Uber Service Screeches To Halt in East Hampton

The announcement last week by the nationwide ride-sharing service Uber that it could no longer offer its service here due to town taxi licensing regulations set the wheels in motion for a confrontation.

On one side are Uber users, who see the ability to hail an Uber car as a key element of their summer weekends, and on the other are town officials, who have enacted and fine-tuned taxi licensing laws in an effort to address what they see as chaotic and potentially dangerous situations created by a large number of out-of-town cabbies who show up to capitalize on the fares to be made on busy nights.

Uber cars, which are owned and operated by independent drivers affiliated with the company, are summoned with a smartphone app. The company’s drivers descended upon East Hampton roads over the first weekends of the summer season. They have operated here for the last several summers, but a change last year to East Hampton Town regulations regarding taxi company licensing made it impossible for Uber drivers to obtain the required town license.

The law requires companies to have a business office in East Hampton, and cabs, which are also licensed by the town, to be registered under a licensed company. Uber complies with neither of those provisions.

Eighteen Uber drivers who were cited by the town for driving here without the required town licenses are due to appear in East Hampton Town Justice Court on Monday. According to their attorney, Daniel G. Rodgers of Southampton, all will plead not guilty.

“The town will not tolerate any vehicles not complying with our regulations, nor will we allow drivers to be sleeping in vehicles for hire, obstructing traffic, and taking up limited parking spaces in hamlet centers that should be available for residents and visitors,” East Hampton Town Supervisor Larry Cantwell said last week in a press release.

After its drivers were targeted and cited, Uber contacted Mr. Cantwell last Thursday to ask for a meeting as soon as possible; a sit-down was scheduled for the next day.

The company sent half a dozen representatives to the meeting, including Josh Mohrer, an Uber general manager. Mr. Cantwell attended with Michael Sendlenski, a town attorney.

Following the meeting, Uber sent out a mass email announcing that its riders “will be unable to get reliable, safe rides in any part of East Hampton out to Montauk — effective immediately,” and urging its customers to register complaints with the town.

On Monday, the supervisor said he had received close to 1,000 emails and about 100 phone calls about the Uber issue. Most, but not all, he said, were complaints about not having access to the service in East Hampton Town.

The standoff got the attention of numerous news outlets and engendered comments and posts on Twitter and Facebook. The combination of summer-in-the-Hamptons news and a controversy involving a well-known and popular service like Uber resulted in stories with headlines such as “Uber Hits Roadblock in Ritzy N.Y. Vacation Spot,” on CBS News.

“A small town in the Hamptons today succeeded where the entire yellow cab industry has failed,” said an article in the New York Business Journal, which reported on actions by taxicab medallion owners against Uber, and other legal challenges to the company’s right to do business in New York City. One correspondent who is a summer resident here and uses Uber sent an original poem on the issue to a reporter covering the story.

Several people posting on Twitter and Facebook claimed that Supervisor Cantwell has or had a financial stake in a local taxi company. On Monday, he said that his late brother, John Cantwell, owned Amagansett Taxi “40 years ago,” and that he did not have an interest in that company.

The situation also prompted many to predict that the lack of Uber cars here will be responsible for a spike in drunken-driving accidents and deaths. The company itself credits its service in California and in Seattle with a reduction in D.W.I. accidents and arrests.

Though news accounts and Uber have painted the town’s taxi licensing requirements as an attempt to ban Uber from East Hampton, Mr. Cantwell said that is not the case. “The town looked at the taxi law over a year ago and adopted changes to it,” he said. “The goal was to create some order out of a totally chaotic situation [that was] creating parking, congestion, and safety issues.”

There had been a growing number of complaints over the last several years from taxi business owners, customers, and town residents about a situation that, especially in Montauk, was becoming “untenable,” Mr. Cantwell said.

