Austin police are now impounding drivers in the peer-to-peer ridesharing group

Austin’s transportation saga just keeps getting more interesting.

Last week, we wrote about a 30,000 member Facebook group that had formed in Austin to help facilitate ride requests in the absence of Uber and Lyft. Riders posted requests, drivers responded, and people got where they needed to go. One problem – the drivers and riders were not using an official service to facilitate the trips…it was entirely peer-to-peer, lacking any safety mechanisms or government oversight.

Now, the city has targeted drivers in a sting operation for driving without appropriate documentation from the city. Yesterday, a driver had two undercover officers get into her vehicle for a ride, and upon arriving at the destination was met by additional officers waiting to issue her a citation and impound her vehicle.

The city said in a statement that “companies and individuals providing transportation services and charging more than the federal reimbursement rate without appropriate documentation are illegal in the City of Austin”. Essentially, anyone charging more than a paltry 57.5 cents per mile needs to be documented by the city of Austin, a process that Uber and Lyft found so laborious that they decided to just leave the city instead of complying.

While the citation was issued directly to the driver, the ticket reportedly listed “Arcade” as the employer on the ticket. This is probably because Arcade City is name of the ride sharing startup that created the ad-hoc Facebook group. But Arcade City didn’t employ the driver, who was acting on her own when accepting the fare.

That being said, the company does plan to eventually launch a ride sharing app, but for now just is the administrator of the Facebook group and isn’t actually involved in any transactions.

But Arcade City understands that Austin police could continue targeting drivers even once they are working directly on the company’s platform, since the startup doesn’t plan on adhering to Austin’s ridesharing guidelines (like Uber and Lyft). So, the company plans to launch a verification system that lets fellow users vouch for you before being “verified”. Presumably, the startup hopes this will prevent further police action by preventing “unverified” Austin police detectives from using the platform and issuing citations to drivers.

But this is an unsustainable solution. As anyone who has ever gone up against a state or federal government knows, pushing back against police enforcement is probably the worst way to get what you want. Just ask Uber or Lyft’s defunct Austin team.


At the end of the day, the only thing that is going to fix the problem is if Austin and ride sharing companies can agree on a fair working relationship. And while this ad-hoc Facebook group has alleviated the strain on Austin’s economy that came from Uber and Lyft leaving, it is simply too risky for unregulated drivers with no background checks to be the long term solution to the city’s transportation problem.