay the fine. But the Consumer Protection and Enforcement Division (CPED) of the California Public Utilities Commission has still yet to vote on agreeing to the court’s ruling. They apparently really want to go to the mat on this one.

What’s really going on here should be obvious. California, like many other blue states and large, liberal cities, has been at war with Uber and Lyft for years. They’ve attempted to use the cudgel of government regulatory power to drive them out of business (or at least out of the state) with a variety of new laws, regulations and definitions. If they could sink GoGo into an unprofitable status, it would cut into Uber’s bottom line, thereby advancing their agenda.

It’s good to hear that the courts have derailed this effort for the moment. But if I were in charge of GoGo I wouldn’t get too comfortable. Much like the state’s former governor, “they’ll be back.”

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John Sexton 3:20 PM on September 26, 2023