The adoption of the taxi licensing rules, Mr. Cantwell said, is an action “that I think is well founded. . . .” Taxi licensing was first enacted by the town in 2010, with revisions to the code in 2013 and again last year, when the East Hampton office requirement was added.

“The fact that Uber chose to make this a confrontation. . . . No one banned them,” Mr. Cantwell said. At last week’s meeting with company officials, he said, there was discussion of how the company might structure its agreement with car owner-operators to comply with the town law provision that cabs are registered to a licensed business. But, he said, “Uber refuses to cooperate to accomplish that.”

“If they want to take their marbles and go home, that’s their choice,” he said. The company could “be flexible,” Mr. Cantwell said, and develop a way to comply. But, he said, “I think that’s a problem that Uber has to solve, not the Town of East Hampton. I really feel that the town is trying to do the right thing in bringing some order to a local issue. I also think that Uber has to find a way to cooperate.”

Yesterday, Paul Hudson, a Montauk resident whose technology investment firm is a large investor in Uber and who works with senior officials of the company, said that he believes there is room for negotiation to find a way to keep the company operating in East Hampton. He said he would work to help broker a solution.

He believes the service is crucial here to avoid drunken driving incidents, and suggested that should injuries or deaths occur while Uber is not operating in East Hampton, the town officials that enacted the taxi licensing law would pay a political price.

According to the town clerk’s office, there are 35 licensed taxi companies and approximately 225 vehicles that have been given town cab licenses through those businesses. Those companies, Mr. Cantwell said, can fulfill passengers’ needs.

But according to Uber in a statement issued last week, “there is an unquestionable need and demand for Uber in the Hamptons because taxi service has been historically unreliable.”

Any taxi may pick up or drop off a fare at an East Hampton address, regardless of whether they have an East Hampton license — as long as the trip originates or ends outside of town limits. However only those with a town license may provide service solely within the town.

James Hirtenstein, the owner of Main Street Drivers, a Sag Harbor service offering drivers for passengers using their own cars, took issue yesterday with “Uber’s ridiculous claims that there’s no safe and reliable transportation services — alternatives to their behemoth.”

His company, he said, gives back to the community by supporting local causes and employs local drivers. “They’re not making money in the community, and then bolting out of town.” Last weekend, when Uber was off the road, said Mr. Hirtenstein, his business “increased 300 percent.”

Nick Kraus, an owner and manager of the Stephen Talkhouse nightclub in Amagansett, where cabs often gather to pick up late-night fares, applauded the town this week for taking action.

As a manager of the club, he said, “I’ve been standing in front of the Talkhouse for over 20 years on busy nights.” While years ago there were practically no cabs at all, “six or seven years ago, it got out of control,” with many cabs coming from out of town, he said. Once the town taxi licensing laws were in place, the situation eased, said Mr. Kraus.

Mr. Kraus said he believes that, on recent weekends, Uber made a concerted effort to send drivers to East Hampton and take over the market. There were so many, he said, that Uber drivers who were not being hailed through the Uber app system were taking fares for cash.

Some cab drivers “have no regard for safety, whatsoever,” Mr. Kraus said, “for their passengers, or drivers passing by, or people crossing the street. It is complete disregard for any kind of safety rules,” with double parking and “letting people load in the middle of the highway. The whole thing is a mess.”

Mr. Kraus acknowledged that there could be improvements in the level of service and fair pricing by local cab companies. But, he said, “There are absolutely enough taxis to take care of the demand.”

“It’s not unreasonable or unfair to ask someone to wait a few minutes,” he said.

Uber’s “surge pricing” here during busy periods over recent weekends led to hikes in fares. Mr. Kraus said he knew of someone who paid an Uber driver $50 to be picked up on Three Mile Harbor Road in East Hampton and taken to the Talkhouse. On the way home, at a busier time of night, the fare was $120, he said.

Mr. Kraus, who uses Uber when he is elsewhere, said he “is not opposed to Uber as an idea. But we need a fair and safe equal playing field.”